Contents:

Executive summary 10 Pharmaceutical sales force landscape 10 Sizing, structuring and targeting 11 Recruiting, training and rewarding 12 Enabling technologies 13 Outsourcing and partnering 13 Strategies for increasing promotional ROI 15 Chapter 1 Pharmaceutical sales force landscape 18 Summary 18 Introduction 19 Changing dynamics of the pharmaceutical industry 19 Resistors to pharmaceutical sales growth 19 Cost containment 20 Generic competition and parallel importing 21 R&D costs and productivity 22 M&A activity 25 Rising commercial expenses 26 Physician detailing 27 Commercial ROI 28 Physician detailing ROI 34 Changing needs of the physician 34 Detailing trends 35 A quieter voice in a louder market 38 Content not frequency 39 The PhRMA code of conduct 40 Impact on the shape and role of the pharmaceutical sales force 41 Organization 42 Management 42 Technologies 43 Collaborations 43 Chapter 2 Sizing, structuring and targeting 45 Summary 45 Introduction 46 Sales force numbers 48 Trends in headcount 50 US sales force numbers 51 European sales force numbers 53 Japanese sales force numbers 53 Case study: Pfizer 54 Sales force structures 56 Trends in structure 56 US sales force structures 57 European sales force structures 58 Japanese sales force structures 60 Segmenting and targeting 61 Product prioritization 61 Primary care versus specialty 62 Chapter 3 Recruiting, training and rewarding 64 Summary 64 Introduction 65 Recruiting talent 65 Internal versus external HR 66 Training and development 68 Benchmarking detailing performance 69 Training versus coaching 70 Case study: AstraZeneca 71 Incentives and rewards 73 Trends in remuneration structure 73 Incentive programs 75 Non-cash incentives 77 Chapter 4 Enabling technologies 80 Summary 80 Introduction 81 Sales force automation 81 Sales force productivity 83 Trends across markets 83 Impact of new technologies 85 Case study: Allergan 87 eDetailing 88 A software solution to increase face-to-face detailing time 89 The ROI of video detailing 90 Enhancing physician relationships through mPrescribing 91 Trends in eDetailing 91 eSampling 93 Integrated web-based solutions 94 Other technologies 95 Laptop 96 PDA 96 Smart phone 97 Chapter 5 Outsourcing and partnering 101 Summary 101 Introduction 102 CSOs 102 Trends in use of CSOs 106 Add-on versus replacement 108 Case study: Takeda 109 Background 109 Situation 109 Taking a different path 110 Regional Account Directors (RADs) 111 Ashfield Healthcare 112 ROI 112 Commercial alliances 114 Trends in use of collaborative partnerships 114 Co-promotion 116 Co-marketing 117 Strategic partnerships 118 Chapter 6 Strategies for increasing promotional ROI 121 Summary 121 Introduction 122 vi Measuring ROI 122 Field force productivity 122 Sales force ROI 124 Organization 127 Management 128 Technology 129 Partnering 131 CRM 133 Physician’s perceptions 134 Lasting physician relationships 135 Partnering with the patient 136 Best practices 137 Meetings and events 137 Mid-level practitioners 138 Permission-based sales model 139 Case study: Pharma’s top-ranked sales force 140 Appendix 143 Primary research 143 References 144 Index 147 List of Figures Figure 1.1: Resistors to pharmaceutical revenue growth 20 Figure 1.2: R&D expenditure as a proportion of sales, 1980-2003 24 Figure 1.3: R&D productivity, 1994-2003 25 Figure 1.4: Absolute and proportional promotional expenses, 2000-2003 26 Figure 1.5: Promotional expenses split by source, 2000-2003 27 Figure 1.6: Commercial ROI by leading pharma company, 2002-2003 29 Figure 1.7: Commercial ROI by leading biotech company, 2002-2003 31 Figure 1.8: Commercial ROI by leading specialty company, 2002-2003 33 Figure 1.9: Trends in the number of detailing visits per sales rep over next 2-3 years 36 Figure 1.10: Trends in the average length of detailing visits over next 2-3 years 38 Figure 1.11: Key influences on sales force ROI 41 Figure 2.12: Impact of US promotional spend on US sales, 2003 46 Figure 2.13: Impact of US detailing spend on US sales, 2003 47 Figure 2.14: Impact of US sales force size on US detailing spend, 2003 49 Figure 2.15: Trends in sales force headcount over next 2-3 years 51 Figure 2.16: Impact of US sales force size on US sales, 2003 52 Figure 2.17: Typical US sales force structure, 2003 58 Figure 2.18: Typical EU sales force structure, 2003 59 Figure 2.19: Typical Japanese sales force structure, 2003 60 Figure 3.20: Trends in the proportion of sales force remuneration comprised of basic pay over next 2-3 years 74 Figure 4.21: Greatest impact on sales force effectiveness over next 2-3 years 86 Figure 4.22: Uptake of eDetailing across Europe and the US 92 Figure 5.23: Trends in the use of CSOs over next 2-3 years 107 Figure 5.24: Trends in the use of collaborative sales forces over next 2-3 years 114 Figure 6.25: Field force productivity model 124 Figure 6.26: Sales force ROI model 125 Figure 6.27: Relative ROI impact of sales force effectiveness strategies 126 Figure 6.28: Survey respondents split by company type and region 143 List of Tables Table 1.1: Total pharmaceutical R&D expenditure, 1980-2003 22

Sample

eDetailing While there is increased pressure for sales reps to maximize detailing time, there is an equal emphasis on optimizing the quality of promotional contact with a product's target audience. This increase in quality requires the adoption of technologies that present the rep as a product educator, rather than a mere promotional agent. Additionally, technology can enhance and extend the relationships reps have established with physicians through using new medium applications such as electronic and video detailing. However, such investments can only be justified by effectively targeting the right technologies towards different physician prescribing patterns. eDetailing describes detailing activities conducted electronically, most often online via the Internet, sometimes with personal computing devices or via Internet-enabled video conferencing. eDetailing provides an opportunity to maximize access to physicians by allowing the prescriber to initiate the detailing process. This reach can be extended irrespective of geographic limitations. eDetailing also provides future opportunities for physicians to interact with online communities and also provides pharmaceutical companies with quantifiable tracking data relating to physicians' responses and queries about pre-launched or launched products. Furthermore, matching the eDetailing format and program to a physician's prescribing behavior further increases the ROI of the promotional effort. This is achieved largely through an increased number of rep calls.