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Blog
Patients, Payers, Policy & Pressure: Trends to Watch in 2021
Luke Greenwalt, Vice President, IQVIA Market Access Center of Excellence
Jul 13, 2021

It has become increasingly difficult to forecast and achieve net sales goals. Pressures were building long before 2020, and the COVID-19 pandemic has only accelerated and amplified the challenges.

Net pricing has been below the Consumer Price Index (CPI) since 2015 — years before the pandemic. Manufacturer net discounts, a primary driver, continue to climb and now average 54% for traditional and 41% for specialty treatments. When added to the pricing picture, those discounts often push net prices below the rate of inflation or even negative in some instances.

Meanwhile, an estimated one billion anticipated diagnosis visits to healthcare providers simply did not happen last year due to the impact of the COVID-19 pandemic. That translates into an unexpected decline of 30% -- a gap that hit oncology, gastroenterology, dermatology, anesthesiology, and ophthalmology the hardest.

Other demand and margin factors are also at play. On the demand side of the equation, challenges include restrictive formulary designs, higher patient co-pays and deductibles, declining patient value, and an overall erosion in promotional effectiveness. When it comes to margin, challenges include contracting pressures and higher rebates, higher costs associated with offsetting patient co-pays, changing (and uncertain) public policy design, and leakage related to the 340B Drug Pricing Program.

Add it up and you have what IQVIA calls “The Big Squeeze.”

In the face of these pressures, brand teams are challenged to determine the right level and type of investment in market access, patient services, and elsewhere. Making the best possible decisions requires an understanding of multiple interrelated factors and the ability to tackle these questions:

  • How does pricing strategy impact gross sales?
  • When it comes to rebates, how much should you contract for? How do you run operations?
  • What can you do to mitigate the explosive growth of the 340B Drug Pricing Program?
  • How does patient co-pay impact demand and margin?
  • In the realm of Medicaid and Medicare, how might healthcare policy affect patient access, eligibility, and benefit design?

When old rules and assumptions no longer apply, there are no quick or easy answers to those critical questions. But in this blog series, we will take a closer look at some key trends that should help inform your answers as we continue making our way into the post-pandemic reality. My next post will highlight the role of increasing payer controls – including step edits and National Drug Code (NDC) blocks – and address how payer controls impact market sizing assumptions.

Battling the Big Squeeze

Globally and within the US, IQVIA is well positioned to help clients strategically identify how, where, why, and when challenges in demand and margin will impact business, operations, and strategic decision-making.

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