The pharmaceutical sales force will expand 22% over the next two years, according to an industry study released this week.
Companies in the pharmaceutical industry currently spend an average of $875 million for field representative budgets, down from $888 million in 2002, says the report by Cutting Edge Information, a business research and publishing company based in Durham, N.C. Top-spending companies spend more than $1 billion on sales.
However, that decline will be reversing. "Basically, if companies can afford it, they put more representatives in the field," says Cutting Edge senior analyst Eric Bosher, lead author of the report.
Bosher says the number of pharmaceutical representatives has doubled since 1998.
According to the report, the largest sales forces have more than 6,000 primary care reps and 1,000 specialty reps. The report includes more than 250 measures of sales budgets, staffing, strategies and tactics from 12 top pharmaceutical companies, including Pfizer, Merck, AstraZeneca, Eli Lilly, Novartis and Aventis.
There are currently about 85,000 drug representatives, Bosher says. That is a ratio of about 1 rep per 10 physicians, compared to a 1-to-18 ratio in 1998.
Bosher concedes there is a crisis of volume among the industry's sales forces. "Physician access is becoming a critically important issue for pharmaceutical field forces," he says. "It's a big problem. A lot of doctors are limiting the number of sales reps they see or completely shutting their doors."
Combined with the effects of the pharmaceutical industry ethics code adopted last year, which limits incentives for physicians like sporting events or big-ticket dinners, the crowded sales climate is forcing reps to focus on providing solid clinical knowledge and show how they are providing value to a doctor's pharmaceutical practice, Bosher says.
"It is a question of differentiation, as it is in any market," he says.
A summary of the 159-page report is available online at www.pharmasalesmanagement.com.