Regulations and GTN Headline Pharma’s Revenue Management Challenge in 2026

Life sciences companies will spend 2026 grappling with an uncertain regulatory environment and gross-to-net (GTN) management challenges. According to the 2026 State of Revenue Report, 84% of surveyed life sciences executives struggle with regulatory ambiguity, while 99% agree that GTN has become more complex. 

There’s no relief from these circumstances on the horizon, so pharmaceutical companies must find a way to effectively manage their operations under these conditions. Data and visibility will support revenue management. 

Regulatory uncertainty creates operational challenges

Over the last few years, government policies have been unpredictable and often ambiguous. Nearly all (98%) of surveyed leaders believe government regulations will have some impact — either positive or negative — on their business. 

Four in ten respondents were hopeful for positive changes related to the 340B rebate model pilot program. However, since the survey was conducted, that initiative has been scrapped, demonstrating just how quickly the regulatory environment is changing. 

As for the negative impacts, nearly half of life sciences executives were concerned about Medicare drug price negotiations under the Inflation Reduction Act (IRA). State drug affordability boards and the Most Favored Nation (MFN) pricing also worried about 40% of survey respondents. 

IRA implications become reality this year, as the first round of negotiated prices are in effect. Manufacturers of affected products will face direct revenue compression, while inflation rebate penalties continue to limit list price growth. Together, these provisions reduce pricing flexibility, compress net margins and add new layers of compliance and reporting complexity

The MFN policy may spread the complexity of U.S. pricing models internationally. Other nations are already adopting opaque rebate and contracting policies to shield their true net prices from influencing American benchmarks. MFN may also force manufacturers to be more selective about where they launch products, potentially slowing down new drug availability outside the U.S.

To hedge against regulatory uncertainty, 57% of life sciences companies are looking to establish direct-to-consumer (DTC) sales processes. While this won’t entirely replace the traditional reimbursement-driven pricing framework for pharma manufacturers, these channels improve patient access, diversify revenue pathways, and increase margin predictability for some medication categories. 

Momentum and support for DTC is growing; the federal government recently launched TrumpRx, connecting consumers with highly discounted drugs from pharma manufacturers. Medications that cost more than a thousand dollars at a pharmacy can be purchased DTC for a few hundred dollars. 

But even with the large discounts, these prices are still quite high, especially when many Americans can get prescriptions cheaper through their insurance. As a result, DTC primarily benefits patients who are uninsured, those with high deductibles and those whose insurance will not cover their medication. 

The vast majority of sales will still come through traditional insurance channels, which are putting pricing pressure on manufacturers and compounding the revenue management complexity. 

Market influences are complicating gross-to-net management

The divide between list prices and net prices after rebates, incentives and other reductions, coined by the Drug Channels Institute as the gross-to-net bubble, reached a record $356 billion in 2024. Pharma company leaders say optimizing GTN has become significantly more difficult in recent years, and they cite pharmacy benefit managers (PBMs) as the top contributing factor. These intermediaries heavily impact the industry by controlling patient access, influencing formulary decisions and negotiating deep discounts and rebates. 

Manufacturers also mentioned government pricing programs and the proliferation of patient assistance programs and payer countermeasures as complicating influences. 

PBMs themselves are facing pressure from government policies and drug list price scrutiny. PBMs’ current rebate-driven strategy becomes unstable when policymakers target list prices without redesigning the underlying negotiation framework. To protect margins, the organizations may rely more on administrative fees and intensify formulary negotiations with pharmaceutical manufacturers to push for deeper concessions.

That dynamic could further disrupt GTN management. If compensation structures shift, manufacturers may face a more fragmented and less predictable contracting environment. At the same time, constraints on list price growth limit the traditional lever companies have used to absorb escalating concessions. The result is greater revenue leakage risk, compressed net margins and heightened forecasting uncertainty. 

Most life science leaders agree that addressing issues throughout the GTN lifecycle would impact their company’s margin, and they believe technology presents significant opportunities for improving revenue management. 

Building agility with AI

According to the State of Revenue Report, 97% of life science leaders use AI for revenue processes. Nearly two-thirds of survey respondents see data analytics as a promising avenue to optimize GTN, but data is a major hurdle to enabling this use case.

Less than 30% of companies have fully integrated GTN data (sales, rebates, contracts, etc.), and less than 1% have real-time visibility into this information. These silos and delays will hamper the ability to gain meaningful insights from analytics. 

Companies must pursue system integration and visibility in the year ahead. Mapping revenue processes from end to end helps identify where leakage occurs and ensures all teams are working from the same data. Then organizations can invest in automation and analytics to reduce losses through better demand forecasting, price optimization and scenario planning.  

While they can’t anticipate new disruptions, pharma manufacturers can build more resilient systems with integrated data and real-time visibility. Powered by analytics, leaders can react quickly with informed pricing, contracting and market access adjustments.