Pharma Reform

It is alarming to see prominent pharmaceutical industry names in the headlines these days regarding manufacturing issues serious enough to require recalls and plant closings, and for the DOJ to be compelled to seek prosecution.  Is it just a matter of the FDA increasing their surveillance scrutiny and compliance enforcement or is there really something more fundamental going on with pharmaceutical manufacturing?

Even with all the automation, IT support, instrumentation, purpose built facilities, and technical expertise, pharmaceutical manufacturing is difficult.  Those who do or have done pharmaceutical manufacturing know how challenging it is to maintain consistency and the high quality of products, batch after batch for tens of millions of tablets, capsules, or doses, year in and year out.

Pharmaceutical manufacturing is tightly regulated for quality with highly developed quality systems supported by rigorously defined product specifications, detailed SOPs (standard operating procedures), training requirements, job qualification expectations, and mandatory supervisory and quality assurance (QA) checks and balances.  One of the biggest question I  had when these issues started to more frequently hit the press was, “where was  Quality Assurance management?”

I believe with all the regulatory safeguards supposedly built into pharmaceutical manufacturing,  industry executives who have never worked in manufacturing have  very simplistic views of manufacturing, have developed a false sense of security about compliance requirements, and many are probably taking quality of manufacturing for granted.

Here are a few issues, attitudes, and situations that may be at the root of some of these pharmaceutical manufacturing issues.  Many if not all of them have to do with management’s perspective or the perspectives and expectations they project to their manufacturing teams.

• Management thinking that manufacturing is all about efficiency, so “let’s have manufacturing find another 5% reduction in cost of production.”  If you make this request year after year, at what point do you compromise quality?
• With the jobs so well defined in our SOPs, “we can train anybody to do these jobs.  How hard can it be?”
• Once the process is defined, it’s just a matter of production execution and efficiency
• Repetitive, routine operational steps by otherwise competent operators can lead to complacency, including at the checking and double checking steps of the supervisory role
• we don’t need QA people who are going to be difficult to work with (interpretation…we don’t need people who aren’t flexible in their process reviews and sign-offs)
• “we are not making any product when we are cleaning.”  “what is the longest stretch of time between cleanings that we can justify?”   Facility, manufacturing room, and equipment cleaning time, when viewed as non-production time (reduces productivity), puts pressure on performance metrics.
• Similarly, “when people are training they are not making product”
• “We are not going to let a meticulous operator get in the way of making our numbers.  Find a new operator.”
• “I am so busy with paperwork…nobody is going to know if I just sign off on this, even though I haven’t really checked it”
• “Nobody in management needs to know, we’ll just write that batch off as waste”
• “Let’s just do another sampling. I’m sure the batch will pass”
• “let’s just get a management authorized override for that deviation”
• We can’t afford the shutdown time to make the necessary upgrades to the process, even though it makes sense.
• FDA will require a new set of trials if we make these changes to our outdated process
• “We’ll never get caught up with these CAPAs” (Corrective Action and Preventive Action).  Sometimes the hardest but most important never get addressed in a timely fashion despite SOP defined prioritizations and timelines that are supposed to safeguard against delaying the fixes.

OK.  I think I have made my point.  Time for pharmaceutical manufacturing to get some respect and more importantly, some much needed investment.  I’m not talking just about buildings and machines although that may be in order for some.  I’m talking about putting quality standards of production ahead of production output metrics (no game playing, not just lip service).   I believe well managed manufacturing teams of  competent, conscientious operators, supervisors, and QA/QC staff with expertise and integrity will take pride in delivering high quality products as efficiently as they feel is possible.  It is the “well managed” part that I believe may be missing in some manufacturing operations.

It is also time for pharmaceutical company executives to appreciate the contribution manufacturing makes to the revenue line and not just look at the expense line impact.  Some executives, unfortunately, now know the negative impact manufacturing can have on revenues, especially if you take it for granted and don’t pay attention to it.

mike@pharmareform.com

Many pharmaceutical companies have been divesting assets and downsizing operations as they try to accommodate the impending patent cliff, disappointing research productivity, diminishing impact of traditional commercial tactics, and the slowing revenue growth.   Given the state of the industry and in light of the market changes taking place,   I also recommend in Pharmaplasia™  that pharmaceutical companies downsize their operations.   Despite being painful to employees (and their families)  and as disruptive as it might be for the company, it in many cases is the absolute right thing to do,  but how you go about doing it matters.

Criteria used to assess what gets divested or downsized include things like poor or mediocre past performance, lack of perceived need, and the magnitude of the potential expense savings.  In the spirit of fairness (especially when it comes to employee relations issues) and to satisfy the quantitative justification needs of management, numbers often drive the decision making process.  As strategic as companies might try to be,  a numbers-based decision making process will lead to collateral damage with unintended consequences including:

• Loss of  expertise
• Loss of management experience
• Disruption of business relationships

Unfortunately, these are the very business assets pharmaceutical companies need and can least afford to jeopardize as they prepare for the evolving new healthcare market.

But you might be thinking that companies and management are smart enough to avoid these pitfalls by being analytical about their choices, right?  Well, let’s take a look at a few examples of where the process may not yield the results expected and could be detrimental to the company.

• Early retirement packages often accommodate employees with years of experience, including seasoned managers, scientists with expertise, and employees (including sales) with valuable long standing business relationships.  How many of your best people can’t resist the offer and walk out the door?  Remember, your best people are not afraid of being unemployed for too long if they take your offer.
• How about when the numbers  suggest eliminating sales representatives and territories with lagging sales and diminishing physician access.    Are less effective and even poorer performers being protected by having better sales numbers because their territories are in a less managed market…today?  Are your sales numbers a real reflection of the experience, expertise, and effectiveness of your sales representatives and managers?
• What about a manufacturing operation with a perfect track record for production that has comparatively higher costs driven mostly by the expenses associated with a larger, more experienced quality staff and more operational training.  Is this staffing and training perceived to be quantitatively excessive and unnecessary in the context of downsizing expectations?  Have you factored the complexity of their manufacturing and the impact (and expense) of a recall compared to the other production facilities? If so, do you eliminate the management experience, the staff (operational expertise), or the training?  What numbers do you use for that decision?

The point is that divestitures and downsizing while necessary in the current business environment for most large pharmaceutical companies will have collateral damage that goes well beyond the personal impact such decisions have on employees and their families.  Also,  a company’s assets may not be accurately reflected in the numbers used for the analysis of what to keep and what to let go.  Companies that are aware of potentially losing these hidden assets may ultimately make the same decisions but they also might look to find ways to avoid the loss or at least mitigate the impact rather than just accepting collateral damage as a part of the process.   mike@pharmareform.com

NIH (not invented here) is probably dead or at least dying at most Big Pharma today as is the thinking that companion diagnostics are not commercially interesting because they imply smaller market opportunities.  But, are there other research maxims that need to be reevaluated in the context of the evolving new healthcare market?  Here are 5 to consider changing if your company still thinking this way:

• “kill early, kill fast”

This has been intended to encourage researchers to cut losses by quickly identifying drug candidates that have a high probability of failing in later trials because of safety concerns or lack of efficacy.   Poor Phase 1 or Phase 2 results may raise concerns about mass market use of the product but may not necessarily reflect how the drug candidate might perform in a more targeted population.  Think personalized medicine with companion diagnostics.  A more comprehensive understanding of the disease, product pharmacokinetics, and pharmacogenomics may be needed to avoid killing promising compounds for smaller, targeted patient groups with significant unmet medical needs.

• “what’s the fastest, commercially viable indication that will get us to market”

The thinking behind this was that “we can use the scientific literature and medical education to expand the market.”  This will become increasingly difficult as the FDA, CMS, and the managed market become more demanding for label indications and data to support claims for use and reimbursement.  Relying on traditional sales and marketing tactics to fill the label claim or data voids to expand market opportunities will be less likely and less tolerated in the evolving new healthcare market.

• “if we do that study or analyze that data, we might find something we don’t want to know”

Product liability cases continue to make headlines and the ability for pharmaceutical companies to “bury” findings, mislead the market, cover-up or ignore potential safety issues or inferior efficacy results is becoming increasingly difficult.  Research organizations might as well assume that if they know or suspect an issue, they will need to explore it, get the science behind it, and be forthcoming about the findings.

• “our research is built around (you name the biological target) program”

As many “target-based” biotechnology companies and Big Pharma research programs have found, this is a very high risk strategy of  “either it works or it doesn’t work” (betting black or red at the roulette table).  In the evolving new healthcare market where proven innovation and differentiation are going to be essential for commercial success,  I believe companies that take a more comprehensive approach to understanding the pathophysiology of the disease will have more opportunities to discover and develop ways to intervene in the disease process, will better understand how different targets interact with each other, and will reduce the risk of betting on a single target.

• “we can do it cheaper and better in house”

Market expectations for innovative and differentiated product profiles will make research pipelines more variable than they have been in the past.  The days of merely bringing any safe and effective product through the regulatory development process and onto the market are gone.  Disciplined research portfolio management will eliminate those products that will not meet market expectations, creating more dramatic time gaps, and making pipeline flow less consistent than in the past.  This will require research flexibility of facilities, equipment, and staffing.  While a core team of research expertise is essential to retain in-house, most laboratory, preclinical, and clinical work can now be outsourced to well staffed, competent CROs that often have as much if not more expertise, capabilities, and capacity than the research teams at Big Pharma.  Even at higher per project costs, these incremental expenses will be far lower than the inevitable up-sizing and downsizing of staff or the carrying costs of intermittently idle facilities, equipment, and staffing.

mike@pharmareform.com

Unless you really understand and appreciate the mindset difference between that of the professional representative compared with that of the traditional pharmaceutical sales representative, this compensation discussion will not make sense to you.  As GlaxoSmithKline recently discovered, a change in sales compensation structure, especially incentive compensation,  away from traditional sales and prescription volume model will take an organizational and perhaps even industry realignment of pharmaceutical sales compensation philosophy.  Most pharmaceutical companies, their commercial management teams, and many representatives are not ready for this.

In fact, I predict that sales organizations will be most resistant to this change as most pharmaceutical sales representatives and managers are too grounded in the traditional sales mentality.  Many sales people are just going to see this as a take-away and will want nothing to do with the job.  It will also be hard for managers to get their arms around how to manage sales (“drive sales”) and evaluate performance without sales quotas and other activity based numbers.   They will complain about the inability to fairly and consistently assess performance if they don’t have hard numbers.  They ignore the fact that today’s prescription data and sales volumes are not accurate and are filled with national, regional, district, and territory caveats.   They also like to think that today’s sales goals and territory alignments are fairly distributed and accurately reflect potential.  And when was the last time we correlated the number of territory activities to sales results?

In the end, none of this matters because incentive compensation is not a performance driver for professional representatives the way it is for traditional sales representatives.  Incentive pay is not a scorecard like it is for traditional sales reps.  In fact if the lack of incentive pay is the reason for a representative to quit, you really didn’t lose a professional representative, you lost a sales representative and this is fine because they wouldn’t be happy or satisfied trying to make it work.  This is the hardest concept to get comfortable with if you have a traditional sales and sales incentive mentality.

Professional representatives want to be paid for their expertise, their stature in their medical community, and recognized for their personal performance excellence.  They prove their expertise and the effectiveness of that expertise by the business health of their territory in terms of how their products are perceived, formulary and reimbursement status, their access to key decision makers, and the professional respect those decision makers have of them personally.   They appreciate that actual sales of their product depends on a number of factors, some they can influence while for others it would be inappropriate to influence (e.g., encouraging the use of their product for patients who are not good candidates or where there is a better product available).  Sales and prescriptions are merely surrogate markers for a lot of things going on, not just their performance.

So how do you compensate the professional representative?  You pay them relatively high base salaries (compared to traditional sales representatives) consistent with their expertise and ability to create or maintain a healthy market environment for your products.   How many people can you hire with that level of expertise and ability to keep a territory healthy?  If you think you can find a lot of these people, you don’t have much for expectations and you are probably not looking beyond physician prescribing.  Are the people you are talking about able to hold their own in a scientific discussion with the Medical Director of an insurance company or pharmacy benefits manager that is considering how your product should be used in their patient population?  Can your representative cite the scientific literature to support their claims and recommendations for appropriate use? Is your professional representative so knowledgeable and good at their job that the insurance company Medical Director wants to hire them?

As for incentive pay, you might as well save it or better yet, invest it in your professional representative’s development.  You’d be better off spending the $20,000 per year on training, development, or sending them to more scientific meetings not to stand in an exhibit but to go to sessions and interact with their professional and academic colleagues.  If you still feel compelled to provide incentive pay, test them regularly on their expertise and give cash awards for testing performance.

You have to remember, professional representatives don’t do things because there is an additional pay opportunity associated with it.  They inherently want to do it because they see it as their responsibility. Their job is a big part of who they are and they take pride in themselves and the work they do. They view their compensation as a reflection of the level of expertise they have and the value they bring to the company when they apply that expertise.  They get more job satisfaction out of applying their expertise than any incentive pay could possibly achieve.   In fact, they’d rather have a pay raise as recognition of their advanced expertise than an incentive to drive sales.

The industry’s strong sales mentality will make it difficult to embrace the professional representative concept and even more challenging to formulate sales compensation plans that are not tied to sales and prescription volume.  You have to start someplace so perhaps this at  least has got you thinking about it philosophically.

mike@pharmareform.com

Ok, this will be a little controversial and I will probably touch a sensitive nerve or two but I am trying to help identify a way forward for the industry that will ultimately restore business viability while reestablishing trust and credibility.  You also have to be thinking 3-5 years from now when you have an even more managed market where there are far more influences on physician prescribing than sales representatives.   Which means representatives will have different, more analytical target audiences (think insurance company Medical Directors and their staffs , technology and product review committees, etc).  If you are thinking in today’s world this may not will make no sense to you.

So here goes.

When it comes to skills and expertise each of the following representative profiles has its strengths and these strengths may or may not be a good fit for a particular industry or job function.  Here is how I see the two profiles:

Traditional Pharmaceutical Sales Representative:

• Strong interpersonal and social skills help build rapport and establish relationships
• Exceptional selling skills and persuasive techniques
• Tactically oriented, relying on sales materials, promotional programs, and samples
• Customers are seen as prospects and a source of sales revenue
• Selling is seen as a competition (if I get more prescriptions I win, you lose…even if my product isn’t as good as yours)
• Sales numbers are a scorecard for incentive compensation
• Work Objective:  “get the doctor to prescribe your product as much as possible”

Future Professional Representative:

Has many of the skills of the sales representative including interpersonal, social, and selling skills but…

• They have a patient-oriented focus around meeting or exceeding customer and market expectations (want the best product for the patient)
• Rely heavily on technical and scientific expertise as their base of confidence  to establish rapport and build credibility and trust
• Sales numbers and incentive pay are not performance motivators
• Work Objective:   “make sure patients  get the right product and customers realize the maximum benefit from your products”

The biggest differences between these two profiles for selling pharmaceuticals are the level of expertise and the mindset about their jobs.  The professional representative goes well beyond the company training and resources to understand the science around their products and diseases.     They pride themselves in staying current and knowing more about their products, the diseases being treated, and competitive products than anybody in their territories, including the physicians.  They base their knowledge, presentations, and conclusions on data from the literature which they can quote objectively and accurately.  They do this because they see this not just as their job but their responsibility.

The professional representative has a different motivational mindset.  They are motivated more by personal performance excellence and expertise than sales numbers and incentive pay.   The reason they like and do their job goes well beyond making the sale.   In fact you might even think the sale is a collateral benefit of their work.   This is a very hard attribute and concept to describe because it is inherent in the thinking of a professional representative.  This is one of those “you know it when you see it” type things.  Their drive and motivation may not even make sense to the hard core traditional sales representative and certainly isn’t compatible with most traditional pharmaceutical sales management thinking or expectations.

There is nothing wrong with being a traditional sales person.  This profile drove sales in the pharmaceutical industry for decades.  And, there are industries , especially retail and consumer products, that require a sales mentality to succeed.  And, you can be a professional sales person, mastering the skills and acquiring the expertise related to sales of the products you are selling.  But if your mindset is still that you  are motivated by making the sale and the only reason for your interaction with a customer is to generate a sale, you are a sales person.

The healthcare market has changed however, and one of the changes that the pharmaceutical industry must accommodate is the declining effectiveness and diminishing tolerance for the traditional sales representative role and profile.  Declining physician access was perhaps the first indication of this market change.  State legislation to restrict sales representative activities followed and intensified regulatory scrutiny has now made for a much more challenging environment for pharmaceutical sales representatives.  As a result, I believe that a professional profile as described here and in  a previous post is the only hope for pharmaceutical companies to have a local “in the field” presence in the evolving new healthcare market.

I can hear it now….but the regulatory and legal constraints won’t allow for this profile.  I’ll address that in the next post.  Stay tuned.  mike@pharmareform.com

For professional representatives to flourish in the evolving new healthcare market executives must create a corporate environment that understands the importance of and is committed to changing the commercial model.  An environment where executives and commercial managers are committed to do whatever it takes to help professional representatives be successful in this evolving new healthcare market.  With the professional representative focused on the customer (again, not just physicians), corporate and commercial management should be focused on developing the products, label claims, data, information, and programs that help professional representatives meet the needs and expectations of the evolving healthcare market customer.

This organizational transformation will require that commercial management step up their game and the level of their own professionalism.  Expertise in traditional marketing and sales tactics is not going to help much in this evolving new healthcare market. There are no slick technology quick fixes or gimmicky tactics that will substitute for meeting product and data needs of the market.  It is critical that marketing and sales management understand and accept that tactics that worked in the past and the bad behaviors that drove revenues in the past, are no longer going to be tolerated and will not work in the evolving new healthcare market.  It means marketing and sales management must reformulate their strategies and acquire new skills and expertise that are better aligned with the needs and expectations of the evolving new healthcare market.  This includes being able to effectively deploy a  sophisticated team of professional representatives and arm them with products and support resources that address the evolving healthcare market needs and expectations.

Unfortunately, most executives and the people running commercial teams today are grounded in a traditional mentality about pharmaceutical marketing and sales.  This is where I predict most organizational transformations will fall short and stall out.  Those who can make the changes and should be championing the changes will feel threatened by a move away from their own expertise, experience base, and comfort zone.

Here is something to think about.  Let’s assume the company decides to embrace the organizational changes we have discussed and it is ready to embrace the new professional representative profile. Where do you find marketing and sales management with the new skills, expertise, and mindset needed to formulate and implement the new commercial strategy?  For example, will sales managers understand and appreciate the differences between sales reps and professional representatives?  Will marketing managers understand that they need to spend more time comprehending the complexities of the evolving decision-maker processes and nuances of customer expectations (not just market research) rather than worrying about the copy and graphics for their next TV commercial?

Again, don’t underestimate the need for executives and commercial management to really understanding the market at the customer level and having the right mindset about how to approach this new commercial model.  Some sales representatives and some commercial management may be close to the desired profile and mindset needed for these changes but they also need corporate executives who can create an environment in which these individuals can champion these changes and flourish.   Unfortunately, there are probably more who don’t get it, won’t get it, and will probably fight it, if not actively, passively by doing nothing.

mike@pharmareform.com

In our series about pharmaceutical representatives we have covered factors impacting their job function, market expectations, what needs to be done to launch and market a pharmaceutical product, and what it means to be a professional pharmaceutical representative.  Today we are going to discuss the organizational implications and what has to happen throughout the corporation to make this transformation for professional representatives a successful reality.

If we work back from how the market is evolving and what companies need to do to address the changing expectations of a broader and at times, more sophisticated customer (not just physicians), we can see that the implications for change at a pharmaceutical company are organizational and not just for “sales”.  This is truly transformational for executives and senior management, R & D, and commercial operations.  Companies will fail miserably if they are merely looking at how to change their sales organization (e.g., restructure, new compensation, and new titles).

Of all the issues we could discuss, getting all the functional areas aligned for this change is the one that precludes most pharmaceutical sales organizations from making the fundamental changes they know they should make in light of the evolving new healthcare market. What we are talking about is formulating an organizational strategy that creates a comprehensive culture and support system that embraces the role of the professional representative so they and the company products can succeed in the evolving new healthcare market.

The first change that needs to take place is the organizational mindset from the traditional “sales” position to that of the professional representative.  Your CEO and executive team play a huge role in this.  They must see professional representatives in the light we have described and not as “expendable field people” deployed tactically to drive sales.  This mindset change requires that executives and senior management understand the changing healthcare market at the customer level (not just physicians).  They must appreciate how the role of professional representative will be different from that of the sales job they have known for decades and probably did themselves.  If executives and senior management don’t understand the difference, it will make no sense to implement any of the other organizational changes needed.   In fact, the other changes are probably not going to get their support because they will seem like a waste of time and money to the “sales rep” oriented executive team.

If it is not somebody on the executive team proposing the changes it is incumbent on the person or team that is to make sure the executive team fully comprehends and supports the strategy, organizational implications, and the rationale for the changes being proposed.  As bureaucratic as large companies can be, but more importantly because of the multi-functional implications,  this is not just a discussion over coffee.  It will require well thought out planning with a series of discussions to work out details of the functional implications and to garner functional support.

Each company and executive team will be different.  Company strategy, financial position, product pipelines, and even the expertise and competency within the organization will factor into how receptive an executive team might be to the magnitude of change being proposed.  Whether or not you can get the executive team to buy in and how to do that may be interesting fodder for another series but in our next post, let’s just assume the executive team is on board. They not only understand and are ready for change but  embrace it, expects it, and they are ready to support it.  I know this is a big assumption but we can’t get to where we need to be without it so let’s play this out in the next few posts.  What else has to change?  Stay tuned. mike@pharmareform.com

As word spreads and the popularity of Pharmaplasia increases so do the requests for more format options.  For those who have been waiting for the convenience of an e-book version of Pharmaplasia, it is now available as the Kindle Edition at Amazon.com ($9.99).

For industry insiders, Pharmaplasia provides a nostalgic look back at the changing pharmaceutical industry over the past five decades.  The book is packed with management and leadership lessons learned as industry veteran Mike Wokasch explores the root causes of mistakes and poor decisions that led to diminished trust and credibility and its current state of dysfunction.  With specific recommendations for change, Pharmaplasia answers many of the questions being asked about how pharmaceutical companies can increase R & D productivity; reduce operating expenses without sacrificing profitability, and what they should do to align with the evolving new healthcare market in light of healthcare reform.

“Wokasch’s insightful view of the pharmaceutical industry offers some logical explanations for the volatile changes and disappointment in that once proud business sector. As a senior level insider with access to key decision makers, Mike is able to provide both concrete examples and an educated perspective of the pinnacles and pitfalls surrounding this important segment of our economy and lives. This is a must read for both senior level pharma executives and those aspiring to bring back the real value to this once respected industry.” Jim Patchen

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From our last post it should be apparent that successful pharmaceutical companies will move to a considerably more complex product sale than a simple discussion about indications for use and potential side effects or adverse reactions.   The technical depth of the science, the volume of data, and breadth of expertise required (basic sciences, therapeutics, diagnostics, pharmacoeconomics, and new quality metrics and outcomes) will require a level of scientific and technical expertise beyond that required or expected for most traditional sales presentations.  Success for pharmaceutical representatives will also require a much broader understanding of market dynamics (government, insurance, payers, and managed markets) and enhanced territory management skills beyond physician call scheduling.

I’m sure some readers are saying they already do these things and this is not new.  I am going to make a point here that might irritate some readers but it needs to be made.  There is a difference between being a sales representative and being a professional representative.  I believe sales representatives have little opportunity in the future of the pharmaceutical industry while professional representatives will be in high demand.

Being a true professional is more than just getting paid to do something.   So what’s the difference between being a professional and not being a professional?  One way to distinguish a professional from others is that they works so hard at being good at something that they can  even make difficult things in their profession look easy to do.

I know you have seen it.  There are those who always have perfect scores on package insert tests and always win the product presentation contests.  They even know stuff you don’t need to know.  They are also the ones who know every office staff person in their territory and have more access in their territories than most of their competitors.  They are always in their territories until late, sometimes even after most sales representatives would consider beyond a reasonable time to call on an office.

Professional representatives are frequently the ones who volunteer to help or mentor new representatives.  Probably most interesting is they are also the ones that seem to complain the least and accept regulatory or market challenges as something they just have to deal with.  And, while they may be critical of marketing materials, they offer constructive feedback and find ways to work with what they have.  They also welcome skillful manager coaching and performance reviews as ways to get critical feedback on how to get better rather than looking at them as their manager checking up on them and a scorecard for incentive compensation.

For every job there are different levels of performance and expertise.   If you are a sales representative you do what needs to get done, make the calls you can, learn enough about your products to deliver the marketing message and answer the important, high probability questions, and in the end,  hopefully you’ll deliver the sales expected.  You give the company a full day of “work stuff” and maybe even do some “work stuff” at home to make you feel better about being committed to your job.  Again, there are varying degrees of performance and expertise in being a sales representative.

If, on the other hand, you are a professional representative, you commit to a much higher level of job performance and expertise than merely going through the motions and doing “work stuff.”  You research more, study harder, practice often, and try to reach a level of job performance and expertise beyond the expectations of others.  You are doing it not just to increase sales in your territory.  You are doing it not just to be the smartest person in your district or to garner favor with your District Manager.  You are not even doing it just to please your customers.  You are doing it because it is your profession and you are committed to being a professional representative.

Today both types exist (pharmaceutical sales representatives and professional representatives) but I believe you have no choice in the evolving new healthcare market.  If you want to be employed as a pharmaceutical sales representative, your days are numbered.

If, on the other hand, you are committed to being a professional pharmaceutical representative you have a much higher probability for being employed and having a positive impact on patient care.  And while you may find the market more complex and products more technically difficult, you will find that overcoming those challenges will be even more professionally satisfying.  You will also find that patients in your territory who should be on your products will have a higher probability of that than if you are a pharmaceutical sales representative in that same environment.   Professional representatives will be in demand because, while there are plenty of people who can be pharmaceutical sales people, there are far fewer people who are ready, willing, and able to commit to the hard work and effort required to be a professional pharmaceutical representative.

In our next post we will discuss how the corporate mindset and expectations must be aligned to support professional pharmaceutical representatives in the evolving new healthcare market.

mike@pharmareform.com

If we are trying to figure out how sales representatives can add value, we must start with those who will determine whether or not there is value being added… the customer.  This may be obvious to some, especially sales representatives, but over the past several decades pharmaceutical industry management has characterized the “value added” in the context of what sales representatives can do for the company or the product and not what sales representatives can do for the customer.  So let’s start with the customer (which is not just physicians in the evolving new healthcare market) and what their needs are and how we can add value by meeting or exceeding those expectations.

I don’t want to get off on a tangent but the needs and expectations I’m talking about here are not for things like lunches being delivered or a return of the tchotchkes.  Unfortunately, the industry trained physician offices into developing these expectations in lieu of meaningful clinical discussions about products.

So let’s review some of the evolving market expectations for pharmaceuticals that the industry must be ready to meet, especially in light of healthcare reform:

• Safe and effective products that can be differentiated (clinically proven and with label claims where possible) from currently available treatment options (including preventive medicines)
• A clear understanding with supportive data for the basic science behind the product, its mechanism of action, and rationale for efficacy and potential side effects and adverse reactions.
• Clinical data to support “comparative efficacy” and other claims of differentiation or even superiority (justify the premium pricing)
• Personalized medicine supported by biomarkers and companion diagnostics that can predict response, determine extent of response, and anticipate side effects and adverse reactions with specificity and accuracy
• Real world pharmacoeconomics data to support the economic value of the product and pricing that reflects the value being delivered. Again, justify the premium pricing.
• Hospitals will want data and methodologies to demonstrate the impact of products on newly established quality metrics and outcomes data that will be used to force rank their institution performance against national standards.

One of the first implications of meeting these more demanding market expectations is that pharmaceutical companies must readjust their thinking to be more selective in their pipeline evaluations and  a lot more comprehensive in their approach to research and development.  In the past, you could just find a compound, identify the potential indications for use, do the clinical studies, get approval, and go to market.  This traditional “get it to market” approach to R & D will deliver products and data that fall short of market expectations and hamper commercial viability of products in the evolving new healthcare market.

It also becomes apparent that regardless of the representative’s scientific or technical expertise, even the best of sales representatives will struggle to address these market expectations if the research foundation and data are lacking.  I believe this is one of the reasons sales representatives are struggling today.  Pharmaceutical research has not kept pace with the demands of the market and sales representatives are being asked to compensate for limited regulatory product labeling, a lack of product differentiation, and minimal real world clinical data that can be used in product discussions.

But let’s assume your company is committed to a much more comprehensive research approach to deliver truly innovative new products with robust data packages.  This has significant implications for how pharmaceutical sales representatives can add value for customers.   You might be surprised by some of the implications we’ll discuss in our next post.  mike@pharmareform.com