International Reference Pricing Simulation Engine
International reference pricing (IRP) is a common cost containment measure used by countries to reduce the price of in-patent pharmaceutical products. The mechanics of IRP involves using the price of a medicine in one or a select group of countries to derive a benchmark or a reference price for price setting within the country or for negotiating the price of a product with the supplier.
In most countries, IRP is applied to all marketed drugs or specific categories of medicines such as publicly reimbursed medicines, prescription only medicines or innovative medicines. To fully comprehend the effects of IRP, a sophisticated simulation tool – developed on the latest principles of optimisation – can model the linkages between countries and effectively predict the impact on prices during launches and regualr updates to price lists in each country. At Niteo, we have developed a comprehensive toolkit for our clients to simulate the effects of IRP across 65 countries.
Software-as-a-Service (SaaS): Tendering Platform Development
Tendering (or Public Procurement) is one of the most common ways to source pharmaceutical products within a healthcare system. Both public and private systems, throughout the globe, launch various request-for-proposals (RFPs) for the supply of medicines, medical devices, surgicals, and other healthcare services and products.
While almost 60% of pharmaceuticals are supplied via tendering systems, it is challenging for companies to keep track of all bid submission requests. A software solution that is geared towards tracking, cataloging, indexing, and analyzing RFP requests (and results) will immensely help pharmaceutical companies optimize resources to capitalize on all such opportunities. We have created a comprehensive Software-as-a-Service (SaaS) solution for our clients to increase ROI on tender activities. Our aggregation capabilities, embedded inside the platform, allows our customers to create a comprehensive, analytical view of the public procurement space.
Customer and Market Analytics
The biggest challenge for the pharmaceutical industry is lack of decision making architecture and infrastructure leading to poor quality decisions, often based on untested assumptions. In many cases, this can lead to making no-decision at all.
This is troubling because the industry itself generates vast amounts of data (and data points) but somehow fails to comprehend them all. That often means the industry is data rich but information poor. The data to insights problem affects access to markets (placing a heavy burden on patients) in a critical way that creates very long time-to-market (TTM) for products – almost ten years on average.
We worked on the access dimension by first focusing on the internal data set (qualitative in nature) and breaking the wider problem into sections. We had access to data (mostly analytical commentary on a particular country issue or policy or a relevant market update) going back ten years (date and country categorized).Niteo, we have developed a comprehensive toolkit for our clients to simulate the effects of IRP across 65 countries.
We achieved the following with the data files we had across each country and date:
- Sort and score the data files on the basis of select keywords and select context statements (relevance parameter)
- Sentiment analysis of the policy documents – scoring policy documents by frequency as well as sentiment
- Rating the data files in terms of total power (frequency of keywords and context statements) across a policy dimension
- Undertake training for a set of files and then develop the algorithm (or program) so that it can analyze 50000 such data files
Intra-country Tiered Pricing in the Emerging Markets
There has been a lot of interest from the pharmaceutical industry, policymakers, academics, and economists in creating a tiered pricing framework that can gear medicine prices in different countries according to the population incomes.
The central rationale for such a structure is to increase access to medicines while still maintaining profits for pharmaceutical companies. We worked with our clients to fully understand this dynamic in emerging markets and the potential implications for implementing such a strategy on the ground.
We directly interviewed various stakeholders, including doctors, payers, policymakers, pharmacists, and industry experts. Our research highlighted that even though there is a great appetite for adopting such a framework, the challenges of implementation are enormous. We identified three main challenges for implementation:
1. Creating a legally valid tiered pricing structure which can be implemented across different healthcare service points in a country
2. Measuring the willingness to pay for any drug in the tiered pricing structure based on a set of parameters including family income, value of the drug in terms of increase in quality of patient’s life, the length of the recovery program etc.
3. Managing frauds and product leakage in a tiered pricing structure especially in the emerging markets