Working in Sync
Maximizing reimbursement in a challenging pricing environment requires market access and pricing teams to work in concert
As private and government payers around the world grow more powerful, obtaining market access promptly at an appropriate price has become critical to company success. Faced with a raft of challenges, including the advent of lower-priced generics and biosimilars, branded biologics manufacturers are finding it increasingly difficult to command premium prices.
Compounding these challenges is the fact that Market Access and Pricing teams are often not housed in the same structure, says Trevor Landry, VP Market Access Europe at Novo Nordisk. “Market access should have a direct line, through its leadership, to align with pricing. I have market access and pricing under my scope and they go hand in hand. Finance should also be part of decision making when it comes to market access. At Novo, a pricing committee that includes Finance meets on a regular basis to ensure everyone is involved in pricing decisions.”
Market access has become far more challenging through a confluence of several factors – the need to contain rising costs, proliferation of competing drugs in the same therapeutic areas, and reliance on evidence-based medicine (EBM) and health technology assessment (HTA) to drive payer decisions. In addition, growth of the generics segment and the advent of biosimilar drugs have given payers additional choices when deciding which medicines to cover.
For Landry, the differences in reimbursement requirements across the 35 countries that make up Novo Nordisk’s Region Europe is one of the most difficult challenges. “It’s nice to sit here in the regional office in Copenhagen and make a strategy, reimbursement plan or brand strategy, but in reality, there are 35 different countries and endless combinations for reimbursement. It begins with those requirements; within each, you must consider burden of disease, patient populations, country GDP, percentage of spend in pharmaceuticals, and of course competition; all of which can vary widely and which put up a different set of barriers and price points,” he says.
Demands for clinical trials or real-world evidence can also vary considerably. “It is a significant burden to design programs to meet the needs of 35 different countries with potentially different variations, so we’re constantly challenged with developing programs that prove the value of our data in a meaningful and efficient way,” says Landry.“Much of the planning for our RCT trials or RWE programs incorporates input from Market Access so they’re designed with a lot of various perspectives in mind. This way, when we do come to market or complete a program, our efforts may better support improved market access.”
For Landry, the structure of Market Access and its interface with global colleagues has driven a pan-European view. “With the HEOR/RWE team covering the 35 countries also sitting under my direct reporting structure, we have a good view of the land. At the local affiliate level, we have sales teams, Market Access teams and local experts – they do the tough work. You can’t expect someone in Poland, for example, to have a pan-European view so that’s where our structure is beneficial. It’s my responsibility to stay close to our global colleagues here in Copenhagen; we come together on life cycle management and strategic pricing decisions, as well as clinical trial and RWE study generation and what we need to do to address the needs of the market in the next 10 years.”
While neither the short nor long-term implications of Brexit are known, short-term currency fluctuations and long-term international reference pricing (IRP) implications are potential market access risks, says Landry.
“The UK is a highly referenced country from a price standpoint, and so the decrease in the valuation of the Pound undoubtedly raised warning flags. We had a process that closely monitored the fluctuations; thankfully, it recovered enough to ease some of our fears but the devaluation of the Pound – because of parallel trade and referencing – was of concern when the Brexit vote took place. Those fears have eased somewhat but that’s an example of where reference pricing can have a negative affect for us,” he says.
The challenge with reference pricing is the lack of a standard process. “Where one country may reference a basket of 12, the country next door may use the same 12 but take an average or some combination of countries. Then you can add currency fluctuations and local market dynamics to the mix. We have a group that evaluates the long-term impact of a reference price; if we provide Denmark, for example, with a certain price point for a product then we can extrapolate that out and look at the long-term impact on the brand and the immediate term for most of our evaluations.”
And value-based contracts? “We do have a committed resource in Market Access that is focused on innovative contracting; obviously, it’s a direction that everyone is exploring. While the idea is good, the implementation and execution is challenging. We’re exploring it and looking into whether it’s feasible; the market is calling for innovation in general as the payers are looking to find the value. We are seeking effective ways to partner and ensure patients receive the best treatment. ”
Trevor Landry will be speaking at the upcoming Access Europe Summit, 25-26 April
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