What is market access?

What is market access?

Essentially, market access is synonymous with patient access: ensuring that patients have the right access to the right therapy at the right price and the right time. The role of a manufacturer’s market access team is to secure appropriate payer coverage for their products. The teams must also lay the groundwork for each drug’s pricing, contracting, reimbursement and fulfillment strategies.

The cornerstone of a manufacturer’s market access strategy is the process of defining and communicating a product’s clinical and economic value to payers, providers and patients, as each is involved in the decision to initiate therapy. Market access is a critical function of a drug’s development and go-to-market strategy, as it sets the stage for a successful product launch.

What is utilization management?

Utilization management refers to the process in which health insurance companies manage healthcare utilization and control costs. Utilization management often imposes barriers to access for patients.

If a payer has placed utilization restrictions on a medication, a pharmacy will be unable to dispense it at the point of sale unless those restrictions have been met. For example, a quantity limit restricts the amount of a particular medication that can be dispensed within a given time frame. This restriction is usually aligned with the directions on the drug’s label; a drug that is given twice daily might have a quantity limit of 60 tablets within 30 days.

Prior authorization (PA) restrictions are commonly used for expensive medications, drugs that have dangerous side effects, or drugs that a payer considers to be overused. To prescribe these drugs, the provider must first complete a PA request and receive advance approval from the payer.

While PA may be appropriate for certain drugs, this restriction can act as a powerful deterrent to providers. Despite recent legislation supporting electronic PA standardization, the PA process is still complex, time-consuming and highly manual. Providers are often unsure if they are including the right documentation with the request, which contributes to denials and unnecessary care delays. As a result, the presence of a PA restriction can lead providers to prescribe a different medication altogether.

Payers can also impose step therapy restrictions, sometimes called “fail first” requirements, to ensure that patients try a generic or less expensive drug before a more expensive one. If only one step is mandated, issuing a prescription for the higher-cost medication will not necessarily require PA. When a patient tries to fill the prescription, the pharmacy’s adjudication platform will automatically review past claims to determine if the patient has already tried the first-step therapy and is compliant with their plan’s coverage rules.

Why is a market access strategy important for pharmaceutical manufacturers?

Investing in a strong market access strategy—and the data necessary for market access analysis—is essential for commercialization and to overcome barriers to market access. There are so many ways that market access can go wrong, from poor product differentiation to unfavorable formulary placement to underestimating providers’ willingness to switch therapies. With a data-driven game plan, pharma companies can better anticipate and solve these challenges in advance. 

Here’s what manufacturers need to know ahead of and during product launch, and why it matters:

  • The coverage landscape: In 2019, 45% of commercial payers had policies that did not cover newly approved drugs at launch, according to MMIT research. To successfully launch a product into a crowded space, understanding how payers have covered competitor products is perhaps the most important element of success. Do payers already have a preferred drug on the market? What kind of restrictions (prior authorization, step therapies, etc.) are in place for these competitors? What are payers basing their coverage decisions on? What do the policies look like at large national plans and PBMs? When manufacturers gather this information at the outset, they can use it to build out more effective commercial strategies. For example, these insights can be used to identify payers that are likely to restrict access based on past behavior. Segmenting these payers will allow commercial teams to target them early—ideally 12 to 18 months before launch—and start having access discussions. As a result, sales reps will be able to focus their energy on these critical accounts instead of spinning their wheels in the field. Furthermore, tracking changes in the coverage landscape at launch—for your product and your competitors’ products—will enable sales teams to fine-tune their strategies as they go and pivot when needed to ensure optimal coverage.
  • Existing pricing and contracting: Learning about how competitor products are priced and the existing contracting activity within your therapeutic category is key for appropriately forecasting—and meeting—your launch goals. Manufacturers need to know whether their drug’s price is more or less than therapies already on the market, what kind of rebates and discounts are in place, whether there’s a specialty threshold, if pricing impacted the uptake of competitor brands, etc. Furthermore, understanding if and how payers are implementing utilization management techniques to manage access to similar brands is key for setting expectations at launch. Once armed with that info, manufacturers can use it to test various pricing and contracting scenarios in a simulated pharmacy and therapeutics (P&T) session, which can shed light on payers’ perception of value, how health plans might evaluate costs, and what level of rebating may be necessary. Moreover, manufacturers can look into options such as value-based contracting to determine if an alternative approach is needed to help influence coverage decision making.
  • Provider behavior: Knowing providers’ preferences within a therapeutic area and which factors lead them to write scripts for existing products is a valuable part of a well-thought-out launch strategy. Are they prescribing a competitor drug because of its efficacy data? Or because of a health plan’s coverage policy? Do physicians prefer surgical options within this therapeutic area? Do they have a preference for oral products vs. injections? The earlier that this information is uncovered, the better equipped manufacturers are to price, contract, and frame their messaging appropriately. This will lead to more productive pre-commercialization conversations with payers to educate them on the clinical benefits of a product and for manufacturers to understand how their product will likely be received. Similarly, insight into provider behavior can help manufacturers determine if certain strategies, like patient assistance programs, would influence physicians’ decision making and, therefore, lead to better coverage.

When should you develop a market access strategy?

For a successful launch, manufacturers need to start market access planning 12-18 months prior to FDA approval. Otherwise, companies risk launching their product without firmly establishing their coverage, distribution, or reimbursement strategies—which can lead to low uptake and suboptimal sales figures upon launch.

In recent years, the FDA has begun to reject drug applications if the pharma company hasn’t yet established a valid manufacturing and distribution strategy. If this occurs, resubmitting on the FDA’s timeline can cost a company millions of dollars in forecasted revenue.