1. A Datamonitor In-Depth Analysis
Pharmaceutical Sales Forces
Benchmarking sales force management by
geographical market and product lifecycle
Published: Aug-03 Code: DMHC1904
95% of Datamonitor clients use
our research to help improve
their company’s decision making
Source: Datamonitor customer research
Why buy this analysis?
• Identify new promotional strategies
that could halt the decline in ROI from
physicians detailing
• Benchmark the size and structure of your
company's sales force against competitors
in different disease markets and countries
• Determine the key metrics needed to
link sales force productivity with the sales
performance of a product
• Understand the different sizing and
structuring strategies a company applies
with its sales force in different markets
• Learn from the industry's leaders when
optimizing promotional effectiveness across
different therapy areas and geographical
markets
www.dat amonitor.com/healthcare
2. Pharmaceutical Sales Forces: Benchmarking Sales Force Management by Geographical Market and Product Lifecycle
DMHC1904
tel: +44 20 7675 7014 fax: +44 20 7675 7016 email: hcinfo@datamonitor.com
Introduction
Scope and coverage
Pharmaceutical Sales Forces: Benchmarking Sales
Force Management by Geographical Market and
Product Lifecycle provides an in-depth profile of 56
sales forces' size and structure from 41 companies
operating in Japan, US, UK, Spain, Italy, Germany and
France.
Breakdown includes rep allocation by target audience, therapy area/indication and
region, which is correlated with the marketed portfolio defining key areas of
promotional focus. Benchmarking analysis also reviews sales support technologies.
Optimizing sales force size and structure throughout the product lifecycle is discussed
with use of a proprietary benchmarking ROI model. The study also benchmarks 14
top tier companies' investment in primary care promotion in the US and Europe from
1998-2001. Investment strategies and ROI in detailing versus marketing are
compared with support of a proprietary revenue potential index.
• Accurate 2003 sales force structure data from 56 sales forces operating in
Japan, US, UK, Spain, Italy, Germany and France
• Evaluate optimal sales force sizing and structuring strategies with use of
a proprietary benchmarking ROI model
• Benchmark 14 top tier pharmaceutical companies' investment in primary
care promotion in the US, UK, Spain, Italy, Germany and France from 1998-
2001
• Compare and contrast investment strategies and ROI in face-to-face detailing
versus marketing cost with support of a proprietary revenue potential index
Research methodology
Pharmaceutical Sales Forces reflects primary research with 56 senior sales
executives. Benchmark analysis of 14 top tier companies' promotional investment
is from CAM Group base data supported by a proprietary revenue potential index.
Optimal sales force strategies are discussed with use of a proprietary benchmarking
ROI model.
For more information...
Eimear O'Brien, Director of Strategy Analysis
3. Achieve blockbuster revenues
Entering new market
Increase market penetration
Increase product’s profile in the
face of competitors
Boost market share at
the expense of older competitors
Acquire market share lost
by rival product withdrawal
Compete effectively with the
launch of newer competitors
Boost market share at
the expense of older
competitors
Switch customers to follow -up
product
Promote Phase IV studies, line
extensions or multiple indications
Launching 2 nd or 3rd
generation products
Productsales
Producttsales
Key findings and highlights
• Companies are not maximizing their returns from detailing spend despite
the continual focus to maintain high sales force numbers.
• Each stage of a product's lifecycle presents a different set of objectives to a
pharmaceutical marketer when intending to maximize revenue potential. Sales
force size and structure has to evolve to fully realize this sales potential but
without driving promotional costs up and reducing associated profit margins.
• Sales force size and structure has to be linked directly with product performance.
• The regional focus of a sales force has to be driven by physicians'
prescribing behavior. Determining the sales potential of the product defines
which areas would benefit greatly from sales force presence.
Average change in sales force size
throughout a drug's lifecycle
Key factors that drive the level of detailing investment
to be increased throughout a product's lifecycle
Total sales force size
assigned to product
*Data is based on primary research in
2003
Achieve blockbuster revenues
Entering new market
Compete effectively with the
launch of newer competitors
Boost market share at
at launch Overall reduction
in size of about
50% Overall reduction
in size of about
80%
Increase market penetration
the expense of older
competitors
100%
70-35%
40-0%
No sales force
capacity used
Launch Growth Maturitty Nearlly
offff
pattent
Pattent expiry
0%
Launch Growth Maturity Nearly off
patent
Patent expiry 2 6 10 14
Years on tttttthe market
Increase product’s profile in the
face of competitors Switch customers to follow -up
product
2 6 10 14
Years on the market
Boost market share at
the expense of older competitors
Acquire market share lost
by rival product withdrawal
Promote Phase IV studies, line
extensions or multiple indications
Launching 2 nd or 3rd
generation products
Source: Datamonitor DATAMONITOR Source: Datamonitor DATAMONITOR
Structure, chapter by chapter
• Companies need to re-think current detailing strategies to halt declining returns:
recommendations to increase the effectiveness of detailing strategies
• Optimizing sales force size and structure throughout the product
lifecycle: benchmark analysis of sales force management in different
geographical markets and by product
• Japanese sales force structures: detailed breakdown of 7 domestic
and international sales forces operating in Japan
• US sales force structures: detailed breakdown of 6 sales forces operating in the US
• UK sales force structures: detailed breakdown of 7 sales forces operating in the UK
• Spanish sales force structures: detailed breakdown of 11 sales forces
operating in Spain
• Italian sales force structures: detailed breakdown of 6 sales forces
operating in Italy
• German sales force structures: detailed breakdown of 9 sales forces
operating in Germany
• French sales force structures: detailed breakdown of 9 sales forces operating
in France
“...Returns on promotional investment for the top 14 companies have declined
by an average 24 per cent between 1998 and 2001...”
4. Source: Datamonitor Survey
Summary of Contents
DRIVERS AND TRENDS
Sales force expansion has not generated the expected returns but
companies are under pressure to match the promotional spend of
competitors to maintain their sales force 'share of voice,' which refers
to the number of reps detailing a particular drug. Datamonitor defines
the key problem in promotional investment through benchmark
analysis and provides a solution to improve sales force effectiveness.
• How can face-to-face detailing with physicians be increased?
• What metrics do I need to better assess the sales
force's productivity?
• What stages of the product lifecycle should changes in sales
force size be made?
• How are different sales forces sized and structured in
seven regional markets?
• How does the same company organize its sales force in
different markets?
COMPANIES NEED TO RE-THINK CURRENT DETAILING
STRATEGIES TO HALT DECLINING RETURNS
Companies are not maximizing their returns from detailing spend
despite the continual focus to maintain high sales force numbers.
Furthermore, the size of the sales force had a negligible impact on
returns. A large sales force produced similar returns to a smaller sales
force indicating that economies of scale did not factor into achieving
high revenue margins from increased detailing investment.
Datamonitor challenges the industry's focus on maintaining high face-
to-face detailing spend and instead recommends the level of
investment change in favor of more effective promotional strategies.
• Benchmark analysis of current promotional strategies of the top
14 pharmaceutical companies
• Apply a proprietary revenue potential index to identify
optimal promotional effectiveness
• Determine if high investment in either detailing or
marketing boosts ethical revenues
• Identifying key tactics to increase promotional effectiveness
• Benefit from recommendations to optimize sales
force effectiveness
OPTIMZING SALES FORCE SIZE AND STRUCTURE
THROUGHOUT THE PRODUCT LIFECYCLE
Each stage of a product's lifecycle presents a different set of
objectives to a pharmaceutical marketer when intending to maximize
revenue potential. Consequently, sales force size and structure have
to evolve to ensure the product's full sales potential is captured but
without driving promotional costs up and reducing associated profit
margins. Datamonitor suggests that companies need to understand
the true sales performance of their product by determining which
sectors of the customer segment have highest sales potential.
• Compare and contrast the size and structure of sales forces
from top, middle and lower tier companies
• Benchmark current sizing and structuring strategies applied by
the same company to its sales force in different markets
• Use proprietary analysis to define which metrics provide
an overview of sales force performance
• Identify the key changes needed in either sales force size
or structure throughout the product lifecycle
• Provide recommendations of best practice in sizing
and structuring sales forces
SALES FORCE STRUCTURES: JAPAN, US, UK, SPAIN,
ITALY, GERMANY AND FRANCE
Sales force size and structure varies in each market and is mainly
driven by the type of target audience sought, size of the marketed
portfolio and regional coverage. Datamonitor provides a detailed
breakdown of 56 sales forces from 41 companies operating in seven
geographical markets.
• Access accurate 2003 sales force data and opinions of
senior sales executives
• Identify the key promotional focus of each sales force
• Understand the rationale for either expanding or reducing
a particular sales force
• Compare and contrast the size and structure of sales forces
from top, middle and lower tier companies within the same
market communicating product value
• To implement effective reimbursement strategies,
pharmaceutical companies must adopt an organizational
structure that enables coordination across multiple business
functions while accounting for global variation in reimbursement
policy
APPENDIX
• Glossary of sales force terms
• Benchmark analysis of leading pharmaceutical companies
• Regional maps
• Methodology for use of the CAM Group data
• Datamonitor's promotional universe
• Datamonitor's revenue potential index
DATASETS
Table 1: Returns on promotional investment by top tier
pharmaceutical companies, 1998-2001
Table 2: Johnson & Johnson's revenues by division, 2001-02
Table 3: Revenue Potential Index scores per company
Table 4: Leading companies' portfolio composition*, 2001
Table 5: Revenue and sales force data for participating top
tier companies
Table 6: Revenue and sales force data for participating middle
tier companies
Table 7: Revenue and sales force data for participating lower
tier companies
Table 8: Revenue and sales force data for the participating
and predominantly privately owned companies
Table 9: Bayer: sales force data in the US, Japan and Spain, 2003
Table 10: Boehringer Ingelheim: sales force data in the US, Germany
and France, 2003
Table 11: Chugai Pharma: sales force data in Germany and France,
2003
“...The ROI from physician detailing is declining and continual sales force expansion
is a major contributor to this outcome...”
5. Table 12: Elan: sales force data in France and Spain, 2003
Table 13: Fournier: sales force data in Spain and the UK, 2003
Table 14: GlaxoSmithKline: sales force data in Japan and Italy, 2003
Table 15: ICN: sales force data in Spain and the US, 2003
Table 16: Novartis: sales force data in the US and Spain, 2003
Table 17: Pfizer: sales force data in the US, Japan, Italy and Spain,
2003
Table 18: UCB Pharma: sales force data in the US, Japan, Italy and
Spain, 2003
Table 19: Most popular range of sales support technologies used in
seven geographical reports, 2003
Table 20: Revenue and sales force data for seven
participating companies
Table 21: Range of technologies used by sales forces in Japan, 2003
Table 22: Bayer's key prescription products in Japan, 2002
Table 23: Sales of Daiichi's prescription pharmaceuticals in Japan,
March 2003
Table 24: GlaxoSmithKline's CNS and respiratory franchises drove
global revenue growth, 2001-02
Table 25: Sales of Kyowa Hakko's key drugs, 2001-02
Table 26: Pfizer's cardiovascular and CNS franchises drove global
revenue growth, 2001-02
Table 27: A breakdown of Sumitomo's ethical sales, March 2003
Table 28: Yamanouchi's top selling drugs, March 2003
Table 29: Revenues and sales force data of six
participating companies
Table 30: Range of technologies used by sales forces in the US, 2003
Table 31: Bayer's prescription products currently sold in the US
Table 32: Most of Bayer's best-selling drugs are facing declining
global sales, 2001-02
Table 33: Global sales of Boehringer Ingelheim's top 10
pharmaceutical products, 2001-02
Table 34: Sales of ICN's top 10 global pharmaceutical products, 2002
Table 35: Novartis's cardiovascular and oncology franchises drove
global revenue growth, 2001-02
Table 36: Pfizer's cardiovascular and CNS franchises drove global
revenue growth, 2001-02
Table 37: Revenue and sales force data for seven
participating companies
Table 38: Range of technologies used by sales forces in the UK, 2003
Table 39: Most of Schering-Plough's key franchises are experiencing
declining global sales, 2001-02
Table 40: Revenue and sales force data of 11 participating
companies
Table 41: Range of technologies used by sales forces in Spain, 2003
Table 42: Most of Bayer's best-selling drugs are facing declining
global sales, 2001-02
Table 43: Bristol-Myers Squibb's cardiovascular and cancer franchises
drove global revenue growth, 2001-02
Table 44: Elan's CNS and anti-infectives franchises drove global
revenue growth, 2000-01*
Table 45: Global sales of the leading branded fibrates, 2000-01
Table 46: Sales of ICN's top 10 global pharmaceutical products, 2002
Table 47: Novartis's cardiovascular and oncology franchises drove
global revenue growth, 2001-02
Table 48: Pfizer's cardiovascular and CNS franchises drove global
revenue growth, 2001-02
Table 49: Products promoted by Pfizer reps targeting either
hospitals or therapy area specialists in Spain, 2003
Table 50: Roche's oncology franchise drives global revenue growth,
2001-02
Table 51: Allergic rhinitis and anti-epilepsy products drove UCB
Pharma's global revenues, 2001-02
Table 52: Revenue and sales force data of six participating companies
Table 53: Range of technologies used by sales forces in Italy, 2003
Table 54: Abiogen's diabetes and musculoskeletal franchises are
leading domestic revenue growth, 2000-03
Table 55: GlaxoSmithKline's CNS and respiratory franchises drove
global revenue growth, 2001-02
Table 56: Novo Nordisk's hemostasis management and diabetes care
franchises drove global revenue growth, 2001-02
Table 57: Pfizer's cardiovascular and CNS franchises drove global
revenue growth, 2001-02
Table 58: Revenue and sales force data of nine
participating companies
Table 59: Range of technologies used by sales forces in Germany,
2003
Table 60: Aventis's oncology and diabetes franchises drove global
revenue growth, 2001-02
Table 61: Global sales of Boehringer Ingelheim's top 10
pharmaceutical products, 2001-02
Table 62: Revenue and sales force data for nine
participating companies
Table 63: Range of technologies used by sales forces in France,
2003
Table 64: Allergan's entire marketed portfolio is experiencing double-
digit growth in sales, 2001-02
Table 65: Aventis's revenues by division, 2001-02
Table 66: Global sales of Boehringer Ingelheim's top 10
pharmaceutical products, 2001-02
Table 67: Elan's CNS and anti-infectives franchises drove global
revenue growth, 2000-01*
Table 68: Genzyme General's marketed biotherapeutics portfolio,
2 001-02
Table 69: Solvay's cardiovascular and gastrointestinal franchises
drove global revenue growth, 2001-02
Table 70: Total detailing spend, marketing spend and ethical sales,
1998-2001
Table 71: Key metrics of the top 14 pharmaceutical companies
Table 72: Detailing, marketing, sales force and ethical revenue data
for the top 14 companies
Table 73: Detailing and marketing ROI data for the top 14 companies
Table 74: Ethical revenues per Revenue Potential Index score*
Table 75: Datamonitor's promotional universe
Table 76: Estimated data points and methodology
Table 77: Revenue Potential Index metrics and ranking system
“...Face-to-face detailing time can only be increased through the provision
of high value data to physicians...”
6. Source: Datamonitor Customer Research
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