News and Insights
The Numerof 2024 Global Pharma Outlook
As our Numerof 2024 Global Pharma Outlook infographic illustrates, this year’s story for pharmaceutical manufacturers will be about responding to growing pressure on price from government payers, and to the increasing complexity and power of a consolidating yet financially pressed healthcare delivery market in the U.S.
Across the globe, the challenge of engaging with clinical and other stakeholders is being reassessed by management teams, even as some access restrictions recede. The pandemic forced the adoption of technology in commercialization, and it’s here to stay. The grip of a one-size-fits-all approach to customers has been broken, yet companies are still experimenting to find the right mix of technology and personal contact to optimize customer engagement for their particular circumstances.
Especially in the U.S., the consolidation of healthcare delivery into fewer, more complex and powerful healthcare systems is a growing challenge. This dynamic is changing who makes purchasing decisions, the criteria used, and the kinds of questions that get asked. Manufacturers are struggling to adapt their marketing and market access processes to this ongoing trend. We see continued innovation here – in engagement methods and in the way companies structure and support their commercial model. Both technology as an enabler, and on more sophisticated approaches to major accounts management are increasingly being used to address the evolving way in which purchase decisions are made in healthcare. The search for new and effective ways to engage with stakeholders and differentiate products in a crowded field is here to stay.
The passage of the Inflation Reduction Act (IRA) in the U.S. shattered management’s complacency regarding the political landscape. Similar regulatory actions are moving forward in the EU as well, with direct pricing agreements, price controls, reference and risk-based pricing increasingly being adopted. The IRA and similar actions being taken in the EU have put a spotlight on cost management and heightened attention on processes like evidence development, launch sequencing, and fresh approaches to portfolio pricing. The outcome of court challenges will be profound when they come, but in the meantime, the industry must respond.
With the U.S. election approaching, inflation driving medical costs higher, and the IRA emboldening a range of actors, we expect payer, PBM and employer pushback on drug prices will continue to intensify. Consumers will get even more engaged as they pay more of the cost. The inability of the pharmaceutical industry to capitalize on their achievements during the pandemic stands as one of its signal failures. This is a glaring issue that needs to be addressed going forward.
We expect that consolidation and centralization of decision making will continue in healthcare delivery. Anticipated challenges from a commercialization perspective include continued efforts to centralize buying decisions in cross functional committees, and additional restrictions regarding customer engagement. U.S. integrated delivery networks (IDNs) will expand their influence over outpatient prescribing as they move closer to value-based payments. Systems will try to influence product decision-making as they try to gain control over variation in cost and quality.
Given this outlook, what’s next? We recommend these key action steps:
- Reevaluate investments, R&D priorities, launch sequencing.
- Redesign commercial models, targeting/segmentation.
- Align R&D, Medical Affairs, Commercial functions.
- Craft compelling databased economic & clinical value propositions that resonate with key stakeholders.
- Elevate business acumen, diagnostic, and influence skills.
- Structure more strategic collaborations with providers/payers.
- Develop portfolio investment and pricing strategies that reflect lifetime value.
At Numerof & Associates, we help pharmaceutical manufacturers achieve these key action steps for success in today’s evolving healthcare landscape. From competitive strategy and ensuring evidence to demonstrate value to commercial model innovation and implementation we have solutions. Read more about our perspectives and solutions for the pharmaceutical industry and see our case studies.