Forecasting With The Theta Method

5Applications in Health Care

By Kostas I. Nikolopoulos and Dimitrios D. Thomakos

5.1 Forecasting the Number of Dispensed Units of Branded and Generic Pharmaceuticals

In this chapter, we use the variations of Theta method along with the aforementioned established benchmarks in order to forecast pharmaceutical life cycles, specifically around the time of patent expiry when the generic form of the product is introduced to the market, while the branded form is still available for prescription. Assessing the number of dispensed units of branded and generic forms of pharmaceuticals is increasingly important due to their relatively large market value globally and the limited number of new “blockbuster” branded drugs. As a result, pharmaceutical companies make every effort to extend the commercial life of their branded products and forecast their sales in the future, while public health institutes seek insights for effective governance as the use of a branded drug, when a generic form is available. In essence, this chapter presents an application of the method in the border of two disciplines: healthcare management and marketing. Marketers have always been encouraged to become more socially relevant and to broaden their viewpoints and extend their research into areas not traditionally associated with marketing (Andreasen 1978). Forecasting plays a major role in increasing marketing relevance, as it is included in more than 98% of companies' marketing plans and should be taught in business ...