Why are some drug launches successful and some aren’t?
The launch of a new drug is a complex process. With so many factors playing into the final outcome, it may seem impossible to predict whether or not any given launch will be a success.
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Two Labs’ Gross to Net Solutions team partners with pharma manufacturers to determine accurate expenses and revenue so they can create operations and funding plans that meet their needs. Our analyses are grounded in experience – we have led over 200 relevant projects – which can significantly improve a launch plan if done at the beginning of the process.
A gross to net model is only as good as the assumptions and philosophy that drive it. Manufacturers need to be able to answer questions like:
How does gross to net differ by channel?
How can we influence gross to net?
Should we invest our dollars with payers? With patients?
What assumptions should we use?
With specialty products, what are the expenses we need to expect for launching?
What is the Market Access strategy?
The first step with developing an accurate gross to net model is making sure all expenses are accounted for. This can change based on the type of drug you are launching, but generally it’s:
Fair market value and appropriate assumptions
The current pharma climate
Channel / 3PL costs
Copay assistance
Patient assistant program costs
Specialty pharmacy costs
Market Access / Payer fees
Government pricing
In many cases, we have seen CFOs at emerging manufacturers rely on previous experience at a big pharma company. But costs are different when working at a smaller scale, and how gross to net was predicted in large pharma isn’t likely to translate very well into the emerging pharma market.
Creating your gross to net model isn’t a singular part of the process, but rather it needs to continually be evaluated and adjusted according to any decisions that are made as part of the launch. The result of a comprehensive gross to net process such as this is an accurate and efficient picture of finances which informs a unique and effective funding, operations, and sales plan.
At Two Labs, we’ve seen unprepared launches miss their gross to net target by more than 15%, which completely disrupts a business case for a new drug. Our experience with more than 200 relevant projects helps you plan for and respond to every evolving detail necessary to avoid making costly mistakes. Understanding the key elements early pre-launch is crucial to ensuring all expenses are being accounted for in the forecasting models.
Get in touch with our Commercial Finance team for a free consultation to talk about how to create a successful gross to net plan for your new pharma product.
We Lead Pharma Manufacturers Through the Commercial Strategy and Operations Journey
Leverage our strategic expertise to bring greater certainty to your gross to net forecasting.
The COVID-19 pandemic is unprecedented and unpredictable. Nevertheless, we are remaining flexible as we continue to support pharmaceutical manufacturers and their life-changing work.
The launch of a new drug is a complex process. With so many factors playing into the final outcome, it may seem impossible to predict whether or not any given launch will be a success.
Through every step of the commercial journey, Two Labs is your partner in driving success.
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Phone: (614) 389-4004
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Email: info@twolabs.com
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