Gaining Regulatory Approval for New Drugs is the “Easy Part” Compared to Obtaining Favorable Pricing

New Cutting Edge Information study shows pharmaceutical companies rate payer considerations more important than regulatory approval

RESEARCH TRIANGLE PARK, N.C.--(BUSINESS WIRE)--Top pharmaceutical companies regard payers’ reimbursement and pricing decisions as more challenging than gaining regulatory approval for their products, according to a new study by Cutting Edge Information.

“Clarity from payers is increasing in importance, especially in Europe”

Regulatory approval has consistently been a determining-factor when pharmaceutical companies develop their global launch sequences – or the order of countries in which they launch products. After all, products cannot be marketed until they are approved. Today, however, pharmas consider regulatory approval as the easy part when compared to gaining favorable pricing.

Cutting Edge Information’s study, “Pharmaceutical Launch Sequencing,” found that managing payer relations are equally important as regulatory approval when setting a global launch sequence. Half of all surveyed companies rated both clarity of payer demands and payer reimbursement rates at least 8 out of 10 in terms of importance. Clarity, however, was rated more important to actually determining launch sequence, according to study data.

Clear reimbursement criteria help companies move products quickly through the pricing process and keep their global launch calendar on schedule. Reimbursement rates are, of course, at the forefront of a company’s brand launch strategy. Higher reimbursement rates lead to better profit margins. In many cases, higher rates also impact reference pricing for later launches.

“Clarity from payers is increasing in importance, especially in Europe,” said Michelle Vitko, senior research analyst at Cutting Edge Information. “The UK and Germany are both in the middle of a major payer policy adjustment.” Germany and the UK are both frequently referenced, first-launch countries. Without pricing and reimbursement clarity for their products in these countries, drug companies’ profit models quickly become hazy.

Cutting Edge Information’s latest study, “Pharmaceutical Launch Sequencing: Mapping Commercialization Opportunities to Maximize Global Value and Expand Market Access” (www.cuttingedgeinfo.com/research/marketing/global-launch-sequencing/) explores important launch sequencing metrics and examines the market potential of 14 individual countries. Use this report to:

• Build a successful global launch sequencing strategy for your brands.
• Understand and navigate changing regulatory and pricing processes
• Optimize commercialization and enhance product revenue in key markets
• Prepare for future growth in emerging markets by building commercial infrastructure now

For more information about global pharmaceutical launches and market access, contact Elio Evangelista at 919-403-6583.