Drugmakers may be shedding thousands of primary care sales reps, but at the same time, they are increasing hospital and specialty sales teams. Over the next 12 to 24 months, 30 percent of specialty sales forces will expand, while only 5 percent expect to contract. Significantly, among hospital sales teams, 53 percent expect to grow - on average, by 14 percent - and only 5 percent see shrinkage.
Consequently, the findings suggest that the "long, grim trend of sales force contraction may be coming to a close as economic conditions improve and sales forces reach statis," according to Cutting Edge Information, a market research firm that surveyed 21 drugmakers about their plans for hospitals and specialty sales staffing. Not surprisingly, the prognosis comes after a period of realignment.
Over the last two years, 40 percent of the drugmakers realigned their specialty sales teams and 21 percent of hospital sales forces did the same. For instance, specialty district managers now oversee 9.7 reps, on average, down from 10.1 two years ago, while hospital district managers oversee an average 8.3, down from nine during the same period.
There was growth during this period, however. Over the last 24 months, 33 percent of specialty forces expanded and 19 percent contracted (and the average expansion was 24 percent and average contraction was 16 percent). Among hospital sales teams, 16 percent expanded and 16 percent also contracted (average expansion was 11 percent and average contraction was 20 percent).
Nonetheless, there are caveats. While contraction may have receded, a return to expansion may yet prove gradual, especially if there is a paucity of new hospital-based meds. Meanwhile, growth among specialty forces is expected to be propelled by biologics, since many of these treatments are for conditions that involve chronic care and require more sales for penetration.
A few other nuggets: Specialty reps spend 48 percent of their time detailing doctors and nurses, up 20 percent from a similar survey in 2007, while hospital reps spend 42 percent of their time detailing docs, medical directors, hospital pharmacists and nurses. On average, both specialty and hospital reps succeed in seeing docs face to face about 60 percent of the time. Reps average 6.8 minutes with specialty targets and 10.2 with hospital targets.
Not surprisingly, the practice of mirroring - multiple reps visiting the same targeted docs each week - is declining. The average mirroring levels for top targets is down to 2.1 each week, from 2.6 two years ago. Meanwhile, 31 percent of specialty sales forces have increased the number of daily targeted visits, while 25 percent decreased. Among hospitals sales forces, 33 percent increased and 17 percent decreased. The average number of daily visits is 7.5 among specialty and 7.8 among hospital teams.
Specialty sales groups spend an average of 45 percent of their budgets on compensation for reps and managers versus 57 percent for hospital sales groups. Newly hired hospital reps start out making, on average, $113,000 and receive 29 percent of their compensation in bonuses versus $100,000 for specialty reps and 28 percent in bonus.