Research summary for Resource Benchmarks for US Pharma Managed Care Operations. Contact me to view the full report.

1. Resource Benchmarks for U.S.
Pharmaceutical Managed Care Operations
Best Practices, LLC Benchmarking Report

2. Table of Contents
 Project Overview
 Key Findings
 Structure, Revenue and Brand Oversight
 Staffing Profiles for U.S. Managed Care
 Budget Allocation By Activity for U.S.
Managed Care
 Efficiency Ratios
 Best Practices
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3. Business Issue and Corporate Challenge
This benchmark study will provide payer and Managed Care leaders with important
benchmarks on the optimal size of U.S. Managed Care groups. The study focused
exclusively on U.S. pharmaceutical/biotechnology company operations.
Research Objectives:
This survey probes the resource levels, structure and revenue of U.S. Managed Care
groups for major pharmaceutical and biotechnology companies.
 Key study objectives
 Overall Staffing Levels
 Outsourcing Levels
 Staffing Levels Per Key Activity
 Staffing Levels Linked to Brands Supported
 Financial Investment for U.S. Managed Care Group and Key Activities
 Staffing Efficiency Measures
INFORM Research Outcome
Field Research & Insight Development:
 Results based on survey responses from 12 Improve Management of
biopharmaceutical, and medical device
executives. Managed Care Operations
2
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4. Definitions for Study Purposes
The following terms are defined as follows for this study:
U.S. Managed Care: Pharmaceutical or biotechnology Managed Care divisions that serve the
U.S. Managed Care: Pharmaceutical or biotechnology Managed Care divisions that serve the
following customers: MCOs, PBMs, Trade/Wholesale, Hospitals/IDN, Public Payors (VA, DoD,
following customers: MCOs, PBMs, Trade/Wholesale, Hospitals/IDN, Public Payors (VA, DoD,
Federal Accts), Clinics (e.g. dialysis) and Specialty Pharmacies.
Federal Accts), Clinics (e.g. dialysis) and Specialty Pharmacies.
This study defines Managed Care divisions by the following activities:
This study defines Managed Care divisions by the following activities:
•Account management
•Account management
•Customer marketing strategy (sets contract strategy, liaison to brand teams)
•Customer marketing strategy (sets contract strategy, liaison to brand teams)
•Contract management (back office support)
•Contract management (back office support)
•Customer market research (specific to Managed Care customers)
•Customer market research (specific to Managed Care customers)
•Customer program management (e.g., disease management or value-added programs)
•Customer program management (e.g., disease management or value-added programs)
•Pharmacy Relations
•Pharmacy Relations
•Public Payor pricing (Implementation of rebates/chargebacks for Medicare/Medicaid/DoD/VA).
•Public Payor pricing (Implementation of rebates/chargebacks for Medicare/Medicaid/DoD/VA).
FTE: For the purposes of this study aa"FTE" is defined as aafull-time equivalent resource. For
FTE: For the purposes of this study "FTE" is defined as full-time equivalent resource. For
example; ififfull time employees are expected to work forty hours per week that equates to 1.0
example; full time employees are expected to work forty hours per week that equates to 1.0
FTE. Twenty hours per week is half time or .50 FTE.
FTE. Twenty hours per week is half time or .50 FTE.
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5. List of Participating Companies/ Range of
Career Levels
The benchmark class includes 12 participants from the companies across pharmaceutical,
biotech and medical device industries. Their roles ranged from senior leaders to
managers of managed markets.
 Bayer Healthcare  Director Marketing Managed Markets
 Shire  Sr. Exec. Dir, Sales Rep
 GlaxoSmithKline -  Executive Director, Sales
Respiratory Representative
 GlaxoSmithKline  Sr. Director, MM
 Millennium  Senior Director, US Market Access
 Smith & Nephew  Health Policy & Reimbursement
 Forest Laboratories Director
 Alcon  National Director, Managed Market
 Acorda Therapeutics Sales
 Amylin  Vice President
 Purdue  Assistant Director, Managed Care
Training
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6. Key Findings
The following key findings and insights emerged from the field surveys, direct interviews
and study verbatim.
 All U.S. Managed Care Headcount is internal staff: Members of the benchmark
class do not actively outsource their Managed Care activities. Almost all the
activities are performed internally at the benchmark companies.
 Account Management & Contract Management have the highest average
headcounts: The average FTE deployed for Account Management and Contract
Management activities shows the important role in overall Managed Care business
in the United States. Account management is the most critical activity in U.S.
Managed Care.
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7. Managed Care Structure Remains Centralized
Sixty-seven percent of benchmark companies prefer a centralized structure to organize
their Managed Care function. More than 90% of benchmarked organizations Managed
Care function either have a hybrid or centralized structure compared to 100% centralized
structure in 2003.
How are Managed Care resources organized in your U.S. operations?
Decentralized
, 8%
Hybrid, 25%
Centralized,
67%
N=12
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8. Managed Care Supports Myriad of Services
Almost all the activities performed at the benchmarked companies are supported by U.S.
Managed Care. Amongst all the activities, one thirds of the benchmark class do not support
activities like customer market research, customer program and pharmacy relations.
Does Your U.S. Managed Care Support following activities?
Yes No
17% 33% 33% 33% 8%
100% 100%
92%
83%
67% 67% 67%
Account Customer Contract Customer Customer Pharmacy Public payor
management marketing management market program relations pricing
research
N=12
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9. Customer Marketing Strategy FTE Allocation
The average FTEs in 2010 are only one-third of what they were in 2003 for the Customer
Marketing Strategy function.
Number of Total FTEs for Customer Marketing Strategy
14
8.5
6
4
2.5 2
Max 75th Mean Median 25th Min
Percentile Percentile
N=11
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10. About Best Practices, LLC
Best Practices, LLC is a research and consulting firm that conducts work
based on the simple yet profound principle that organizations can chart a
course to superior economic performance by studying the best business
practices, operating tactics and winning strategies of world-class
companies.
Best Practices, LLC
6350 Quadrangle Drive, Suite 200, Chapel Hill, NC 27517
919-403-0251
best@best-in-class.com
www.best-in-class.com
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