The Contract Sales Organization (CSO) Market Outlook to 2015: Emerging markets, leading players and future trends

The Contract Sales Organization (CSO) Market Outlook provides a detailed analysis of the demands on CSOs in the evolving pharmaceutical sales and marketing environment. Outsourcing is growing in the context of an industry which is increasingly reducing its footprint by cutting fixed costs. CSOs which are dependent on short-term arrangements have suffered from cancellations and unrenewed contracts as large pharma companies cut their internal sales teams. The emerging model of key account management is explored through a case study, and the report includes an in-depth examination of eDetailing. Building on interviews with pharma industry executives and industry experts, the report explores opportunities in emerging markets and describes strategies for success in the future outsourced sales market.

Key features of this report

• Builds on detailed interviews with industry experts and senior executives.
• Examines opportunities in emerging regions including India and China.
• Reviews the changing dynamics of the sales environment including evolving guidelines and physician access issues.
• Analyses the drivers and resistors of the CSO industry.
• Explores the future of the contract pharmaceutical sales and promotion.

Scope of this report

• • Assess the opportunity for CSOs in emerging markets including China and India.
• Learn what is changing in the pharmaceutical sales and marketing environment.
• Track the CSO market to 2015, including predictions across different markets.
• Identify the capabilities and feature of the leading CSOs.
• Develop strategies to succeed in the future CSO market.

Key Market Issues

• Pharmaceutical outsourcing is increasing in the context of rising industry pressures such as the drop in numbers of approvals, negative pricing pressures and expirations of patents.
• Codes on interaction between sales representatives and physicians have become more stringent placing extra restrictions on hospitality and promotional items.
• High competition for share of voice and rising access barriers to physicians have created an imperative for pharma companies to find new sales and marketing approaches.
• Larger medical practices and health system owned practices are most likely to require representatives to make appointments or restrict access entirely.
• The key account management model places additional demands on CSOs, entailing longer and more strategic relationships with sponsors.


Key findings from this report

• The pharmaceutical industry will spend around $200bn on product promotion in 2010.
• The number of sales representatives in the US peaked in 2007, and is expected to decline to 73,000 in 2015.
• The global CSO market was estimated at $2,712m in 2009, and is expected to exceed $5,600m by 2015.
• Currently only a handful of CSOs operate in China. Leading operators include NovaMed which has 500 representatives and Invida which aims to increase from 400 to 600 representatives by the end of 2010.
• While India has a thriving pharmaceutical outsourcing market, sales outsourcing penetration is low, creating a large opportunity as the pharmaceutical market grows.

Key questions answered

• •What are the drivers and resistors of the CSO market?
• Who are the leading players in the CSO market?
• What opportunities exist for CSOs in China and India?
• How is the pharmaceutical sales and marketing environment changing?
• What strategies are necessary to succeed in the future CSO market?

Business Outsourcing Industry in India

Table of Contents
The Contract Sales Organization (CSO) Market Outlook to 2015
Executive summary 10
The pharmaceutical sales environment 10
Evolving pharmaceutical sales strategies 10
The global contract sales organization market 11
Leading players in the CSO market 11
Emerging regions in the global CSO market 12
The future of contract sales 13
Chapter 1 The pharmaceutical sales environment 16
Summary 16
Introduction 17
Rising industry pressures 17
Outsourcing as an industry strategy 18
Overview of pharmaceutical sales 20
Sales force sizes 20
Diminishing returns from larger sales forces 21
Sales codes of practice evolving 24
Barriers to physician access are high 26
Need for new marketing and sales approaches 27
Conclusion 28
Chapter 2 Evolving pharmaceutical sales strategies 30
Summary 30
Introduction 31
Key account management 31
Takeda UK case study 33
eDetailing 35
Live virtual eDetailing 37
Scripted eDetailing 37
Website linked eDetails 38
The benefits of e-Detailing 38
Chapter 3 The global contract sales organization market 42
Summary 42
Introduction 43
Sales outsourcing strategies 44
Advantages of using CSOs 44
Barriers to using CSOs 45
Market drivers 46
Cost pressures drive outsourcing 46
Imperative not to increase sales headcount 47
Emerging market growth 47
Market resistors 47
Physician access barriers rising 47
Pharma industry consolidation 49
Rise of new promotion models 50
Market size 50
Chapter 4 Leading players in the CSO market 54
Summary 54
Introduction 55
Quintiles 55
Company overview 55
Business description 55
Partnering collaborations and recent deals 56
Case study: Takeda market entry to Spain 58
Ashfield 59
Company overview 59
Business description 59
Partnering collaborations and deals 61
inVentiv 61
Company overview 61
Business description 62
Partnering collaborations and deals 62
PDI 62
Company overview 62
Business description 63
Partnering collaborations and deals 63
Publicis Selling Solutions 64
Company overview 64
Business description 64
Partnering collaborations and deals 65
Invida 65
Company overview 65
Business description 65
Partnering collaborations and deals 66
Chapter 5 Emerging regions in the global
CSO market 68
Summary 68
Introduction 69
China 70
The Chinese pharmaceutical market 70
CSOs in China 72
India 74
The Indian pharmaceutical market 74
CSOs in India 74
Chapter 6 The future of contract sales 78
Summary 78
Introduction 79
Towards outsourced key account management 79
Increasingly specialized sales reps 80
CSOs will continue to diversify into multi-channel promotion 81
CSOs will become strategic partners 81
Emerging markets are the key opportunity for CSOs 82
Conclusions 82
Appendix 83
Methodology statement 83
Selected bibliography 84
Index 85
List of Figures
Figure 1.1: Number of FDA approvals 1990-2009 17
Figure 1.2: US promotional spending ($bn), 1989-2008 20
Figure 1.3: US pharmaceutical sales force numbers (thousands), 2004-2012e 23
Figure 1.4: Major pharmaceutical sales force layoffs, 2008 24
Figure 1.5: Pharma sales rep funnel 27
Figure 2.6: Stakeholders influencing prescribing decisions 32
Figure 2.7: Survey of doctor attitudes towards electronic promotion 36
Figure 2.8: Merck & Co. website linked eDetailing portal 38
Figure 3.9: Global CSO market ($m), 2009-2015e 51
Figure 3.10: Relative size and potential of regional CSO markets 52
Figure 4.11: Quintiles recruitment process for Takeda Spain project 58
Figure 4.12: UK primary care sales force sizes 61
Figure 5.13: Quintiles presence in Middle East and Asia via joint ventures 69
Figure 5.14: NovaMed coverage of China 73
Figure 4.15: The expected shift in marketing and sales efforts 80
List of Tables
Table 3.1: CSO services 43
Table 3.2: Survey of US medical practices, February 2009 48
Table 4.3: Invida Asia-Pacific sales forces, 2010 66
Table 5.4: Tier 1, 2 and 3 Chinese cities, 2008 71



Companies mentioned
Invida , PDI Inc , Publicis , Quintiles , Takeda UK (case study) , United Drug (Ashfield in2Focus) , Ventiv health