Sales Force Outsourcing – MaBiCo
Many pharmaceutical companies operating in Greece decide to outsource several aspects of their operations for a number of reasons. The most common operations outsourced by pharmaceutical companies include sales (medical detailing and sales to pharmacies), promotion (merchandising, in-store promotions) and regulatory (as well as pharmacovigilance, R&D and clinical trials).
Pharmaceutical salesforce outsourcing and medical detailing is provided mostly by CSO (Contract Sales Organization) companies, while CROs (Contract Research Organizations) are responsible for regulatory affairs and pharmacovigilance. As the aforementioned solutions gain momentum both in Greece and globally, the typical solution of employee leasing through a PEO (despite the big differences it has from CSO – CRO solutions) are still widely held.
There are several reasons why pharmaceutical companies outsource their sales force to a CSO. However the most important of all is experience in the pharma industry. Many CSOs are considered to have the necessary expertise in the pharmaceutical sector. However there are some major differences among them. Depending on how many years a CSO is present in the pharmaceutical market, a company looking for this kind of services can infer about the capacity of the Contract Sales Organization to deliver results. The most experienced CSOs have the ability to hire the best candidates in the market based on certain criteria, while at the same time know how to manage their sales force and how to handle relations with HCPs (Health Care Professionals) in order to achieve the best outcome for their customers.
Other reasons for pharma companies to outsource their sales operations include better cost control, higher flexibility, access to the CSO’s knowledge (e.g. doctors’ lists, reps’ training) and reduced time to market.
Contract Sales Organizations are pharmaceutical companies specializing in the sales of pharmaceutical products such as Rx, OTC, Generics, Vitamins-Minerals-Supplements and Personal Care products. Therefore outsourcing this kind of business operations to a CSO is considered to be the most efficient way for a pharmaceutical company to achieve results.
Another important reason to outsource sales with a CSO is that it allows pharma companies to adjust the number of med-reps or pharmacy sales reps based on the duration of the contract as agreed between the two companies. It is estimated that from 2010 and on contract sales services have grown by 37,5%.
Additionally, by outsourcing their salesforce to a CSO, pharmaceutical companies can benefit from more complicated solutions that can drive their costs down by a significant amount. Typically the sales force of a CSO operates either on a dedicated or on a syndicated mode. Even though both solutions translate to lower cost of sales, a syndicated sales model is by far the most cost effective solution for pharmaceutical sales that a company may achieve. In this case though, it is essential that the client negotiates with the CSO the position of his products in the rep’s portfolio. On the other hand though, a dedicated sales force brings with it higher chances of success together with higher costs. Therefore a pharmaceutical company must weigh very carefully which CSO services better suit its needs.
As a conclusion CSOs offer many benefits to their clients. For instance cost control, increased effectiveness, freeing-up of internal resources and gaining access to knowledge are among the most important advantages a Contract Sales Force carries. However not all CSOs are equally resourceful and proficient. Therefore when the executives of a pharmaceutical company decide which CSO to work with, they should take into account the processes set in place by the third party that relate to all aspects of pharmaceutical sales. Additionally pharma executives should decide which level of dedication is the most suitable for their company’s needs.