Health Economics and Outcomes Research (PH137)

Health Economics and Outcomes Research Report Sample

The following is an excerpt taken from Chapter 1, Aligning Team Structure and Staffing with Corporate Goals, section 1: Health Economics and Outcome Research Department Structures.

Establish a Pharmacoeconomics Structure that Supports Global Health Economics Strategies

Ideally, drug companies aim to develop a global pharmacoeconomics strategy that can then be customized for key markets around the world. Implementing a global strategy is very complex, however, and it is difficult to manage effectively. To illustrate, the United States is the largest drug market in the world, but it does not have the same formal health economic outcomes research requirements that exist outside of the US.

Companies must constantly strike a balance between employing creative, customer-based strategies in the US and developing formal, tactical expertise necessary in Europe, Canada and other markets with rigid managed markets in place. To incorporate this balance into a cohesive global strategy requires companies to organize their pharmacoeconomics departments accordingly.

As with any critical function, structure facilitates strategy. In the case of health economics and outcomes research departments, communication is critical to implementing a truly global pharmacoeconomics strategy. Differences between US and ex-US requirements should impact where a company bases its decision-making. It is not enough to allow that decision-making to occur at the company's headquarters and to filter down to the affiliates because that could either over- or under-emphasize the United States' importance as the largest market.

European-based drug companies, for example, have a tendency to approach pharmacoeconomics based on European managed markets' requirements, leaving the US strategy to follow suit. But a US pharmacoeconomics strategy requires a completely different set of needs than in Europe. The same is true in reverse; European pharmacoeconomics strategies require country-specific tactics. Therefore, an organizational structure that does not support the proper strategy at the affiliate level in the United States, Europe or other affiliates, such as Canada, Australia or Japan, does the company and the brands a disservice.

A significant difference between ex-US pharmacoeconomics structures compared to those in the US is that ex-US department structures must support tactical expertise. It is far more important in the US to have a structure that supports strategic development than it is in other markets. In the US, technical ability and competency must be present, but pharmacoeconomics groups must operate more strategically and be more adaptable to changes. Outside the US, pharmacoeconomics groups operate more predictably, but have requirements that are more defined.

The decision-making necessary for the specific needs of each market should keep that country's needs and specific idiosyncrasies in mind. Companies headquartered in Europe are typically adept at developing pharmacoeconomics structures that handle markets requiring tactical, technical expertise. When the US affiliate has to fit into a European-based system, it is easier for internal organizational conflicts to occur.

To avoid this problem, companies should develop a separate US-based pharmacoeconomics organizations focused on developing customer-based strategies. The natural extension of a strategically focused US pharmacoeconomics organization is that this US-based group should develop the company's global health economics strategy. But of course, whether the US leads the global strategic development efforts depends on how important the US market is to the company. The full chapter provides benchmarks and best practices for building a strong, cohesive health economics teams via improved structure and reporting lines.