Sales Force Effectiveness in Pharmaceuticals - Targeted Sales Models such as Enhanced Key Account Management (KAM) and Closed-Loop Marketing (CLM) Strategies Drives Sales Force Efficiency

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Sales Force Effectiveness in Pharmaceuticals - Targeted Sales Models such as Enhanced Key Account Management (KAM) and Closed-Loop Marketing (CLM) Strategies Drives Sales Force Efficiency

This report is built using data and information sourced from proprietary databases, primary and secondary research, and in house analysis by GBI Research's team of industry experts.

At present, the pharmaceutical industry is changing due to expensive promotion and research and development (R&D) campaigns, which are crucial to examine opportunities to simplify and streamline operations in order to align businesses towards the needs of customers. In this situation, sales force effectiveness drives the success of pharmaceutical companies. Sales force effectiveness begins with developing an effective sales strategy, sizing and structuring the sales force, designing incentive compensation plans, setting goals, managing sales performance, recruiting sales people, motivating the sales force, building a potent sales force culture, and coordinating sales and marketing.

Pharmaceutical companies should have the best sales force to generate the most sales, and should also know how to integrate strategic business objectives with selection program strategies. Due to the changing pharmaceutical market environment, sales force roles are also changing. Sales representatives in leading companies now have the responsibility of delivering marketing messages and offering information and educational opportunities to physicians to build and change behaviors and relationships. Physician demand for more detailed, comparative and customized information from pharmaceutical sales representatives is also increasing. As a result, new sales representatives should have the right set of skills to play these varying roles.

In recent years, there has been a change in direction in the pharmaceutical industry about methods for effectiveness selling. The industry has recorded a number of sales job cuts, and as a result, sales forces in the US and Europe has reduced drastically. This reduction has forced pharmaceutical companies to change the size, structure and sales strategies of their sales forces. In addition, pharmaceutical companies are now under pressure to generate more profits with smaller sales forces. To achieve this, pharmaceutical companies are adopting strategies to remain competitive in the market.

- A study of major strategic sales models with case studies that enhance sales force effectiveness.

- Sales force sizing, recruitment strategies, and key sale force training and compensation models.

- An analysis of the competitive landscape, including profiles of major companies such as Pfizer, GlaxoSmithKline, Teva Pharmaceuticals, Novartis, Merck & Co., BMS, Johnson & Johnson, Eli Lilly, AstraZeneca, Abbott and Sanofi.

- Optimize your organization's resource allocation by identifying key models to size, recruit and train sales forces

- Develop and understand how companies use tools and models to improve sales force effectiveness

- Make informed decisions with respect to sales force training and compensation

- Make more informed business decisions from the insightful and in-depth analysis of sales force effectiveness sales models and the factors that shape them.

1 Table of Contents1 Table of Contents 51.1 List of Tables 71.2 List of Figures 72 Introduction 93 Sales Force Effectiveness in Pharmaceuticals - An Overview 103.1 Sales Force Effectiveness Required 103.1.1 Declining Return on Investment (ROI) for R&D Expenditure 103.1.2 Pharmaceutical Company Staff Reductions 123.1.3 Changing Product Portfolios 133.1.4 Difficulty Attaining Regulatory Approval 133.1.5 Specialty Care Focus 133.1.6 Industry Consolidation and Changing Competition 133.1.7 IT Increasingly Applied to Sales Models 134 Sales Force Effectiveness in Pharmaceuticals - Role of New Sales Models and Strategies 144.1 Implementation of Strategies in Pharmaceutical Companies 144.1.1 Implemented Sales Force Effectiveness Strategies 144.1.2 Future Implementation of Sales Force Effectiveness Strategies 154.2 Current Sales Models for Enhancing Sales Force Effectiveness 164.2.1 KAM Process 164.2.2 Types of KAM 234.2.3 Case Studies 244.3 Contract Sales Outsourcing 294.3.1 Contract Sales Representatives 304.3.2 Sales Team Recruitment and Training 304.3.3 Sales Data Analytics and Management 304.3.4 Shared Sales Teams and Telesales 314.3.5 MSLs 314.3.6 Deployment Sales Force Across Product Lifecycle 324.3.7 The Evolving Model 344.3.8 Case Study 355 Sales Force Effectiveness in Pharmaceuticals - IT Applications in Sales Models 365.1 Customer Relationship Management (CRM) 365.2 Sales Force Automation (SFA) 365.2.1 Pharmaceutical CRM Vendors 365.3 Closed Loop Marketing (CLM) Systems 375.3.1 Benefits for Sales and Physicians 385.3.2 Benefits for Analytics 385.3.3 Benefits for Legal and Regulatory Departments 385.3.4 Benefits for Marketing 385.3.5 CLM Vendors 385.3.6 Case Studies 395.4 Predictive Modeling in Sales and Marketing 435.4.1 Case Studies 455.5 Examining Strategies 465.5.1 Promotional Response Model 475.6 Sales Force Effectiveness Dashboards 476 Sales Force Effectiveness in Pharmaceuticals - Sales Force Planning and Strategy 496.1 Sales Force Sizing 496.1.1 Affordability and Breakdown Method 496.1.2 Workload Build-up Technique 496.1.3 Competitive Benchmarking 516.1.4 Promotion Response Modeling 526.2 Sales Force Recruitment 536.2.1 Introduction 536.2.2 Sales Force Recruitment Strategy 536.2.3 Recruitment Process Outsourcing (RPO) 556.2.4 Case Studies 556.3 Sales Force Training and Compensation 576.3.1 Introduction 576.3.2 Behavioral Coaching and the Five Step Model 576.3.3 Specialty Care Training 606.3.4 Continuous Assessments 616.3.5 Incentive Management 627 Sales Force Effectiveness in Pharmaceuticals - Competitive Landscape 657.1 Efficiency Analysis 657.2 Company Profiles 677.2.1 Teva Pharmaceutical Industries Ltd. (Teva) 677.2.2 Bristol-Myers Squibb (BMS) 697.2.3 Sanofi 717.2.4 Novartis AG (Novartis) 747.2.5 Merck & Co., Inc. (Merck) 757.2.6 Pfizer Inc. (Pfizer) 787.2.7 Takeda Pharmaceutical Company Limited (Takeda) 797.2.8 GlaxoSmithKline plc (GSK) 817.2.9 Johnson & Johnson (J&J) 847.2.10 Eli Lilly and Company (Lilly) 857.2.11 Abbott Laboratories (Abbott) 887.2.12 AstraZeneca Plc (AstraZeneca) 908 Sales Force Effectiveness - Appendix 938.1 Market Definitions 938.2 Abbreviations 938.3 Bibliography 948.4 Research Methodology 958.4.1 Coverage 958.4.2 Secondary Research 958.4.3 Primary Research 958.4.4 Expert Panel Validation 968.5 Contact Us 968.6 Disclaimer 96

List of Tables

1.1 List of TablesTable 1: Sales Force Effectiveness in Pharmaceuticals, Pharmaceutical and Biotech R&D Expenditure ($billion) v/s Number of NME/BLA Approvals, the US, 1995-2009 11

List of Figures

1.2 List of FiguresFigure 1: Sales Force Effectiveness in Pharmaceuticals, Pharmaceutical and Biotech R&D Expenditure ($bn) v/s Number of NME/BLA Approvals, The US, 1995-2009 10Figure 2: Sales Force Effectiveness in Pharmaceuticals, Global, Layoffs by Pharmaceutical Companies, 2010 12Figure 3: Sales Force Effectiveness in Pharmaceuticals, Global, Implemented Sales Strategies in Pharmaceutical Companies (%), 2011 14Figure 4: Sales Force Effectiveness in Pharmaceuticals, Global, Sales Strategies to be Implemented in the Future (%), 2011 15Figure 5: Sales Force Effectiveness in Pharmaceuticals, KAM Process, 2011 16Figure 6: Sales Force Effectiveness in Pharmaceuticals, Identification and Prioritization of Key Accounts, Risk vs. Potential 17Figure 7: Sales Force Effectiveness in Pharmaceuticals, Key Accounts Identification and Prioritization, Skill vs. Will 18Figure 8: Sales Force Effectiveness in Pharmaceuticals, Key Accounts Primary Selection Criteria 19Figure 9: Sales Force Effectiveness in Pharmaceuticals, Understanding Needs and Developing Customer Insights 20Figure 10: Sales Force Effectiveness in Pharmaceuticals, Forming the Account Team 21Figure 11: Sales Force Effectiveness in Pharmaceuticals, Developing Key Account Strategic Plan 21Figure 12: Sales Force Effectiveness in Pharmaceuticals, Communicating and Implementing the Key Account Strategic Plan 22Figure 13: Sales Force Effectiveness in Pharmaceuticals, Reviewing KAM Results 22Figure 14: Sales Force Effectiveness in Pharmaceuticals, Lundbeck and the KAM Principle, 2010 24Figure 15: Sales Force Effectiveness in Pharmaceuticals, Abbott's Sales Force Optimization 25Figure 16: Sales Force Effectiveness in Pharmaceuticals, Abbott's Account Strategy, 2010 25Figure 17: Sales Force Effectiveness in Pharmaceuticals, Abbott's Segmentation and Targeting Strategy, 2010 26Figure 18: Sales Force Effectiveness in Pharmaceuticals, Calculating Account Value, 2010 27Figure 19: Sales Force Effectiveness in Pharmaceuticals, Positioning the Key Accounts 28Figure 20: Sales Force Effectiveness in Pharmaceuticals, CSOs, Major Services, 2010 29Figure 21: Sales Force Effectiveness in Pharmaceuticals, Modern CSO Applications, Deployment of Sales Force Across Product Lifecycle, 2011 32Figure 22: Sales Force Effectiveness in Pharmaceuticals, CSOs and Evolving Sales Model 34Figure 23: Sales Force Effectiveness in Pharmaceuticals, CLM-enabled Commercial Organization 37Figure 24: Sales Force Effectiveness in Pharmaceuticals, Wyeth's Target Selection Model, 2010 39Figure 25: Sales Force Effectiveness in Pharmaceuticals, Wyeth's Segmentation Model, 2010 40Figure 26: Sales Force Effectiveness in Pharmaceuticals, Benefits of CLM for Wyeth, 2010 40Figure 27: Sales Force Effectiveness in Pharmaceuticals, Customer Response Framework for CLM, Wyeth, 2010 41Figure 28: Sales Force Effectiveness in Pharmaceuticals, Customer Response Success Rate for CLM, Wyeth, 2010 41Figure 29: Sales Force Effectiveness in Pharmaceuticals, Wyeth and its CLM Process, 2010 42Figure 30: Sales Force Effectiveness in Pharmaceuticals, Predictive Modeling Data Integration 44Figure 31: Sales Force Effectiveness in Pharmaceuticals, Predictive Modeling 44Figure 32: Sales Force Effectiveness in Pharmaceuticals, Predictive Modeling Process 45Figure 33: Sales Force Effectiveness in Pharmaceuticals, Sales Index vs. Sales Strategy 46Figure 34: Sales Force Effectiveness in Pharmaceuticals, Promotional Response Model on Sales 47Figure 35: Sales Force Effectiveness in Pharmaceuticals, Workload Build-up Model Case Study, 2011 50Figure 36: Sales Force Effectiveness in Pharmaceuticals, Competitive Benchmarking Model Case Study, 2011 51Figure 37: Sales Force Effectiveness in Pharmaceuticals, Promotion Response Model, 2011 52Figure 38: Sales Force Effectiveness in Pharmaceuticals, Optimal Promotion Response Model, 2011 53Figure 39: Sales Force Effectiveness in Pharmaceuticals, Advantages of RPO, 2011 55Figure 40: Sales Force Effectiveness in Pharmaceuticals, Sales Force Strategy, Incentive Compensation Functionality, Global, 2010 63Figure 41: Sales Force Effectiveness in Pharmaceuticals, Sales Force Strategy, Oracle Incentive Compensation Solution, 2010 64Figure 42: Sales Force Effectiveness in Pharmaceuticals, Efficiency Analysis, 2011 65Figure 43: Sales Force Effectiveness in Pharmaceuticals, Efficiency Analysis, 2010 66Figure 44: Sales Force Effectiveness in Pharmaceuticals, Efficiency Analysis, 2009 66Figure 45: Teva Pharmaceutical Industries, Global, SG&A Expenses (%), 2011 68Figure 46: Teva Pharmaceutical Industries, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 69Figure 47: Bristol-Myers Squibb, Global, SG&A Expenses (%), 2011 70Figure 48: Bristol-Myers Squibb, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 71Figure 49: Sanofi, Global, SG&A Expenses (%), 2011 72Figure 50: Sanofi, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 73Figure 51: Novartis, Global,, SG&A Expenses (%), 2011 74Figure 52: Novartis, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 75Figure 53: Merck, Global, SG&A Expenses (%), 2011 76Figure 54: Merck, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 77Figure 55: Pfizer, Global, SG&A Expenses (%), 2011 78Figure 56: Pfizer, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 79Figure 57: Takeda Pharmaceutical Company, Global, SG&A Expenses (%), 2011 80Figure 58: Takeda Pharmaceutical Company, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 81Figure 59: GlaxoSmithKline, Global, SG&A Expenses (%), 2011 82Figure 60: GlaxoSmithKline, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 83Figure 61: Johnson & Johnson, Global, SG&A Expenses (%), 2011 84Figure 62: Johnson & Johnson, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 85Figure 63: Eli Lilly, Global, SG&A Expenses (%), 2011 86Figure 64: Eli Lilly, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 87Figure 65: Abbott, Global, SG&A Expenses (%), 2011 88Figure 66: Abbott, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 89Figure 67: AstraZeneca, Global, SG&A Expenses (%), 2011 91Figure 68: AstraZeneca, Global, SG&A Expenses by Year ($m) and Growth Rate (%), 2009-2011 92

Companies Mentioned

Teva Pharmaceutical Industries Ltd. (Teva)Bristol-Myers Squibb (BMS) Sanofi Novartis AG (Novartis) Merck & Co., Inc. (Merck) Pfizer Inc. (Pfizer) Takeda Pharmaceutical Company Limited (Takeda)GlaxoSmithKline plc (GSK) Johnson & Johnson (J&J) Eli Lilly and Company (Lilly) Abbott Laboratories (Abbott) AstraZeneca Plc (AstraZeneca) To order this report:Pharmaceutical Industry: Sales Force Effectiveness in Pharmaceuticals - Targeted Sales Models such as Enhanced Key Account Management (KAM) and Closed-Loop Marketing (CLM) Strategies Drives Sales Force EfficiencyMore  Market Research ReportCheck our  Industry Analysis and Insights

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