In many emerging markets, healthcare funding remains very much an out-of-pocket expense. For some, it is the second most important household expenditure after food.
It is critical, therefore, when establishing pricing strategies in such markets that we consider both willingness and ability to pay. We also must consider how these factors may be shaped by a range of external influences, including:
- patient-relevant product attributes/outcomes
- patient-access pathway
- physician endorsement
- pharmacist recommendation/substitution
- multichannel information sources
- friends, family or caregiver attitudes
- financial support and drug donation programs
- brand awareness/loyalty
Patients’ priorities vs. physicians’ views
Patient-relevant product attributes and outcomes that would not normally be seen as valuable to government or insurance-based payers or indeed the treating physician may resonate far more with the patient who is also the “payer”. For example, they may be far more willing to pay for convenience. Outcomes demonstrating earlier return to school or work may carry far greater value than would normally be the case in formal health technology assessment, which is too often limited to a view which takes only direct health system costs into account.
Where the physician continues to act as a key gatekeeper, it is critical to understand that their views of what is important to the patient may not be aligned with the patients themselves. Take, for example, breast cancer. While over 70% of physicians believe that patients with breast cancer consider keeping their breast as a top priority, the figure from direct patient research is less than 10%.
Comparison of patient and physician drivers in asthma (GfK Asthma Research, China)
Consequently, physicians may also make treatment decisions/recommendations based on false assumptions regarding the patient’s willingness to pay.
Physicians: Are they reliable surrogates of patients’ willingness to pay (WTP) or not?
Our research across a range of markets and therapy areas has highlighted how physicians often provide a very unreliable surrogate of patient WTP. It has also revealed significant variation between the impact of different WTP drivers on patients in different markets, socioeconomic groups and disease areas.
Examining evidence-based pricing
We apply our best-in-class approaches to support evidence-based pricing in these self-pay markets, building on many decades of experience in both the prescription and consumer medicines space. By combining our global expertise and local market knowledge, we are able to help clients optimize patient access and uptake in a way which is aligned to our client’s global and regional commercial strategy.
These same approaches are equally valuable in more traditional markets where there has been a shift in financial burden towards the patients through co-payment mechanisms. The US is an obvious example of where co-payments are the norm, and understanding the trade-offs between pricing, tier placement and co-payment are crucial elements of pricing and contracting strategy development.
Tim Fitzgerald is the Managing Director of Market Access at GfK. Please email firstname.lastname@example.org or leave a comment below to share your thoughts.