Demystifying the Market Events Library: A Strategic Tool for Gross-to-Net Forecasting

In the world of pharmaceutical forecasting, especially when it comes to Gross-to-Net (GTN) channel forecasting, staying ahead of market dynamics is both an art and a science. As commercial teams aim to predict customer- and channel-level revenue performance, one of the most effective tools in the toolkit is the Market Events Library.

What Is a Market Events Library?

A market events library is a centralized means of tracking, organizing, and applying future market developments—known as "events"—to financial forecasting models. These events could include contract wins or losses, competitor product launches, regulatory changes, or even shifts in payer mix (often called “lives shifts”).

Historically, many forecasting teams handled market changes manually, overriding system-generated numbers with individual adjustments in spreadsheets or enterprise performance management (EPM) tools. While that method can work well in moderation, it has its limitations when the sheer number of events causes overrides to balloon. While overrides in EPM models can be documented and auditable, they can be difficult to manage and track.

Imagine having to parse through hundreds of override notes to try to identify trends.

There’s a much better way. A market events library offers a structured, repeatable, and transparent way to model and analyze these events across products, customers, and market segments.

Key Benefits of a Market Events Library

1. Transparency and Traceability

No more scattered overrides and comments. A market events library lets teams capture assumptions in one centralized location, improving visibility and reducing the risk of overlooking key inputs in future forecast cycles.

2. Time Savings and Reusability

Events are reusable. Once a live shift or contract loss scenario is set up, it can be copied, modified, and reapplied across brands or customers with similar dynamics. You can change one or two parameters and apply it to a different customer or brand, building on existing work without having to start at the beginning of the process.

3. Multi-disciplinary Participation

Building a library requires participation from thought leaders across the organization, each sharing their intelligence in areas such as product pricing and contracting strategies, payer and patient dynamics, competitor product landscape, and legislative proposals on the horizon to name a few. Each thought leader can voice their opinion or provide a calculated probability for a market event’s timing and impact.

4. Improved Accuracy

By separating volume assumptions from discount impacts and tracking them by event type, analysts can model each variable more precisely—and then analyze performance by event type over time.

5. Enhanced Reporting

With categories and types assigned to each market event, reporting becomes much more insightful. Teams can ask: “How do contract loss events impact revenue over time?” or “Are our assumptions about competitor launches proving accurate?” Furthermore, the ease of reporting enables manufacturers to get a more granular look at the numbers and the ability to adjust forecasts on a monthly basis rather than waiting for quarter end.

How to Set It Up

Setting up a market events library involves several key steps:

1. Define Categories and Types

Common categories include:

• Contracting (wins, losses, term changes)

• Market Dynamics (competitor launches, product withdrawals)

• Regulatory (e.g., maximum fair price impacts on discounts)

• Portfolio Events (product launches, cannibalization)

Each category can have multiple subtypes. For example, under “contracting,” you might include “contract shift” or “payer group migration.” With cannibalization, it’s important to identify how the rise in Brand A will cause Brand B to suffer and the point at which that situation is no longer financially beneficial.

2. Identify Relevant Parameters

Each type of event will require specific modeling assumptions, for example:

• For a lives shift: source and destination payers, volume moved, and time period

• For competitor entry: market share loss, impact curve over time

• For regulatory change: estimated price drop or discount impact

3. Create Uptake Curves

Adoption or uptake curves help define how quickly an event affects forecasted results. Is it a sharp spike? A slow ramp? Libraries can include a collection of standard curves (e.g., fast, moderate, slow adoption) to choose from.

4. Ensure Scenario Modeling Capability

Forecast models need to support scenario-based modeling. This means being able to test different combinations or sequences of market events, see which events are active in which scenarios, and adjust parameters as more information becomes available.

5. Build for Self-Maintenance

The library should be user-friendly, allowing business analysts to add, update, and archive events and curves as needed, without having to rely on the IT department.

How to Analyze and Report Market Events

Analysis and reporting are where the market events library shines:

• Performance Tracking by Event Type

By categorizing events, analysts can track which types (e.g., contract losses, competitor entries) were forecasted accurately and which were not. This can feed back into improved assumptions over time.

• Cross-Functional Visibility

Since many market assumptions require input from multiple teams—marketing, pricing, legal, and sales—centralizing the events fosters better collaboration and reduces blind spots.

• Conflict Detection and Prioritization

When multiple events are applied simultaneously, the forecast model should apply them in a logical sequence. For example, apply the first event, then apply subsequent impacts on top of the already-adjusted forecast. Teams should review whether overlapping events unintentionally conflict or compound in unrealistic ways.

Challenges and Pitfalls to Watch For

While powerful, market events libraries are not without risks:

1. Overfitting and Overuse

Analysts may create too many events in an attempt to explain every anomaly, resulting in deviation from historical trend, cluttered forecasts, or even negative volumes. Avoid developing trying to model events for which there is too much uncertainty, or in some cases, simplicity… sometimes a simple override can be the right choice.

2. Lack of Supporting Data

Events are only as good as their assumptions. Sourcing internal data from multiple departments and external syndicated data to justify event parameters (e.g., market share loss after a competitor’s launch) is crucial.

3. Scope Creep

Without periodic cleanup, libraries can balloon with outdated or unused events. Teams should review and archive events that are no longer relevant as a regular exercise in each forecasting cycle.

The market events library represents a significant advancement in how pharmaceutical companies can manage their GTN forecasting. It introduces rigor, repeatability, and cross-functional alignment—key elements in today's data-driven, competitive landscape.

Done well, it not only improves forecast accuracy through better management of assumptions but helps commercial teams understand why performance changes occur and how to adapt faster. As market complexity increases, the companies that invest in structured forecasting components like the market events library will be better positioned to lead.

How Pharosity Can Help

Leverage Pharosity’s extensive experience to help you understand the categories and types of market events that are most applicable to your portfolio of products and determine which standardized set of methodologies to use to best apply those market events to your GTN forecast. Contact us today for a free consultation. Pharosity.com/contact.