Sales Force of the Future The Pharma, Biotech & Device Colloquium June 7, 2004 Presented to:

Sales Force of the Future

The Pharma, Biotech & Device Colloquium

June 7, 2004

Presented to:


Coverage Points

Future Truths We Hold to be Self-evident Future Sales Force: “3F” Principles of Design

– Fusion

– Flexibility

– Fit Getting There Barriers to Design Principles Summary


Future Truths We Hold to be Self-evident

1. Physicians prescribing behavior will match product to patient subject to patient then payer influence

2. Success in satisfying unmet clinical needs first will drive therapeutic market dominance

3. Blockbusters will derive from bold investments in research, development

4. Blockbusters will be built to reach all healthcare professionals, payers and patients

5. The meaning of critical mass will forever be reinvented6. Drugs will remain political and by extension high margins are a

privilege, not a right7. Exclusivity periods for drugs will be continually challenged by fast

followers, IP attacks and other “unfriendly threats”8. Healthcare technology’s ability to change behavior will elude our

ability to predict the timing, pace and implications of change


Notable Implications

A much more fluid, dynamic environment is predicted Capacity for and ability to change will be critical Operational capabilities will need to reflect this environment

This provides the context for sales force futuringdraws a set of conditions upon which we have viewed the sales force of the future


Future Sales Force: “3F” Principles of Design

1st Principle: Fusion Representatives will act as “Integrated Content Delivery Systems,”

fusing a variety of mediums and channels to connect healthcare professionals to product content experiences

Corollaries: The sales representative will be the centralized conduit, personally

connecting healthcare professionals to product content The sales representative will deliver content in two fundamental

mediums: – Personally via 1:1 interactions – Digitally via interactions customized to mediums of choice by healthcare

professionals The sales representative will have the ability to distribute content at two

levels, 1:1 and 1:(1+X)


Future Sales Force:“3F” Principles of Design

2nd Principle: The Flexibility Formula Manufacturers will be able to increase/decrease total sales force size by

X% on 12 –24 weeks notice, for periods of up to 18 months, with 0% increase in permanent overhead

Corollaries: A core sales team will exist The total sales force is a flexible resource, surging and shrinking with

periods of growth or attack and periods of market reduction or defense


Future Sales Force:“3F” Principles of Design

3rd Principle: Fit, for Purpose Sales Force will be tiered, with tiers tied to product lifecycle stage to

maximize product margin

Corollaries: There are 4 phases of product lifecycle (Periods are subject to market

conditions and brand lifecycle mgmt, strategies)– Launch Period (-18 months to +18 months)– Growth (+19 months to 36 months)– Maturity (+37months to 60 months)– Decline (+60 monthsexpiration)

One sales force cannot support all phases of a product’s life cycle to maximize margin opportunity

The points of change in a product life cycle must be clearly marked


Pharma Field Force of the Future

Core Sales Force Supplemental Core Harvest & Support Team

Permanent Semi-Permanent Highly Flexible

• Market Development

• Product Launch

• KOL relationship

• Relationship-Driven

• Drivers Growth

• Defends Competitive

Threats

• Raises Barriers to Entry

• Trained & equipped for brand maintenance

Reminding/

Harvesting

Investin

g/

Establis

hing

Profiles of Teams hired, engineered and supported for specific purpose

Leveraging/

Reinforcing


Getting There

Fusion Principle– Increased investment in enabling technologies

Broadband Infrastructure CRM Capability Internet-driven content & communications systems Cultural: Representative as center point for all product content

– Flexibility Principle

– “Plug & Play” Partnerships with fully integrated systems architecture

– Cultural: Sales force is a flexible asset

Fit Principle– Brand scorecards clearly underscoring points of change in lifecycle

– Cultural: Sales Force is ubiquitous, but tailored and tiered


Barriers to 3F Principles We’ve Heard

Can’t Disarm, Big Sales Force is Still Working– Not calling for disarmament, suggesting redeployment that can still

provide current SOV and higher return on sales, which has declined 25% last 4 years

Current Sales Force critical bridge to Pipeline– Current forces, on an industry basis, spend 35% of time on mature and

declining products; inefficient Flexibility requirements are daunting

– Principles of Just in Time inventory management have revolutionized the business cycle; the idea here is the same

Fusion is happening now, not new– Rep role is tough; engineered for dynamic interpersonal contacts with

physicians but increasingly pushed to drive promotional events as real content delivery medium; small meeting market has a ___% CAGR last 5 years



Success in future will recognize: Shifts in representative role from primary agent for driving

treatment change to hub for Integrated Content Delivery System Emerging trends in IT enable return to content-rich selling and

improved customer experience Inflection points connecting Launch-Growth-Maturity-Decline can

and must be clearly marked Traditional allocation strategy of “one size fits all sales force” is

inefficient and can be replaced by tiered sales force structure “fit to purpose”

Greater flexibility is critical to cope with faster market forces

Documents

Sales Force of the Future The Pharma, Biotech & Device Colloquium June 7, 2004 Presented to: