Glaxo (NYSE:GSK) Offers Government Rebate if Votrient Doesn't Outperform Pfizer's (NYSE:PFE) Sutent

If GlaxoSmithKline's (NYSE:GSK) new kidney cancer drug Votrient doesn' outperform competitor Pfizer's (NYSE:PFE) Sutent, they've offered to pay the National Health Service a partial rebate of funds.

Simon Jose, head of GSK in the UK, said, "If we fail to confirm that they are comparable in efficacy – which we do not expect – then we provide a rebate back to the NHS as a result.

"We are moving in the direction where price is driven by value and value is driven by evidence, and therefore we can start to construct different sorts of arrangements where we can balance this off."

Clinical trials will determine the outcome of the deal, which is reportedly the first of its kind.

Also part of the deal is an agreement to reduce the cost of Votrient, which is more expensive than Sutent.

The outcome of the clinical trials, which will place the two drugs in direct competition with one another, won't be known until sometime in the middle of 2012.