Fixing the Sales Model - Pharmaceutical Executive

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Fixing the Sales Model
Pharma's new commercialization strategy is, uh, in the works. But what did you expect? Getting it right takes time.


Pharmaceutical Executive


When it comes to business models, styles come and go. "But in today's pharmaceutical industry, the specialty model is very much in vogue," says Mike Luby, co-founder of the sales consultancy TargetRx. Companies as different in size, sales, and product portfolio as Bristol-Myers Squibb, Bayer, Shire, and Endo Pharmaceuticals have dubbed themselves "specialty" at one time or another—which leaves us wondering, what does the term actually mean?

That seems to be the case with the specialty model of selling, too, which has come to represent more of an ideal than a defined set of specific practices. Executives equate specialty sales with seasoned reps who distinguish themselves in the doctor's office by way of deep, detailed discussions. But often "specialty" translates best as "not this, not that, not the way we have been doing it." Kindler himself seemed to reach hopefully for the specialty trope when announcing Pfizer's 20 percent sales force retrench. He said reps could be more effective with less frequent, but longer, more meaningful meetings with doctors than by dropping off samples every few days. Although no one would call Pfizer a specialty pharma, there's no question that the boss was on to something.

"That level of 'we're here to help solve problems' really is going to be the premise, the basis, for any model in the future," says Jeffrey Aronin, CEO of Ovation Pharmaceuticals. "No matter what direction the industry goes or what influence large payers have, you will always need that type of consultative, advisory role."


Jack Nightingale
Given the blowback from the arms race, the evolving model is likely to feature the "more brains, less brawn" virtue of specialty selling. Still, the size of the market of a particular drug will always dictate the exact model—and small markets boast an inherent economy in the specialty sales design. "We have a very lean sales force," says Ovation's Aronin. "Yet, the coverage that we get is unbelievable for this industry. You know who is writing the drugs, who the thought leaders are—and usually there is a high need for products." Last year, Ovation launched a new neonatology drug and got 100 percent coverage in less than 12 months by targeting neonatal intensive care units.

Ovation reps, like those with many specialty shops, take a portfolio approach when pitching docs. Each has his or her own list of physicians, makes the call alone, and details a brand or portfolio of brands in a single category. This organization gives each rep not only accountability but authority for a particular physician, product, and territory. It also regularizes the relationship between the doctor and the rep, potentially opening the window for richer exchanges starting with the product and ranging from disease management to office management. "The thing that you notice when you spend time with specialty reps is that they are very close to their customers," says Hans Bishop, Bayer's new president of the hematology and cardiology businesses.

One of the hallmarks of the specialty model has been to facilitate the payment approval, purchase, and delivery of therapies. Since many specialty products are considerably more complex than a simple pill, several companies have taken a holistic approach to the provider's entire practice. However, this thinking has also translated into expanding the base of customers companies call on.

Eisai, for example, piloted a team of 25 reps to market to the full range of stakeholders in long-term care facilities. "We carved out nursing homes that we hadn't been calling on," says Frank Ciriello, vice president of sales and marketing for Eisai. "Our reps weren't just providing products and disease information to physicians—they were also calling on pharmacy directors in the nursing home, putting them in contact with our contracting group, and having a true business discussion." Ciriello says that at first his colleagues were skeptical, but now the company is fixing its plans to expand the team working with long-term care-facilities.


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