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Why are pharma prices changing?
Understanding the reasons behind medicines' price changes has been a common challenge
Prices of medicines evolve over time and are notoriously complex to understand at both the list and discount levels. The actual reasons behind price changes are often relatively obscure and the pharmaceutical industry has struggled in the past to predict when and why price cuts are being implemented.
Linking market events to price changes is a top priority
Being in a position to identify the market events occurring before a medicine experiences a price cut is fundamental. This allows a better understanding of a specific situation in a pharmaceutical market and helps to anticipate future price changes when this type of event takes place again.
Our newly released visualization offering puts together all market events analysis of pharmaceuticals in line with their price history, including clinical trial data, M&A activity, approvals, P&R/HTA decisions, patent expirations. It is, therefore, possible to put in perspective the impact of market events on medicine prices and draw correlations between them.
Case Study: Keytruda pricing in Germany and Italy.
For Keytruda, the first presentation that entered the German market in August 2015 experienced a first price cut by 6.85%, around one year after it had been available. The visualization tool highlights that three indications were initially approved in advanced melanoma and assessed by the G-BA in February 2016. A considerable added benefit was proven in at least one population of the indications assessed. Consequently, the G-BA assessment triggered a price negotiation between the pharmaceutical company and the statutory Germany health insurance (GKV) and is very likely the reason why prices dropped.
The chart above is an extract from our new tool and each form highlights specific market events.
Later, a new price cut was experienced again, following the assessment of new indications that have increased the overall population the treatment can be given to. For instance, in September 2017 a new price cut by almost 21% was implemented. It followed the HTA assessments of two indications in lung cancer. Both were considered as bringing a considerable added benefit in at least one population.
The same type of analysis in Italy demonstrates that the first price cut of Keytruda in this country - in May 2016 - is linked to its inclusion into the reimbursement list in late April of the same year.
However, following the first price cut, the approval of new indications as well as their assessments have not had any impact on prices despite the fact that some of the indications approved were approved for reimbursement. And this is just scratching the surface of the many ways that the powerful new version of POLI can integrate the daily insights from our experienced team of experts with critical pricing data trends.
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