Gross to Net Benchmarking Survey-Initial Trends: Technology

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In the life sciences industry, gross to net (GTN) is the management process at the heart of the pricing and contracting lifecycle. Within this process, manufacturers forecast demand and accrue for rebates, chargebacks, and any other adjustments to the price charged for a product’s sale.

HighPoint is currently conducting a Gross to Net Benchmarking Survey with the goal of gaining insight into current process trends for life sciences manufacturers. Preliminary results have yielded some useful insights, which we are sharing in an ongoing series of blogs. Previously, we reviewed the initial trends for forecasting accuracy. In this installment, we take a look at technology use.

Respondent demographics

The following trends are based on a sample of 15 small, medium, and large life sciences manufacturers and reported annual revenues. As the sample size builds up, we expect the statistical significance of the results to increase; however, the initial data can provide some directional trend information for decision makers.

Benchmarking survey questions regarding technology

  1. Which technology does your organization primarily use to produce its Gross to Net forecasts?
  2. If you primarily use spreadsheets, manual processes, or custom solutions for Gross to Net forecasting, on a scale of 1 to 5 (with “1” being “extremely satisfied”), how satisfied are you with your current solution?
  3. Please rank your concerns related to the current Gross to Net forecasting process.
  4. Will your organization consider an alternate solution to transform the current Gross to Net forecasting process?
  5. In your opinion, which of the following would give your organization the most benefit in improving the Gross to Net forecasting process?

Initial trends in technology use

  1. Which technology does your organization primarily use to produce its Gross to Net forecasts?
    • Overall, the majority of respondents reported using spreadsheet/manual processes:
      • 78 percent of all respondents
        • 100 percent of small organizations
        • 67 percent of large organizations
      • The remaining 22 percent of all respondents reported using a custom Gross to Net forecasting tool.

 MT GTN 1-1

  1. If you primarily use spreadsheets, manual processes, or custom solutions for Gross to Net forecasting, on a scale of 1 to 5 (with “1” being “extremely satisfied”), how satisfied are you with your current solution?
    • Small organizations report being more satisfied with their current GTN forecasting methods than large organizations:
      • Small organizations: Average satisfaction of 2.5
      • Large organizations: Average satisfaction of 4

 MT GTN 2-1

  1. Please rank your concerns related to the current Gross to Net forecasting process?
    • Top 3 Concerns for GTN Forecasting Process: Organizational Risk, Accuracy, and Efficiency for both large and small organizations:

 MT GTN 3-1

MT GTN 4-1

  1. Will your organization consider an alternate solution to transform the current Gross to Net forecasting process?
    • Most respondents from large and small organizations reported that they plan to change if sufficient business value can be demonstrated:
      • Small organizations:
        • 50 percent plan to change if sufficient business value can be demonstrated.
        • Of the remaining 50 percent, 16.67 percent each say they do not know, do not have plans to change, or plan to change in the next one to three years.
      • Large organizations:
        • 67 percent plan to change if sufficient business value can be demonstrated.
        • 33 percent have no plans to change.

 MT GTN 5-1

 

  1. In your opinion, which of the following would give your organization the most benefit in improving the Gross to Net forecasting process?
    • Improved quality of input data would be the greatest benefit

 MT GTN 6-1

MT GTN 7-1

Preliminary conclusion

Initial benchmarking results are very consistent with informal observations across the industry:

  • More than three-quarters of respondents, representing both large and small organizations, still use spreadsheets and manual processes, even though their stated satisfaction is at or below average.
  • Most respondents agree that shifting away from manual processes will alleviate concerns by reducing risk and increasing accuracy, efficiency, and transparency.
  • More than half of respondents will consider an alternate solution to transform the current Gross to Net forecasting process if sufficient business value can be demonstrated.
  • The greatest benefit to improving Gross to Net processes among small and large organizations is an improved quality of input data.

For more insights and trends on the current industry landscape, please stay tuned for this continuing series of blogs about HighPoint’s Gross to Net Benchmarking Survey.

Tags: Life Sciences, pricing and contracting, gross to net, gtn

   

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