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Drug Pricing and Reimbursement Strategies: Preparing for the Coming Generic Onslaught

Kalorama Information
October 1, 2007
200 Pages - SKU: KLI1422997

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Countries covered: Japan, United States, Europe

It can be said that pharmaceutical companies face a 'new era.' in the coming years. Old strategies will not produce the same results. A wave of generic competition is poised to affect most brands. Drug companies have had to cut research budgets, leading to a dearth of new products on the market. This means there is very little margin for error in the pricing decision.

Drug pricing is one of the key levers that determine the profitability of a drug company. Premium pricing of a new drug helps cover the high cost of innovation and helps run a profitable enterprise. But the recent onslaught of generics, as well as shrinking government and corporate healthcare budgets, is threatening the time-tested models, leading to higher pricing pressures for pharmaceutical and biotech companies in the coming years. In this environment, executives in these companies and the consultants who service them need better information to make the most profitable decisions.

Kalorama Information's Drug Pricing and Reimbursement Strategies: Preparing for the Coming Generic Onslaught provides considerable detail on the this all-important area of pharmaceutical marketing strategy. The guide describes pricing strategies for specific results, including:

Gaining Market Share
Defending Market Share
Enhancing Brand Loyalty
Gaining New Customers
Improving Margins
Utilizing Capacity

The result of exhaustive research into recent pricing trends as well as interviews with top pharmaceutical executives, the Guide provides executives in pricing decision capacities with critical information needed to arrive at the most effective strategy:

Useful statistics detailing the Overall Pharmaceutical Pricing Environment, including Healthcare Expenditures, Pharmaceutical Expenditures and Drug Prices in Select Countries as well as Biopharmaceutical R&D Expenditures
Updated Medicare Reimbursement Information for Parts A,B,C and D
The Development phases in which it is most important to consider pricing
Overview of U.S. Pharmaceutical Market (including Healthcare Spending, Promotional Spending, Average Co Payments, Generic Drug Trends, Single Source Brand Vs. AWP and more.)
Pricing Strategies for the European Market
Japanese Market Pricing and Reimbursement Strategies.

Drug pricing and reimbursement also differs widely across the globe due to the huge disparity in economic situations of various countries, and this global report addresses the pricing environments in:

U.S
Europe

Japan

Pricing and reimbursement will remain one of the most talked about industry issues going into the next decade. This report aims to provide a holistic view on pricing and reimbursement across the globe. This report enables executives to make proactive decisions and to craft their responses to the changing dynamics of the market.

License Note: Kalorama Information's listed default price on its information products reflects a single user license only. Purchasing a global site license (entire company) permits multiple individuals in the company to benefit from this resource.

Executive Summary

Drug Pricing and Reimbursement: Strategic Overview
Factors affecting Pharmaceutical Expenditur
Key Issues and Challenges
Pricing Strategies
Regional Pricing Differences
Scope and Methodology
Reasons for Conducting the Study

Drug Pricing and Reimbursement: Strategic Perspectives

2.1. Background
2.2. Global healthcare costs and their Impact on GDP
2.3. Drug Costs and Affordability
2.3.1. Price Variability across countries
2.4. Factors contributing to Drug Expenditures
a) Volume Growth
b) Rising Prices
2.5. Pharmaceutical Pricing and Ethics
2.5.1. Differential Pricing
2.5.2. HIV/AIDS Pricing & Ethics

Pricing Strategies

3.2. Pricing Strategies: Goals
3.2.1. Market Share
3.2.2. Defending Market share
3.2.3. New Customers
3.2.4. Enhancing Brand Loyalty
3.2.5. Improving Margins
3.2.6. Capacity Utilization
3.3. Pricing Decisions: Types
3.3.1. Traditional Pricing
3.4. Role of Pricing Function in Price setting
3.5. Pricing and Pharmacoeconomics
3.6. Price Optimization
3.7. Pricing in the Product Development Process
3.7.1. Background
3.7.2. The First Price Estimate
3.7.3. Improving Pricing in the Product Development Process

Current Pricing and Reimbursement Trends in the USA

4.1.1. National Prescription Drug Expenditures
4.1.2 Pharmaceutical Costs
- 4.1.2.3. Factors for rise in pharmaceutical costs
4.1.3. Future trends in Pharmaceutical Costs
- 4.1.3.2. Rising Consumerism
- 4.1.3.4. Shifting Payor Mix
- 4.1.3.5. Cost Containment and the Formulary
- 4.1.3.6. Basis of price determination
4.2. Pricing mechanism in USA
4.3. Price Movement
4.3.1 Impact of Supply Chain on Price
4.3.2. Supply chain and price differentials
Retail Sector
Non retail sector
4.4. Key Pricing measures
4.4.1. Background
a) Average Manufacturer’s Price (AMP)
b) Average Sales Price (ASP)
c) Average Wholesale Price (AWP)
d) Estimated Acquisition Cost (EAC)
e) Federal Supply Schedule.
f) Federal Upper Limit (FUL)
g) Maximum Allowable Cost (MAC)
h) Wholesale Acquisition Cost (WAC)
4.5. Drug Pricing Litigations
4.6. Pricing Dynamics
Single-Source Drugs
Multiple-Source Drugs
4.7. Pricing and customer segments
4.7.1 Background
4.7.2 Pharmacy Benefit Managers
- PBM role
- Cost containment Strategies
- Pharmacies
- PBMs’ Negotiated Payments to Pharmacies
- PBMs’ Payments to Pharmacies
4.7.3. Mail-Order Pharmacies
4.7.4. Cash Customers
4.7.5. Government Markets
4.7.5.1. Federal Supply Schedule
4.7.5.2. 340B Drug Discount Program
4.7.5.3. Medicare
a) PART A
b) PART B
Medicare Reimbursements
c) Part C (Medicare Advantage)
d) PART D
Future Challenges
2008 Changes in Medicare Part D Payments
Calculation of the Low-Income Benchmark Premium Amounts
Annual Updates to Medicare Part D Benefit Parameters
4.7.5.4. Medicaid
4.7.6. Third party payors
Managed care business structure
Healthcare maintenance organizations (HMO)
Point of service (PoS)
Preferred provider organizations (PPO)
MCOs and Pharmacy Benefit Managers (PBMs) relationships
Co-payments and cost-reduction initiatives
Managed Care Contracting: Pharmaceutical Manufacturers’ Perspective
Managed Care Business Goals
Managed Care Strategy
6. Monitoring Performance
4.7.7. Emerging Issues
4.7.7.1.Drug Price Transparency in United States
4.7.7.2. Wal-Mart and $4 Generics
4.7.7.3. Average Wholesale Price and First Data Bank

Current Pricing and Reimbursement Trends in Europe

5.1.1 EU Pricing Environment
5.1.2. Reimbursement Mechanisms
5.1.3. Pricing and Reimbursement impact on new product launch sequence
5.1.4. Drug Budgets
5.1.5. Pricing and Reimbursement Overview
U.K. and Germany
France, Italy and Spain
5.1.6. Parallel Trade
Germany
5.2.1. Background
5.2.2. Statutory Health Insurance Funds
5.2.2.1.Reference Prices
5.2.3. Statutory Health Insurance Market
FRANCE
5.3.1. Background
5.3.2. Regulatory Affairs in France
5.3.3. Regulations
UK
5.4.1.Pricing System
5.4.2. Pricing of New Products
5.4.3. Pricing Methods for Generic Products
5.4.4. Reimbursement
ITALY
5.5.1. Pricing Systems
5.5.2. Reimbursement
SPAIN
5.6.1. Pricing Systems
5.6.2. Reference Pricing System
5.7.Tackling Parallel Trade

Current Pricing and reimbursement Trends in Japan

6.2. Japanese Healthcare System
Employee’s Health Insurance Plan
National Public Health Insurance Plan
6.2. Bungyo
6.3. Reimbursement system
6.3. The R-Zone and regular price decreases

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