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Marketing Offshoring Q&A

  •   Which pharma or biotech company, in your opinion, uses offshoring of commercialization activities particularly well, and what benefits has this company derived from offshoring?

    Answered September 2nd, 2010 by Expert: Rajesh Nair, MBBS, MBA

    There are early adopters that have made significant progress in offshoring, while others are currently experimenting, firming up plans to scale up.

    A majority of players started on the commercialization space with analytics, reporting and information research, traversed through content development and updates across a range of activities before moving on to full-scale marketing offshoring.

    In our experience, while most of the top 15 global pharma companies are engaged in offshoring various commercialization and marketing activities, there are three companies in particular that are ahead of the curve, aggressively pursuing this strategy.

    With global cost saving mandates in place, these companies have embraced the offshoring model in a highly structured manner to not only increase savings, but also to derive value out of the additional innovation opportunities that this model provides. The big 3 are already reaping the rewards of being the early movers.

    Our clients, big and small, have been able to save no less than an estimated 40% on the existing spend. Assuming that a company spends $500 million annually on commercialization and marketing activities that include analytics, information research, promotional medical education, eMarketing, sales training, medical affairs, medical communication, and publication planning, a 40% savings by driving efficiency could yield cost savings of $200 million per year. This amount saved is then diverted towards more innovative initiatives as well as newer products.

    To quote a specific example, we have been partnering with a top 5 client for over 3 years now. What started with a small $100,000 a year engagement has grown leaps and bounds over the last two years, with the client now accounting for the largest share of our revenues. In addition, we are now the preferred global partner for all medical communication initiatives of the company, globally. From the company’s standpoint, the $4-5 million saved thus far have been diverted to other strategic initiatives.

    We believe that over the next few years, most of the large and midsize pharmaceutical companies will aggressively use offshore delivery capacity as a significant element of their commercial support organizations and successfully target cumulative annual savings of the order of millions of dollars.

    1 comment
     

    One response to to “Which pharma or biotech company, in your opinion, uses offshoring of commercialization activities particularly well, and what benefits has this company derived from offshoring?”

    1. You did not mention the top 3 names, that was in the question.

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