Criteria for Drug Pricing: Preliminary Experiences with Modeling the Price-Volume Relationship

In managing drug prices at the national level, price-volume agreements are a tool aimed at ensuring sustainability in cases where the drug price is high and the population is large. These agreements in fact determine a progressive price reduction as more and more patients are treated. Price decays in this context generally have a purely empirical nature, but a theoretical basis would be needed.
The present paper describes a simple model that manages price-volume agreements. Two real examples (ranibizumab for macular degeneration and sofosbuvir for hepatitis C) are analysed in detail. The objective of our analysis was to identify some objective criteria to rationally guide these agreements and to convert these criteria into explicit quantitative rules.