Current Pricing System Research Articles

Multiple criteria qualitative value-based pricing framework “MARIE” for new drugs

ObjectivesValue-based pricing (VBP) could improve allocation of healthcare resources. We created and evaluated a simple VBP method that qualitatively considers broad values for drugs. MethodFirst, we established the value elements that determine the value of drugs. Then, we decided on the criteria for scoring the value elements, constructed a method for estimating daily drug prices from the value elements and the maximum number of patients, and used this framework to estimate daily drug prices. ResultsFour base value elements and 8 additional elements were identified. We applied our scoring criteria to calculate scores for 39 drugs already listed in Japan and estimated the daily drug price of each drug by creating a conversion table of base drug prices according to base points and maximum number of patients and adding points for additional elements. For all hepatitis C drugs, the estimated daily drug prices were lower than the actual prices, whereas for the other drugs, they were higher or, in some cases, lower. ConclusionOur VBP framework comprises 4 steps: 1. gathering information on value elements; 2. scoring value elements; 3. calculating the base drug price from the base points and the maximum number of patients by using the conversion table; and 4. calculating the daily drug price by adding points for additional value elements. Our framework, which we refer to as MARIE (multiple criteria qualitative value-based pricing framework), is a versatile, practical, and simple option for pricing new drugs that can be easily adapted to different healthcare environments. Public Interest SummaryDrug prices do not necessarily reflect the values provided by drugs in Japanese current drug pricing system. It is not fully discussed how to quantify the value of drugs for prices by considering a broad range of value elements. We created and evaluated VBP method for drug pricing that would be applicable in Japan considering the current pharmaceutical regulations, medical environment, and availability of data at the timing of pricing negotiation process for new drugs. The study summarizes the value elements to be considered in determining drug prices and proposed VBP framework. It also revealed that qualitative factors can be used for drug pricing. Our proposed approach for drug pricing system enables to capture and reflect broader values of new drug.

The dependence structure and causality detection in crude oil markets

ABSTRACT It is essential to capture the dependence structure among the world’s dominant crude oil markets for understanding the world’s crude oil pricing mechanism. The dependence structure and interaction between Shanghai International Energy Exchange (INE) market and other major crude oil markets in the world are investigated to determine whether the world crude oil market is efficient. Using the vine copula model based on GARCH, we analyze the dependence structure and interactions among these markets. The highest dependence is found between West Texas Intermediate (WTI) and BRENT crude oil markets, displaying strong symmetric tail dependence. DUBAI market exhibits unidirectional Granger causality to WTI and INE markets. Empirical results suggest that the world crude oil markets are not efficient and are far from One Great Pool. DUBAI and Brent markets emerge as leaders in the current international crude oil pricing system, while INE markets do not significantly influence DUBAI and BRENT markets.

Thermodynamic and economic analyses of modified ejector enhanced solar-air composite dual-source heat pump system in residential buildings

This research utilizes an ejector enhanced solar-air composite dual-source heat pump (EDHP) system for water heating in residential buildings. The main advantage of the EDHP system is the use of an ejector and dual-heat source to efficiently utilize solar energy, thereby enhancing heating performance. This ejector operates by utilizing a refrigerant stream from the solar collector line with higher pressure to elevate the suction pressure of the compressor. This feature enables the EDHP system to maintain stable heating performance even in adverse weather scenarios with low temperatures or limited solar radiation. Thermodynamic modeling using energetic and exergetic analysis methods is employed to theoretically evaluate the conventional air-source heat pump and EDHP systems. The energy analysis of the EDHP system using R134a refrigerant has shown significant improvements in both heating coefficient of performance (COP) and exergy performance (ECOP). Under specific conditions, such as an ambient temperature of −5 °C and an irradiance level of 250 W∙m2, and utilizing a 20 m2 PVT (Photovoltaic and Thermal) collector for a heating supply of 5 kW, the EDHP system exhibits a 23.64 % increase in COP and a 25.83 % increase in ECOP. Furthermore, when the electricity generated by the PV system is incorporated into the EDHP system, the demand for electricity from the grid can be reduced by up to 51.96 % under the same conditions. In the Beijing area and considering the current energy price system, the heating operating cost of the EDHP system is 0.206 Yuan/kWh. Compared to a standard air-source heat pump system, the payback period for EDHP system ranges approximately from 10 to 12 years, taking into account an annual heating period of 5 months. Among the alternative refrigerants to R134a in the EDHP system, R152a is found to be the most suitable. It shows COP improvements of 24.92 %–30.0 % and ECOP improvements of 24.89 %–29.96 %. This innovative approach opens up new possibilities for the application of heat pump technology under adverse weather conditions in residential and commercial buildings.

RETRACTED ARTICLE: Sustainable regional rail system pricing using a machine learning-based optimization approach

AbstractRegional transport pricing is indeed very vital in urban settings where the transportation network is spread out across large areas and can influence travel behavior and the sustainability of cities. Therefore, in addition to existing pricing systems, such as flat fare, distance-based fare, and zonal pricing, this study proposes a sustainable approach to regional rail system pricing using rent prices and a transportation affordability index. The proposed model aims to reduce commuters' overall travel distance in order to reduce air pollution and maintenance costs for public transportation vehicles. Rent-based pricing encourages people to rent houses in regions that shorten their travel distances and fill a gap in the literature on regional rail system pricing by dealing with the decentralization of the cities. A two-step clustering and non-linear optimization modeling approach are proposed based on face-to-face surveys with regional rail system passengers. For various clusters of stations, rent per income rates and rental-based ticket prices were obtained. Furthermore, a sensitivity analysis is conducted to evaluate different conditions of the affordability index and rent prices in the studied regions. Compared to the current pricing system, ticket revenues increased by 3.88% and 1.68% in rent-based pricing.

Effects of data time lag in a decision-making system using machine learning for pork price prediction

Spain is the third-largest producer of pork meat in the world, and many farms in several regions depend on the evolution of this market. However, the current pricing system is unfair, as some actors have better market information than others. In this context, historical pricing is an easy-to-find and affordable data source that can help all agents to be better informed. However, the time lag in data acquisition can affect their pricing decisions. In this paper, we study the effect that data acquisition delay has on a price prediction system using multiple prediction algorithms. We describe the integration of the best proposal into a decision support system prototype and test it in a real-case scenario. Specifically, we use public data from the most important regional pork meat markets in Spain published by the Ministry of Agriculture with a two-week delay and subscription-based data of the same markets obtained on the same day. The results show that the error difference between the best public and data subscription models is 0.6 Euro cents in favour of the data without delay. The market dimension makes these differences significant in the supply chain, giving pricing agents a better tool to negotiate market prices.

Launch sequencing of pharmaceuticals with multiple therapeutic indications: evidence from seven countries

BackgroundNew medicines are increasingly being identified as efficacious across multiple indications. The impact of current pricing and reimbursement policies on launch decisions across these indications remains unclear.ObjectiveThis paper, first, maps marketing authorisation and HTA coverage recommendation sequences of multi-indication medicines across Germany, France, England, Scotland, Canada, Australia, and the USA, and, second, evaluates the clinical characteristics, clinical development time and coverage recommendation time of multi-indication medicines, drawing comparisons between the first and subsequent indications of an approved molecule.MethodsMedicine approvals by the Food and Drug Administration between 2009–2019 were screened to identify multi-indication products with approved oncology indications. Data on clinical trial characteristics, clinical performance and HTA outcomes were extracted from publicly available regulatory approval and HTA reports.ResultsRelative to subsequent indications, first indications were more likely to receive conditional marketing authorisation, have an orphan designation, have a single arm phase II pivotal trial and lower MCBS score. Subsequent indications had faster HTA coverage recommendation times in England and Canada. While the majority of first indications received HTA coverage recommendations across all settings, the proportion of subsequent indications with HTA coverage recommendations was lower and uptake varied considerably across settings.ConclusionsDiscordance in the value of first versus subsequent indications can pose major challenges in systems that define price based on the initial indication. Current pricing and reimbursement systems generate significant fragmentation in the approval and availability of multi-indication products across settings.

A water pricing model for urban areas based on water accessibility

Water resource, with properties of scarcity, is one of the vital resource endowments. Like land resources, the prices of these resource endowments should be correlated to their locations to follow fair and reasonable principles. The current water price systems are mainly policy-oriented fixed regimes. And the water use was charged according to the regional-average situation with scarce consideration of the fine-scale geographical water accessibility. With a combination of the water accessibility and the current water pricing regime, this paper first proposed a novel water pricing model, the Water Price at Grid-scale (WPG) model, to dynamically allocate water prices to fine grids for urban residents. The WPG model was examined in the case study of the Han River Basin in the Hubei province of China. The specific results were: (1) the Pgrid of Tier I is between 0.66 and 3.94 yuan/m³, the Pgrid of Tier II is between 0.57 and 5.44 yuan/m³, and the Pgrid of Tier III is between 0.47 and 6.94 yuan/m³ in the study area. (2) the grids with more water acquisition generally have lower water prices than others and vice versa. (3) the average water prices in tiers obtained by the WPG model are generally higher than that derived from the current water pricing system. The results proved that the proposed WPG model spatially allocates the three-tier water prices into grids of urban areas. The WPG framework can be adopted in any society by involving its water price regimes and adjusting the scale of grids and the pricing year. This study provided a new viewpoint of domestic water pricing involving fine-scale water accessibility. The WPG model has great potential to ease water shortage pressure in water-limited societies and can be utilized and loaded into the current smart-city network for efficient and fine-scale water resource management.

Understanding and Approaching the Problem of the Korean Dairy Farming

Since the Free Trade Agreement (FTA) with the EU was signed in 2011, the domestic dairy market has become more open. As a result, imports of dairy products increased sharply and the domestic raw-milk self-sufficiency rate fell below 50%. Due to stagnating domestic demand for raw-milk caused by increasing imported dairy products, low birth rates, and environmental problems, the problem of oversupply of domestic raw-milk is emerging. The current price and quota system in domestic raw-milk market has many limitations in solving this supply and demand imbalance problem. In this study, this problem was approached from two aspects to solve the supply and demand imbalance facing the domestic dairy industry. As an approach to solving the problem, one is to look at the domestic dairy market from the perspective of supply and demand balance, and the other is to look at the asymmetric aspect of bargaining power due to the oligopolistic market structure. The approach to solving the problem has been summarized by improving supply and demand balance and competitiveness, compensating farmers income, and resolving asymmetry in bargaining power for various issues currently discussed.

Estimation of Milk Fatty Acids Health Index as Milk Value Added Determinant using FT-NIRS

The current milk price system based on Total Plate Count (TPC) and Total Solids (TS) are less sensitive in determining milk quality. Milk fatty acids profiles reflected milk quality for human health. However, their determination using Gas Chromatography (GC) is impracticable to be included as a daily price decision determinant. The study aimed to find a model for milk value added based on milk fatty acids profiles that reflected milk quality for human health measured by pre-calibrated rapid Fourier Transform Near-Infrared Reflectance Spectroscopy (FT-NIRS) method. Two hundred fifty-six samples of milk were collected from 3 dairy farm areas. Samples were analyzed using a Milkotronic milk analyzer for fat, protein and lactose contents and Gas Chromatography (GC) for fatty acids. The data were inputted into the FT-NIRS spectrum for calibration. The regression model to calculate milk value-added that can be used as a bonus system was developed after classifying and weighting of Milk Fatty Acid Index (MFAI) determined based on expert judgment. The results showed that milk fatty acids profiles vary greatly. Eight parameters (CLA, C16:0, SFA, MUFA, LCFA, PUFA, C18:2 trans9, 12 and H/H) can be detected accurately using FT-NIRS and used in milk value-added calculation. Simpler equation was used Y = 16.38307 + 5.395582 CLA + 0.695062 PUFA - 0.0244 C18:2, trans 9, 12 with R2 = 0.950 and was validated insignificantly different as calculated from the 8 parameters. It is concluded that the milk processing industry can use milk fatty acids generated from FT-NIRS to add value to milk collected from smallholder farmers.

Ecological effectiveness of payment for ecosystem services to identify incentive priority areas: Sloping land conversion program in China

Identifying incentive priority areas could improve the sustainability of payment for ecosystem service (PES) schemes. However, the lack of systematic and rigorous assessing ecological effectiveness of PES has resulted in some challenges to identify incentive priority areas in China. This study aimed to assess ecological effectiveness of China’s largest PES scheme, the Sloping Land Conversion Program (SLCP) for identifying the incentive priority areas. Firstly, we used the financial investments as the substitution variable of SLCP. And then the maximum marginal method was adopted to determine the reasonable lag periods of the SLCP`s financial investments. Finally, the panel fixed effect model (with regional dummy variable) was also applied for assessing its ecological effectiveness in different zones. We found that after the implementation of the SLCP, the vegetation improved significantly in Shaanxi province. The average normalized differential vegetation index (NDVI) was 0.831 in 2015, with an increasing rate of 15.097% compared with 2000, although it had some degeneration between 2010 and 2015. It took about four years after investments to realize its greatest performance benefits. The overall financial efficiency showed a pattern of "higher in the north, lower in the south" in Shaanxi province because the afforestation costs in the south were more expensive than that in the north of Shaanxi province. However, some previous key SLCP zones in the north had also been invested excessively, such as Wuqi, Zhidan and Ansai counties. Hence, the government should invest in higher financial efficiency zones based on the incentive priority areas if using the current payment price system.

Трансформация системы ценообразования в газовой отрасли как способ стимулирования экономического развития России

The article analyzes the current natural gas pricing system in Russia and suggests directions for its transformation, taking into account the situation in the economy and the energy sector. The methodology is based on the methods of system analysis using economic and mathematical optimization modeling of the energy sector and the economy. The authors show that the current gas pricing system in the country limits the development of competition, does not allow to increase the efficiency of economic sectors and to modernize the energy sector. Mechanisms of gas exchange trading, which were created in the country, do not reflect the state of the market. Under these conditions, it is necessary to implement a set of measures that will allow creating a transparent pricing system based on market principles and reflecting the real situation in the consuming sectors. The gas industry can become a tool to stimulate economic development. The increase in gas prices would allow to create conditions for modernization, leading to GDP growth due to the expansion of orders for the Russian industry from the energy and consuming sectors. At the same time, increased efficiency helps to contain the growth of consu­mer spending, while increased tax revenues from the gas industry would make it possible to avoid the growth of other taxes on consumers, which could be inevitable due to the expected decline in revenues from the oil industry. In parallel, objective conditions would be created for the development of inter-fuel competition, and the gas industry itself will become a more attractive segment for investment.

ФОРМИРОВАНИЕ МОДЕЛИ ЦЕНООБРАЗОВАНИЯ С ИСПОЛЬЗОВАНИЕМ ИНДИВИДУАЛЬНЫХ ХАРАКТЕРИСТИК (НА ПРИМЕРЕ СПОРТИВНЫХ ИНВЕСТИЦИЙ)

The article analyzed various factors that influence the pricing system of players in the management system of a football club. The main problems of the described subject area are identified. First of all, the problems of developing the transfer market of professional players requires studying not only market participants, but also creating a methodology for the initial assessment of the value of players. The current system of pricing for players, which is used in most football clubs, is considered. Its current analysis is carried out, the main directions for potential development are identified. A regression analysis of key factors with the presentation of the mathematical apparatus of the model. An assessment of the results of the obtained correlation coefficients from the point of view of factors affecting the pricing system of players is presented. The main problems of the described subject area are identified. First of all, the problems of developing the transfer market of professional players requires studying not only market participants, but also creating a methodology for the initial assessment of the value of players. It has been established that the influence of sports achievements on the transfer cost decreases with increasing age, and the athlete’s high level of publicity, on the contrary, can significantly increase the price of the contract. A regression model of the main influencing factors is constructed, and correlation coefficients are estimated, which make it possible to analyze the current pricing system for players.

Proposed postal rate structure could lead to big jump in nonprofit mailing costs

The Postal Regulatory Commission has announced a proposal that would revise the Post Office's current pricing system so that it meets the regulatory requirements of a law passed in 2006 that aims to get the agency's fiscal house in order. For nonprofits—and anyone else that regularly sends large amounts of mail—the proposed changes could mean steep price increases and, potentially, a mass exodus from the government's postal service.

Pricing Regulation In Greece - Analyzing The Price Bulletin Of December 2016

Pricing regulation in Greece provides that generics are priced at 65% of the reference off-patent’s price, while off-patents are priced at the minimum between a decrease of 50% of their latest on -patent price and the average of the three lowest originator prices in the EU. The purpose of this study is to assess the impact of the pricing regulation for generics in Greece. Official pricing data from the December 2016 price bulletin were used to stratify the generisized active substances per pricing regulation category. 325 active substances with generics in circulation were identified, of which 19% were priced at 65% of the average of the three lowest originator prices in EU, while 15% were priced below that level. Another 49% had ex-factory prices equal to or lower than 4.15€ (net ex-factory prices after obligatory paybacks ≤2.90€), 15% were subject to a price decrease of 10% and 2% were excluded from re-pricing due to reasons related with market equity. The current pricing system in Greece, in which price increases are not allowed, drives generic prices to a downward pricing spiral, while generic penetration remains at the comparatively low level of 25% in volume. By continuously correlating generic prices with the prices of their respective reference product a significant portion (15%) is priced lower than the provisions of the 65% of the average price of the three lowest prices in EU. Moreover, half of the substances are marketed with extremely low net prices, equal or lower to 2.90€ after deducting the obligatory paybacks of approximately 30% in 2016. The above, combined with the lack of demand-side measures to foster the use of generics, question the medium/long-term viability of generics. In that light, correlation of pricing with market penetration, poses as a more appropriate approach ensuring sustainability of generics.

Welfare, wellness, and job satisfaction of Chinese physicians: A national survey of public tertiary hospitals in China

Little national data are available on Chinese physicians' welfare, wellness, and job satisfaction. We conducted a self-administered smartphone-based national survey in early 2016 of 17945 physicians from 136 tertiary hospitals across 31 provinces in China. In addition to collecting the physicians' basic information, we also measured 5 domains (the ethical and working environments, welfare, wellness, and job satisfaction). Half of the physicians reported a hospital-based annual income of less than RMB 72000 ($10300), and 60.31% of them did not think that the current medical pricing system reflects physicians' value. More than half (58.64%) of them did not have or did not know about medical malpractice insurance. These physicians worked long hours (an average of 10h) and slept short hours (average 6h). Only 35.78% of them thought that they were in good health, and 51.03% were in good mental health. Approximately, a quarter of them had helped to pay medical bills for patients who could not afford care, and 1 in 7 has been penalised for seeing patients who generated bad debts. Only 33.42% of them thought that their occupation receives social recognition and respect, and 70.98% would not encourage their children to pursue a medical career. The top 3 factors that may influence physician job satisfaction as chosen by the physicians were as follows: (1) the income distribution policy (45.92%), (2) working environment safety (25.86%), and (3) public trust and respect for their job (16.10%). In conclusion, we found that Chinese physicians bear heavy physical, mental, and financial stress, and many of them lack confidence that they receive trust and respect from society.

The legal aspects of Ecosystem Services in agricultural land pricing, some implications from a case study in Vietnam's Mekong Delta

Ecosystem economic valuation has been proposed as an appropriate approach to account for natural resources. More specifically, the tangible and intangible values of ecosystem services (ES) associated with specific land uses/land covers have been appreciated by practitioners both in academia and policy arenas as useful accounting means for land use management. This paper explored how the outcomes from ecosystem valuation studies could be utilized to improve the current agricultural land pricing system in Vietnam's Mekong Delta. By reviewing the relevant legal documents, we highlighted some limitations of the current land pricing system and suggested reforms utilizing ES valuation results. By comparing the results of ES evaluation study for the prawn-rice rotational crops (PRRC) areas with their regulated agricultural land prices, one major limitation of the current pricing method was identified, that being its inability to capture the actual land profitability resulting from the classification system of lands which currently typifies PRRC areas as annual crops, similar to rice and vegetables. However, to register a dedicated classification for PRRC can be time consuming and costly due to the complexity of the relevant legal framework. As a response, an ES-based index to account for the differences between PRRC and other cultivation systems without having to thoroughly reform the legal system was recommended. Our recommendation is essentially in harmony with the Ministry of Environment and Natural Resources Decree, which allows for the application of correction factors according to local conditions. As a methodological contribution, this attempt to include ES information in legal systems could facilitate the better standardization of core terminologies and practical guidelines, two of the most important challenges to the mainstreaming of the ES concept in decision making and policy planning.

PROBLEMS IN FORMING COST ESTIMATES FOR CONSTRUCTION INDUSTRY

Problems of forming cost estimates for the construction industry is relevant in Russia, where many construction organizations face the issue of a current pricing system that does not consider new technologies in construction. This leads to underestimations of costs in construction and limits opportunity for competitive pricing between construction companies. This article aims to provide recommendations for improving reliability in calculating construction costs and enhance efficiencies in capital investments by construction participants. The article provides an analysis of the existing system of pricing in construction, and the peculiarities of the system of pricing in both Russia and the United States. Results indicate the need for expediency in applying certain provisions of the foreign system into that of Russia’s for determining the cost of construction. These measures would help minimize the presence of contractors in the construction market who do not actually perform the construction and installation work on their own, and to achieve the desired level of profitability of 8 to 10%.

European Union Pharmaceutical Markets: A Case for Differential Pricing?

Differential pricing has been considered extensively for its potential to increase access to medicines in low- and middle-income countries. A differential pricing system applied within an economic union (such as the European Union [EU]) comprising high-income and middle-income countries would also increase access and provide stronger incentives to invest in the R&D of innovative medicines. Access to innovative medicines is limited in EU markets with relatively low GDP per capita, indicating that the current pricing system does not promote efficient access. This article looks at how theory could be put into practice suggesting ways to implement a differential pricing system in the EU that can enhance overall welfare.

Research on the Pricing Model of Medical Services in China Based on System Dynamics Method

The current medical charge system is dominated by the government. Facts have proved that this system had caused many unreasonable phenomena. Consequently, the reform of medical service pricing system is emphasis and difficulty in China’s medical system reform. The paper sets up the pricing process of medical services to analyze the dynamic mapping relationships between various factors. And this paper breaks the government independent pricing mold and establishes the medical service pricing method of government and hospitals co-decision. Furthermore, this paper applies System Dynamics method to build the simulation model of pricing medical services on Vensim simulation platform that can overcome many drawbacks existing in the current pricing system of China’s public hospitals. In addition, this paper compares simulation results with the current price of Abdominal Vascular Color Doppler Ultrasound to illustrate the advantages of this model. The study will be helpful for the reform on new health care system in China.

경쟁체제 도입시 주택용 전기요금개선에 관한 연구

Korea electric power industry had been under vertical monopoly but is typically getting restructured for free competition. An ideal pricing system under the competitive market system is ‘unbundled pricing system’ and ‘marginal pricing system’, but the current pricing system still adheres to the traditional bundled system and the average cost pricing system. Especially, progressive electricity rates for residential use reflect governmental policy-making which is focused on income redistribution & welfare, industrial supports and energy saving. This study proposes new and reasonable residential electricity pricing systems which are Time-Of-Use (TOU) and Real-Time Pricing (RTP) to reflect variations in the wholesale price of electricity. It also presents examples of various tariffs for residential electricity pricing systems.