Medtech Optimizes Pricing of New Product Launch To Achieve Company Goals

A leading medtech engaged L.E.K. to determine the right launch price for two new products in clinical development in both the U.S. and Asia Pacific, to optimize individual product profitability in tandem with pull-through of its broader portfolio.  

Prior to launch, the client wanted to understand customers’ willingness to pay based on value-proposition resonance, reimbursement context and forecast revenue, as well as likely impact on profitability of its overall business.  

Approach

L.E.K. performed a range of analytical tasks to support the client’s goal:  

• Assessed the market context for the procedures that the client’s products would serve, including procedure reimbursement, current standard of care, clinical outcomes and target product profile (TPP) feedback  
• Designed and fielded a quantitative survey powering Van Westendorp and Gabor-Granger pricing analysis and reimbursement substantiation  
• Estimated the costs displaced and incremental value created by the client’s products across key related procedures for payers and hospitals based on the economics of current standard of care  
• Developed financial projections to estimate overall revenue and profitability impact over time of the individual product business units and their impact on pull-through of the client’s broader portfolio

Results of L.E.K.’s work

• Our strategy recommendations helped the client set the optimal price of its two new products upon launch in the U.S. and APAC to meet the client’s overarching goals.  
• We delivered to the client a robust understanding of customer feedback and expected use of the products relative to current standard of care.  
• We helped inform the client’s broader understanding of revenue potential from the two products, which helped operationally with resource allocation and prioritization, to prepare the client for bringing the products to market.

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