Bringing data to life. 1

Proprietary and Highly Confidential. 2014 daVIZta, Inc. All Rights Reserved.

Successful Gross to Net Sales Forecasting & Analytics Practices

2016 CBI Product Forecasting Summit

1

Thursday, June 23, 2016

Jennifer SharpeSenior Director, Revenue Analytics Collaborative

2Proprietary and Confidential

is a private network of only

industry professionals

anonymously sharing their

Commercial, Government, and

Gross-to-Net expertise

The Collaborative is over

425 professionals and

105 pharmaceutical, biopharma,

biotech and medical device

companies.

June 16, 2016 3Proprietary and Confidential

“Deriving Insights, Driving Results”

ConsultingData

Management

Software

HighImpactInsights

DeliveryExcellence

DomainExpertise

Decision Enablement

• For over 6 years daVIZta has been servicing the Life Sciences industry

• We currently employ nearly 90 business and technical professionals in three global locations coming from a broad set of backgrounds across Life Sciences

• Have serviced 30+ top-tier, mid-market, and emerging Life Sciences companies across our three verticals

• For over 6 years daVIZta has been servicing the Life Sciences industry

• We currently employ nearly 90 business and technical professionals in three global locations coming from a broad set of backgrounds across Life Sciences

• Have serviced 30+ top-tier, mid-market, and emerging Life Sciences companies across our three verticals

Vision: Enterprise Revenue Analytics

Mission: Mitigate Risk & Improve Profitability

June 16, 2016 4

Revenue Analytics SoftwarePortfolio

Revenue Analytics SoftwarePortfolio

Gov’tPricing

VIZualizerReporting

Engine

Gross to Net

Managed Care

Analytics

• Gross to Net Forecasting• Rebates Accruals• Chargeback Accruals• Medicaid Accrual• Price Increase Impact

• Deal/No-Deal Modeling• Formulary /Restrictions/Co-

Pay Impact• Price Protection Forecasting• Side-by-Side Comparison• Customizable Forecasting• Forecast Overrides• Cross Channel Impact• Actuals vs. Expected

• Medicaid Program• Federal Supply Schedule• Medicare Part B• 340B PHS• Price Comparisons and

Trends

Price and ContractManager

ClaimSMart

• Pricing Terms Maintenance

• Central Contracting / Price Terms Repository

• Managed Care Rebate Calculation and Validation Solution Set

• Medicaid Claims Rebate Calculation and Validation Solution Set

• Brand Analyses• Channel Analyses• Market Segment Analyses• My Dashboards • My Reports• On-Demand Query/Reports

Proprietary and Confidential

5

EGWPPlans

Managed Medicaid MCOs

Affordable Care Act

Medicaid Expansion

Coverage Gap

Gross-to-Net Forecasting Challenges Over the Years

FinalRule

Mega Rule

20112011 20132013 2014201420122012

HealthCare Reform

20152015 20162016 20172017

Payer/Wholesaler Consolidation

Price Protection

What’sNEXT?

A G E N D A• Organizational Design

• Process Flow

• Data & Assumptions

• Systems

• Methodologies

6

DataData MethodologyMethodology ForecastForecastAssumptionsAssumptions

Org Design, Process & SystemsOrg Design, Process & Systems

Managed Markets Finance

Brand Finance

Pricing & Reimbursement

Organizational DesignGross-to-Net Forecasting: Where does it belong?

Marketing Finance

FP&A

Contracts & Pricing

Revenue Analytics

Sales Operations

GTN/RevenueManagement

GTNForecasting

Accounting

8

Organizational Design

Poll the Audience:Where does your GTN forecasting reside?A. FinanceB. OperationsC. Shared

Poll the Audience:Have you been impacted by a reorganization in the past 18 months?A. YesB. No

9

Accounting

Contracts & Pricing

Managed Markets

FinanceSales

Forecasting

Gross to NetBrand

TeamMarket Access

Contract Terms &

Rates

Channel Forecast& Analytics

TRx &/orUnit

National Forecast

Contract Strategy

National Assumptions

GTN Accruals& Reporting

Review & Guidance

Gross Sales Forecast

Process FlowGross-to-Net Forecasting: Is There an Ideal Process Flow?

10

Process FlowCross-Functional Unity

Poll the Audience:Do you have a cross-functional Executive Pricing Committee?A. YesB. No

Poll the Audience:Do you have a cross-functional Working Pricing Committee or Gross-to-Net Management Team?A. YesB. No

11

Process FlowOne Version of the Truth

Poll the Audience:Is your GTN Forecast the basis or baseline for your GTN accruals?A. YesB. No

Poll the Audience:Does your extended forecasted team ‘own’ data, assumptions and forecast?A. YesB. No

• ERP/Payment SystemsRebate and Chargeback claim dataUnit Rebate Amount (URA)Best Price (BP)WAC PricingContract/Rebate Rates

• Thirds Party Data IMS/Sympony TRx and NRx demand data (Plan/Payer level) ValueCentric/Integrichain Inventory Data Customer/States LIVES data

DataGross-to-Net Forecasting: There’s Never Enough?

13

• Sales Forecasting/Brand Team– Market Share– Market Growth– WAC Pricing

• Sales Force/Contract Team– Forecasted Customer/State LIVES data– Contract /Rebate Contract Rates and Terms

• Government Team– Forecasted Unit Rebate Amount (URA)– Forecasted Best Price (BP)

AssumptionsGross-to-Net Forecasting: Trust Them?

EXCEL

ACCESS

CONSULTANT/HOMEGROWN EXCEL MODELS WITH

TOOLSETS

DATABASE/QUERY TOOLS OFF

ERP & PYMT SYSTEMS

SECUREAUTOMATED

SOLUTION∂-Rive™

SystemsGross-to-Net Forecasting: What Do You Use?

15

SystemsPoll the Audience:

What vehicle do you use to forecast?A. Homegrown Excel Model

B. Excel Model built by external party

C. Homegrown Automated Model

D. Automated Model built by external party

Poll the Audience:

Do you believe there is valuable ROI for automation?A. Yes

B. No

16

• Mathematical Trends

• Statistical Algorithms

• Assumption Based

– Product, Market and Customer Events

– Uptake (Launch) and downturn (LOE) curves

– Internal and External Product and Customer Analogs

MethodologiesGross-to-Net Forecasting: Everyone Needs One…

17

• Demand Sales basis is ideal• Rebate actuals by ‘earned’ period is ideal• Bottoms-up harmonized with a Top-down approach• Inventory Roll-forwards• When insight/data available, avoid historical trends and

leverage multi-assumption based methodologies• Perform 3rd party data analytics• Assumption Based• Layering in Product, Market and Customer Events• Leverage internal and external Analogs

MethodologiesGross-to-Net Forecasting: Successful Practices

Please Contact Us With Any Questions

18

• Jen Sharpe

– Phone: (908) 247-9105

– Email: jsharpe@davizta.com

Proprietary and Confidential