eyeforpharma Barcelona

Mar 15, 2016 - Mar 17, 2016, Barcelona

Rewrite pharma’s business plan. Become the trusted partner.

Has Selling Gone Social Again?

Relationships, not territory coverage, are what drive sales, argues Richie Bavasso.



Back in 2012, pharma companies were laying off or downsizing their field forces and also losing access; relationships were crumbling and the share of voice model was broken. Since then, companies have been experimenting with a variety of go-to-market approaches, seeking to build in value, patient centricity and an outcomes-based dimension.

Particularly in B2B-focused segments, where providers are coalescing into larger and larger organizations and the business relationship can be a clear differentiator, companies have been exploring account management strategies. In this context, the quality of the relationship is key, particularly in terms of the supplier’s understanding of a client’s business objectives.

But what if a new approach could also rebuild the relationship dimension between pharma and physicians in primary care, which has fast been draining away? Some three years ago one technology start-up thought it had the answer with a plan to reinvent the commercial landscape.

VPSN was a social network that sought to provide an online marketplace that optimized existing relationships between physicians, salespeople and other healthcare professionals. It positioned itself as a cross between eBay and Amazon sitting on a LinkedIn-style platform for health professionals and with all of the requisite regulatory controls absent in those commercial platforms.

Three years on and renamed RIMEDIO, the platform infrastructure is complete and life science companies, sales agents, and healthcare practitioners are engaging in what RIMEDIO calls, “opportunities.” But, needless to say, not everything went according to plan. CEO Richie Bavasso explains: “Like most vendors in our space, when we want to sell something we always think of the top 25 pharma companies; we thought big pharma would come running as we had a viable solution for their access and influence problems.”

However, under pressure from regulators and with substantial fines levied for stepping out of line with some of their commercial practices, big pharma had understandably become more cautious. So, although to some it might appear that “innovation had left the building,” companies largely focused on repurposing their sales organizations in more traditional ways.

Proof of Concept

So does this hesitancy on the part of big pharma imply an instinctively conservative outlook beyond the demands of compliance? Maybe, but Bavasso acknowledges the need to prove the concept with small and mid-size companies first, before expecting big pharma to come knocking. In the meantime, the network has picked up a range of clients in the healthcare space beyond the original targets.

Today’s customer base ranges from nutraceuticals to toxicology screening companies, and medical device firms to concierge medicine companies, with a lot of medical software vendors selling into physician practices. Thus, the original concept remains sound with the added advantage that, for clients outside pharma, the regulations are less onerous; a particular benefit for RIMEDIO has been that the sales cycle is often much shorter for these smaller, more nimble companies.

Pull not push 

RIMEDIO works on a pull (rather than a push) model, relying on independent reps and healthcare professionals such as pharmacists, nurse practitioners and physician’s assistants who already have the relevant connections with prescribers, in order to foster relationships. The platform is all about relationship selling, though it also draws on the detailed market knowledge and experience of its agents, of which there are some 3,000 on the network.

Importantly, agents are rated by the physicians according to their performance, which helps to maintain quality and, unlike a traditional sales model where a typical rep might have a territory covering a hundred physicians yet only have good relationships with about 15% of them, RIMEDIO agents are not limited by geography as many have leveraged relationships over time and relocation. Their portfolio may cover fewer doctors but they boast trusted relationships with all of them. Each agent indicates in their profile, accessing a database of 3.4 million practitioners, the doctors with whom they enjoy access.

Accordingly, customers can target their campaigns through the most relevant agents, filtering on relationships by doctor name, expertise, education, and past employers. Larger companies have sophisticated customer segmentation and know exactly who its customers are. In contrast, smaller companies may need some help with their segmentation strategy – something RIMEDIO can advise on.

Pay by results

Engagement starts with a small, one-time setup fee. After launch, clients pay only for successful transactions. The entire technological platform, consisting of a CRM, CLM iPad app, web detailing app, business rule compliance content management system, SCORM compliance Learning Management System, payroll system, and reporting and analytics, all integrated into a regulatory compliance professional social network, is free to the customer. So most of the typical field force overhead is eliminated. Customers also define what success looks like, at whatever level – maybe delivering a 90-second detail to a doctor, dropping a sample, leaving literature or signing a contract. “Unless that transaction is actually executed the client has no liability to pay anybody, not RIMEDIO nor the agent.”

The reps, or as Bavasso likes to refer to them as “Agents of Engagement,” have the choice of only accepting commissions where they expect to be successful – they tend to select good products and those that are complementary to what they are already doing – so they boost their own efficiency and their income.

Bavasso highlights the market potential, pointing out that in the United States alone there are over 150,000 life science companies seeking to bring their products to market without a field force. Yet, the approach also appeals to organizations with their own sales operation, where RIMEDIO can be deployed alongside the traditional sales operation and support white space territories or hard-to-see prescribers.

He sets out a number of additional areas where the system provides an opportunity:

• As a short-term pulse/seasonal push
• Vacancy management
• As an alternative to a shared product bag
• To extend share of voice on late-stage products or markets with declining share
• Where product revenue doesn’t justify the cost of a dedicated team

Networks within networks

Unexpected benefits have arisen over the years since the system was first conceived, not least that the platform is able to extend its reach via the agents’ own personal networks – a phenomenon Bavasso somewhat dramatically refers to as the “secret dark web network of independent sales reps.”

Taking the example of a company that wishes to target ophthalmologists, he claims: “If you want to sell to an ophthalmologist in the US, there are only 37 reps in the entire country that you need to know to reach every ophthalmologist, because those 37 reps have built their own sub-networks of peer sales agents, their own private field force of independent reps on a state-by-state basis that they manage. So, they know everybody. What RIMEDIO is now doing is providing a technological platform for independent networks that already exist – and that’s been a big find for us,” added Bavasso.

I think there’s great efficiency and certainly more opportunity to be successful if you build your field force based on the relationship backwards as opposed to the geography frontwards.

As a consequence, the number of independent sales agents you actually need to cover the United States is dramatically smaller than the number of sales reps out there: Bavasso estimates there to be 75,000 to 100,000 employed and unemployed pharma sales reps in the US, in addition to a further 50,000 reps who have chosen to be independent. There are also some 200,000 nurse practitioners, pharmacists and other professionals who can potentially take on the role of part-time agents. If these calculations turn out to be right – 3,000 can potentially do the work of 300,000 – and the market can expect some serious disruption over the coming years.

“I think there’s great efficiency and certainly more opportunity to be successful if you build your field force based on the relationship backwards as opposed to the geography frontwards,” Bavasso declares.

Innovation

Of course, there are actually some excellent examples of creativity among big pharma companies. One such is a potential new project with RIMEDIO where the company involved is exploring a hybrid model with the independent reps brought in to supplement the field force to provide better territory coverage. Perhaps more interestingly, the agents with the good relationships are also being used to effect introductions to the mainstream field force.

Another groundbreaking project will see RIMEDIO used as a test bed to try out different call configurations – a commercial rep calling on a primary care physician, a nurse practitioner calling on a specialist, a pharmacist calling on a pharmacist – as well as different types of calls, say remote versus face-to-face. The client is able to test different types of calls over a short timescale without taking its own field force off the streets. Then, when something works, the company will stick with that new formula and increase or decrease its investment accordingly. Maybe innovation is back in the building after all.


Since you're here...
... and value our content, you should sign-up to our newsletter. Sign up here

eyeforpharma Barcelona

Mar 15, 2016 - Mar 17, 2016, Barcelona

Rewrite pharma’s business plan. Become the trusted partner.

comments powered by Disqus