A Riskier, But Perhaps More Profitable, CSO Business
Executive Summary
At a time when much of the pharmaceutical outsourcing sector is struggling-with CROs particularly dragging over the last several years-the contract sales and marketing industry remains solid. One thing the CROs and CSOs do have in common is a desire to form risk-sharing partnerships with their clients that will bring them higher margins than traditional fee-for-service contracts. Last October, PDI's LifeCycle Ventures Inc. subsidiary inked a five-year agreement with Glaxo Wellcome Inc. for the exclusive US marketing, sales, and distribution rights for Ceftin, an oral antibiotic used in treating acute bacterial respiratory infections. PDI had to create an infrastructure with all the various commercial components, and since the deal, its share prices have been on a singularly impressive roller coaster ride. But PDI is once again looking for risk-sharing arrangements, although future deals may involve a more limited set of services than it is providing in connection with the Glaxo deal.
You may also be interested in...
The Outsourcing Dilemma
The drug industry has accepted the need to outsource R&D--now, with sales productivity down, and the rising cost and risk of owning too much commercial infrastructure, why not outsource more of the sales effort, too? Big and small pharmas resist the idea but will eventually have to accept it--junior partners in licensing deals are insisting on roles in selling their own products, and Big Pharma must investigate cost-saving solutions.
UK Government Wants To Work With Industry To Identify OTC Switch Candidates
The UK's medicines regulator, MHRA, alongside other government agencies, intends to work together with manufacturers to identify Rx-to-OTC switch candidates. Switch criteria might include “different strength medicines to those available today, combination formulations, or medicines manufacturers already offer without prescriptions in other countries,” NHS England says, in its recently published “Delivery plan for recovering access to primary care.”
Stock Watch: How To Avoid Blockbuster Loss Of Exclusivity Bringing Your Company Down
What is the difference between companies with franchises that rise and then fall into obscurity, and those that keep on rising even after loss of exclusivity?