I had quoted the section of the article regarding how the outcome payments would be calculated because you mentioned I was sidestepping the issue, but hope it is clearer now in any case! There is also a risk that too much detail might confuse a reader.

I agree that QALYs are vague should only be used as a tool to determine a specific price for repurposing RCT data. The price and "deliverables" (i.e. successful generic drug repurposing RCT data) will be specifically defined in the contractual language and negotiated with a payer in advance. Essentially you ask a payer to state a price they are willing to pay for off-patent RCT data to treat a specific disease (e.g. $100k per prevented hospitalisation in the treatment arm of a Phase 2/3 RCT, and may also require regulatory approval as a condition or "bonus"), then put it to the market in an RFP document. This would be scalable if the price paid is less than the amount of savings for payers. For repurposed generic drugs there is a significant arbitrage opportunity because the marginal cost of generic drugs and it is over 100x times cheaper to conduct RCTs and achieve regulatory approval ($10-15m, enter phase 3 trials immediately) vs patented drugs that take 10-15 years and cost over $1-2b. So even agreeing to transfer 1% of cost savings into a pay for success contract could generate billions of dollars in outcome payments for generic drug repurposing and trillions in healthcare cost savings in the US alone from the discovery of new low cost generic drugs to treat diseases

E.g. from the article:

By way of example only, repurposing the off-patent NSAID ketorolac as a prevention treatment resulting in 10% reduction in breast cancer recurrence would cost $5 million annually (100,000 cases at $50 per case for ketorolac and its administration). The savings would be over $1 billion annually (10,000 patients at approximately $100,000 per patient for the treatment of metastatic disease)

It really isn't that much different from how military contracting works, except the process would be more competitive because anyone would be allowed to conduct the RCTs - the idea is to leverage the market to crowdsource the solution using pay for success, otherwise it's not really much different from the risks of traditional grant funding "picking the winners" (although it still is different in the sense that the the funds are not provided up front from the payer). But like biotech industry, you want everyone to be able to raise money for RCTs and a minimum of bureaucracy (except dealing with FDA and ethics approvals, which is a necessary evil).

The key difference here is that you now have a market for something that is essentially a public good. Ideally, payers should form a syndicate to minimise free riding - this is one of the core benefits of patents: they tend to be enforced globally since GATT/TRIPS, even in India and China. The equivalent would be a global pay for success fund (similar to the proposed Health Impact Fund - see https://en.wikipedia.org/wiki/Health_Impact_Fund, although this is not focussed on incentivising generic drug repurposing to save payer healthcare costs, which would be scalable, but more on developing new therapeutics for neglected/tropical diseases)