Report Suggests Corporate Environmental and Social Goals Should Include ICER Pricing Assessments

May 19, 2021

Bernstein analysts suggest that companies implementing environment, social, and governance (ESG) actions should consider drug pricing. They might consider incorporating the Institute for Clinical and Economic Review (ICER)’s independent value assessments. This shift would allow investors to establish a company’s ESG value. Pharmaceutical companies are not expected to be enthusiastic about the suggestion; 832 drugs rose in price by 4.6% in January. Such measures could lead to reduced revenue of 25%.

Bernstein analyst Ronny Gal remarks, “If you’re going to charge X dollars for a product, your pricing needs to have scrutiny to it. Most industries have that already,” adding, “In looking at the ICER database, we realized the data set can be used as an in-depth, independent, objective and transparent systematic analysis of how fairly individual companies set U.S. prices. Further, the database offers quantitative targets to what prices should be. Thus it offers an actionable decision-making tool for ESG investors and offers an alternative way to legislation to pressure the industry to control their prices (boards and CEOs care about their stock prices).” Read more here.

(Source: Beth Snyder Bulik, Fierce Pharma, 5/18/21)

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