Challenges With Judging and Interpreting a Drug’s Launch Price

AJMC March 24, 2025
Melanie D. Whittington, PhD, Louis P. Garrison Jr, PhD, Jonathan D. Campbell, PhD

This commentary explains why comparing a launch price with a value-based price from a cost-effectiveness analysis requires further examination.

Am J Manag Care. 2025;31(7):In Press

Takeaway Points

We found 4 reasons why comparing a launch price with a value-based price from a conventional cost-effectiveness analysis requires further examination before jumping to a judgment about its policy relevance. These reasons are as follows:

• The launch price rarely equates to the price actually paid.
• Cost-effectiveness analyses often do not measure everything that matters.
• Cost-effectiveness analyses rarely account for future price changes.
• Commonly used cost-effectiveness thresholds have great uncertainty.

Drug prices at launch continue to be debated in the lay press and other forums.¹ We commonly observe public launch price announcements...

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