Set the optimal price for your product, ensure market success — and maximize profit. As market access and reimbursement grow ever more important, pricing decisions separate the winners from the rest in the global marketplace. Discover how leading life sciences companies find and justify prices in light of heightened pressures from government payers and stringent economic policies. Explore in-depth benchmarks and insights, culled from over 30 pharmaceutical, biotechnology, and medical device firms, to build an elite pricing team that can adapt and thrive in today’s uncertain pricing landscape.
Eliminate guesswork in your pricing decisions using detailed metrics and battle-tested strategies:
- Win resources and stakeholder support: Empower pricing groups with staffing and spending benchmarks from companies of varying sizes and across all phases of development. Understand other functions’ involvement in pricing to strengthen coordination and build consensus at each lifecycle stage.
- Learn groundbreaking techniques to maximize ROI: Analyze your product pipeline to funnel resources to your company’s most innovative and crucial products. Prove the value of your team by communicating novel ROI measures.
- Navigate the currents of change: Explore eight major global trends and strategies — including risk-sharing agreements and comparative
effectiveness research — and their effect on pricing. Is your team prepared? Top executives share their perspectives, assessing each trend for benefits and drawbacks. CEI analysts provide actionable recommendations to prepare your team for the future.
- Master global launch sequencing: Perfect your timing in global launch sequences. Learn which countries your competitors target first — and which they avoid — as you weigh your brand’s launch sequence.
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- Executive Summary
- Study Methodology
- Study Definitions
- Strategic Pricing: Five Recommendations for Success
- Pricing Team Structure and Resources
- Pricing Team Structure
- Pricing Group Resources
- Pricing Activities
- Groups Involved in Pricing Activities
- Pricing Studies: Timelines and Cost
- Pricing Offers Benefits in Every Phase
- End Users of Pricing Studies
- Market Position and Pricing Strategies
- The Effects of Global Currents of Change on Pricing
- Risk-Sharing Agreements: A Win-Win Situation for Few
- Austerity Economic Policies Lead to Price Cuts
- Comparative Effectiveness Research Raises Many Questions, Few Answers
- Value-Based Pricing: An Improvement on NICE?
- Parallel Trade & Reverse Importation: A Continuing but Less Critical Threat
- Global Launch Sequencing
- Specific Launch Sequences
- The Future of Pricing
- CHARTS AND GRAPHICS
- Executive Summary
- 17 Figure E.1: Focus of Pricing Research at Pharmaceutical Companies
- 19 Figure E.2: Pricing Team Involvement: Lifecycle Entry and Exit
- 20 Figure E.3: Increasing Importance of Innovative vs. Follow-On Products
- 21 Figure E.4: Rationale Behind Prioritization of Pricing Resources
- Pricing Team Structure and Resources
- 26 Figure 1.1: Rationale Behind Prioritization of Pricing Resources
- 27 Figure 1.2: Rationale Behind Prioritization of Pricing Resources by Company Type
- 28 Figure 1.3: Prevalence of Pricing Teams by Company Type
- Pricing Team Structure
- 30 Figure 1.4: Age of Pricing Teams at Selected Companies
- 31 Figure 1.5: Structural Approaches to the Division of Pricing Activities by Company Type
- 32 Figure 1.6: Function with Final Responsibility for Pricing
- 33 Figure 1.7: Executive Level in Charge of Pricing Activities
- 36 Figure 1.8: Size of Pricing Teams at Top 25 Companies
- Pricing Group Resources
- 37 Figure 1.9: Size of Pricing Teams at Top 50 and Small Pharmaceutical Companies
- 38 Figure 1.10: Size of Pricing Teams at Medical Device Companies
- 39 Figure 1.11: Number of Seperate Pricing Teams at Companies that Decentralized Pricing Responsibility
- 39 Figure 1.12: Average Geographic Division of Pricing Personnel Focus
- 40 Figure 1.13: Average FTE Support by Phase at Companies that Prioritize Resources by Level of Innovation
- 41 Figure 1.14: Average FTE Support by Phase at Companies that Prioritize Resources by Anticipated Revenues
- 42 Figure 1.15: Average Number of Funding Sources for Pricing Activities by Company Type
- 44 Figure 1.16: Departments/Functions that Contribute to Funding for Pricing Activities at Top 25 Companies
- 44 Figure 1.17: Departments/Functions that Contribute to Funding for Pricing Activities at Top 50 Companies
- 45 Figure 1.18: Departments/Functions that Contribute to Funding for Pricing Activities at Small Pharma Companies
- 45 Figure 1.19: Departments/Functions that Contribute to Funding for Pricing Activities at Medical Device
- Companies
- 46 Figure 1.20: Prevalence of Dedicated Pricing Budgets by Company Type
- 47 Figure 1.21: Spending on Pricing Activities by Top 25 Company
- 48 Figure 1.22: Spending on Pricing Activities by Top 50 Company
- 48 Figure 1.23: Spending on Pricing Activities by Small Pharma Company
- 49 Figure 1.24: Spending on Pricing Activities by Medical Device Company
- 50 Figure 1.25: Average Percentage Pricing Spending Change by Company Type
- 51 Figure 1.26: Average Monetary Support by Phase at Companies that Prioritize Resources by Level of Innovation
- 52 Figure 1.27: Average Percentage of Spending Allocated Toward Outsourced Affairs
- 53 Figure 1.28: Prevalence of Vendor Use for Specific Pricing Activities
- 55 Figure 1.29: Average Ratings of Company Success in Pricing
- Pricing Activities
- 58 Figure 2.1: Pricing Team Involvement: Lifecycle Entry and Exit
- 59 Figure 2.2: Departments/Functions that Support Pricing Initiatives at Pharmaceutical Companies
- Groups Involved in Pricing Activities
- 60 Figure 2.3: Departments/Functions that Support Pricing Initiatives at Medical Device Companies
- 62 Figure 2.4: Brand Team Involvement: Lifecycle Entry and Exit
- 62 Figure 2.5: Marketing Team Involvement: Lifecycle Entry and Exit
- 64 Figure 2.6: HEOR Team Involvement: Lifecycle Entry and Exit
- 65 Figure 2.7: Reimbursement Team Involvement: Lifecycle Entry and Exit
- 65 Figure 2.8: Market Access Team Involvement: Lifecycle Entry and Exit
- 67 Figure 2.9: Business Development Team Involvement: Lifecycle Entry and Exit
- 68 Figure 2.10: Market Research/Competitive Intelligence Team Involvement: Lifecycle Entry and Exit
- 69 Figure 2.11: New Product Planning Team Involvement: Lifecycle Entry and Exit
- 71 Figure 2.12: Medical Affairs Team Involvement: Lifecycle Entry and Exit
- 71 Figure 2.13: Clinical/R&D Team Involvement: Lifecycle Entry and Exit
- 73 Figure 2.14: Sales Team Involvement: Lifecycle Entry and Exit
- 73 Figure 2.15: Lifecycle Management Team Involvement: Lifecycle Entry and Exit
- Pricing Studies: Timelines and Cost
- 75 Figure 2.16: Length of Average Pricing Study by Company
- 76 Figure 2.17: Cost of Average Pricing Study by Company
- 77 Figure 2.18: Overview of Pricing Study Cost and Time by Company
- Pricing Offers Benefits in Every Phase
- 79 Figure 2.19: Timeline of Price Updates for Pharmaceutical Products
- 80 Figure 2.20: Timeline of Price Updates for Medical Devices
- 82 Figure 2.21: Focus of Pricing Research at Pharmaceutical Companies
- End Users of Pricing Studies
- 83 Figure 2.22: Focus of Pricing Research at Medical Device Companies
- 85 Figure 2.23: The Most Difficult Focus of Pricing Research
- The Effects of Global Currents of Change on Pricing
- 97 Figure 3.1: Average Ratings of Company Success in Pricing
- 98 Figure 3.2: Outlook on Trends Affecting Pricing
- 99 Figure 3.3: Average Outlook on Trends Affecting Pricing (All Companies)
- 100 Figure 3.4: Average Outlook on Trends Affecting Pricing by Company Type
- 101 Figure 3.5: Industry vs. Consultant Perspectives on Trends
- Risk-Sharing Agreements: A Win-Win Situation for Few
- 103 Figure 3.6: Average Outlook on Trends: Growing Experience with Risk-Sharing Agreements
- 107 Figure 3.7: Types of Risk-Sharing Agreements in Order of Cost and Complexity
- 110 Figure 3.8: Countries in Which Companies Plan to Utilize Risk-Sharing Agreements By 2013
- 112 Figure 3.9: Average Outlook on Trends: Europe’s Austerity Economic Policies
- Austerity Economic Policies Lead to Price Cuts
- 113 Figure 3.10: Average Outlook on Trends: Government-Specific Price Cuts
- 117 Figure 3.11: Average Outlook on Trends: Focus on Comparative Effectiveness
- Comparative Effectiveness Research Raises Many Questions, Few Answers
- 119 Figure 3.12: Loss of Innovative Premium Due to Competitor Launch
- 120 Figure 3.13: Same Loss of Innovative Premium Adjusted for Competitor’s Positive CER Study
- 123 Figure 3.14: Average Outlook on Trends: UK’s Move Toward Value-Based Pricing
- Parallel Trade & Reverse Importation: A Continuing but Less Critical Threat
- 128 Figure 3.15: Average Outlook on Trends: Parallel Trade in Developed Markets
- 128 Figure 3.16: Average Outlook on Trends: Parallel Trade in Emerging Markets
- 132 Figure 3.17: Average Outlook on Trends: Implementation of US Health Reform Law
- Global Launch Sequencing
- 138 Figure 4.1: Overview of Global Launch Sequencing
- 139 Figure 4.2: Global Launch Sequencing: First Launch
- 140 Figure 4.3: Global Launch Sequencing: Second Launch
- 140 Figure 4.4: Global Launch Sequencing: Final Launch
- 142 Figure 4.5: Global Launch Sequencing: Countries Avoided
- Specific Launch Sequences
- 144 Figure 4.6: Top 25 Company F’s Global Launch Sequence
- 145 Figure 4.7: Top 50 Company I’s Global Launch Sequence
- 146 Figure 4.8: Small Pharma Company N’s Global Launch Sequence
- 147 Figure 4.9: Medical Device Company X’s Global Launch Sequence
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