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Value Proposition: Partnering with the Department of Veterans Affairs

The Veterans Healthcare Administration (VHA) presents a unique market opportunity for pharmaceutical companies and medical device manufacturers. As the largest system delivering integrated healthcare services in the United States, the VHA focuses on solutions that address veteran-specific needs and, frequently, embraces novel therapies. In seeking implementation of cutting-edge medications and technologies, VHA’s insistence for evidence-based solutions means its utilization of a product (which is its only form of endorsement) is very meaningful in the commercial marketplace.

Caring for over 9 million veterans, the VHA is serving a population that is getting younger and more diverse. The typical view of a veteran is an older male; however, the reality is that the VHA provides obstetric services to female veterans in its care as well. Because military veterans experience physical and mental health issues unique to their time in service, solutions addressing those issues hold significant value. Developing a value proposition tailored to the actual population served in both demographics and ailments is important when entering this market.

The VHA seeks reliable partnerships with an eye towards long-term relationships. It predominantly orders through the Federal Supply Schedule (FSS) contracts that it administers or other, similar long-term (5 to 10 year) contracts. These long-term purchasing pathways allow companies to avoid the time and expense of supporting a frequent bidding process and, generally, allow for a more predictable revenue stream. Because the VHA utilizes a competitively selected Prime Vendor as its distributor for its FSS contracts, manufactures also generally experience an efficient and automated inventory management process in fulfilling VHA orders.

The VHA is highly cost-sensitive as it operates within its congressionally-established budget. Companies highlighting potential savings through measurable metrics (i.e., reduced hospital stays, improved patient management, etc.) tend to find greater utilization opportunities. Prominent explanations of the overall or long-term cost savings a product offers generally best capture the attention of decision-makers.

Offering a compelling value proposition worthy of active analysis and consideration, pharmaceutical companies and medical device manufacturers that understand key elements of how this health system operates can expect a return on resource investment. By understanding veterans' specific needs and prioritizing evidence-based solutions, companies can contribute significantly to improving veteran care while establishing a strong partnership with meaningful spillover into other market segments.  


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