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INDEX

Sr. No. Topics Page No.

1. Acknowledgment 3-3

2. Certificate 4-4

3. Synopsis 5-5

4. Objective 6-6

5. Indian Pharmaceutical Overview 7-12

6. Industry Profile 13-14

7. SWOT Analysis of Pharma Industry 15-19

8. Global Pharma Vs Indian Pharma 19-27

9. Challenges in Pharma Industry 28-29

10. Activities by SALES TEAM 30-31

11. Sales Force Effectiveness 32-40

12. Problem with Sales tool & Measurement 41-4713. Ways company Market to Doctor 48-53

14. Survey of Sales Force 54-54

15. Data analysis Of Sample Survey 55-61

16. Working & Challenges in Sales Force 62-73

17. Conclusion 74-7418. Annexure 75-76

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Acknowledgment

During the perseverance of this project I was supported by different

people, whose names if not mentioned would be inconsiderate on my

part.

I would like to thank with affection and appreciation and

acknowledge my indebt ness to Oriental Institute of Management,

(Vashi) for initiating in the preparation of a project on Brand

Management in Pharmaceutical Industry. The learning and

knowledge that I have gained in the process of preparation of this

project has been tremendous and I would like to thank Dr. D.R.

Kamraj for providing me with the opportunity to work on this project

and guiding me for the same.

I owe sincere gratitude towards each and everyone who have given a

helping hand in the completion of this project.

SOHAN KUMBHAR

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Certificate

I, D.R. Kamraj, hereby certify that Mr. Sohan K Kumbhar, studentof Oriental Institute Of Management, Vashi, Navi-Mumbai,enrolled in the course of MMS-II (Marketing), Mumbai University,

academic year 2006-2008, have completed his project Perceptionof Sales Force in Pharmaceutical Industry as per my guidelines.

Dr. D.R. Kamraj

.

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SYNOPSIS

For Sales & Marketing in pharmaceutical industry it is important

to have skilled sales force to promote the products because most ofdoctors prescribed quality product based on relationship with theMedical Representative.

For selling a product, relationships with doctors are moreimportant.

Samples are not so important for established brand.

For core doctors, MRs should meet twice or thrice in a month.

For repeat visit with doctors sales people should go always withdifferent promotional tools.

According to sales people visual aid must be change everyquarter.

Most of companies change visual aid twice in year.

Quality is more emphasized while promoting brand.

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OBJECTIVE

To Understand the sales force perception in PharmaceuticalIndustry.

How Medical Representative/ Marketing Executive do theImplementation of the strategies given by company inpharmaceutical Industry?

SWOT analysis of pharmaceutical industry.

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Indian Pharmaceutical Industry: An Overview

The Indian pharmaceutical industry is a success story providingemployment for millions and ensuring that essential drugs ataffordable prices are available to the vast population of this sub-

continent.

Richard Gerster

The Indian Pharmaceutical Industry today is in the front rank ofIndias science-based industries with wide ranging capabilities in thecomplex field of drug manufacture and technology. A highly organized

sector, the Indian Pharma Industry is estimated to be worth $ 4.5billion. It ranks very high in the third world, in terms of technology,quality and range of medicines manufactured. From simple headachepills to sophisticated antibiotics and complex cardiac compounds,almost every type of medicine is now made indigenously.

Playing a key role in promoting and sustaining development in the vitalfield of medicines, Indian Pharma Industry boasts of qualityproducers and many units approved by regulatory authorities in USAand UK. International companies associated with this sector havestimulated, assisted and spearheaded this dynamic development in thepast 53 years and helped to put India on the pharmaceutical map ofthe world.

The Indian Pharmaceutical sector is highly fragmented with more than20,000 registered units. It has expanded drastically in the last twodecades. The leading 250 pharmaceutical companies control 70% ofthe market with market leader holding nearly 7% of the market share.It is an extremely fragmented market with severe price competitionand government price control.

The pharmaceutical industry in India meets around 70% of thecountry's demand for bulk drugs, drug intermediates, pharmaceuticalformulations, chemicals, tablets, capsules, orals and injectables. Thereare about 250 large units and about 8000 Small Scale Units, whichform the core of the pharmaceutical industry in India (including 5Central Public Sector Units). These units produce the complete rangeof pharmaceutical formulations, i.e., medicines ready for consumptionby patients and about 350 bulk drugs, i.e., chemicals having

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therapeutic value and used for production of pharmaceuticalformulations.

Following the de-licensing of the pharmaceutical industry, industriallicensing for most of the drugs and pharmaceutical products has been

done away with. Manufacturers are free to produce any drug dulyapproved by the Drug Control Authority. Technologically strong andtotally self-reliant, the pharmaceutical industry in India has low costsof production, low R&D costs, innovative scientific manpower, strengthof national laboratories and an increasing balance of trade. ThePharmaceutical Industry, with its rich scientific talents and researchcapabilities, supported by Intellectual Property Protection regime iswell set to take on the international market.

Market TrendsThe industry has enormous growth potential. Factors listed belowdetermine the rising demand for pharmaceuticals.

The growing population of over of a billion

Increasing income

Demand for quality healthcare service

Changing lifestyle has led to change in disease patterns, and increaseddemand for new medicines to combat lifestyle related diseases.

India Pharmaceuticals and Healthcare Report Q1 2009

This India Pharmaceuticals and Healthcare Report provide

independent forecasts and competitive intelligence on India's

pharmaceuticals and healthcare industry.

India remains regarded as a moderately attractive proposition, as

illustrated by the fact that it once again holds an unchanged eighth

position in BMIs Q109 regional Business Environment Rankings forAsia Pacific. While the fast-growing population in India will represent

one of the main drivers of pharmaceutical growth in the coming years,

low per capita consumption and emphasis on generics hamper the

level of market development. Similarly, an excessive amount of red

tape,

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underdeveloped infrastructure and the deficient legal framework

remain barriers to investment, although the government is striving to

improve the regulatory environment, with the imminent creation of the

Department of Pharmaceuticals. Nevertheless, in December 2008,

India's drug price regulator decided to lower prices of 46 brands and toinclude 254 new medicine brands in the list of

Price-controlled drugs, despite an announced increase of prices of 31

medicine brands.

In the meantime, the domestic generics industry continues to expand,both locally and abroad, although it has not all been plain sailing. Inlate 2008, Indian Zydus Cadila a unit of Cadila Healthcare purchased Italy-based Etna Biotech from Dutch biotechnology firmCrucell, while Sun Pharm acquired 100% of the US-based narcotic

producer and importer Chattem Chemicals. On the otherhand, Lupin recently became the third drug maker to be accused ofsub-standard manufacturing by the US Food and Drug Administration(FDA), which will attract greater scrutiny on the sector as a result.Other Indian companies facing similar problems in the past includeRanbaxy Laboratories,Suns' US-based subsidiary, Caraco Pharmaceutical Laboratories, as

well as Wockhardt and Granules India.

The above developments will have an impact on Indian generics

exports. According to the recently released figures by news providerPharmabiz, the annual growth of India's pharmaceutical export sector

is down by more than half. Key reasons include increased competition

in the highly regulated markets of the US and Europe and the steady

appreciation of the rupee. Nevertheless, BMI believes that the

fundamentals of the sector are sound and we expect high double-digit

growth to be maintained over the medium term. A victory for Barack

Obama and the Democratic Party in the US general election in

November 2008 will increase generic substitution in the world's largest

pharmaceutical market, while the 2011 patent cliff provides yet thegreatest opportunity for Indian generics exports.

On the domestic front, generics are also winning, with the first generic

drugs store reportedly opened by the Department of Pharmaceuticals

at the end of November 2008, as part of an ambitious project to set up

such stores in each district of the country. The use of generics will be

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India's US$ 3.1 billion pharmaceutical industry is growing at the rate of

14 percent per year. It is one of the largest and most advanced among

the developing countries.

Over 20,000 registered pharmaceutical manufacturers exist in the

country. The domestic pharmaceuticals industry output is expected to

exceed Rs260 billion in the financial year 2002, which accounts for

merely 1.3% of the global pharmaceutical sector. Of this, bulk drugs

will account for Rs 54 bn (21%) and formulations, the remaining Rs

210 bn (79%). In financial year 2001, imports were Rs 20 bn while

exports were Rs87 bn.

STEPS TO STRENGTHEN THE INDUSTRY

Indian companies need to attain the right product-mix for sustained

future growth. Core competencies will play an important role in

determining the future of many Indian pharmaceutical companies in

the post product-patent regime after 2005. Indian companies, in an

effort to consolidate their position, will have to increasingly look at

merger and acquisition options of either companies or products. This

would help them to offset loss of new product options, improve their

R&D efforts and improve distribution to penetrate markets.

Research and development has always taken the back seat amongst

Indian pharmaceutical companies. In order to stay competitive in the

future, Indian companies will have to refocus and invest heavily in

R&D.

The Indian pharmaceutical industry also needs to take advantage of

the recent advances in biotechnology and information technology. The

future of the industry will be determined by how well it markets its

products to several regions and distributes risks, its forward and

backward integration capabilities, its R&D, its consolidation through

mergers and acquisitions, co-marketing and licensing agreements.

Industry Profile

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Industry Segmentation by Products

Pharmaceutical sales include:

ethical (prescribed) drugs, which can't be dispensed without a

physicians prescription; over-the-counter (OTC) medications, which are readily

available on drugstore shelves.

Ethical drugs account for about 60% of total industry sales, with

OTC products representing the balance.

The ethical sector can be further segmented into:

Brand-name products; Generic products.

Generics are less-expensive equivalents of brand-nameprescribed drugs, and may be produced and sold once the originaldrug's patent protection expires.

Industry Segmentation by Distribution

Three-quarters of industry sales consist of pharmaceuticals used in

outpatient settings, with the balance administered in hospitals, nursinghomes, and other inpatient facilities. About 70% of prescribed drugs is

distributed through wholesalers to hospitals, health maintenance

organizations (HMOs), and retail pharmacies. The remaining 30% is

sold directly by manufacturers to physicians, hospitals, retailers, and

others.

Industry Living Space

Demand

The demand for medicine is tied to the health of the populace, which is

relatively constant over the years. Drug pricing is also relatively

inelastic, due to the absence of alternate therapies for the most

prescribed drugs.

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Life cycle of products

The product cycle of nearly all prescribed drugs is fairly stable. After

the average 10- to 15-year period of discovery, development, testing,

and FDA review, a branded ethical drug has about 10 years of

commercial life.

Discovery

New drugs are discovered in scientific laboratories. The process is longand laborious, with the vast majority of attempts unsuccessful.

Bringing the drug to market

Before a drug can he brought to market, it must undergo years oftesting and receive government approval from the FDA. It takesseveral years of sales buildup in major markets in the U.S. and abroadbefore a drug reaches its full commercial potential. At that point, newcompetition of drugs similar in action may enter the market.

Going generic

Drug's patent expires, typically after fifteen years on the market.

Generic competition usually appears immediately after it, and pricesbegin to fall. Branded prescription drugs typically have about 10 yearsbefore generic competition erodes their profitability.

Going OTC

Companies sometimes switch a patent-expired product fromprescription-only status to over-the-counter (OTC) status to broadenits market and extend its economic life. Competition in the market of

OTC products is more straightforward. Margins on products switchedto OTC status are lower than those on the prescription products theyreplace, but popular consumer medications can have almost infiniteshelf lives.

SWOT Analysis Of Industry

Strengths

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Opportunities

When a drug maker launches a new compound that achieveswidespread acceptance in the marketplace, the economic rewards can

be very high. This is the primary reason for the industry's profitmargins.

Threats: FDA approval

The FDA requires manufacturers to perform extensive testing to provethat products are safe and effective before it will sanction commercialsale. All animal and human tests, which often last for years at the cost

of many millions of dollars, are conducted by the manufacturer.

The cycle for the development of a new drug is as follows:

Discovery (searching for innovative products is especiallychallenging in pharmaceuticals, because products come from thehighly complex fields ofmolecular biologyand biochemistry.); Preclinical(animal) testing( hundreds of compounds are testedbefore any are identified as promising enough to warrant humantesting);

Clinical (human) testing.

The clinical testing period on humans usually consists of three phases:

Phase I (small number of healthy people to test the drug's safety);

Phase II: (patients suffering from the disease or condition the drugis intended to treat);

Phase III: (large groups of ill patients to test drug's safety,effectiveness and optimal dosage).

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Fugure. Compound Success Rates by Stages of Development

Out of 20 drugs entering clinical testing, average 13 successfullycomplete phase I. Of those about nine finish phase II, but only onelikely pass trough the phase III. Only one of 20 will ultimately

approved for marketing.

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In 2007, the Indian pharmaceutical industry looks ahead at a colourfulhorizon, what with contract research and clinical trials businessestaking wing, and the new patent regime opening new avenues forplayers in the country.

Globally the Indian pharmaceutical industry ranks 4th in termsof volume (with an 8 per cent share in global sales), 13th in termsof value (with a share of 1 per cent in global sales) and produces 20-24 per cent of the worlds generic drugs (in terms of value). India isalso one of the top five active pharmaceutical ingredients (API)producers (with a share of about 6.5 per cent). The sector today is inthe front rank of Indias science-based industries with wide rangingcapabilities in the complex field of drug manufacturing and technology.

Industry Structure

The Indian pharmaceutical industry is estimated to be worth US$ 6billion, growing at over 13 per cent annually. Indianpharmaceutical companies now supply almost all the countrysdemand for formulations and nearly 70 per cent of demand for bulkdrugs.

Exports constitute nearly 40 per cent of the production withformulations contributing 55 per cent and bulk drugs 45 per cent. Theindustry ranks 17th in terms of export value of bulk actives and

dosage. It comprises large, medium and small-scale operators out ofwhich some 300 companies together account for nearly 90 per cent ofthe domestic market, while the rest is accounted for by a largenumber of small companies which total about 9000 units.

Growth

The domestic Indian pharmaceutical industry is likely to more thantriple to US$ 20 billion by 2015 from the current US$ 6 billion tobecome one of the top ten pharmaceutical markets in the next

decade, says a report prepared by global consultancy firm, McKinsey.Significantly, patented drugs are likely to see increased sales in thedomestic pharmaceutical market, growing from virtually nothing atpresent to about US$ 2 billion in seven years.

In fact, the absolute growth of US$ 14 billion will be next only to thegrowth potential of the US and China. Echoing similar sentiments,another report by Goldman Sachs predicts that India will be the

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fifth largest pharmaceutical market in the world by 2020, withsales of US$ 43 billion.

Important factors that are expected to make this reality are thedoubling of disposable incomes, increase in numbers of middle-classhouseholds, expansion of medical infrastructure, greater penetration

of health insurance and a gradual shift in disease profile and adoptionof patented products.

Consequently, a number of multinationals have entered the IndianPharmaceutical market. Already 15 of the 20 largest pharmaceuticalcompanies in the world have a presence in India. In fact, drugs andpharmaceuticals is the eighth largest FDI-attracting sectors in India.

CRAMS

India is emerging as the global hub for contract research andmanufacturing services (CRAMs) due to a combination of low cost andworld-class quality standards. The Indian CRAMS market which isvalued at US$ 895 million in 2006 (as against US$ 533 million)accounts for between 6-7 percent of the global CRAMS market andmany expect India will command at least 15 per cent of the market by2009-10. Research agency Frost & Sullivan estimates this segment toreach close to US$ 6.6 billion by 2013.

Contract research--including both drug discovery research and clinicalresearch--has been growing at a phenomenal rate. While clinical trialsrepresent 65 per cent of this market and new drug discovery makesup the remaining 35 per cent. Frost and Sullivan estimates outsourcedcontract research in India to reach US$ 2 billion by 2010. Similarly,according to a McKinsey report, the global clinical trial outsourcing toIndia in the pharmaceutical industry is estimated to be worth US$ 1.23billion by 2010.

Over 15 prominent contract research organizations (CROs) are nowoperating in the country which includes names such as Novartis,

Johnson & Johnson, Pliva, Astra Zeneca, Bristol-Myers Squibb andGlaxoSmithKline among others.

Contract manufacturing is another new opportunity for the Indianpharmaceutical industry. Already, India has the largest number of USFood and Drug Administration (US FDA)-approved plants outside theUS, with over 100 facilities. And now even small and medium scalepharmaceutical companies are setting up new and upgraded high-quality manufacturing plants to take part in this growing segment.

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About 40-50 new plants (which are in addition to the plants being setup by major Indian pharmaceutical companies) are likely to becommissioned by these companies in the next two years conforming tothe quality standards suggested by the US FDA and the UK Medicines

and Healthcare Regulatory Agency (MHRA), making India one of thelargest drug manufacturers in the world.

The small- and medium-scale companies, which are setting up newunits, include Bangalore-based Bal Pharma, Paras Pharma, VenusRemedies, Surya Organics and Chemicals, UnijulesLife Sciences,Centaur Pharma, Flamingo Pharma, Kemwell, Coral Labs amongothers.

The Boston Consulting Group estimates that the contractmanufacturing market for global companies in India would touch US$900 million by 2010.

India Advantage

India offers a huge cost advantage in the clinical trials domaincompared to Western countries. A multinational company moving R&Dto India could save as much as 30 to 50 per cent. For example, whilethe cost of hiring a chemist in the US is as high as US$ 250,000-300,000 per year, Indian discovery research outfits charge global

pharma companies around US$ 60,000 per chemist which is roughlyone fifth of what the pharma companies pay abroad.

Similarly, the comparative cost advantage in India can be seen fromthe fact that Indian companies can manufacture pharmaceuticals forless than half of what it costs in the US, conduct clinical trials at lessthan one tenth of US costs, and conduct research at less than oneeighth of what it costs in the US.

Generics

Indian pharmaceutical companies with their reverse-engineeringexpertise, abundant investment in research facilities and availability ofskilled manpower are favorably placed in the global generic market.

According to a report by global pharmaceutical market intelligencecompany, IMS Health, Indian generic manufacturers will grow by 14-15 per cent next year, to more than US$ 70 billion as drugs worth

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approximately US$ 20 billion in annual sales will face patent expiry in2008. In fact, with nearly US$ 80 billion worth of patent-protecteddrugs to go off patent (including 30 of the best selling US patent-protected drugs) by 2012, Indian generic manufacturers arepositioning themselves to offer generic versions of these drugs.

Already, Indian drug companies account for over 25 per cent of thetotal generic drug applications made to the FDA of US, which accountsfor over half of the US$ 60 billion market. Also, India has over 100 USFDA-approved plants, the highest number outside the US. Indiancompanies are also able to build their US generic pipeline with Indianfilings of around 408 products.

Global Company Sales Summary

Rank Company Sales Market Share Sales Growth 2006 $(m) %

1 Pfizer 45,0838.61.8

2 GlaxoSmithKline 36,9477.18.9

3 sanofi-aventis 35,6056.84.9

4 Novartis 28,8685.517.9

5 Roche 26,5605.121.4

6 AstraZeneca 25,7414.910.5

7 Johnson & Johnson 23,2674.44.2

8 Merck & Co 22,6364.32.8

9 Wyeth 15,6833.09.8

10 Eli Lilly 14,8162.87.5

www.p-d-r.com/ranking/ranking.html

Top 10 ethical drugs ranked by sales in 2006, Global

1 Lipitor Pfizer/Astellas 13,736 5.7

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4 S o u r c e : I M S K n ow l e d g e L in k : M A T S e p t e m b e r 2 0 0 5

* P h a r m a c y M a r k e t O n l y * * H o s p i t a l M a r k e t O n l y% G r o w t h C o n s t a n t $

+ 7 %

F r a n c e$ 3 0 . 7 B i l

1 %I t a l y

$ 1 9 . 6 B i l

+ 7 %G e r m a n y$ 3 1 . 6 B i l

+ 8 %S p a i n ( * )

$ 1 5 . 1 B i l

+ 0 %U K

$ 2 0 .0 B i lM a j o r E u r o p e

$ 1 6 0B i l

+ 5 %J a p a n

$ 6 0 . 8 B i l

+ 1 1 %

M e x i c o *

$ 7 .2 B i l

+ 8 %C a n a d a

$ 1 3 . 1 B i l

+ 2 4 %

C h i n a* *

$ 8 .9 B i l

+ 7 %U S

$ 2 4 9 . 2 B i l

1 0 K e y M a r k e t s$ 4 5 6 . 2 B i l

I n d i a i s r a n k e d 1 5 t h i n w o r l d p h a r m a c e u t i c a l m a r

s ta n d i n g a t n u m b e r 4 i n v o l u m e t e r m s

+ 9 %I n d i a *

$ 5 . 2B nr e t a i l( $ 6 . 7B i lt o t a l )

STANDING OF INDIAN PHARMACEUTICAL MARKET IN THEWORLD, 2006.

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Pharmaceutical Manufacturing Companies

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Indian Pharmaceutical Sector:Challenges and Opportunities under the WTO Regime

The global pharma industry today is faced with two challenges:

1. To develop and utilize scientific knowledge to derive new drugsand

2. To do it at an affordable cost.

The Indian pharma industry is well-positioned to address these twin

challenges because of the vast availability of talented and skilledscientific manpower. The Rs.28,000 crore Indian pharma industry has

been operating under a new world order from January 1 2005. From

that date, in compliance with the prior commitment given under the

WTO agreement the country has switched over to the product patent

regime from the process patent regime that was in existence hitherto.

The main challenges facing the sector are the following.

Growth in the domestic formulations market is slowing down.

Domestic bulk drugs industry is facing intense competition due tocheap imports.

Price wars between regional and local pharma companies aredriving down prices, exerting pressure on margins.

MNC pharma companies are getting more aggressive atprotecting their patents and defending their market share afterpatent expiry.

There has been considerable confusion in the grant of EMR,(Exclusive Marketing Rights) due to lack of transparency in theprocess.

The huge domestic market (worth Rs.2,14,000 crore in 2002) with

a billion plus population presents a tremendous opportunity to the

Indian pharma industry though the growth is still in single digits.

A roadmap for growth can be the following.

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Activities perform by Sales Management TeamIn pharmaceutical industry

Sales Management

Plan sales objectives-in market & to market, and monitor the sales

to achieve pre-set sales targets. Implement strategies, identify

new business opportunities & expand the existing market. Look-

after sales and marketing along with several aspect of product

management

Sales promotion

Designs & implement marketing activities such as medical

educational programs, seminars and conferences for the doctor's ,

camps, doctor's meets/ conferences for enhancing brand visibility/

coverage & reach. Conceptualize and implement sale promotion

activities such as selection/ Targeting the key opinion leaders and

organizing CME'S as a part of market development and brand

building effort.

Conduct Market Research and Campaign to build the brands.

Relationship Management

Build and strengthen relationship with key accounts, medical

fraternity, opinion leaders there by ensuring high customer

satisfaction by providing with complete product support i.e. CRM

(Customer Relationship Management) activities.

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Dealer Management

Identifying and networking with financially strong and reliable

dealers, resulting in deeper market penetration and reach.

Evaluating performance & monitoring distributor sales and

marketing activities.

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Sales Force Effectiveness (SFE)

ABSTRACT

With the ever increasing pressure to ensure maximum return on

investment, sales force effectiveness (SFE) is becoming a high

priority area in the global pharmaceutical industry. Sales force

represents the largest spend in sales and marketing and yet study

after study shows that the returns gained from this spend is not

particularly strong and one recent IMS report found that pharma

sales force effectiveness declined by 23% in the recent period of

2004 to 2005. Better metrics must be used to measure both the

effectiveness and financial impact of SFE for this very significant

budget. The startling discovery that this comprehensive report

uncovers is that the very metrics currently being used to assess

sales force effectiveness are in fact themselves aiding its decline.

Traditional pharmaceutical organizations are rigorously tracking and

managing sales activity, but still falling short. Data emerging from

the research concludes that current metrics are more focused on

efficiencies than effectiveness and do so to their own detriment.

This report dissects current SFE metrics and their limitation for the

pharmaceutical industry in the United States, Europe and Japan.

The report then discusses appropriate metrics to solve these

problems and goes on to demonstrate implementation methods andissues.

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Sales force effectiveness is a difficult concept to measure, but doing

so can push pharmaceutical companies past todays hurdles and

into increased productivity and sales.

Background - The Scale of the Sales Force Effectiveness

Problem

Most pharmaceutical company teams already rigorously track and

manage sales activity. Unfortunately, despite much measurement,

the sales force effectiveness problem remains. Could this be due to

the fact that the currently used metrics are inappropriate,

nsufficient and often counterproductive? Many companies

accurately diagnose that the problem is sales force effectiveness

but miss the solution, due to using the wrong metrics. But how can

a pharmaceutical company measure the effectiveness of its sales

team?

To truly grasp the problem, we look at current metrics used, alongwith their limitations.

Sales Force Size and Share of Voice

Until recently, the pharmaceutical industry was typified by its ever

growing sales staff, hiring new sales reps at a rate that outstripped

the rate of new physicians (which has remained at a constant rate

of modest increase) and far outstripping the rate of new drugsreleased on to the market (which has fallen dramatically over the

last decade). This strategy continued even in the face of falling

profits by pharmaceutical companies.

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Pharmaceutical companies have ramped up their innovation

and time to market. In the 1970s, the period without

competition for a certain therapy lasted an average of seven

years. Today, this time without competition only lasts 0.1

years.

Increases in targeting technologies in the United States have

allowed reps to call upon those physicians with strong market

volume potential. But everyone has the same targeting data.

These physicians are receiving so many detail calls that they

are saturated and unable to find time for quality calls with thereps. Doctors report feeling inundated by sales force (a by-

product of the sales force arms race) resulting in the average

time spent with physicians decreasing. Of more concern: the

physicians do not see this decrease in time with reps as a

problem.

Access to physicians is decreasing. Sales people are not ableto count on even scheduled appointments to result in an

actual call any more. Many physicians have closed their doors

to sales reps completely and turn to eDetailing, peer-to-peer

interaction and journals for information. Statistics suggest

that for every 100 sales reps, only 20 meet with the

physicians. Additionally, 78% of phone calls to physicians last

two minutes or less. Most calls result in simply a 30-seconddetail and a sample drop.

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Related to this, the number of personal details received by

office-based US physicians in the US declined by 13% in

200513 following seven years of increases. IMS reported that

this was seen across the majority of the major pharmaceutical

companies and was not entirely due to physicians closing

their doors. In this number, 27% were influenced by

blockbusters going off patent, and 22% were due to

withdrawals of Vioxx and Bextra and the relative shortage of

new launches in the primary care space. Two thirds of new

launches were in the specialist areas, meaning there was

limited need for additional representatives. Different therapy

areas also were found to decrease in detailing volume, with

33% decline in detailing volume for the erectile dysfunction

category, 22% decline in the proton pump inhibitor category,

and 9% decline in the lipid lowering agents category.

Although these changes account for some of the decline in

numbers of details, others came from the fact that some

companies (including Pfizer and Wyeth) altered their salesstructures and removed mirroring from their field forces.

On top of this, physician attitudes around pharmaceutical

sales force are also changing. Where previously they may

have welcomed new data and discussion with sales reps, now

fewer than 40% of physicians feel the pharmaceutical industry

is trustworthy. Physicians actively provide barriers to salesreps.

In 2003, the number of doctors reporting intentional limited

access for sales reps totalled 60%15. Only 43 percent of reps

get past the receptionist at any given sales visit.

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Unfortunately there are a number of problems with this sort

of metric:

Focus on call frequency could encourage inappropriate or non-

optimal behaviours in sales staff. Irrelevant calls to non-

target physicians or non-prescribing staff, while doing nothing

to further the companys goals and sales, can still be counted.

Since career success is built on meeting company standards,

sales reps are encouraged to focus their behaviours towards

metrics16. But measures counting the number of calls to a

physician or the number of minutes spent with a physician are

encouraging quantity over quality. Sales reps may do well

when it comes to bonus or yearly review time, but the

company is pushed down the path of decreasing productivity.

By focusing on sales call quantity, reps are encouraged to

make as many calls a day as they can to meet their targets.The focus becomes accessibility of physicians rather than

their value as a target. Accessibility is indeed an issue, as the

industry becomes more competitive and physicians limit or

block access to sales reps17. But contact should be about

more than access. Consider this: IMS reported that decile

analyses in Europe often find little difference in the call levels

achieved by high-decile doctors and low-decile doctors. Thismeans reps will spend time with doctors who are easy to see,

rather than those who will actually provide value and

generate sales. The result is the calls do not seem effective

and yet the calls per day target is being met or exceeded.

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Focusing on sales call quantitynecessarily means less focus

on sales call quality. A sales call merely to enquire over the

physicians golf handicap, or the state of health of the

physicians loved-ones, is clearly not going to result in a

product sale. Likewise, sales call frequency measures favour

irrelevant contacts, such as physicians who might be easy to

talk to but do not actually have many patients who fit the

profile of the drug being marketed.

By focusing on sales call numbers, the company implies that

the only sales tool worth considering is the sales call. When it

comes down to actual sales, this is often not the primary

method of success. In this highly competitive environment, a

physician might be faced with a veritable barrage of requests

for just moments of their time. While good working

relationships between the sales rep and customer are vital,

much can be gained by adequate back-ups to the sales call,such as call centres and websites. Thus, actual sales of a drug

might not necessarily be directly related to the amount of

calls made.

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The Problem With Sales Tools

The Problem with Sales Tools

Pharmaceutical marketers spend a lot of time and money planning

and creating messages, sales aids for use in the sales call,

technological tools to assist the sales force (including CRM), and

training for salespeople. Unfortunately, for many of these

categories, its quite difficult to measure return on investment when

using the majority of measurement tools available.

However, tools to help promote sales are a necessity for sales

forces. Consider the International current state of sales

forces:

The American Marketing Association reports that up to 90%

of what marketing creates for sales support goes unused in

the field. This is backed up by our analysis from literally

thousand of pharmaceutical brands field force activities.

ASTD journal reported a study demonstrating that

salespeople forget 85% of content and skills within four

weeks of training.

B-to-B Online reported results of a survey in which 70% of

marketers give themselves a D or F for the quality of

sales support.

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It also helps analyse what messages and what rep behaviours have

positive financial impact, and how these behaviours and messages

should be time-allocated in a sales call. This tool collects vast

quantities of data from physicians and then validates this data

against prescribing to uncover real, rather than perceived,

influencers. Then powerful analytics are applied that help sales

managers identify what is needed and how to change for maximum

sales growth. This type of analytics is critical to ensuring that sales

force efforts actually increase sales and market share, and

demonstrating sales force return on investment. By limiting metrics

to those that measure only call volume, calls per day and market

share, companies are limiting the provable results and return they

will achieve with their sales force.

Sales Force Resource Optimisation

Real sales force optimisation will only happen when companies

successfully integrate efficiencies and effectiveness to provide

an approach that improves strategic planning, as well as sales

forces productivity and measurable financial return on individual

activities. To really succeed there needs to be more focus on

ensuring the right.

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" Pharmaceutical companies don't look for one standard profile in

their sales forces. Generally, companies require sales reps to have

at least a bachelor's degree, and some prefer MBAs . Employers

don't necessarily require degrees in areas such as chemistry or

biology , but reps must be willing to learn -- and be able to master

-- science. "An aptitude in science is a prerequisite," says Nahman,

a former pharmacist. "If you don't like science, this job will be a

living hell."

Some companies weigh previous marketing or healthcare -

industry experience heavily, although clinical skills alone won't get

you hired. "The most important qualifications are people skills, such

as tact and diplomacy," Nahman explains. "Science can be learned,

but people skills can't be learned."

Ways Pharmaceutical Companies Market to

Doctor

How Drugs Are Sold to Doctor

Even when it was illegal for pharmaceutical companies to advertise

treatments for erectile dysfunction to the public, they had

enormous amounts of cash invested in marketing programs. Your

medical providers - doctors, nurse practitioners, and others -- are

literally bombarded by drug

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8. Payments for consulting or giving lectures - This used to be fairly

egregious, with doctors getting a substantial amount of their

incomes from these sorts of kickbacks -- for they were kickbacks.

Today, new pharmaceutical organizations like PhRMA have

instituted guidelines that their members voluntarily follow,

preventing these abuses from happening.

Most payments for these things now are for time, and provide

about the same or les income to the doctor that he or she would

gain from regular medical practice.

However, there is still a real danger. Most pharmaceutical

companies hire their very well-paid scientists and researchers from

three different sectors: research institutions, the FDA (a whole

nother conflict of interest story), or private practice. This means

doctors who build up a reputation for consulting and lecturing can

increase the chances a pharmaceutical company will hire them.

How much is that worth? When I worked at Pfizer in southeastern

Connecticut, there was one researcher who flew his private plane to

work from his farm in southern New Hampshire, at least three days

a week. You have to make pretty good money to do that.

9. Enrolling their patients in clinical trials - this is one of the most

altruistic marketing methods. Especially with cancer drugs,pharmaceutical companies are hungry for clinical trial subjects;

doctors are hungry for new treatments for their terminal patients

that might buy time or even save their lives. It very much works to

the advantage of both for doctors to remain very aware of what the

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pharmaceutical companies are doing in this area.

10. Direct marketing of all these types to medical school and

nursing professors -- the people who train your medical providers -

All nine of the above methods, when used to market to medical

school professors, are very effective in training new doctors to use

the drugs marketed. You trust your teachers to get it right. If the

pharmaceutical salesperson can convince them of the efficacy of a

drug, they have not just gained a single not-that-lucrative

customer, but rather dozens of customers in his or her students,

who will go on to private and public practice everywhere.

Yes, doctors are human. Many claim that these little - and big perks

do not influence them or their practice, that though they may get

some very nice gifts these things don't encourage them to prescribe

more medications.

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Survey of Sales force in Pharmaceutical

Industry

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SAMPLE SIZE

Sr.No.

Name Company Designation Speciality

1 yogesh Magar Cadila F. O. Card/diab2 Omprakash Chaturvedi Dr. Reddy's SBU Diabetic

3 Nitin Gaikwad Lupin MR Neuro

4 Shilpa Patange Novartis MR General

5 Nagesh Mishra Novartis MR General

6 S. M Kangane Novartis MR General

7 Omprakash zydus Area manager gynae

8 Suraj Soni Emcure MR Card/diab

9 Rajesh Singh Novartis MR General10 Bhaskar Naik Alkem MR Bergen

11 Ranjit Sigma MR General

12 Prabhat ICPA MR General

13 Prafful Systopic MR General

14 Ashish Tiwari Meridian MR General

15 Pravin DRL SBU General

16 Nilesh UCB MR General

17 Sachin Glenmark Area manager General

18 Parag J Emcure MR General

19 Rajesh Ajanta MR opthal

20 Manish Tab. India MR General

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t

To ta l number o f c o re Doc to r as

20 -2

10%

25-3

45%

31-3

10%

36-4

5%

50-6

20%

100-10

10%

20-24

25 -30

31 -35

36 -40

50 -60

100 -10

Total number of core Doctor as per company

20-24

0%

25-30

35%

31-35

10%36-40

25%

50-60

20%

100-101

10%

20-24

25-30

31-35

36-40

50-60

100-101

In both the graphs we can analyse that both the categories have the consent

at the core Doctors requirement. And majority of them suggest to have 25-30

core doctors in list

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Parameter 5. No of Retailer

No of retailers/day as per M

4

40%

5

20%

6

20%

8

0%

10

20%

12

0%

4

5

6

8

10

12

No of retailers/day as per Company

4

40%

5

30%

6

0%

8

10%

10

10%

12

10%

4

5

6

8

10

12

As visiting number of retailers is also field activity. So it also

have some conflict in the match.Majority of the MRs want to have less number of retailers/dayto visit, as desired by the company

No ofretailer Company MR

4 8 8

5 6 4

6 0 4

8 2 0

10 2 4

12 2 0

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Parameter. 7 Important Activities According to MRs for makinggood relation or to make sales

ActivityMostIMP IMP

AverageIMP

LessIMP

Visit 12 6 2 0samples 0 4 6 8

Gifts 2 2 4 6CME/Sponseship 7 6 2

other 3 1 1 0

12

23

6

4

2

7

12

6

4

6

10

8

6

2

0

2

4

6

8

10

12

14

Most IMP

IMP

Average IMP

Less IMP

Most IMP 12 2 3

IMP 6 4 2 7 1

Average IMP 2 6 4 6 1

Less IMP 0 8 6 2

Vis it samples GiftsCME/Sp

onseshiother

This parameter of this survey is has some additional importance,

because in this crux of the total sales and marketing can be seen

In this most of the MRs feels that for making good relationship with

Doctors Regular Visits are of Utmost important.

Here OTHER means Doctor meet, Strategy Implementation,

communication, CRM/ WIIFM etc

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Education is the norm in this field; learning about a companys

product line is like taking an advanced course in pharmacology

(which many do take during their initial years in the industry).

They have to be familiar with data, statistics, and issues in the

health community to be able to communicate successfully with

businesspeople and doctors. Although this job has some aspects

that are unquestionably grueling-one sales rep said he put in 184

days on the road in 1994-many love it, and love is the only term

that accurately describes their zeal, dedication, and willingness to

make sacrifices for their job.

Paying Your Dues

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Pharmaceutical sales representatives with a science background

have an advantage in this profession, in terms of both their

credibility and their ability to educate themselves about product

lines. A college degree is standard for this job, with many

employers looking favorably on graduate work. Useful courses

include biology, chemistry, biochemistry, biophysics, organic

chemistry, English, public speaking, finance, and negotiation

techniques. Professional education is the norm for all sales

representatives, both on their own products and on other

companies product lines. The ability to read a scientific study and

examine its assumptions is critical to a PSRs success. Licensing is

available through professional organizations, but it is not required

to advance to managerial positions.

Associated Careers

Pharmaceutical sales representatives go into sales positions in

other professions-as systems marketers or service sales

representatives, for example-where their selling skills are valued,but where scientific knowledge is less important. Some PSRs are

willing to give up the scientific element of their job in order to go

into a profession where it is easier to advance and easier to

maintain a satisfying family life.

Challenges for Pharmaceutical Sales ForcesPharmaceutical sales forces can overcome their challenges by

learning how companies from other sectors have dealt with similar

challenges.

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Sales force, the main communication channel of the

pharmaceutical industry, faces many challenges: lower perceived

product differentiation, great heterogeneity in the needs of

customers and the value of customers to the company, pressure to

find more efficient communication channels, restricted physician

access, tighter regulatory constraints, the growing power of non-

physician customers, and adversarial relationships with payers and

other non-physician customers.

Are these challenges unique to the pharmaceutical industry?

Companies in other sectors have successfully addressed challenges

similar to what the pharmaceutical industry faces today.

Changing the sales force structure to compensate for the

loss of product differentiation

Many primary care physicians are visited by different

representatives from the same company. While this makes it more

difficult to obtain a holistic understanding of physician needs andrespond to them, it allows a sharp promotional focus on individual

products. However, in many primary care categories competing

brands are perceived to be only weakly differentiated, and the

promotional focus on products has become less effective.

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The sales force is a very effective communication channel, allowing

face-to-face, interactive communication of a considerable amount

of information. But, considering the high cost of a sales

representative's call, do all physicians have a similar need for the

extensive information that can be provided in a face-to-face visit?

Similar to the pharmaceutical industry, the traditional stock market

investment firms such as Merrill Lynch and Morgan Stanley

employed highly-paid professionals who provided customers with

sophisticated advice, often based on proprietary research.

However, the growing availability of stock market information in a

variety of media enabled motivated investors to form their own

preferences about where to invest. Targeting these "self-directed"

investors, who preferred to manage their investments on their

own, Charles Schwab's low-price "discount brokerage" firm

eliminated the high-cost information services and concentrated on

making stock market transactions easy.

After having successfully penetrated the "self-directed" investorsegment, Charles Schwab defined two other segments-"validators,"

who also wanted to manage their own portfolios but required some

consultation, and "delegators," who wanted someone else to

manage their portfolio for them-and designed communication

channels that responded to the different needs of these segments.

Finding the most efficient communication channel for eachfunction

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Matching customer value and the cost of communication

channels

Physicians differ in their value to pharmaceutical companies.

Indicators of value include actual and potential revenue

generation, influence (e.g. opinion leadership) and knowledge (e.g.

advisory board members selected for their knowledge of

physicians' needs). Communication channels differ in their cost,

e.g. face-to-face sales representative visits are more expensive

than other channels such as the telephone, fax, and e-mail. The

greater a customer's value, the greater can be the cost of the

communication channel.

For example, Dell in the U.S. assigned its customers to nine

different segments varying in their value to Dell, and provided a

channel mix that matched each segment's value. Customers in the

highest-value segment were connected to Dell through all

conceivable channels including dedicated account teams

comprising field and telephone sales personnel, program managersand technical support, and customer-specific websites with

extensive functionality. Individual consumers, on the other

extreme, could reach Dell only via telephone and Dell's website.

Segments in between these two extremes were served by a

channel mix in which the availability of costly channels such as

field salespeople increased with the value of the segment.

Creating new channels to increase customer access

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Discussions between senior managers at both companies led to the

recognition that their adversarial relationship destroyed

opportunities for mutually beneficial value creation. This paved the

way for a collaborative partnership, in which the two companies

saw themselves as members of a common team with the following

mission: "The mission of the Wal-Mart/P&G Business team is to

achieve the long-term business objectives of both companies by

building a total system partnership that leads our respective

companies and industries to better serve our mutual customer-the

consumer." P&G assigned 300 full-time staff to its global Wal-Mart

team, more than 200 close to Wal-Mart's headquarters alone.

Sharing a great deal of information, the team and Wal-Mart

cooperated to develop new profitable products and services,

allocate resources to in-market products and services and optimise

the supply chain. The partnership has served both companies well

not only in their relationship with one another but also in making

each of them a more valuable partner in other relationships. In an

annual survey, in which manufacturers rate the performance ofretailers and retailers rate manufacturers, both P&G and Wal-Mart

have held the number one spot for many years in a row.

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Annexure

Name: _______________ Specialty:

Designation_______________ Companys name:

Companysrequirement

As per yoursuggestion

No of doctors in list

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No of core doctors

Frequency of core

doctors visit

Call average

No. of retailers/day

Number ofliteraturesdistribution /month

The most important thing/activity/strategy for making good relation

with customer, according to you is (e.g. Visits, cme, sponsorship etc.)

1.

2.

3.

4.

5.

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The best marketing activity/strategy for launching a new product (e.g.

Symposia, gifts)

1.

2.

3.

The thing which you dont like or you would like to change it

1.

2.

3.

The best marketing strategy according to you:

( )