'The right price is not a price based on cost!"
Q – How was the situation – on pricing issues – at your company before you joined the Certified Pricing Manager Program? What were the challenges?
In the pharma industry, knowledge of Market Access and Pricing is critical to ensure growth on profitability. Therefore, the main challenge for a company like LFB is to increase the level of pricing knowledge and spread it to the operational teams and affiliates. The pricing function has been created in the access dept only mid-2015. We basically start from scratch in pricing which was really challenging when we have to launch products. Therefore, many projects have been conducted at the same time including pricing governance, pricing policies, pricing strategy for new products, tender management, change management…
Q – What triggered you to join the CPM® programme?
The pricing position in the LFB is new and the challenge is high. I wanted to know more about pricing and how I have to move forward to succeed in my new position. What are the different stages of pricing? What are the mistakes to avoid? How can I improve the margin and the value of our products?… many questions to solve before building pricing in the LFB. What was interesting is the broader vision of the subject, not limited to our business specificities.
Q – How did the CPM® programme help you to develop the pricing maturity in your organisation?
I appreciated the CPM®_level2 programme as, it was oriented on “how we can sell and avoid margin leakage?”. Really result and profit oriented. Today, I noticed that a wrong pricing leads to “leave money on the table”.
So, how can we define a price in a country for a product and who can decide a price?
The CPM®_level 2 programme helps me to find answer to these 2 questions and I succeed to set up a methodology for each pricing strategies, going into deeper analyses of prices in a country to find the right price leading to revenue maximization. The right price is not a price based on cost!
Q – Give a short description of the project you delivered for the certification project. What was the challenge and what were the concrete results in €.
To avoid pricing leakage, a right pricing governance and pricing policies have to be set up. Level up operation teams and change the mentality is critical for the LFB. Our goal through this project is to reach a maturity in this field and train the International operational teams to be more efficient during tendering and contracting situation.
Q – How do you feel now after completing this programme? What has changed, like in more visibility, more top level support in pricing in your company, better stakeholder relationships, more involvement in innovation, clear KPI’s,…
Such results allow to have a better support from the management and the top management. It helps a lot to spread the pricing knowledge in the company and bring new opportunities to start new projects linked to pricing. Mostly, it comforts us in the choice we have made in the company to strengthen the function. Moreover, it also helps building the pricing plan for the coming year.
Q – You have been a pricing manager since several years now. How has the function of ‘pricing manager’ evolved during the years?
Pricing role in the pharma is strongly linked to market access. Theses 2 functions have to involved earlier in launches to well define the profitability expected from the management. Pricing is also dynamic and specific to each country. As a price in a country can affect a price in another country a pricing manager has then an operational and global role. As long as price will impact the bottom line of a P&L – it means always – a pricing manager will be involved in strategic projects having always a vision of revenue maximization.