What is price benchmarking?
Price benchmarking is the systematic comparison of a pharmaceutical product’s price against that of similar products within the same therapeutic area or indication, across different countries or healthcare systems. It is used to evaluate relative pricing, identify alignment with market norms, and assess competitiveness. Benchmarking may involve comparing list prices, net prices, or reimbursement levels, and often considers factors such as treatment duration, dosing, and value delivered.
Why is price benchmarking important in pharmaceutical pricing strategy?
Price benchmarking helps pharmaceutical companies develop informed pricing strategies, prepare for payer negotiations, and support international reference pricing compliance. It can reveal pricing gaps, justify value-based pricing approaches, and inform launch sequencing decisions. By understanding how a product’s price compares globally or within a market, companies can better align with payer expectations, mitigate risk, and optimize market access and revenue potential.
