Unified bio-simulate framework

Hub or rebate: what moves stable patients.

Stable brand patients switch to the biosimilar when copay savings outweigh the friction the hub leaves behind. A payer exclusion forces the rest, but every switch still has to be filled. The last section finds the hub and rebate split with the highest NPV.
01

Friction vs hub mitigation

Four barriers to switching, each netted against its own hub lever.

Hub capitalKH$5.0M
Hub efficiency per $1Mγ0.10

Friction f and hub strength Hmax are in utility units, the same scale as copay savings in 02. Each lever cancels only its own friction, so spend past its neutralize point is wasted.

Friction vs hub mitigation

F = fadmin + fpsych + fnav + flogist

Hk = Hmax,k · (1 − e−γ·KH)

net friction = Σ max(0, fk − Hk)

K*k = ln(Hmax,k / (Hmax,k − fk)) / γ

Netting each friction against its own lever keeps a strong PA engine from cancelling anxiety nobody addressed. If H_max ≤ f, that friction is never fully neutralized.

Total friction

4.50

F

Hub cancels

2.40

Σ min(H_k, f_k)

Net friction

2.10

47% of F left

Phase

A

High brand inertia · B at $19.5M

Friction · hub leverfHmax

Administrative · EHR enrollment portal

cancels 0.79 of 1.50 · neutralized at $13.9M

Psychological · Nurse navigator calls

cancels 0.55 of 1.20 · neutralized at $19.5M

Navigational · e-PA and copay engine

cancels 0.59 of 1.00 · neutralized at $11.0M

Logistical · Specialty pharmacy triage

cancels 0.47 of 0.80 · neutralized at $11.0M

02

Switch probability

The monthly odds a stable patient switches, and the share of switches that get filled.

Price sensitivity per $1 savedα0.030
Rebate passed through to the copayβc2.0%
Baseline biosimilar preferenceβ₀-4.5
Fulfillment loss per unit of frictionη0.80

Choice probability bridge

Uswitch = β₀ + α·ΔC − net friction + ε

P(Switch) = eU / (1 + eU) ΔC = βc·R

C = e−η·(net admin + nav + logist)

Everyone modeled is stable on the brand, so the stable gate is 1. β₀ keeps switching realistic once friction is gone: without it a patient with no savings would switch half the time each month. Admin, navigation and logistics friction also stop switches from being filled (C); psychological friction only affects the decision.

Copay savings

$16

ΔC per month

Switch utility

-6.12

no hub -8.52

P(Switch) per month

0.22%

no hub 0.02%

Switches filled

31%

no hub 7%

03

Market share shift velocity

Direct switching, peer diffusion and the payer strike, all limited by fulfillment.

Rebate per unit to the PBMR$800
Rebate that gives 50% exclusion oddsRcrit$1,000
Payer response steepnessθ0.010
Exclusion enforcement per monthδ35%
Exclusion takes effecttM7
Peer diffusionk6.0
Addressable shareM̄90%

Market share shift velocity

dM/dt = [P·(1 + k·M) + δ·Φt] · C · (M̄ − M)

Φ = 1 / (1 + e−θ(R − Rcrit))

P·(1 + k·M) is direct switching plus peer diffusion, so share can grow from zero. δ·Φ is the payer strike from the exclusion month. Both pass through fulfillment C and stop at M̄; in monthly steps they combine as 1 − (1 − a)(1 − b), so share never overshoots.

Exclusion odds

12%

Φ at your rebate

Share at month 12

7.6%

no hub 1.6%

Share at month 36

32.0%

best split 90.0%

Months to half of M̄

—

not within 36 mo

Biosimilar share by month Your split No hub Best split
04

Capital allocation

NPV across hub capital and rebate levels, and where the next dollar should go.

Discount rate, annualr10.0%
HorizonT36 mo

Hub capital is spent once up front; the rebate is held flat across the horizon. Tap a cell in the map to load that split into 01 and 03.

NPV objective and budget

Π = Σ (1 + r)−t · Mt · Q · (Pgross − R) − KH

B = Σ (1 + r)−t · R · Mt · Q + KH

next dollar → higher ΔG / ΔB, hub vs rebate

r is the monthly rate from your annual input. B counts rebates on every biosimilar unit plus hub capital. G is gross revenue at WAC. The next dollar goes where it adds more G per budget dollar over the whole horizon; below $1 it lowers NPV.

NPV, your split

$68.4M

hub $5.0M · rebate $800

NPV, best split

$295.9M

hub $15.0M · rebate $1,000

Revenue per $1 of hub

$2.79

next $100k

Revenue per $1 of rebate

$2.61

next $25 per unit

Next dollar → hub capital.

NPV by hub capital (across) and rebate per unit (up). Tap a cell to try that split.

$2,000$1,500$1,000$500$0
$0M$10M$20M$30M$40M

Best $295.9MYour splitDarker = higher NPV