Access to Healthcare
Medicine pricing
We price our medicines based on a number of factors, including the value of scientific innovation for patients and society in the context of overall healthcare spend; economic factors impacting the healthcare systems’ capacity to provide appropriate, rapid and sustainable access to patients; and the necessity to sustain our R&D investment in innovative, high-quality medicines that address the unmet medical needs of patients with serious disease and improve their lives. There are several factors that go into determining the Bristol Myers Squibb pricing strategy for new medicines, including:
- Level of clinical benefit vs. the current standard of care, including current and anticipated clinical data.
- The eligible patient population and expected future patient populations.
- A holistic view of how the new medicine impacts cost to the healthcare system.
- Impact to payer drug budgets.
- How payers and HTA systems are expected to evaluate the medicine at the time of reimbursement.
Our pricing effort begins during R&D in three different ways.
- For externally acquired assets, our Worldwide Pricing team gets involved during the diligence phase of the Business Development process.
- For internal products with potential significant foreign reference pricing implications, Worldwide Pricing gets involved in the Commercialization and Development process starting with the Phase II study design.
- For all other internal assets, Worldwide Pricing gets involved in the Phase III clinical trial design phase of the Commercialization and Development process.
- For new drug pricing, the final approval for our pricing and contracting strategy lies with the Board Chair and CEO. The Vice President and Head of Worldwide Pricing is responsible for working with cross-functional team members to perform the necessary payer, demand and market access research, as well as conducting preliminary value and HTA assessments, and developing a formal pricing recommendation. This is then reviewed and approved by the Worldwide and U.S. Heads of Value, Access and Pricing, and the Executive Vice President, Chief Commercialization Officer, before going to the Board Chair and CEO for review and approval.
- For in-line pricing decisions, the Vice President and Head of Worldwide Pricing is responsible for the development of formal grants of authority (GOA) for each product and geography. These annual GOAs are then approved by the Board Chair and CEO and are administered and overseen by the Head of Worldwide Pricing through a cross-functional exception committee process.
Every pricing decision is taken with consideration to multiple inputs and outcomes including:
- Value to the patient and healthcare system.
- Improvements in clinical efficacy, safety and patient reported outcomes vs. standard of care.
- Likely HTA assessments based on available clinical data.
- Income and affordability of individual countries.
- Cost-effectiveness results (where relevant).
- Eligible patient population.
- Evolution of eligible patient population.
- Current clinical evidence and anticipated ultimate clinical profile.
- Co-administered medicines/therapies.
- Existing and expected improvements in formulation and administration.
The development of each product’s access strategy and programs is overseen by the Executive Vice President and Chief Commercialization Officer and the Worldwide Value and Access Marketing team in close collaboration with a matrix of functions, with our Board Chair and CEO responsible for the final decision.
There are several criteria that go into determining product-specific access decisions and strategies including:
- Degree of unmet need.
- Current standard of care.
- Existence of biomarkers.
- Target indication.
- Size of the patient population.
Along the process, input is also collected from Global Policy and Government Affairs, Global Product Development and Supply, and Global Advocacy. Numerous decisions are made along the way, including:
- The need for an early-stage access program.
- Whether there are modifications to the study design that can improve the recognition of value on the part of payers.
- Identification of subpopulations for further analysis.
- Need for additional data or modeling to support robust submissions at the country level.
- How to best identify and participate in the regulatory review processes.
We take a thoughtful approach to pricing our medicines and support policies that help advance access. We are actively engaged in the global dialogue surrounding the affordability of our life-saving medicines for patients. We are committed to working collaboratively with many stakeholders, including payers, physicians, advocates, patients and civil societies around the world, to enhance patient access.
We disclose the average net selling price increase for our U.S. products in our annual reports on Form 10-K and our quarterly reports on Form 10-Q. Our average net selling price increases for 2016, 2017, 2018 and 2019 for our legacy BMS products was approximately 5%, 2%, 0% and 0%, respectively, and for 2020 was approximately 1% for our combined company products (including Celgene). We believe we have the appropriate governance mechanisms and internal controls and processes in place to ensure that pricing decisions are made in line with our values and commitment.
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Our position on pricing
