Acute Uncertainty
2021 Health Trends
Pricing reform remains a looming challenge in the industry as governments around the world propose new approaches to limiting reimbursement and requiring new evidence against cost-effectiveness of care. Although much reform has been temporarily stalled due to more pressing pandemic issues, the outline is clear: rebates, discounting, and frameworks for more regional and aggressive tendering. Overall, total global spending is expected to continue to grow over the next several years, but at a slower rate — both due to pricing reform and competition among the significant numbers of new drugs coming to market.
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Critical Question
What new evidence do we need to continuously demonstrate value?
What actions should we be taking to show our commitment to value and fair pricing?
Did you know...
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Repricing: Japan’s 2018 overhaul of the Price Maintenance Premium (PMP) system narrowed the definition of what drugs were considered innovative and worthy of price premiums and exclusivity — creating a 32% drop in the number of drugs meeting the criteria. In 2021, the next wave of the reform will set in, requiring mandatory repricing of drugs annually.
— Pharma Manufacturing, 2020
$35: In the U.S., manufacturers have teamed up with Medicare plans to create a moment of advocacy around pricing. They’ve developed a $35 capped co-pay program for insulin, to both help people struggling with the financial impacts of COVID-19 and to ensure they don’t try to ration their insulin. Eli Lilly was an early mover with a similar standalone Insulin Value Program which offers the $35 cap to people with commercial insurance or no insurance.
— Medscape, 2020;
— Stat News, 2020