The “New-to-Market-Block” – NTMB – yikes. No manufacturer, who has spent years developing its new drug, wants to hear that it has been blocked from the formulary of a PBM or health plan right out of the gate. But in the name of cost savings and a push for increased use of generics, among other things, many are doing just that.
Manufacturers launching products in today’s managed care environment need to expect that their product will likely be subject to such a block and prepare accordingly.
What does it mean?
Implementation of a new-to-market-block means just what the name suggests. At launch, a new product is blocked from formulary coverage and reimbursement. Processes for medical exception can be followed so that patients in need can gain access to your product, but those can be cumbersome. At a minimum, the processes will slow down product uptake as physicians and their office staff fight through the system. At worst, providers will prescribe an alternative product. Setting expectations internally that the trajectory for product utilization at launch and over the first 6-12-18 months post-launch may not be as steep as the organization would like to anticipate.
What can you do about it?
- Recognize the Reality
- As we’ve mentioned in a previous post, sometimes manufacturers may be so entrenched in the value of their product that they lose sight of the harsh reality of payer control
- In today’s managed markets environment with an emphasis on cost containment, generics first, and growing exclusion lists, it is important to recognize that a NTMB is likely to be placed on your product
- Plan for the Impact
- It is important to gather insights on how payers are currently viewing and managing the therapeutic category. Knowing what they are looking for, in terms of both a product value message and financial contracting considerations (e.g., discounts; rebates; price protection) can help you shape your approach to market access.
- Information will also allow you to set realistic expectations internally around product uptake and gross-to-net values
NTMB are tough to overcome. And even harder if you don’t have a plan and experienced account team in place prior to launch to manage the block. It takes an awareness of the nuances within a given payer, persistence from a dedicated account team, and a willingness to work with the system to breakthrough.
Viking Healthcare Solutions has established itself as the premier provider of corporate account services and strategic planning support for the pharmaceutical and biotech industries. VHS Insights, our research division, specializing in payer profiling, market research and analytics, can help you find answers to inform your payer strategy. We support traditional and rare/specialty organizations to create, maintain, defend, and protect access to your product throughout its lifecycle. Bank on our experience to help you achieve successful product commercialization. Contact us at http://www.vikinghcs.com/connect.