SOURCE: Cutting Edge Information

Cutting Edge Information

June 22, 2016 08:17 ET

80% of Surveyed Drug and Device Companies Outsource a Portion of Government Reimbursement Activities

RESEARCH TRIANGLE PARK, NC--(Marketwired - June 22, 2016) - According to a benchmarking study by Cutting Edge Information, 80% of surveyed life sciences companies allocate some portion of their budgets to outsourced activities. Further research found that outsourcing is a common practice for government reimbursement groups among surveyed pharmaceutical and medical device companies.

Life science companies navigating US government payers' complex guidelines for reimbursement have found their tasks increasingly intricate. New guidelines brought in under the Affordable Care Act have only added to this burden. Vendors often help build companies' reimbursement models as an outsource activity. None of the surveyed companies outsource more than a quarter of their budgets.

Cutting Edge Information's study, US Government Drug Reimbursement: Winning Key Formulary Positions and Managing Pricing Systems, found that modeling or CRM modeling were the two most frequently outsourced government reimbursement activities. On average, surveyed life sciences companies allocated 13% of their budgets to outsourced activities.

Some companies turn to third parties to help them maintain compliance with the Office of Inspector General (OIG) guidance. Many of the OIG guidelines refer to government pricing and other trade policies and procedures, which are often high priority areas for government agencies.

"Third-party vendors can be exceptionally valuable to companies that are uncertain of their compliance," said Jacob Presson, Senior Consultant, Data Products at Cutting Edge Information. "Companies benefit from having an outside set of eyes look at their government pricing procedures instead of risking trouble with the US Department of Justice."

US Government Drug Reimbursement: Winning Key Formulary Positions and Managing Pricing Systems is available at and provides a roadmap for better navigating government drug reimbursement amidst the growing influence of the Affordable Care Act. The report, derived from primary surveys and direct interviews, focuses exclusively on US government reimbursement strategies and trends, draws on quantitative and qualitative data from top-performing life science companies to provide actionable insights for winning and maintaining formulary position. Additional guidance outlined in the report includes:

  • Anticipating government payer needs and developing strong market access strategies
  • Managing payer relationships before and after product launches to maintain formulary position
  • Understanding compliant government reimbursement practices in the United States' new healthcare environment

To learn more about Cutting Edge Information and its market access research report offerings, please visit

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