After pharmaceutical and medical technology companies have invested years in research and development, conducted countless studies and overcome bureaucratic hurdles, another decisive step follows: pricing and reimbursement. This is where the price and potential reimbursement by insurance companies or government healthcare systems is determined. The process ensures that the prices are set in the best interests of the payers and the healthcare system.
Pricing and reimbursement are two key aspects of healthcare, especially in the pharmaceutical industry. However, pricing and reimbursement also play an important role in medical technology, biotechnology and animal health in order to appropriately price and reimburse products and therapies in a way that ensures not only economic success but also access to healthcare solutions for all.
- Pricing: Setting prices for medical products such as pharmaceuticals, taking into account the costs of research, development, manufacturing as well as market factors and reasonable profit.
- Reimbursement: Reimbursement of these costs by insurance companies or government healthcare systems. This plays a crucial role in ensuring that patients have access to medical care. If a medical product is not reimbursed, this restricts patients’ access, as they may have to bear the full costs themselves.
Pricing Processes and Tasks
Pricing and Reimbursement professionals, for example, Manager Strategic Pricing & Reimbursement, perform a wide range of tasks, but these may vary by job type and company. Main tasks are usually:
- Managing pricing processes: Pricing & Reimbursement professionals are generally responsible for managing pricing processes. They continuously review and evaluate pricing change processes and perform reassessments to ensure prices are appropriate.
- Price Negotiations: They also prepare for and actively support price negotiations in accordance with Section 130b of the German Social Code (SGB V) with the Central Association of Statutory Health and Long-Term Care Insurance Funds (GKV-SV). This also includes conducting AMNOG price negotiations in various roles.
- Preparation of price planning: As part of financial planning, specialists in Pricing & Reimbursement work closely with other teams, e.g. from Finance, Key Account Management and Market Access, to prepare comprehensive price planning.
- Analysis and strategy development: Pricing & Reimbursement professionals continuously analyze the market and identify pricing and negotiation strategies for the product portfolio.
Price Negotiations according to § 130b SGB V
In the German healthcare system, price negotiations for new drugs are governed by §130b SGB V. When a new drug comes onto the market, its additional benefit compared to existing therapy options is first evaluated (AMNOG procedure). Based on this, the GKV-Spitzenverband and the pharmaceutical company negotiate a reimbursement amount.
The AMNOG Procedure
The German Drug Market Reform Act (Arzneimittelmarktneuordnungsgesetz – AMNOG), which came into force in January 2011, retains the principle of free pricing at market launch, but requires a systematic assessment of the “additional therapeutic benefit” of the new drug in order to negotiate the price within the first 12 months after market launch. This assessment is carried out by the Federal Joint Committee (G-BA).
Expertise in Pricing & Reimbursement
In order to be successful in the field of pricing and reimbursement, professionals must possess a wide range of skills:
- Education and/or studies: companies often require a degree in economics, public health, health economics or a similar field.
- Professional experience: Experience in conducting price negotiations according to § 130b SGB V with the GKV-SV is crucial for taking on senior positions in Pricing & Reimbursement.
- Legal knowledge: Sound knowledge of social legislation, in particular SGB V, is essential. This forms the basis for price negotiations and reimbursement.
- Knowledge of health economics: An understanding of the fundamentals of health economics is an advantage in order to be able to evaluate pricing strategies accordingly.
- Analytical skills and computer literacy: Pricing & Reimbursement professionals must be able to analyze complex data and therefore have strong analytical skills, a good understanding of numbers and mathematics, and computer literacy.
- Soft skills: In addition, highly qualified specialists in the area of pricing & reimbursement have soft skills such as communication skills, goal orientation, strategic and conceptual thinking, independent action and a hands-on mentality as well as intercultural skills.
Pricing & Reimbursement professionals for pharmaceuticals and medical devices are often hard to find because the field is very specialized and requires a deep understanding of regulatory requirements and health economics.
Are you looking for personnel in the area of Pricing & Reimbursement or do you want to develop professionally in this direction? Feel free to contact us – we will find the perfect match for you in your specific area!
