RESEARCH TRIANGLE PARK, NC – Pharmaceutical business intelligence leader Cutting Edge Information announces the launch of a new report, “Pharmaceutical Pricing in the US and Europe: Analysis of Resources, Strategy and Structure” (PharmaPricingStrategy.com).

Gleaned from interviews and surveys with pricing analysis executives in the pharmaceutical and biotech industries, the report assesses drug companies’ spending on strategic pricing, pricing department headcounts, prevalent pricing structural models at companies of all sizes, and strategies for winning the pricing war in the key US and European markets.

With parallel importing and reference pricing in Europe; and political, payor and public pressure on drug prices escalating in the US; and diverse reimbursement environments across the globe; strategic pricing has never been of greater strategic importance to drug’s bottom lines.

According to the report, only the industry’s largest firms have dedicated pricing departments. Companies that rank in the top 35-50 in global sales typically benefit from both US and global pricing departments; a number of the largest companies also have the resources to staff pricing experts in the largest European markets, including Germany, the UK, France, Spain and Italy.

Cutting Edge Information found that the average US pricing department staffs nearly seven people and has an average budget in excess of $1 million. The average global pricing department, which generally oversees pricing strategy in Europe, Asia/Japan, and other key ex-US markets, has nearly eight staffers and an average budget of more than $2.8 million.

“Our research reveals three structural models for handling strategic pricing analysis in the pharmaceutical industry. The vast majority of drug companies aren’t large enough – and don’t have enough work in their drug development pipelines – to warrant dedicated pricing resources,” says David Richardson, senior analyst with Cutting Edge Information. “Most companies are forced to outsource pricing analysis oversight and execution. If they’re not careful, this practice can be detrimental to their drugs’ success when they reach the market.”

According to Richardson, failing to prepare early can lead to suboptimal reimbursement positioning, which can doom products before they even reach the market.

 
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