Contract sales and marketing business to reach $5.2bn

The report said that in the pharmaceutical industry, sales and marketing is shifting from a core competency to a prime candidate for outsourcing, and as a result, the market is increasing at an annual rate of 9 per cent. The research, conducted by Kalorama Information, publishing division of MarketResearch.com, said that pharmaceutical companies spend as much as 30 per cent of their total revenues to promote and sell branded drugs. "While these costs continue to rise, pharmaceutical sales and marketing executives are looking for better ways to improve their selling efforts, uncover significant sales opportunities and reduce expenses,"​ the report said. It suggests that outsourcing sales and marketing is a cost effective strategy that can increase the return on investment in sales and marketing, and therefore improve profitability. According to the research, as more and more companies adopt the contract sales approach, or at least incorporate some aspects of it into their business strategy, a growing number of contract sales organisations (CSOs) have evolved to create a fully-developed industry. Traditionally used to manage peaks in promotional need, these CSOs now offer everything a pharma company can need and constitute the ideal outsourcing partner. Therefore, pharmaceutical firms are increasingly looking for sales outsourcing partners who will work with them on specific product strategies. Furthermore, CSOs now compete against pharmaceutical firms' in-house sales and marketing departments, large biotechnology companies' in-house sales capabilities, and other contract sales organisations in each country in which they operate. This is reflected in the important growth the market has seen in recent years with a total of $2.2bn in revenues this year, a 16 per cent increase compared to last year. The report estimates the CSO will reach $3.3bn by 2008.