How do you prove a product’s value to negotiate pricing with a payer?
Our client, a large global pharmaceutical company, was facing a market access problem for their newly launched product. Generic treatments have been widely available for many years in this particular therapeutic category.
Although the efficacy of our client’s product has been demonstrated to be clinically superior, the payer still wished to limit prescribing of the product due to its higher price and lack of evidence for treatment effectiveness in a real-world setting. The payer’s decision negatively impacts our client’s overall budget.
This is not a unique situation, considering current circumstances and budget constraints. Demonstrating a product’s value is paramount. Pricing pressures, access barriers, and strong demand from payers to see more detailed outcomes information becomes more and more important for pharmaceutical companies to prove. In the past, demonstrating added value on the basis of efficacy from randomized clinical trials was the benchmark.
Now payers in healthcare increasingly rely on outcomes information based on real-world clinical practice, especially how a product performs among a particular population.
- Claims data is lacking the necessary clinical information to identify patients accurately.
- Unlike clinical trials, the dose schedule and frequency of medication actually taken by different patients varies.
- It is increasingly difficult to identify clinical and financial measurements that are meaningful to payers.
- There is potential population heterogeneity between database and payer’s population.
- Evaluated the feasibility to link to EHR data to get more clinical information
- Developed claim-based algorithm as disease proxy
- Assessed treatment pattern and stratified result by medication adherence level
- Evaluated multiple clinical and financial outcomes, including medication burden, incidence rates of comorbidities, all-cause and disease-specific resource utilization and healthcare cost
- Provided patient profile on demographics and clinical characteristics for payer to compare
- Demonstrated the value of product in terms of dollar amount in the real-world setting
- Gained negotiation power for our client on the product rebate
- Opened a dialogue with the payer to discuss the change of formulary, such as removing prior authorization for the product