Marketing Offshoring Q&A
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.
We define commercialization as the entire range of linked activities that include clinical development as well as pre-launch tactics and initiatives. The different stakeholders in this phase typically include those involved in clinical development, clinical trial operations, pipeline marketing, business development and licensing, medical affairs, knowledge management, market research, strategic marketing, and medical education and communications.
The commercialization phase logically segues into the marketing phase, which involves brand launch and subsequent lifecycle management activities.
Commercialization and marketing phases may include, among others, the following types of activities:
Information Research and Data Analytics: Commercialization-related activities involve clinical trial benchmarking, TPP analysis, pipeline surveillance, and licensing support activities, including forecasting and demand estimation, market research, development/updating databases, information search and query services for areas such as business information, chemistry/manufacturing, biomedical, clinical and regulatory information, and specialized activities such as TA and Biomarker Surveillance. Marketing phase activities typically include sales force analytics, dashboards and reports, brand and TA-related primary market research, and wargaming.
Medical Communication and Education: The pre-launch phase includes activities such as publication planning, KOL identification and development, ad boards, congress support, speaker programs, disease education and Websites, Webcasts and meetings, and MSL support activities. Launch and LCM initiatives encompass launch campaigns, physician and patient support programs, e-marketing initiatives including virtual centers and branded Websites, managed care programs, NP/PA and other stakeholder initiatives, and field force support programs.
Training and Learning: Field force training, MSL training, physician education, and clinical and medical affairs training form part of training and learning activites.
At Indegene, we have successfully incorporated offshoring elements in all of the mentioned commercialization and marketing activities for our top 10 global pharmaceutical clients. Indegene has been a pioneer over the past five years in developing an unique hybrid delivery model to seamlessly deliver almost all of the services mentioned previously. Indegene’s hybrid delivery model provides a mix of onsite and offshore resources, thus providing the flexibility required for the type of services being discussed. Many clients initiate the offshoring process with relatively simpler tasks that are easily defined, such as updating databases, slide decks, and medical references, and then move on to increasingly complex tasks once confidence and comfort levels are attained.
Typical benefits in using an offshore delivery model include:
• Cost reduction of 40% to 60%
• Resource availability and quick ramp-up: ability to build in production buffers to cater for “peak” loads without adverse impact to the overall budget
• The flexibility to run programs that are not currently budgeted or with low budgets: critical initiatives for risk reduction, revenue enhancement, or achieving higher share of voice in the market place currently being sacrificed or triaged due to low budgets can be resurrected via the offshore model.
• Reduced “cost of innovation” – the significant knowledge capture and learnings within the dedicated offshore team not only quickly mitigates the initial apprehensions regarding the understanding of strategic and tactical nuances, but also translates into a game changing transformation of the innovation process. The offshore center allows multiple prototyping, shorter development cycle times, and lower cost pilot programs – all critical to innovate quickly in a “doing more with less” scenario.