How to do external reference pricing

Many European countries use external reference pricing (ERP) to help set their drug prices. External reference pricing caps the prices of drugs at some average or weighted average of the drug price in other countries. The comparison countries typically are either in close proximity or of similar GDP/capita level. The advantage of reference pricing is…

What is Reference Pricing?

To reduce utilization of pharmaceutical products, many countries have opted to use reference pricing. Reference pricing is a system where patient coinsurance payments depend not only on the price of the drug but also the price of alternatives therapies.  As the name indicates, reference pricing sets patient coinsurance rates as the difference between the drug’s…

Reference Pricing

What percentage of your prescription drug costs should your insurance company cover?  You may say “100%, of course!”  However, if health insurance cover all pharmaceutical costs this will drive up premiums.   One solution to this problem is reference pricing.  If generics are available for $10 and name brand drugs are available for $100, the…