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    Payer Archetypes

    Understanding payer archetypes

    One-size-fits-all has become an outdated and non-recommendable approach in pharma business. During the period of blockbuster medical products, this approach was applicable – the wider drug developers cast their net, the greater the chances of expanding their market share. Another merit to this approach was that it made strategy development relatively less complex for pharma marketers.

    Today, companies are constantly told to target the specific needs of payers, which is an extremely complicated task. Although all payers across the board are unified in feeling the pressure to deliver value and affordable healthcare, the interpretations of how to achieve such a broad goal varies tremendously. Payers come in a variety of forms (governments, public agencies, private organisations, special institutions, or individuals) and diverse backgrounds and influences (clinical, health economic, research, patient advocacy, budget management, pharmacy), and so, understanding them can be quite a challenge.1

    Payers are starting to influence each other, however, in a way that might ease this challenge. Indeed, decision-makers are now looking to other markets to develop their own strategies for responding to mounting industry pressures. As a result, a preliminary sense of uniformity across payers is emerging – many payers share similar assessment tools and cost control methods, making it possible for pharma companies to identify them as belonging to a certain ‘type’ and developing similar approaches for all payers within a specific type.

    One solution that can reduce the overwhelming challenge of meeting the needs of specific payers is archetyping. In business, archetyping is generally the process of defining the customer in a way that enables a company to identify customers with specific traits. It involves creating an image of a person with specific behaviours, traits, priorities, preferences, or a persona that represents what the product is all about.

    Archetyping is part and parcel of stakeholder mapping. In the context of understanding payers, archetyping helps identify key similarities and differences among markets to facilitate pharma decision-making and strategy development, and make value strategies that are more targeted, effective and efficient. Essentially, payer archetyping involves stratifying payers into major types while leaving room for payer-specific adaptability (where there is potential for inclusion of individual market-specific tweaking) and opportunities to identify potentially new and significant payer characteristics.

    Developing a payer archetype framework

    The common payer archetypes that experts and some companies have identified include:1

    • Cost-effectiveness – Payer requires a methodology for comparing value for improved outcomes.
    • Comparative clinical effectiveness – Payer seeks to assess value and benefit by comparing the clinical evidence between similar products.
    • Budget optimisation – Payer has a limited budget and seeks the best way to allocate their limited resources.
    • Competitive rationalisation – Payer wants to achieve healthcare benefit and maximise profit.
    • Patient-led market – The patient heavily influences payer purchases.

    Companies can further customise their archetype framework where payers are listed on one axis and the framework criteria (characteristics of a market) are listed on another. The selected criteria must be relevant to the core business objective of payer archetyping. Is it to identify new market opportunities, introduce a newly launched product, develop value dossiers, approach tendering in a major market, or something else? Some of the potential criteria to include are:

    • Healthcare expenditure per capita and as GDP percentage
    • Prevalence of targeted indication
    • Scope of payer dominance (local/regional/national/global)
    • Types of contracts and procurement methods (e.g. patient access programs, tenders, negotiation)
    • Significance placed on cost-effectiveness ratios
    • Dependence on health technology assessments
    • Market share of product class of interest.

    Building evidence

    One of the key benefits of conducting payer archetyping is data building. Before payers can be classified according to types, companies are first compelled to dig deeper into and gather more relevant information about the interests of each payer. Generally, an increased requirement for evidence across the industry already exists.2 Therefore, the preliminary archetyping steps of considering which data types to gather and then proceeding with the actual data collection are a natural and necessary activity in the modern healthcare market.

    Gathering individual payer data aids in accounting for the major question that each payer will most likely ask, thus revealing distinctions between payer perspectives. For example, these questions reveal the core need of a payer (and consequently provide the ability to classify them according to such core needs):

    • High unmet need: Do we need this medical product in our market?
    • Clinical effectiveness: Does it work well/better than what we have?
    • Budget impact: Can we even afford this product?
    • Patient population: Will we have the ability to control its use?

    Mapping out payer types helps identify key market decision makers and dominant payers for each cluster or type, which helps clarify which types are the most relevant to a pharma company’s primary business objective. It also narrows down a company’s attention to the payer types of interest, market opportunities, and which data types need to be explored more.

    Ultimately, gathering data about payer’s sheds insight into the evidence requirements per payer of interest. Does a particular payer type require studies showing the performance and use of a new product in clinical practice, studies around the new product’s suitability in a sub-group of the patient population, and/or evidence of the relative deficiencies of competitor products? Do they need data on real-world outcomes or pharmacovigilance surveillance?

    Essentially, pushing companies to be specific and robust in terms of the data captured per payer/payer type aids in population and position scanning, which is highly useful during the development of payer value propositions and product lifecycle management.

    Flexible moulds

    Each archetype encompasses a set of significant market characteristics and major payer needs that are shared between markets. However, as companies build their knowledge about each market or payer type, the attempt to deploy a one-size-fits-all, global strategy becomes increasingly unrealistic.

    Archetypes are not designed to be a rigid categorisation of payers. They also have room for variation and flexibility that makes global and national strategies adaptable to local or regional markets. Since policy requirements at the national level are rarely the same at the local level and since the competitive, regulatory and policy landscapes constantly change, having flexibility helps ensure harmony between a globally rolled out strategy and local/regional policies. It also strikes a balance between having a tailored strategy for individual payers and a one-size-fits-all strategy contained within one archetype. Having flexible ‘payer moulds’ also helps determine whether there is the need to create new archetypes.

    A broad and deep view of payer types and payer-specific requirements is highly useful in the development of strategies for pricing and reimbursement, contracting/tendering, and early payer engagement.3

    Resource optimisation

    Under a one-size-fits-all mentality, there is an assumption that the strategy and associated message “might” work. Payer archetyping can reduce the uncertainty and aid in ‘speaking’ directly to each archetype with the value proposition and messaging tailored to be payer-specific. By identifying, accounting for, and addressing major archetype requirements, pharma companies can avoid the costly and time-consuming implementation of a fragmented or conflicting set of strategies.

    Where local/regional payers fall on a conservative-progressive policy scale can also be determined. Companies can have a better idea as to which submarkets will be open to more novel agreements and special contracts, where and when to tailor payer support, and how to provide payer-specific messaging to optimise resource allocation.

    An overview of the payer landscape provides answers to specific business questions, which are necessary in the proactive development and implementation of tactical strategies. For example, when companies possess a clear picture of the degree of generic drug penetration in a market, they can determine how to better allocate resources to support post-exclusivity strategies. Insights from payer archetyping also inform vital go/no-go development and market access decisions.

    Companies need to identify which stakeholders make the key decisions and how they determine value, and archetyping can be a tool to build understanding about market and clinical opportunity from the perspective of payers. Insights gleaned from payer archetypes can bridge the gap between global and local market access strategy implementation. Therefore, prior to finalising and using the framework, companies need to have local teams evaluate the design and content of the archetype framework to verify its applicability and alignment with reality.

    To find out more about how we can help you apply payer archetype frameworks within your market access strategy, contact us at



    1. Lawson, R. (2013). Who are payers and what information do they need? Retrieved from
    2. Valid Insight (2016). Maximising the value story through payer-centricity. Retrieved from
    3. Valid Insight (2016). Understanding payer strategies to control prices.
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    Valid Insight is an award-winning pharmaceutical global market access consultancy. With a team that includes some of the world’s leading market access and pricing experts, clients across the globe turn to us for innovative pricing, market access and value communication strategies through the full product development cycle. Proud winners of the Queen’s Award for Enterprise: International Trade, we aim to offer world-class solutions that continue to drive growth for our global clients.

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