Background: There has been an increase in 'risk sharing' schemes for pharmaceuticals between healthcare institutions and pharmaceutical companies in Europe in recent years as an additional approach to provide continued comprehensive and equitable healthcare. There is though confusion surrounding the terminology as well as concerns with existing schemes. Methods: Aliterature review was undertaken to identify existing schemes supplemented with additional internal documents or web-based references known to the authors. This was combined with the extensive knowledge of health authority personnel from 14 different countries and locations involved with these schemes. Results and discussion: A large number of 'risk sharing' schemes with pharmaceuticals are in existence incorporating both financial-based models and performance-based/ outcomes-based models. In view of this, a new logical definition is proposed. This is "risk sharing' schemes should be considered as agreements concluded by payers and pharmaceutical companies to diminish the impact on payers' budgets for new and existing schemes brought about by uncertainty and/or the need to work within finite budgets". There are a number of concerns with existing schemes. These include potentially high administration costs, lack of transparency, conflicts of interest, and whether health authorities will end up funding an appreciable proportion of a new drug's development costs. In addition, there is a paucity of published evaluations of existing schemes with pharmaceuticals. Conclusion: We believe there are only a limited number of situations where 'risk sharing' schemes should be considered as well as factors that should be considered by payers in advance of implementation. This includes their objective, appropriateness, the availability of competent staff to fully evaluate proposed schemes as well as access to IT support. This also includes whether systematic evaluations have been built into proposed schemes.