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21 June 2023 ·

Healthcare Agreements: Get them right the first time!



Healthcare agreement negotiations bear a unique and well-known risk burden. Additionally, the timeline for healthcare agreements is also longer than many other industries because of how long it usually takes to bring new products to market. Healthcare agreements involve some extremely sensitive issues, such as protecting the identity of a cancer patient, promoting ground-breaking chemical compounds in the pharmaceutical sector, and ensuring that top physicians do not inadvertently cross ethical lines to support commercial interests.

These issues and more make healthcare agreements uniquely challenging for companies, their negotiators and those who administer contracting systems. Managing healthcare agreements is particularly fraught with pitfalls based on the strict global regulatory oversight and immense public interest that pervades the healthcare sector.

For those reasons and beyond, it is becoming more and more important that companies and business partners write and perform healthcare agreements correctly the first timeevery time.  It’s an industry of cutting-edge innovation and scientific marvels, but underpinning this vital industry’s advances are written healthcare agreements.  

These agreements, however, bring special challenges due to the highly regulated nature of the industry, the sensitivity of personal patient information, and the unique intellectual property concerns that come with slow-developing but crucial advances such as pharmaceuticals and medical devices. 

Laws such as the European Union’s Clinical Trials Regulation,1 the U.S. Health Insurance Portability and Accountability Act,2 the Physician Payments Sunshine Act,3 and far-reaching programs such as Medicare4 and Medicaid5 create a tangled web of obligations and a host of terms and conditions in contracting. How can a contract lifecycle management system and other innovations help simplify the development, execution, and obligation tracking of these critical agreements?

Four keys to attain health care agreement success

Companies that operate in the healthcare sector face constant and unyielding scrutiny of their business and research activities. 

Whether it be the development of a new drug or maintaining a hospital- state, national, and sometimes even international authorities are likely to regulate their activities and demand the ability to review files that can stretch back as far as 25 years. To survive and thrive in this complex environment, companies need contracting and agreement systems that can deliver in four key areas: 

  1. consistent templates with minimum touch requirements;
  2. assurances that all key stakeholders are engaged in the creation;
  3. use of agreements and excellent obligation tracking; and
  4. contract terms and templates must keep pace.  The relevant data and insight come in part from the CLM system.

Contract lifecycle management (CLM) platforms provide a far better foundation for all four of these issues and offer a dramatic improvement over the old system of negotiating via email or phone calls and having a final paper copy of the agreement shelved in the legal office. There are many CLM systems available on the market, but they are all generally Cloud-based systems.6 

In the best CLM platforms, agreements are handled from the inception of a business need until the final obligations of the contract are completed. These systems are geared so that all key stakeholders can access information about the agreement, not just the legal group or a procurement team, helping to ensure cross-team involvement in the creation and use of agreements.

For a company that wants consistency, availability, and unmatched visibility over all of its obligations, these CLM systems are an excellent first step and considered to be absolutely crucial for healthcare companies that have any substantive agreement volume. However, they merely provide the initial capabilities for companies to improve in the areas of template creation, open access, and enhanced obligation tracking. The real differences turn up when a company spends its efforts and invests in technology after setting up that foundation.

Minimize variations in agreements

By harmonizing contracts you ensure that terms and conditions are essentially the same for all business partners. Using a template agreement for everything is likely the goal of many agreement managers and their C-Suite leadership. Nevertheless, exceptions tend to creep up in negotiations as a way of forcing the issue, that is, getting to yes agreements with demanding collaborators. The advantage of a CLM tool is that it keeps track of these differences and ensures that precedents are carefully set for future negotiations and consistency across sectors (such as research universities versus private laboratories).

Minimizing these variations not only reduces risks for the enterprise but also improves efficiency by reducing the options that negotiators can use and by speeding up end-to-end contracting time. For healthcare contracts, having a standard, consistent set of agreements across an entire industry can make life easier for all parties, as we see with the Accelerated Clinical Trial Agreement (ACTA)7 and with global attempts to harmonize the international regulatory environment.

Ensure full stakeholder involvement in agreements

Stove piping (sending information directly through levels of a hierarchy) is a risk in any industry, but perhaps none more so than healthcare due to the requirements to minimize personal identifiable information (PII) or patient data release and to protect intellectual property during testing stages for new product development.

Here's one big problem: it becomes increasingly likely for someone to miss an important deadline or regulatory compliance if your employees can’t easily access agreements to check statements of work, key dates, lists of key personnel, or even basics such as payment schedules. Shared contracting platforms help improve the visibility of terms, conditions, and obligations to all key partners in the process. Having the right stakeholders engaged in creating the agreement from the start can also substantially improve contracting speed.

How many negotiations have become bogged down because legal or finance teams have not been involved until the last minute? Too many. Getting the entire team to see, vet, and touch the business requirement early in the process is key to improved efficiency and reduced frustration, especially when things are generally harmonized, as noted above.

Perfect your obligation tracking

Executing the agreement is an important stage in a contractual journey, but obviously is not the end. Monitoring each partner’s due dates, cyber security requirements, information-sharing duties, and payment terms is crucial. 

In healthcare, ensuring that trial or patient data is handled in accordance with good clinical practice and numerous regulatory schemes is a priority. Having a streamlined, transparent system supported by top-notch data protection capabilities is half of the battle. 

A reliable obligation tracking system is an undisputable ally.  CLM systems can make a tremendous difference for companies that are growing fast in the healthcare arena with top-rated products or drugs in the pipeline with possible impending global success -- but with limited staff.

The exponential growth of healthcare has opened the door for us to discover many opportunities for companies with the right ideas to make a difference globally. Nevertheless, one regulatory miss can spell the end for any good idea, so healthcare agreement negotiations carry a unique risk. The horizon for healthcare agreements is also longer than many other industries due to the long-term effort it takes to bring new products to market. Thankfully, the improvement in CLM systems and technology has made it easier than ever for companies to reduce risks and ensure stakeholder access to agreements before, during, and after product execution and delivery.


Kirk Samson is the Senior Director: Contract Management Services at Nexdigm ( He plays a key role in nurturing client relationships, improving service delivery and business development in the US, as well as transitioning, transforming, and automating processes for Nexdigm. He has over two decades of overseas experience negotiating and advocating effectively with foreign governments, multinational companies, and international organizations.


Nexdigm provides integrated, digitally driven solutions encompassing Business Consulting, Business Services, and Professional Services that help businesses navigate challenges across all stages of their life cycle.  This employee-owned, privately held, independent global organization strives to help companies across geographies meet the needs of a dynamic business environment. Through their direct operations in the USA, Poland, United Arab Emirates (UAE), and India, they serve a diverse range of clients, spanning multinationals, listed companies, privately-owned companies, and family-owned businesses from over 50 countries.


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  1. European Union’s Clinical Trials
  2. U.S. Health Insurance Portability and Accountability Act
  3. Physician Payments Sunshine Act
  4. Medicare
  5. Medicaid
  6. Cloud-based system, definition
  7. Accelerated Clinical Trial Agreement (ACTA
Kirk Samson
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