Which drug pricing term functions similarly to a 'sticker price' in the automotive industry?

The term that functions similarly to a 'sticker price' in the automotive industry is AWP, which stands for Average Wholesale Price. AWP represents a benchmark used in the pharmaceutical industry, essentially indicating the average price that wholesalers charge pharmacies for a particular drug before any discounts or rebates are applied.

Just as the sticker price of a vehicle reflects the manufacturer's suggested retail price (MSRP) before negotiations and discounts, AWP serves as a reference point in assessing the pricing of medications. It can help various stakeholders, including pharmacists, insurers, and patients, understand the initial cost of a drug before any adjustments are made.

Understanding AWP helps influence pharmacy benefit design and pricing negotiations and is commonly utilized in determining reimbursements for prescriptions, thereby making it a pivotal term in the context of drug pricing.