In healthcare, for example, a value-based pricing model might stipulate that a drug maker receives a lower payment unless a medication achieves measurable improvements when compared to other treatment options.
Value-based contracts recognize that both parties are taking a financial risk in the use of a new product. In healthcare, for example, a value-based pricing model might stipulate that a drug maker receives a lower payment unless a medication achieves measurable improvements when compared to other treatment options. In environmental science, value-based pricing could be targeted to the percent of waste cleaned through the use of microorganisms.