Revolutionizing Pharmaceutical Profitability: An 8% Boost with Analytics-Driven Pricing
Originally Published on: QuantzigAnalytics-Driven Pharmaceutical Pricing Strategy Helps a Company Enhance Profit Margins by 8%
Client: A leading global pharmaceutical giant, headquartered in the USA
Objective: Develop a robust analytics-driven pharmaceutical pricing strategy to excel in a competitive landscape and maximize revenue.
Impact of Quantzig’s Solution: Achieved an 8% increase in profit margins over three months, enhanced drug pricing transparency.
Pharmaceutical Pricing Landscape Overview
In the realm of pharmaceuticals, pricing strategy stands as a linchpin in the marketing mix, wielding substantial influence over customer purchasing decisions. However, stringent regulatory norms often restrict the experimentation of various pricing strategies, necessitating innovative models and analytics-driven approaches. This is especially crucial in navigating the ever-evolving global pharmaceutical market.
The Need for a Robust Pharmaceutical Pricing Strategy
The pharmaceutical industry, experiencing a wave of new pricing regulations and practices amid the pandemic, is witnessing a transformation in the buying and selling dynamics of medicines worldwide. Achieving a delicate balance between product prices, innovation costs, research and development (R&D), affordability, and accessibility becomes imperative.
In summary, pricing in the pharmaceutical sector is intricate, shaped by competition, regulatory environments, R&D costs, and healthcare system intricacies. Successful companies must navigate these complexities to establish pricing strategies that harmonize profitability with affordability and access to crucial medications.
Business Challenge
Rapid shifts in market trends and dynamic customer expectations, coupled with stringent global regulatory laws, posed significant challenges for the client’s pharmaceutical enterprise. In the face of disruptions on a global scale, the client sought an optimal pricing strategy for their upcoming product line. This led them to Quantzig, with a specific focus on leveraging a value-based pharmaceutical pricing strategy.
Solution Implemented
Quantzig's team of pricing analytics experts conducted comprehensive research to grasp factors like raw material prices, excipient costs, existing marketing mix, and other organizational considerations influencing the client's current pricing strategy. Identifying crucial factors missing from the client's list, the experts uncovered gaps and devised a roadmap to bridge them. This involved considering internal and external factors, along with data-driven forecasts, paving the way for a robust value-based pricing strategy in the US market.
The analysis also delved into the impact of various price points and the existing cost-based pricing strategy. The insights gained allowed the client to enhance their pricing approach, boost sales volumes, and excel in a fiercely competitive environment.
Business Outcome
Quantzig’s pricing analytics solutions delivered substantial outcomes for the pharmaceutical company:
Achieved an 8% increase in sales volume and profit margins over three months.
Enhanced drug pricing transparency.
Established an analytics-driven value-based pricing strategy with a global perspective.
Key Takeaways
This pricing analytics engagement provided invaluable insights:
Comprehensive understanding of pricing strategies adopted by pharma market leaders.
Strategies to enhance sales performance through pricing analytics.
Recognition of the role of pricing analytics in simulating scenarios for assessing the impact of price changes on profit margins.
Establishment of a consistent approach for monitoring effective price changes.
Appreciation of how a data-driven pricing strategy improves Marketing Return on Investment (MROI).
Why Choose Quantzig’s Pricing Analytics Solutions?
Quantzig stands as a premier full-service advanced analytics and business intelligence solution provider globally. Specializing in turning complex, unstructured data into actionable insights, Quantzig empowers clients to solve intricate business problems and foster innovation, change, and growth. With a track record of successful projects in business intelligence, AI, IoT, automation, and advanced analytics, Quantzig has consistently delivered customized pricing strategies that drive overall performance.
Having assisted over 120 clients across diverse industries such as Pharmaceutical and Life Sciences, Retail and CPG, Food and Beverage, and more, Quantzig has provided 1500 in-depth solutions in areas like Marketing Analytics, Customer Analytics, Supply Chain Analytics, and beyond.
Contact us.