From Cost to Value: How to embed Value-Based Pricing into Launch Strategy

In today’s healthcare environment, traditional drug pricing models are under growing pressure. Governments, payers, patients, and even society at large are questioning whether prices truly reflect the therapeutic value delivered. In this context, Value-Based Pricing (VBP) is no longer a buzzword it’s becoming a mandate.

At the heart of VBP are Value-Based Models (VBMs) structured frameworks that integrate clinical, economic, and real-world evidence to determine a price that reflects true value. This case study explores how a large pharmaceutical company operationalized VBMs to support pricing across oncology launches, ensuring alignment with stakeholders and leadership at the highest level.

The Challenge

The company recognized that every future launch would need a robust VBMto meet payer and policy expectations. But building them wasn’t straightforward:

• Timing pressure: VBMs had to be ready months before launch, developed in parallel with clinical trials.

• Complex data needs: Models required not just trial data, but also real-time epidemiology, healthcare resource utilization (HRU), and competitor intelligence

• High stakes: Pricing recommendations had to stand up to scrutiny — not only from payers, but also from the company’s CEO and executive leadership team.

In short: VBMs weren’t optional , they were mission-critical for launch readiness.

The Approach

To deliver, the company designed a structured, cross-functional process:

1. Model development strategies were created to generate multiple VBMs, each capable of identifying key price drivers across oncology assets.

2. Collaborative alignment with Market Access leadership ensured that model recommendations were integrated directly into pricing strategies.

3. Executive engagement culminated in joint presentations of pricing recommendations to the CEO and executive leadership team, positioning VBMs as a central input to decision-making.
   
   The Impact

   The results underscored the power of VBMs when executed well:

• Strategic influence: VBM outputs directly shaped value-based price setting across solid and hematologic malignancy launches.

• Stronger payer alignment: By anticipating the data requirements of HTA bodies and payers, the company reduced risks of pricing pushback.

• Cross-functional credibility: Pricing decisions were informed by transparent, evidence-driven models, earning confidence from both internal leadership and external stakeholders.

• Future readiness: The approach established a repeatable VBP framework, ensuring consistency and rigor across future launches.
  
  Why This Matters
  For pharmaceuticals, the move from cost-based to value-based pricing is not optional, it’s the new operating reality. This case illustrates how to make that shift tangible:Start early, building VBMs in parallel with clinical development.Go beyond trial data, integrating epidemiology, HRU, and competitor intelligence.Ensure VBMs are not siloed — they must feed directly into executive decision-making and payer negotiations.By embedding VBMs into its launch playbook, this company not only navigated payer scrutiny but also set a benchmark for how value-driven pricing can drive sustainable access in oncology and beyond.