CASE STUDY

How Price Gap Analysis Improved Pricing Strategies For A Major Pharma Manufacturing Client?

Aug 23, 2022

Highlights of the Case Study: 

Particulars Description 
Client A US-based generic drug manufacturer was struggling with the high-price competition due to the entry of new generic drug makers 
Business Challenge The client wanted to leverage a competitive analytics solution to track and monitor the pricing strategies of its competitors across regions and in all drug categories.  
Impact Quantzig’s price gap analysis software empowered the client with information on competitor prices in each drug type and category, along with stock availability data. This enabled the client to make optimum business decisions quickly.  

Game-Changing Solutions for the Pharmaceutical Industry 

Rising consumer awareness about price comparison tools that recommend lower-cost alternatives with similar active pharmaceutical ingredients (APIs) is a severe threat to the price-sensitive generic pharma manufacturing industry. As a result, manufacturers are facing price-based competition amid rising manufacturing costs.   

Competitive analysis is an essential tool that aids businesses in understanding the current market scenario and foreseeing the competition ahead based on existing players and new market entrants. Quantzig’s pricing analytics and competitive benchmarking makes it easy for players to understand the growth prospects of a global market and at the level of a specific region or country. Quantzig’s competitor analytics solutions analyze and interpret the strategies adopted by competitors across the world, including pricing strategy, R&D, and target identification, to help the pharma industry with product pricing and positioning strategies.  

The Challenge for our client 

Our client, a US-based generic drug manufacturer, was struggling with high price competition due to the entry of new generic drug makers. The client had lost a chain of wholesalers to a new entrant that had priced its drugs at a comparatively lower price. The client wanted to leverage a competitive analytics solution to track and monitor competitors’ pricing strategies.  

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Quantzig’s Competitor Analytics Solutions 

Quantzig’s data-driven competitor analytics model extracted and integrated data from across 200+ generic drug manufacturers. This data was then used to create competitive price tracking and monitoring software. This software cataloged all of the client’s products and those of the competitor. It also recorded the price of each product segment as per their respective API. The system also tracked the price changes in the market, discovered previous pricing patterns, listed the brands offering similar drugs, and created an email alert every time a competitor came up with a similar drug at a lower price. The software also kept track of the original manufacturer’s patents’ expiration date.  

Quantzig thus helped automate the clients’ competitive capabilities with our data-driven pricing analytics model and created a dashboard that will provide real-time insights into rivals’ pricing strategies.  

Impact Analysis of Quantzig’s Price Gap Analysis Solutions 

Quantzig’s price gap analysis software enabled the client visibility of competitor prices for each drug type and category. Our competitive price tracking and monitoring software also uncovered the stock availability data in the competitor’s manufacturing units, which helped the client to leverage this information advantageously. Quantzig’s pricing analytics solutions helped to unlock the following benefits:    

  • The client gained real-time insights into the drug prices of other generic drug makers  
  • It could monitor the availability of drugs in the competitor stores   
  • It could access historical pricing data  
  • The client could conduct in-depth tracking of all the competitors across all the regions in a single and unified way  
  • The client could successfully benchmark 50 competitors per week and make multiple pricing decisions based on drug sales with 100% accuracy   

Key Outcomes of Price Gap Analysis: 

The overall result of Quantzig’s price gap analysis and competitive benchmarking solutions enabled the client to keep pace with the rapidly changing market conditions. Visibility into the competitor’s inventory and pricing structure across regions enabled the client to implement innovative pricing for its products based on demand, competitor price, and product availability.   

The implementation of these solutions helped the client to make data-backed pricing decisions, which ensured a return on investment while at the same time keeping it ahead of the competition. 

Broad Perspective on Competitive Benchmarking in the Pharmaceuticals Business 

Competitive benchmarking plays an essential role in the pharma and life sciences industry. As the industry is transforming, pharma manufacturers are shifting their focus toward leveraging competitive benchmarking and gathering information on competitors’ strategies to improve their offerings and implement an effective pricing strategy. Competitive benchmarks help determine the consumer willingness to pay for the products and monitor the prices of industry rivals. The layered and interconnected nature of the value chain in the pharmaceutical industry requires a deep understanding of the rapidly changing market to capitalize on opportunities.   

Key Takeaways 

  • Reduce potential loss in revenue from losing business to competitors 
  • Implement price gap analysis to arrive at a competitive price for products  
  • Visibility of competitors’ inventory to make informed pricing decisions  
  • Evaluate country-specific demand and supply to make pricing decisions  
  • Competitive benchmarking to arrive at consumer affordability and willingness to pay 

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