Sophisticated pricing model tailors discounts to population groups
Customised approach to assigning discounts to patients based on ability to pay (known as mosaic segmentation).
To make medicine more affordable for specific population sub-groups in countries in scope of the Index.
Governments and insurance companies may not cover the full cost of treatment, yet people cannot afford out-of-pocket (non-reimbursed) expenses themselves.
In low- and middle-income countries, affordability remains a significant issue and barrier to people gaining access to medicine. Patients must often self-fund their healthcare from limited incomes, and many rely heavily on privately funded health services. Governments and insurance companies do not always cover the full cost of treatment, yet most people cannot afford out-of-pocket (non-reimbursed) expenses themselves.
How can companies improve price setting for countries in scope?
Pharmaceutical companies can help increase access to medicine for populations that could not otherwise afford them by using economic data and socioeconomic factors when setting prices. This information can be used to determine a variety of price points for different sub-groups that are intended to be affordable.
To address these issues, AstraZeneca is finding ways to accomodate people’s unique ability to pay. It is using differential pricing via a customised approach called Mosaic Segmentation.
What makes this a best practice?
One key element of this approach is to use economic data to compile a set of profiles for different segments of the population. This enables the programme to assign each patient, on registration, a discount level that is more likely to match their ability to pay.
Since February 2016, AstraZeneca has worked with Experian, the data provider, to develop and implement its model in Brazil, helping to increase affordability for 150,000 patients in need of medicines for hypertensive heart disease. This model is a sophisticated intra-country equitable pricing strategy that applies to an in-scope country, for at least one in-scope disease, identified by the Access to Medicine Index.
The initiative was recognised as innovative by the 2016 Index. Back then, the project was in an early phase, and few details were publicly available. Since then, the initiative has been included in AstraZeneca’s public Access to Healthcare report, with progress recorded. The Index recognises it as a highly refined intra-country equitable pricing model that now represents current best practice.