Top Drug Companies Outsource 75% or More of the Health Economics Workload

A new study by Cutting Edge Information finds that HEOR outsourcing a staple at most pharmacoeconomics groups, regardless of company size.

RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--HEOR outsourcing is prevalent at more than 75% of Top 20 and Top 50 pharmaceutical companies, according to a new study by Cutting Edge Information. As health economics and outcomes research (HEOR) teams take on a greater role within drug companies, outsourcing becomes an attractive strategy to maximize their internal resources.

“The varying requirements of health economics studies, along with an unsteady stream of pipeline products, means that the pharmacoeconomists’ skills are not consistently needed”

The study, “Health Economics and Outcomes Research: Aligning Clinical and Commercial to Meet Payer Demands and Win Reimbursement,” found that, among surveyed companies, at least two-thirds of all health economics work is outsourced across all company types. Small pharma companies outsource 93% of their HEOR work, as these companies are typically not large enough to employ staff to perform the necessary studies. Device companies outsourced only 66% of health economics work. Top 20, Top 50 and affiliate pharmaceutical companies outsourced 77%, 75% and 73% of their HEOR workload, respectively.

One of the reasons that outsourcing has become so prevalent among pharmacoeconomics groups is the varying studies required for each product. The necessary study type depends on a brand’s competitive profile, countries the product will enter, and the disease states that it treats.

“The varying requirements of health economics studies, along with an unsteady stream of pipeline products, means that the pharmacoeconomists’ skills are not consistently needed,” said Michelle Vitko, senior research analyst at Cutting Edge Information. “In most cases, it is better for a company to outsource its needs to vendors specializing in the required study type than to employ generalists in-house.”

Cutting Edge Information’s analysts do not expect the life sciences industry’s reliance on outsourcing HEOR work to change in the future. In fact, as government payers in Europe and Canada grow more exact in their reimbursement specifications, more companies in these markets plan to outsource health economics studies.

“Health Economics and Outcomes Research: Aligning Clinical and Commercial to Meet Payer Demands and Win Reimbursement,” (http://www.cuttingedgeinfo.com/research/market-access/health-economics/) includes 14 highly detailed HEOR team profiles, as well as team benchmarks on structural oversight responsibilities, compensation, team size, make-up, outsourcing and centralization.

For more information about health economics and outcomes research or market access, contact Elio Evangelista, 919-403-6583.