Pharmaceutical companies are well aware there is a trend toward shifting the financial burden to the patient that can be seen in many markets. Traditionally, patients have had the payer role in the emerging private pay markets, such as China and India. The US is also an obvious example of where co-payments are the norm. Other countries, traditionally thought of as fully reimbursed, are increasingly passing this burden over to patients. Spain, for example, levies a 40-60% co-pay depending on the patient’s level of income, with pensioners contributing 10%, subject to certain caps.1
This shifting of payer responsibility means that pharmaceutical companies must really understand the idea of the “patient as a payer”. They need to establish drivers of patient choice and willingness and/or ability to contribute to the cost of therapies when assessing the potential of new products.
Multiple factors shape patient product preference
With many different factors influencing patient preference, it is important to understand their significance:
- Product characteristics that resonate with the patient may differ from the physician’s view. In market research, all too often the physician is asked to be a proxy for the patient and how the patient views their disease and treatment. This can result in some very misleading research. Take, for example, breast cancer.2 While 71% of physicians believe that patients with breast cancer consider keeping their breast as a top priority, the figure from direct patient research is only 7%.
- Individuals are likely to have different preferences based on desired health outcomes.
The outcomes can be characterized by several dimensions; for example, improved physical function, social function, cognitive function, psychological well-being and relief from symptoms.
- Brand loyalty can differ by country.
Out-of-pocket countries, such as Brazil, Russia and India, are particularly brand loyal.3 Reasons for this loyalty are:
- safety and clinical effectiveness concerns
- concerns regarding manufacturing quality of generic medicines
- ‘trust’ in the specific originator brand
- brand and/or company reputation.
- Often, it’s not only the traditional stakeholder that influences patient decisions.
Traditionally, the physician’s word was taken as gospel by patients, but now others are influencing patient preference. They include pharmacists, family and friends, and other patients. Patients may also do their own internet searches to verify the information provided by others.
Yet, merely understanding patient product preference is not sufficient
Pharmaceutical companies also need to understand patients’ willingness-to-pay and the patient perspectives on the questions:
- Do I want to pay for it?
- What do I want to pay for it?
- What are my other alternatives?
It is critical, therefore, to establish a view on patients’ affordability/ability to pay, for which monthly household income and healthcare-related spending can serve as a proxy. The issue of affordability might also depend on the patients’ particular insurance coverage; i.e., is the preferred product on an affordable insurance tier for the patient with lower co-pay?
Ultimately, uptake and utilization of a product are dependent on many factors
For a pharmaceutical company seeking to understand how their new product might fare in the self-pay/out-of-pocket market, the following equation summarizes the key elements contributing to the patients’ decision to comply/adhere to a product prescribed to them. This, in turn, leads to uptake, utilization and success for a product.
Figure 1: Factors contributing ultimately to uptake and utilization of a product
In summary, uptake of a product in self- and co-pay markets is determined and influenced by many different patient preference factors. Among them are stakeholders who interact with the patient and whose influence needs to be understood in order to define the most commercially successful pricing strategy in those markets.
This article was co-authored by Deborah Hooker.
 Puig-Junoy J1, Rodríguez-Feijoó S, Lopez-Valcarcel BG. Paying for formerly free medicines in Spain after 1 year of co-payment: changes in the number of dispensed prescriptions. Appl Health Econ Health Policy. 2014 Jun;12(3):279-87.
 Lee CN, Dominik R, Levin CA, Barry MJ, Cosenza C, O’Connor AM, Mulley AG Jr, Sepucha KR. Development of instruments to measure the quality of breast cancer treatment decisions. Health Expect. 2010 Sep;13(3):258-72.
 McKinsey & Company. Unlocking pharma growth; Navigating the intricacies of emerging markets. 2012.
 PWC Health Research Institute. Customer experience in the pharmaceutical sector: Getting closer to the patient. Commonwealth Fund International Health Policy Survey in eleven countries. November 2013.