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Pharmaceutical Sales Forces: Benchmarking sales force management by geographical market and product lifecycle
Datamonitor, Aug 2003, Pages: 321
EXECUTIVE SUMMARY 3
Action points 4
Companies are not maximizing their returns – high detailing spend has to change relative to the investment on other more effective promotional strategies 4
Sales force size and structure has to evolve throughout the lifecycle to fully realize a product’s revenue potential but not at a cost to profit margins 7
Determining the level of product uptake within each sector of the customer base is required to ensure promotional effectiveness 8
Sales force structure should be driven by the identified sales potential of the product 8
eDetailing remains an under utilized sales support tool 9
CHAPTER 1 COMPANIES NEED TO RE-THINK CURRENT DETAILING STRATEGIES TO HALT DECLINING RETURNS 14
Sales force productivity is declining but detailing spend continues to rise 15
Promotional spend far exceeds sales growth 15
Methodology 16
The problem: declining returns on promotional investment,1998-2001 18
The ‘share of voice’ fallacy: sales force expanison is not halting the decline in ROI from detailing 20
Improving promotional effectiveness: detailing versus non-detailing spend 22
Benchmark analysis of leading pharmas 24
Comparing the overall promotional spend between 2001 and 2002 25
Evaluating the absolute promotional spend 28
Assessing the ROI from promotional spend 34
The solution: improving sales force effectiveness by addressing the quality of detailing strategies 40
Datamonitor’s Revenue Potential Index 40
Example of an application: benchmark analysis of leading pharmas 42
Assessing the clinical quality of marketed portfolios 43
Evaluating the detailing effectiveness of leading sales forces 46
Key recommendations to increase the effectiveness of detailing strategies 49
Problem: reliance on a few high earning products 51
Problem: general over-spending on detailing strategies 51
Problem: over-spending on detailing strategies focused on few products 53
Problem: failing to realize a product’s full earning potential 54
CHAPTER 2 OPTIMIZING SALES FORCE SIZE AND STRUCTURE THROUGHOUT THE PRODUCT LIFECYCLE 55
The need to optimize sales force size and structure 56
Benchmarking sales force size and structure in seven geographical markets 56
Sales force size – the trends from top, middle and lower tier companies 56
Sales force structure – the trends from top, middle and lower tier companies 60
How a company structures its sales force in different countries 61
Use of sales support technologies in seven geographical markets 71
Benchmarking sales force size and structure throughout a product’s lifecycle 72
Optimizing sales force size 74
Optimizing sales force structure 81
Recommendations of best practice in sizing and structuring pharmaceutical sales forces 84
CHAPTER 3 JAPANESE SALES FORCE STRUCTURES 85
General trends in size and structure 86
Use of technology 88
Bayer 89
Sales force size 89
Structure of sales force 90
Daiichi 92
Sales force headcount: changes in sales force size, 2001-03 92
Structure of sales force 93
GlaxoSmithKline 96
Sales force size 96
Structure of sales force 97
Kyowa Hakko 99
Sales force size 99
Structure of sales force 100
Pfizer 101
Sales force size 101
Structure of sales force 103
Sumitomo 105
Sales force size 105
Structure of sales force 105
Yamanouchi 107
Sales force size 107
Structure of sales force 108
CHAPTER 4 US SALES FORCE STRUCTURES 110
2003 sales force structure in the US 111
General trends in size and structure 111
Use of technology 113
Bayer 114
Sales force size: changes in rep headcount, 2001-03 114
Structure of sales force 117
Boehringer Ingelheim 118
Sales force size: changes in rep headcount, 2001-03 118
Structure of sales force 120
ICN Pharmaceuticals 123
Sales force size: changes in rep headcount, 2001-03 123
Structure of sales force 124
Novartis 125
Sales force size: changes in rep headcount, 2001-03 125
Structure of sales force 127
Pfizer 128
Sales force size: changes in rep headcount, 2001-03 128
Structure of sales force 129
Savient Pharmaceuticals (formerly Bio-Technology General) 131
Sales force size 131
Structure of sales force 132
CHAPTER 5 UK SALES FORCE STRUCTURE 134
General trends in size and structure 135
Use of technology 137
Alliance Pharmaceuticals 138
Sales force size 138
Structure of sales force 138
Fournier Pharma 139
Sales force size 139
Structure of sales force 140
Mayne Pharmaceuticals (formerly F. H. Faulding) 141
Sales force size 141
Structure of sales force 142
Rosemont Pharmaceuticals (Savient Pharmaceuticals) 143
Sales force size 143
Structure of sales force 144
Schering-Plough 145
Sales force size 145
Structure of sales force 146
Schwarz Pharma 148
Sales force heacount: changes in sales force size, 2001-03 148
Structure of sales force 148
Unnamed French pharmaceutical company 149
Size and structure of sales force 150
CHAPTER 6 SPANISH SALES FORCE STRUCTURE 152
General trends in sales force structure 153
Use of technology 155
Química Farmacéutica Bayer 156
Sales force size 156
Structure of sales force 159
Bristol-Myers Squibb 160
Sales force size: changes in rep headcount, 2001-03 160
Structure of sales force 162
Elan Farma 163
Sales force size 163
Structure of sales force 164
Ferring 165
Sales force size 165
Structure of sales force 166
Fournier 168
Sales force size 168
Structure of sales force 169
ICN Iberica 170
Sales force size 170
Structure of sales force 172
Novartis Farmacéutica 174
Sales force size 174
Structure of sales force 177
Pfizer 179
Sales force size: changes in rep headcount, 2001-03 179
Sales force structure 185
Puerto Galiano 187
Sales force size 187
Structure of sales force 187
Roche 188
Sales force size 188
Structure of sales force 190
UCB Pharma 192
Sales force size 192
Structure of sales force 193
CHAPTER 7 ITALIAN SALES FORCE STRUCTURES 196
2003 sales force structure in Italy 197
General trends in sales force structure 197
Use of technology 199
Abiogen Pharma (Merck & Co.) 199
Sales force size: changes in rep headcount, 2001-03 199
Structure of sales force 201
Angelini 203
Sales force size 203
Structure of sales force 203
GlaxoSmithKline 206
Sales force size 206
Structure of sales force 207
Novo Nordisk 209
Sales force size 209
Structure of sales force 211
Pfizer 212
Sales force size 212
Structure of sales force 213
Pierre Fabre 215
Sales force size 215
Structure of sales force 215
CHAPTER 8 GERMAN SALES FORCE STRUCTURE 217
2003 sales force structure in Germany 218
General trends in sales force structure 218
Use of technology 221
Aventis 222
Sales force size: changes in rep headcount, 2001-03 222
Structure of sales force 225
Baxter BioScience (hemophilia division) 226
Sales force size 226
Structure of sales force 227
Betapharm Arzneimittel 228
Sales force size 228
Structure of sales force 228
Boehringer Ingelheim 229
Sales force size 229
Structure of sales force 231
Chugai Pharma 234
Sales force size 234
Structure of sales force 234
Jenapharm (Schering AG) 235
Sales force size 235
Structure of sales force 236
Merckle Arzneimittel 237
Sales force size 237
Structure of sales force 238
Riemser Arzneimittel 239
Sales force size 239
Structure of sales force 240
Rodleben Pharma (UCB Pharma) 241
Sales force size 241
Structure of sales force 242
CHAPTER 9 FRENCH SALES FORCE STRUCTURE 243
2003 sales force structure in France 244
General trends in sales force structure 244
Use of technology 246
Allergan 247
Sales force size 247
Structure of sales force 248
Aventis Behring 249
Sales force size 249
Structure of sales forc 250
Boehringer Ingelheim 250
Sales force size: changes in rep headcount, 2001-03 250
Structure of sales force 252
Chugai Pharma 254
Sales force size 254
Structure of sales force 254
Elan 255
Sales force size 255
Structure of sales force 256
Ferlux 257
Sales force size 257
Structure of sales force 257
Genzyme 259
Sales force size 259
Structure of sales force 261
Grünenthal 262
Sales force size 262
Structure of sales force 263
Solvay 265
Sales force size: changes in rep headcount, 2001-03 265
Structure of sales force 266
APPENDIX 267
Glossary of sales force terms 267
Benchmark analysis of leading pharmas 267
Regional abbreviations for Boehringer Ingelheim in the US 271
Japan 272
US 273
UK 274
Spain 275
Italy 276
Germany 277
France 278
The CAM Group: data collation and methodology 279
Glossary of terms 279
Estimated data points 286
Revenue Potential Index methodology 287
Hospital specialities covered by ICN in Spain 288
Related reading from Datamonitor Healthcare 290
Healthcare’s pharmaceutical strategy capabilities 290
About 21st Century Insight 290
About eHealthInsight 291
Strategic consulting expertise 292
Key strategy team members 293
List of Tables
Table 1: Returns on promotional investment by top tier pharmaceutical companies, 1998-2001 19
Table 2: Johnson & Johnson’s revenues by division, 2001-02 28
Table 3: Revenue Potential Index scores per company 43
Table 4: Leading companies’ portfolio composition*, 2001 45
Table 5: Revenue and sales force data for participating top tier companies 57
Table 6: Revenue and sales force data for participating middle tier companies 58
Table 7: Revenue and sales force data for participating lower tier companies 59
Table 8: Revenue and sales force data for the participating and predominantly privately owned companies 60
Table 9: Bayer: sales force data in the US, Japan and Spain, 2003 62
Table 10: Boehringer Ingelheim: sales force data in the US, Germany and France, 2003 63
Table 11: Chugai Pharma: sales force data in Germany and France, 2003 64
Table 12: Elan: sales force data in France and Spain, 2003 65
Table 13: Fournier: sales force data in Spain and the UK, 2003 66
Table 14: GlaxoSmithKline: sales force data in Japan and Italy, 2003 66
Table 15: ICN: sales force data in Spain and the US, 2003 67
Table 16: Novartis: sales force data in the US and Spain, 2003 68
Table 17: Pfizer: sales force data in the US, Japan, Italy and Spain, 2003 69
Table 18: UCB Pharma: sales force data in Spain and Germany, 2003 71
Table 19: Most popular range of sales support technologies used in seven geographical reports, 2003 72
Table 20: Revenue and sales force data for seven participating companies 86
Table 21: Range of technologies used by sales forces in Japan, 2003 89
Table 22: Bayer’s key prescription products in Japan, 2002 90
Table 23: Sales of Daiichi’s prescription pharmaceuticals in Japan, March 2003 93
Table 24: GlaxoSmithKline’s CNS and respiratory franchises drove global revenue growth, 2001-02 96
Table 25: Sales of Kyowa Hakko’s key drugs, 2001-02 100
Table 26: Pfizer’s cardiovascular and CNS franchises drove global revenue growth, 2001-02 102
Table 27: A breakdown of Sumitomo’s ethical sales, March 2003 105
Table 28: Yamanouchi’s top selling drugs, March 2003 107
Table 29: Revenues and sales force data of six participating companies 111
Table 30: Range of technologies used by sales forces in the US, 2003 114
Table 31: Bayer’s prescription products currently sold in the US 115
Table 32: Most of Bayer’s best-selling drugs are facing declining global sales, 2001-02 116
Table 33: Global sales of Boehringer Ingelheim’s top 10 pharmaceutical products, 2001-02 120
Table 34: Sales of ICN’s top 10 global pharmaceutical products, 2002 124
Table 35: Novartis’s cardiovascular and oncology franchises drove global revenue growth, 2001-02 126
Table 36: Pfizer’s cardiovascular and CNS franchises drove global revenue growth, 2001-02 129
Table 37: Revenue and sales force data for seven participating companies 135
Table 38: Range of technologies used by sales forces in the UK, 2003 137
Table 39: Most of Schering-Plough’s key franchises are experiencing declining global sales, 2001-02 146
Table 40: Revenue and sales force data of 11 participating companies 153
Table 41: Range of technologies used by sales forces in Spain, 2003 156
Table 42: Most of Bayer’s best-selling drugs are facing declining global sales, 2001-02 158
Table 43: Bristol-Myers Squibb’s cardiovascular and cancer franchises drove global revenue growth, 2001-02 162
Table 44: Elan’s CNS and anti-infectives franchises drove global revenue growth, 2000-01* 164
Table 45: Global sales of the leading branded fibrates, 2000-01 169
Table 46: Sales of ICN’s top 10 global pharmaceutical products, 2002 172
Table 47: Novartis’s cardiovascular and oncology franchises drove global revenue growth, 2001-02 177
Table 48: Pfizer’s cardiovascular and CNS franchises drove global revenue growth, 2001-02 182
Table 49: Products promoted by Pfizer reps targeting either hospitals or therapy area specialists in Spain, 2003 184
Table 50: Roche’s oncology franchise drives global revenue growth, 2001-02 190
Table 51: Allergic rhinitis and anti-epilepsy products drove UCB Pharma’s global revenues, 2001-02 193
Table 52: Revenue and sales force data of six participating companies 197
Table 53: Range of technologies used by sales forces in Italy, 2003 199
Table 54: Abiogen’s diabetes and musculoskeletal franchises are leading domestic revenue growth, 2000-03 201
Table 55: GlaxoSmithKline’s CNS and respiratory franchises drove global revenue growth, 2001-02 207
Table 56: Novo Nordisk’s hemostasis management and diabetes care franchises drove global revenue growth, 2001-02 210
Table 57: Pfizer’s cardiovascular and CNS franchises drove global revenue growth, 2001-02 213
Table 58: Revenue and sales force data of nine participating companies 218
Table 59: Range of technologies used by sales forces in Germany, 2003 222
Table 60: Aventis’s oncology and diabetes franchises drove global revenue growth, 2001–02 224
Table 61: Global sales of Boehringer Ingelheim’s top 10 pharmaceutical products, 2001-02 231
Table 62: Revenue and sales force data for nine participating companies244
Table 63: Range of technologies used by sales forces in France, 2003 246
Table 64: Allergan’s entire marketed portfolio is experiencing double-digit growth in sales, 2001-02 247
Table 65: Aventis’s revenues by division, 2001–02 249
Table 66: Global sales of Boehringer Ingelheim’s top 10 pharmaceutical products, 2001-02 252
Table 67: Elan’s CNS and anti-infectives franchises drove global revenue growth, 2000-01* 256
Table 68: Genzyme General’s marketed biotherapeutics portfolio, 2001–02 261
Table 69: Solvay’s cardiovascular and gastrointestinal franchises drove global revenue growth, 2001–02 265
Table 70: Total detailing spend, marketing spend and ethical sales, 1998-2001 268
Table 71: Key metrics of the top 14 pharmaceutical companies 268
Table 72: Detailing, marketing, sales force and ethical revenue data for the top 14 companies 269
Table 73: Detailing and marketing ROI data for the top 14 companies 270
Table 74: Ethical revenues per Revenue Potential Index score* 271
Table 75: Promotional universe 285
Table 76: Estimated data points and methodology 286
Table 77: Revenue Potential Index metrics and ranking system 288
List of Figures
Figure 1: Lower detailing spend or higher marketing investment boosts ethical revenues* 6
Figure 2: Growth in detailing and marketing costs have surpassed ethical sales, 1998-2001 16
Figure 3: Returns on promotional investment for the top 14 companies has declined significantly, 1998-2001 20
Figure 4: Strong linear correlation between the marketing and detailing spend* for the top 14 companies 23
Figure 5: Ethical revenues are improved when marketing spend* is increased or detailing spend* is reduced 24
Figure 6: Comparing S,G & A spend and ethical revenues for the top 13 pharmaceutical companies, 2001-2 26
Figure 7: Benchmarking absolute promotional spend against ethical revenues generated within defined therapy areas* 29
Figure 8: Sizeable armies of sales reps and smaller sales forces generate similar return 31
Figure 9: Leading companies are achieving low promotional returns 33
Figure 10: Benchmarking promotional ROI against ethical revenues generated within defined therapy areas 35
Figure 11: Low returns in promotion are being achieved mainly from detailing 38
Figure 12: Strong linear correlation between the clinical quality of a portfolio and the generated ethical revenue 42
Figure 13: Benchmarking corporate Revenue Potential Index against average Revenue Potential Index per product 44
Figure 14: The level of detailing spend has a poor linear correlation with the revenue generated from a particular portfolio of products 48
Figure 15: Key recommendations to lower detailing costs and increase product returns 50Figure 16: Key revenue objectives throughout a product’s lifecycle 73
Figure 17: Average change in sales force size throughout a drug’s lifecycle* 74
Figure 18: Key factors that drive the level of detailing investment to be increased throughout a product’s lifecycle 77
Figure 19: Estimating the detailing productivity on a product-by-product basis applicable to any stage of the lifecycle 78
Figure 20: Evaluating the detailing effectiveness for a particular product at launch 80
Figure 21: Determining the level of market penetration within a defined customer base 82
Figure 22: Using activity-based assessment to define profit by customer segment* 83
Figure 23: Japan: generic sales force organogram, 2003 88
Figure 24: Japan: structure of Bayer’s sales force in 2003 91
Figure 25: Japan: structure of Daiichi’s sales force in 2003 95
Figure 26: Japan: structure of GlaxoSmithKline’s sales force in 2003 98
Figure 27: Japan: structure of Kyowa Hakko’s sales force in 2003 101
Figure 28: Japan: structure of Pfizer’s sales force in 2003 104
Figure 29: Japan: structure of Sumitomo’s sales force in 2003 106
Figure 30: Japan: structure of Yamanouchi’s sales force in 2003 109
Figure 31: US: a generic sales force organogram 113
Figure 32: US: structure of Bayer’s sales force, 2003 118
Figure 33: US: structure of Boehringer Ingelheim’s sales force in 2003* 122
Figure 34: US: structure of ICN Pharmaceuticals’ sales force in 2003 125
Figure 35: US: structure of Novartis’s sales force in 2003 127
Figure 36: US: structure of Pfizer’s sales force in 2003 130
Figure 37: Savient Pharmaceuticals: 2002 global sales by product 132
Figure 38: US: structure of Savient Pharmaceuticals’ sales force in 2003 133
Figure 39: UK: generic sales force organogram, 2003 136
Figure 40: UK and Ireland: structure of Alliance Pharmaceuticals’ sales force in 2003* 139
Figure 41: UK: structure of Fournier Pharma’s sales force in 2003 141
Figure 42: UK: structure of Mayne Pharmaceuticals’ sales force in 2003 143
Figure 43: UK: structure of Rosemont Pharmaceuticals’ sales force in 2003 145
Figure 44: UK: structure of Schering-Plough’s sales force in 2003 147
Figure 45: UK and Ireland: structure of Schwarz Pharma’s sales force in 2003 149
Figure 46: UK: structure of unnamed French pharmaceutical company’s sales force in 2003 151
Figure 47: Spain: a generic sales force organogram 154
Figure 48: Spain: structure of Bayer’s sale force in 2003 160
Figure 49: Spain: structure of Bristol-Myers Squibb’s sales force in 2003 163
Figure 50: Spain: structure of Elan’s sales force in 2003 165
Figure 51: Spain: structure of Ferring’s sales force in 2003 167
Figure 52: Spain: structure of Fournier’s sales force in 2003 170
Figure 53: Spain: structure of ICN’s sales force in 2003 174
Figure 54: Spain: structure of Novartis’s sales force in 2003 178
Figure 55: Products detailed by Pfizer’s Spanish sales force to primary care physicians, 2003 180
Figure 56: Spain: structure of Pfizer’s sales force in 2003 186
Figure 57: Spain: structure of Puerto Galiano OTC sales force in 2003 188
Figure 58: Spain: structure of Roche’s sales force in 2003 191
Figure 59: Spain: structure of UCB Pharma’s sale force in 2003 195
Figure 60: Italy: a generic sales force organogram 198
Figure 61: Breakdown of the proportion of visits to doctors made by Abiogen’s sales force in 2002 200
Figure 62: Italy: structure of Abiogen’s sales force in 2003 202
Figure 63: Italy: structure of Angelini’s sales force in 2003 205
Figure 64: Italy: structure of GlaxoSmithKline’s sales force in 2003 209
Figure 65: Italy: structure of Novo Nordisk’s sales force in 2003 211
Figure 66: Italy: structure of Pfizer’s sales force in 2003 214
Figure 67: Italy: structure of Pierre Fabre’s sales force in 2003 216
Figure 68: Germany: a generic sales force organogram 220
Figure 69: Germany: structure of Aventis’s sales force in 2003 226
Figure 70: Germany: structure of Baxter BioScience’s hemophilia division sales force in 2003 228
Figure 71: Germany: structure of Betapharm’s sales force in 2003 229
Figure 72: Germany: structure of Boehringer Ingelheim’s sales force in 2003* 233
Figure 73: Germany: structure of Chugai Pharma’s sales force in 2003 235
Figure 74: Germany: structure of Jenapharm’s sales force in 2003 237
Figure 75: Germany: structure of Merckle’s sales force in 2003 239
Figure 76: Germany: structure of Riemser’s sales force in 2003 241
Figure 77: Germany: structure of Rodleben Pharma’s sales force in 2003 242
Figure 78: France: a generic sales force organogram 245
Figure 79: France: structure of Allergan’s sales force in 2003 248
Figure 80: France: structure of Aventis Behring’s sales force in 2003 250
Figure 81: France: structure of Boehringer Ingelheim’s sales force in 2003 253
Figure 82: France: structure of Chugai’s Pharma’s sales force in 2003 255
Figure 83: France: structure of Elan’s sales force in 2003 257
Figure 84: France: structure of Ferlux’s sales force in 2003 259
Figure 85: France: structure of Genzyme’s sales force in 2003 262
Figure 86: Pain and infectious diseases franchises are the main contributors to Grünenthal’s global 2002 revenues 263
Figure 87: France: structure of Grünenthal’s sales force in 2003 264
Figure 88: France: structure of Solvay’s sales force in 2003 266
Figure 89: Regional map of Japan 272
Figure 90: Regional map of the US 273
Figure 91: Regional map of the UK 274
Figure 92: Regional map of Spain 275
Figure 93: Regional map of Italy 276
Figure 94: Regional map of Germany 277
Figure 95: Regional map of France 278
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