International price referencing
Most countries set the price (or more commonly the reimbursable price) of a pharmaceutical by a process that includes referencing the price of the same product in different countries. (They may also use national referencing where the prices of different, but similar products in the same country are used as a reference.)
The exact process varies from country to country:
- Some countries' formulae for calculating the reference price are explicit.
- Other countries request information on prices in other countries, but how they use them can only be determined from their behaviour rather than an explicit set of rules.
- Different countries use different baskets of reference countries (usually countries that are close both in terms of geography and in terms of similarity of health care system).
- Varying formulae are used to calculate the reference price - including the average of the price in other countries, the minimum price in other countries and other more complex methods.
- International referencing can be conducted at launch or - as is increasingly common - periodically after launch as well.
It can be difficult to model the outcome of all this because there are many countries and their prices can interact.
Inpharmation provides elegant software solutions for pharma companies who need to model the impact of international price referencing - either as a stand alone program or powerful functions that you can drop into your existing Excel spreadsheet models.
For more information of international reference pricing (and international price setting in general) please complete the form below...
