US and European pharmaceutical sales and marketing executives believe that the current business model is ‘broken’, according to a new survey.
More than two thirds (68%) believe that pharma’s current sales model needs to be rejuvenated to face current industry challenges.
Danielle Rollmann, a partner in Booz & Company’s global health practice, says industry is in the “eye of a hurricane of change” and companies need to “identify and focus” new capabilities needed to succeed.
The survey, conducted jointly by Booz & Company and National Analysts Worldwide, asked 156 sales and marketing leaders, most with global responsibilities, how the industry can adapt to face a changing healthcare environment.
If found that respondents noted that growing healthcare prices along with the need to highlight value and outcomes were the greatest challenge faced by sales representatives.
More than half of respondents now expect to invest heavily in marketing to key accounts and payers to counter these challenges. New pricing approaches, new service models and new partnerships with clients were also highlighted as being important.
“Those of us who work with pharma companies to develop and implement commercialisation strategies know very well the challenges of maximising asset value in this new environment, where both key customers and customer expectations are being redefined,” said Susan McDonald, CEO of National Analysts Worldwide. “We’re not surprised to hear people acknowledge that they can’t count on doing ‘business as usual’ and that they’re looking for new ways to gain traction.”
Respondents said the strategies which they believe will be the most important moving forward include:
- Organising sales and marketing activities around diverse stakeholders
- Taking a more creative approach to customer relations and partnerships
- Effectively demonstrating value through outcomes to clients
- Innovatively using digital media channels.
“Virtually everything is changing in the model and the market,” commented Rolf Fricker, a Munich-based partner at Booz & Company. “In response, most respondents say they plan to spend more on all their target marketing activities. Yet this is not aligned with what pharma is doing and needs to do at a company level. The companies that focus, prioritize, and follow a coherent strategy will be the winners.”