Arrowhead priced its newly approved drug for FCS at $60,000, a 90% discount to competitor Ionis's $595,000 price for a similar drug. Arrowhead is strategically pricing for the larger, future SHTG market to gain a foothold, forcing a pricing showdown in an ultra-orphan indication.
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When selling high-ticket services, don't raise prices incrementally. Instead, make a significant jump (e.g., from $3,800 to $8,000). If it doesn't sell, you've gained valuable market data and can simply re-price the next cohort. The upside of finding a new price ceiling far outweighs the risk of a single failed launch.
Facing public outrage, Mylan offered a "generic" EpiPen at half price. However, due to convoluted drug pricing economics, this move quelled the controversy while allowing the company to earn nearly the same amount of profit per device. It exposed the illusion of consumer savings in a broken system.
Businesses often launch with transparent, all-in pricing because it feels honest. However, as seen across e-commerce, strategies like partitioned pricing ($9.99 + shipping/tax) and added fees consistently convert better. This creates competitive pressure that makes adopting such psychological hacks almost inevitable for survival.
By negotiating prices down from over $1,000 to as low as $150 per month, the government deal fundamentally shifts Ozempic's market position. It is no longer a high-end luxury akin to plastic surgery but an accessible wellness product comparable to a fancy gym membership, dramatically expanding its addressable market.
In explosive markets like GLP-1 drugs, significant price drops and margin compression (e.g., from 80% to 60%) don't necessarily harm profits. The sheer volume of new customers can completely offset lower per-unit profitability, leading to far greater overall earnings.
To commercialize curative 'one-and-done' genetic medicines, Eli Lilly is considering a subscription-like model. The procedure could be free upfront, with patients or insurers paying an ongoing fee only as long as it works.
Novo priced the maintenance dose of its oral Wegovy pill far lower than anticipated. This aggressive strategy, costing less than the average U.S. monthly grocery bill (~$400), is a direct attempt to regain momentum from rival Eli Lilly and expand the self-pay market before more oral competitors launch.
Lacking market comparables, Nexla priced its initial enterprise deals by first understanding the customer's internal cost to solve the same problem. They then proposed a price that was a clear fraction—like one-fifth or one-tenth—of that internal cost, making the ROI immediately obvious and justifiable for the buyer.
Shure prices its service at $100/month vs. the industry's ~$600. This isn't just to compete with incumbents like Deel, but to serve a massive pool of smaller companies for whom traditional EORs were prohibitively expensive, thereby expanding the total addressable market.
Unlike labor-dependent services that get more expensive, prescription drugs offer a unique societal ROI because they eventually go generic and become cheaper. This deflationary aspect is a powerful, underappreciated argument for investing in drug development, as successful medicines provide compounding value to society over time.
