Pharmaceutical Sales Force Strategies: Driving ROI Through Best Practice In Targeting, Management, Outsourcing And Technologies
Scripp Business Insights, December 2004
The management report 'Pharmaceutical Sales Force Strategies: Driving ROI through best practice in targeting, management, outsourcing and technologies' provides a detailed analysis of current trends in commercial ROI across the pharmaceutical, biotechnology and specialty pharmaceutical industries. Continued sales force growth has resulted in increasingly aggressive promotion to physicians, reducing the average duration of detailing visits and diluting 'share of voice' with the physician. Changes in physicians' information needs across a product's lifecycle has resulted in requirements for more responsive and flexible promotional efforts. New sales force tactics are being considered within Europe, US and Japan, such as the implementation of new CRM approaches, investment into new technologies and partnering with commercial alliance partners. This report’s case studies and primary research with current industry leaders provides unique strategic insight. Examine the best practises that will help you drive ROI in your pharmaceutical sales force and will boost your product up-take, with the help of this report.
This report answers the questions:
- What key factors are driving the increasing attention paid to improving
sales force effectiveness in the pharmaceutical industry?
- What are the key levers of sales force effectiveness in the
pharmaceutical industry and what will deliver the greatest ROI?
- What are the key trends in sales force size and detailing frequency?
- What are the key drivers of sales force effectiveness in the future?
- Which companies are using best practise to deliver sales force
effectiveness?
- What are the key trends in the use of CSOs and commercial alliances as
potential sources of improved sales force effectiveness?
- How can new technologies deliver benefits to pharmaceutical sales
forces?
Reasons to purchase this report:
- Identify the most suitable cost effective strategies that will
optimize your company’s sales force performance.
- Analyze leading companies’ strategies, such as Allergan and Pfizer,
with detailed case studies.
- Determine your optimal strategy by utilizing ROI evaluations
which provide a framework for different companies in different
contexts.
- Evaluate your internal sales force effectiveness program by
benchmarking your company against competitors, with studies from
Pfizer, AstraZeneca, Allergan and Takeda.
- Benefit from targeted recommendations on targeting, mangement,
outsourcing and technologies
- Examine the current best practises that senior pharmaceutical sales
executives have identified within our survey.
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
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.
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