U.S. Sales Communications Excellence: Resources, Structure and Processes to Optimize Pharmaceutical Sales Communications Report Summary

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LLC

U.S. Sales Communications Excellence:U.S. Sales Communications Excellence:Resources, Structure and Processes to Optimize Resources, Structure and Processes to Optimize

Pharmaceutical Sales CommunicationsPharmaceutical Sales Communications

BEST PRACTICES,®

LLCCopyright© Best Practices®, LLCSales/Field Communication Study

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Table of ContentsTable of ContentsResearch OverviewResearch BackgroundKey InsightsCommunication VolumesCommunication Headcounts and InvestmentCommunication Skill-SetsCommunication Systems and TrainingAppendixAbout Best Practices, LLC

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Research OverviewResearch Overview

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Key Study ObjectivesKey Study Objectives

Understand the investment levels and headcounts necessary for optimal Communications performance

Benchmark the volume of communications and the delivery vehicles used

Discover what systems are being used to measure and track messaging

Find what skill-sets are considered most valuable for Communications employees and what skill sets will be of value in the future.

Understand the investment levels and headcounts necessary for optimal Communications performance

Benchmark the volume of communications and the delivery vehicles used

Discover what systems are being used to measure and track messaging

Find what skill-sets are considered most valuable for Communications employees and what skill sets will be of value in the future.

Study Objective & MethodologyStudy Objective & Methodology

Sales force performance significantly impacts growth and bottom line results. The ability of senior management to effectively disseminate vital information to their sales forces while maximizing selling time is integral to the overall success of all pharmaceutical and biotech companies.

The objective of this benchmarking study is to better understand U.S. pharmaceutical sales communications groups impact and effectiveness. To accomplish this, an on-line survey was conducted, supplemented with several interviews.

Sales force performance significantly impacts growth and bottom line results. The ability of senior management to effectively disseminate vital information to their sales forces while maximizing selling time is integral to the overall success of all pharmaceutical and biotech companies.

The objective of this benchmarking study is to better understand U.S. pharmaceutical sales communications groups impact and effectiveness. To accomplish this, an on-line survey was conducted, supplemented with several interviews.

Data for this study was collected utilizing an on line survey instrument and several in-depth qualitative interviews. Seventeen organizations participated in this study.

Research Objective and MethodologyResearch Objective and Methodology

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Research BackgroundResearch Background

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Benchmark ClassBenchmark Class

Data for this study was collected utilizing an online survey instrument and several in-depth qualitative interviews. Nineteen respondents from 17 organizations participated in this study.

Adams Respiratory Therapeutics Merck

Ascend Therapeutics Novartis

Centocor Ortho-McNeil

Covidien Sanofi-Aventis

Cubist Pharmaceuticals Shire Pharmaceuticals

Eli Lilly and Company Solvay Pharmaceuticals

Endo Pharmaceuticals Takeda Pharmaceuticals North America

GlaxoSmithKline Vistakon Pharmaceuticals

LifeScan

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Benchmark SegmentationBenchmark Segmentation

For the Purposes of this study, the Benchmark Class was cut into two different groups. A Total Benchmark Class (TBC) containing all participants and a Large Pharma Segment (LPS) containing those Communications groups supporting at least 1 blockbuster brand

Total Benchmark Class Large Pharma SegmentAdams Respiratory Therapeutics Centocor

Ascend Therapeutics Eli Lilly and CompanyCentocor GlaxoSmithKlineCovidien Merck

Cubist Pharmaceuticals NovartisEli Lilly and Company Ortho-McNeilEndo Pharmaceuticals Sanofi-Aventis

GlaxoSmithKline Shire PharmaceuticalsLifeScan Solvay Pharmaceuticals

Merck Takeda PharmaceuticalsNovartis

Ortho-McNeilSanofi-Aventis

Shire PharmaceuticalsSolvay PharmaceuticalsTakeda Pharmaceuticals

Vistakon Pharmaceuticals

n= 19 n=10

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Participant TitlesParticipant Titles

As with all benchmark data, the position of the participants is as important as the companies they represent. Participant titles included:

Associate Director, Communications Manager, Training & Development

Communications Manager National Sales Director

Director, Internal Communciations Sr. Director, Internal Communications

Director, Sales Operations Sr. Director, Sales Operations & Analytics

Global SFE Director Sr. Manager, Field Communications

Manager, Field Communications VP, ADHD Sales

Manager, Field Operations VP, Healthcare Systems and Training

Manager, Sales Communications OTC VP, Sales OPs & Training

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Key InsightsKey Insights

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Communication VolumesCommunication Volumes

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Total Benchmark Class Percentage of N respondents for each Function Average Volume for Each Function

Very Low Very High Very Low Very High

Communications Volume by Function N 1 2 3 4 5 1 2 3 4 5

Business / Sales Analytics 17 0% 12% 6% 53% 29% 4

Brand 17 6% 6% 24% 24% 41% 3.88235

Sales Training 16 13% 19% 0% 50% 19% 3.4375

Samples 16 13% 13% 31% 31% 13% 3.1875

Corporate 16 6% 38% 31% 25% 0% 2.75

Human Resources 17 18% 24% 35% 18% 6% 2.70588

Information Technology 18 22% 33% 11% 22% 11% 2.66667

Compensation 17 18% 29% 41% 12% 0% 2.47059

Health Care Compliance 16 19% 50% 19% 13% 0% 2.25

Safe Fleet 17 35% 35% 18% 12% 0% 2.05882

Finance 14 57% 29% 14% 0% 0% 1.57143

Business/Sales Analytics and Brand Communications Business/Sales Analytics and Brand Communications Have the Largest Volumes for the TBCHave the Largest Volumes for the TBC

Communications volumes were consistently high for Business/Sales Analytics, Brand’s and to a slightly lesser extent, Sales Training.

Please indicate the monthly sales/field communications volume asPlease indicate the monthly sales/field communications volume associated with each sociated with each function/department.function/department.

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Communication Communication Headcounts and Headcounts and

InvestmentInvestment

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13Organizations Typically Spend $80Organizations Typically Spend $80--$150 in Sales $150 in Sales Communications Salary per Salesperson ServedCommunications Salary per Salesperson ServedThis ratio was derived from the total number of people supported by each communication group and the salaries of the communications employees. This indicator should serve as a means to assess the relative amount of resources dedicated to providing efficient communications. Interestingly, the overall range for the TBC and LPS are very similar.

Total Benchmark Class Large Pharma Segment

Total Cost of Salaries Salary spent per Salesperson served Total Cost of Salaries Salary spent per

Salesperson served

75th Percentile $455,000 $157 $410,000 $153

Mean $451,929 $149 $528,833 $123

Median $230,000 $111 $240,000 $111

25th Percentile $161,500 $80 $142,000 $80

n= 14 13 9 9

Total Salary Cost & Salary Per Salesperson ServedTotal Salary Cost & Salary Per Salesperson Served

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Communication SkillCommunication Skill--SetsSets

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Total Benchmark Class Percentage of N respondents for each Experience Factor Average Importance of each Experience Factor

Least Important

Most Important

Least Important

Most Important

Experience Factors N 1 2 3 4 5 1 2 3 4 5

Prior Sales Experience 18 0% 11% 22% 33% 33%

3.88889

Prior Communications Experience 16 0% 6% 38% 25% 31%

3.8125

Prior “Pharma” Industry Experience 17 0% 12% 29% 47% 12%

3.58824

Prior “Pharma” Communications Experience 14 0% 21% 29% 29% 21%

3.5

No Prior Pharma Experience 17 35% 24% 24% 6% 12%

2.35294

Prior Sales and Communications Experience Rate Most Prior Sales and Communications Experience Rate Most Effective for the TBCEffective for the TBCParticipants generally indicated a preference for employees with some experience in the area of sales, communications, or pharmaceuticals, while bringing in an outside perspective of a non-pharmaemployee did not seem to be an issue of importance for the majority of participants.

Based on your experience, please rank the relative importance ofBased on your experience, please rank the relative importance of the following prior the following prior experiences when selecting an individual for your sales/field coexperiences when selecting an individual for your sales/field communications group.?mmunications group.?

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Communication Systems Communication Systems and Trainingand Training

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17Content Creation and Management Are the Most Content Creation and Management Are the Most Common Intranet Tasks Common Intranet Tasks Roughly 2/3 of participants stated that they create and manage content on their intranet, while roughly half also indicate that the are also responsible for vendor management. Among larger companies, webpage design tends to also be part of communications responsibilities, but most communications groups are not responsible for more technical tasks.

What aspects of your Field Intranet is your sales/field communicWhat aspects of your Field Intranet is your sales/field communications group ations group responsible for?responsible for?

Total Benchmark Class Large Pharma Segment

Intranet solution development (business case and technical specification creation) 26.3% 20.0%

Vendor Management (specifically for external vendors and internal IT resources) 52.6% 60.0%

Application design and evaluation 26.3% 20.0%

Webpage design, creation and maintenance 42.1% 60.0%

Communications content management 68.4% 80.0%

Communications content creation 68.4% 70.0%

Quality assurance and systems auditing 31.6% 40.0%

IT infrastructure operations and maintenance 10.5% 10.0%

n= 19 10

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AppendixAppendix

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FTE Levels FTE Levels –– Managers/Operations SupervisorsManagers/Operations Supervisors

Please indicate the composition of your U.S. based sales/field cPlease indicate the composition of your U.S. based sales/field communication group ommunication group by indicating the number of FTE for each title and their averageby indicating the number of FTE for each title and their average annual salary in U.S. annual salary in U.S.

dollarsdollars

Manager/ Operations Supervisor Total Benchmark Class Large Pharma Segment

75th Percentile 2.0 2.0

Mean 1.3 1.6

Median 1.0 1.0

25th Percentile 0.1 1.0

n= 14 9

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Investment Levels Investment Levels –– Managers/Operations SupervisorsManagers/Operations Supervisors

Please indicate the composition of your U.S. based sales/field cPlease indicate the composition of your U.S. based sales/field communication group ommunication group by indicating the number of FTE for each title and their averageby indicating the number of FTE for each title and their average annual salary in U.S. annual salary in U.S.

dollarsdollars

Manager/ Operations Supervisor Total Benchmark Class Large Pharma Segment

75th Percentile $120,000 $120,000

Mean $106,364 $108,750

Median $110,000 $115,000

25th Percentile $100,000 $107,500

n= 11 8

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21Email, Voice Mail and Intranet Are the Primary Modes of Email, Voice Mail and Intranet Are the Primary Modes of CommunicationCommunication

Please share approximate volumes for each of the following commuPlease share approximate volumes for each of the following communications tools nications tools delivered by your sales/field communications group on a monthly delivered by your sales/field communications group on a monthly basis. basis.

Total Benchmark Class

Email Voice Mail Field Mail Intranet Surveys News-letters:

Hardcopy

News-letters: On-

line Podcasts

Text Messag-

ing

75th Percentile 100 25 8 23 2 1 4 0 0

Mean 79 16 6 18 2 0 3 0 3

Median 50 10 2 10 1 0 1 0 0

25th Percentile 30 5 0 3 1 0 0 0 0

(n=19)(n=19)

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About Best Practices, LLCAbout Best Practices, LLC

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Best Practices, LLC is a research and consulting firm that conducts work based on the simple yet profound principle that organizations can chart a course to superior economic performance by studying the best business practices, operating tactics and winning strategies of world-class companies.

Best Practices, LLC6350 Quadrangle Drive, Suite 200, Chapel Hill, NC 27517

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www3.best-in-class.com

About Best Practices, LLCAbout Best Practices, LLC

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U.S. Sales Communications Excellence: Resources, Structure and Processes to Optimize Pharmaceutical Sales Communications Report Summary