If you don't have confidence in your shot, or you are scared to take a big shot in a game you are most likely going to miss it. That is why it is important that you train yourself to be mentally strong, and to trust your shot. It is not enough to just work on your shooting. You need to train your mind as well and this is one of the better pressure basketball drills to use to do that.
By putting consequences on the shooter for missing shots in the drill, you help train them to learn to shoot under pressure. If they can learn to overcome some of the pressures of shooting this will help them to shoot and make that big shot at the end of the game. It is very difficult to simulate game pressure but this drill does a good job at simulating some of that pressure.