Contact Us
Sign In / Sign Up for FREE
Go to advanced search...

External reference pricing in pharmaceutical industry - Essay Example

Comments (0) Cite this document
External Reference Pricing in Pharmaceutical Industry Introduction In the marketing practice, marketers largely focus on four key elements that include the product itself, the price of the product, the place, or the location where the product or service is made available for the customers and the promotional activities that are geared towards creating awareness of the product and informing the target audience about its unique attributes…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER91.5% of users find it useful
External reference pricing in pharmaceutical industry
Read TextPreview

Extract of sample "External reference pricing in pharmaceutical industry"

Download file to see previous pages 2013). Under competition, marketers tend to consider the price of other competing product/ service whilst setting the new price and this strategy is called external reference pricing. According to Trivedi (2002), the idea behind this pricing strategy is that the price should not be too high or low to the competing products/ services. In the pharmaceutical industry, external reference pricing, is commonly applied in order for the government to tame the prices of pharmaceutical products that are protected by intellectual property rights and even enable the pharmaceutical companies to benefit from a created monopoly arising from the patented drugs. This present study seeks to investigate the flaws of external reference pricing strategy in the pharmaceutical industry from the point of view of PainCeptor Pharma in Canada, and it will seek to provide a recommendation to the Canadian government on whether to continue using this strategy or not in the pricing of pharmaceutical products. ...
On the other hand, the Patented Medicine Prices Review Board (PMPRB) is an independent quasi-judicial body that was established by the Canadian parliament in 1987. Therefore, the board regulates the company’s pricing strategy and it recommends the prices for prescription and non-prescription drugs that are sold within the borders of Canada (Ruggeri and Nolte, 2013). One of the principles of pharmaceutical pricing in Canada by the PMPRB is that if a price is found to be excessive, the Board will call for a public hearing against the company and then order it to reduce its prices or offset some of the excess revenue earned (Ruggeri and Nolte, 2013). According to Ruggeri and Nolte (2013), the board applies external referencing pricing when a new drug is regarded as a major breakthrough, or there is a significant or moderate improvement on an already existing drug. In such scenarios, the board applies the median international price comparison test. This test considers the prices of other related patented drugs that have the same dosage and strengths that are being sold in seven specific countries that include the United States, the United Kingdom, Germany, Sweden, Italy, France, and Switzerland. The median price calculated from these seven countries determines the maximum average potential price that the board will stipulate for the new or improved drug that has been manufactured by PainCeptor Pharma. If the drug is only in use in less than five countries, the international median price is calculated on an interim basis but it will be subject to a review after three years putting into consideration changes that have occurred on the consumer price index ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
(“External reference pricing in pharmaceutical industry Essay”, n.d.)
External reference pricing in pharmaceutical industry Essay. Retrieved from
(External Reference Pricing in Pharmaceutical Industry Essay)
External Reference Pricing in Pharmaceutical Industry Essay.
“External Reference Pricing in Pharmaceutical Industry Essay”, n.d.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF External reference pricing in pharmaceutical industry

The Global Pharmaceutical Industry

Using PEST-L analysis to prepare for strategic plans in taking advantage of opportnities in the external environment and addressing eminent threats, one understands that the consumers of the pharmaceutical industry are patients who need the drugs and medications to address various health concerns. As the prices of medicines were highly dependent on the amount, level and extent of research and development, consumers have no control nor say on the strategies involving prices. As shown in the chart on one of the branded prescription drugs marketed in the U.S., when compared to other areas around the world, the chart would reveal that the price of Lipitor was highest in the U.S.. Buyer power, is therefore considered restricted and li...
3 Pages(750 words)Essay

The US Pharmaceutical Industry

... are rewarded with profit to be used for further innovations. Consumers are also protected from high prices that could be dictated by monopolistic or oligopolistic markets. The perfect competition would ensure that prices are dictated by supply and demand and not some scrupulous company. Finally, the government must also ensure that it retains its power to intervene or regulate in cases of unfair or abnormal market condition such as an erratic or abnormal pricing behaviors. References Agrawal, M. (1999). Global Competitiveness in the Pharmaceutical Industry: The Effect of National Regulatory, Economic, and Market Factors. London: Routledge. Alexander, D., McLennan, N. and Cappuccilli, E. (1991). Global Competitiveness of U.S. Advanced...
3 Pages(750 words)Essay

Pharmaceutical industry: pain relievers

The part also compares the performance of US firms with competitors. Demand, consumers and government regulations – This part analyzes the demand of the pharmaceutical products in US and the number of consumers. The section also indicates major government initiatives to regulate the US pharmaceutical industry. Conclusion – This section concludes the entire paper by indicating major areas covered. Additionally, the part gives an opinion on the way forward to curb entry of illegal and cheap drugs in the US market. Introduction As the global economy recovers from the recent economic downturn, stiff competition has been experienced in various industries as the firms compete for the available resources. In the same way, companies have...
4 Pages(1000 words)Research Paper

The Global Pharmaceutical Industry

...The Global Pharmaceutical Industry Introduction The global pharmaceutical industry is characterized by lengthy and risky research and development process, powerful purchase pressures, stringent government regulations and high competition for rational property. The global pharmaceutical industry has significantly contributed to the human civilization for the welfare of mankind. The study will describe how internal and external environment forces have affected the industry (Maclennan, 2004, p.11). In order to determine the issues, PESTEL Analysis and Porter’s Five Force Analysis have been implemented in the study. Finally, a strategic SWOT analysis has been implemented in the study. This strategic framework will help to conclude the study...
6 Pages(1500 words)Case Study

Global pharmaceutical industry

... Alpharma Inc. is one of the giants in the global pharmaceutical industry. The company provides health safety medication and life saving drugs to the people around the world. The company does not only develop the pharmaceutical products, but also manufactures them and market them to make them available in most parts of the world. Due to the every increasing cost and expenses that adversely affected the company's profit margin, even though the company was having substantial increase in turnover and revenues, the management decided to launch a workforce reduction program in the year 2003. As mentioned in the company's annual report (2003, p21), "In the fourth quarter of 2003, the Company reviewed its overall business cost structure...
10 Pages(2500 words)Essay

Pharmaceutical Industry

Phase trials are primarily concerned with assessing the drug's safety and tolerability and are the first step in testing new investigational medicines in humans. The patients in these trials usually number 20-100 and the trials may last several months (ABPI 2006). However, prior to testing the drug in humans for the first time the following requirements have to be met: The study drug must have undergone preclinical research in the laboratories needs to be undertaken to determine which compounds will result in a chemical effect on the disease, and the drug compound will have to have been placed in a living biological system to check for safety in human disease, which involves testing the compound in at least two animals. This is...
2 Pages(500 words)Essay

The pharmaceutical industry

...The Pharmaceutical Industry: 2. After 2002, the profitability of the industry, measured by ROIC, started to decline. Why do you think this occurred? There are several reasons for the decline in profits for pharmaceutical companies after 2002. The foremost among them is the aggressive competition for market-share seen in the generic drug sector. It is well-known that once pharmaceuticals lose patent protection over their proprietary drugs the prices tend to fall drastically – as much as 80%. With companies losing patents over blockbuster drugs without adding new drugs to their repertoire, the profits are bound to fall. Then there is the negative publicity attracted by the adverse side-effects of drugs such as Vioxx and Bextra...
2 Pages(500 words)Essay

Pharmaceutical Industry Critisizm

... that the pharmaceutical industry in the near future changes its mentality to become a better allied for the industry. The prices of prescription drugs must come down in order to lower the high inflation that exists in the health care industry. References Murphy, T. (2009). Critics say Pfizer fine won’t cure problems. Retrieved August 6, 2011 from Plunkett Research (2011). Biotech Industry Overview. Retrieved August 6, 2011 from Plunkett Research database....
2 Pages(500 words)Research Paper

Pharmaceutical Industry

... system results in the hospital losing money when it tries to increase care to patients. Medicare is a healthcare insurer that is used in many hospitals. It provides reimbursement on a fixed basis per treated individual, for treatments that have already been provided. Medicare acts as an insurer for a large pool of clients to ensure that any losses through having to pay for medical care are balanced by the premiums charged to the remaining clients. A consequence of the way Medicare allocates its reimbursement is that it promotes a lower standard of patient care, with allocation being the same despite the length of time stayed, and no differences in allocation based on quality. References Bodenheimer, T., Wagner, E. H., & Grumbach, K...
2 Pages(500 words)Research Paper

Counterfeit Pharmaceutical Drug Industry

In the recent years, both the appearance of incurable diseases and the popularity of fake medication complicate global counterfeit regulation. In particular, the core sense of this activity in the current economic framework of developed North and developing South, which was a crucial and is still not solved problem. In other words, pharmaceutical drug regulation is incorporated in global economy. In this context, huge profits of pharmaceutical companies cause the situation when business structures resist to any strict regulatory practices. In fact, it is reasonable because regulation has always been strong enough to block innovative potential for business by its strict ruling nature (Brooker and Cullum, 2008, p. 5). Consequently,...
13 Pages(3250 words)Essay

Management of the UK Music Industry

Online market demand is dominated by teenagers who have shifted their purchases from singles CDs to mostly illegal downloads of singles tracks, stimulated by continually evolving software and P2P networks. In order to survive, market players have to reconsider their strategies and value propositions – by mergers of music labels; flexible pricing and value-added offers by online distributors and active ethical campaigns, the challenge before these companies is to convert the internet medium from a threat to copyrighted material into an effective distribution channel.
Rivalry among competing sellers in the industry – rivalry among legal internet music sites is not too intensive, because the legal online download ind...
15 Pages(3750 words)Case Study

A Short History of Japanese Film Industry

The response generated from other regions is good enough yet questionable. What do these Asian productions have that attracted the international scene? What does the Korean wave really mean? Furthermore, were their productions in the recent years created in the nature that the other regions would appreciate, diverting from the contemporary film style they used to execute locally so that it would sell in the global market?

The transition from traditional to contemporary entertainment in Japan came a few years before the advent of the 20th century with the production of the first Japanese films, Bake Jizo1 and Shinin No Sosei2, both said produced in 1898. The next year, a short production entitled Geisha no Teodora was cr...
9 Pages(2250 words)Case Study

The Growth of the Service Industry

The expansion of the service sector has unquestionably generated economic prosperity, but it has eminently contributed to social injustice and inequality. Consequently, I believe that while the growth of the service industry has great economic intuition, it is eventually socially detrimental and distancing society from achieving paradigms of social equilibrium.
Service, by definition, is the exchange of a commodity that has no tangible form; whereas industry is described as the people or organizations engaged in a particular type of enterprise. The service industry is then simply defined as an aggregation of commercial entities that provide services rather than physical objects. The non-material nature of services can be dist...
9 Pages(2250 words)Case Study

Internal and External Environmental Analysis for the Bakery Business

Liberalization of foreign investment and technology policy of the government is supportive of establishing industrial units in the country.

Threat: The UK food regulatory authority is planning to enforce the EC Regulations relating to food labeling. The labeling requirements under the new regulations will affect the food industry as the suppliers will be legally obliged to disclose the GM content of foods to the caterers. Thus business firms in the bakery industry also will be effected through the exclusion of flexible manner of labeling arrangements in the case of flour confectionery involving GM Soya or maize. (Genetically modified and novel foods (labeling) (England) regulations, 2000).

Trend: The new subs...
6 Pages(1500 words)Case Study

Is the Meat Industry in Kenya Productive and Rewarding

The following report gives insight to the industry and the environment surrounding it.

The major meat processing and marketing firm in Kenya – Kenya Meat Commission - was incorporated as a public institution for the sake of engaging professionalism in management and meeting the hefty financial demands the corporation has. This has enabled an excellent running of the corporation and the production of quality meat both for local consumption and for export.

The infrastructural improvement in the transport sector in Kenya has enabled speedy delivery of meat to the market while the meat is still fresh. At the same time, cold rooms have been utilized as a means of storage for meat. These facilities check on t...
6 Pages(1500 words)Report

The Effects of Financial Crisis on Supplier Selection Criteria of the Oil and Gas Industry Equipment Market

It is a difficult task to find those vendors who not only have the adequate quality and quantity of the needed raw materials but who also have an attitude of efficiency and display commitment to customer service (Sonmat, 2006). Further, organizations also strive to locate and select vendors who can be depended upon for long term relationship.

The number of factors or attributes desired from the vendor is vast, and different organizations and different industries place different importance on the attributes (Sonmat, 2006). Some of the vendor attributes may gain importance owing to the nature of the industry, for example, in the case of consumer perishables suppliers, like fresh vegetables or fruits, the buying firm would...
20 Pages(5000 words)Literature review

Structure of the Educational System in Morocco and Its Capacity for Addressing the Needs of the Hospitality Industry

...Independent Research Study An investigation into the Structure of the Educational System in Morocco and its Capa for Addressing the Needs and Expectations of the Hospitality Industry in the Country Submitted by : Submitted to : Course : Date : September 29, 2009 Word Count : 3,069 words STATEMENT OF AUTHORSHIP “I confirm that no part of this work, except where clearly quoted and referenced, has been copied from material belonging to any person e.g. from a book, handout, another student. I am aware that it is a breach of GIHE regulations to copy the work of another without clear acknowledgement and that attempting to do so render me liable to disciplinary procedures.” ________________ Table of Contents I. Consultant’s Brief 4...
15 Pages(3750 words)Research Proposal

Capital Asset Pricing Model and Recent Developments

It is the most essential aspect of any venture. The important considerations that finance has within it, is that of profit and loss. The business as a whole or a person as an individual always strives to earn a profit. To earn a profit, one has to undertake uncertainties that are known as risks. Therefore, profit is also known as the reward for incurring risks.
In the present world of today, the capital market has come up as a viable investment opportunity for individuals all across the globe. People invest their hard money only with the expectation to earn profit or return. The stocks of various companies that are traded in the capital market are also known as capital assets. Prior to investing in any of the stock or capital...
7 Pages(1750 words)Assignment

Management Theory and Practice in the Early Childhood Education Industry

As pointed out in a study by Osgood and Halsall (2007) where they carried out research to examine the position of women in leadership or management positions, a “glass ceiling” exists for women in the academic setting, which could significantly impair motivation. Since many of the individuals employed in the early education sector are women, addressing this issue is even more important because these individuals are faced with the difficult task of shaping young minds while also dealing with the problems associated with the actual physical care of very young children. The quality of professionals in this sector is vital because it impacts the growth and development of the children that they care for. The degree of invol...
6 Pages(1500 words)Coursework

The Key Macro Factors that Have Influenced the UK Grocery Retailing Industry since the Early 1960s

...1. Assess the key macro factors that have influenced the UK grocery retailing industry since the early 1960s. The concept of organisational change is inherently intertwined with external threats and opportunities, which businesses must adapt to as part of strategic planning to continue long term growth. Senior and Fleming argue that the concept of organisational change has many faces, namely “convergent changes and transformational change that is organisation wide and characterised by radical shifts in strategy, mission values and associated changes of structures and systems” (In Thompson & Martin, 2005, p.41). Moreover, Johnson et al highlight that external macro-economic factors intrinsically impact strategy management and without...
13 Pages(3250 words)Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic External reference pricing in pharmaceutical industry for FREE!

Contact Us