What is price potential?
Price potential is the forecasted price range that a pharmaceutical product may be able to command in the market, considering its clinical profile, therapeutic benefit, degree of innovation, and differentiation from existing treatments. It reflects what payers may be willing to reimburse, based on health outcomes, cost offsets, unmet need, and the value perceived by healthcare systems. Assessments of price potential typically include comparative pricing analysis, health economic modeling, and early payer research.
Why is price potential important in pharmaceutical planning?
Understanding price potential is essential for shaping clinical development, market access strategy, and revenue forecasting. It helps companies identify the evidence needed to support premium pricing, anticipate payer objections, and make informed go/no-go decisions for pipeline assets. Accurately estimating price potential also enables better portfolio prioritization, launch sequencing, and alignment of internal expectations across R&D, commercial, and market access functions.