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The First Cut Is The Deepest
Author:  PharmaVet
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Sales force cutbacks are nothing new in pharmaceuticals. Although the industry as a whole has traditionally been quite stable, the individual companies within it are much more volatile. The nature of the beast is that its companies' sales forces expand and contract in a cyclical fashion, almost like it's breathing.

Last week, Pfizer announced that it will downsize its U.S. sales force by 20% by the end of this month. This will directly affect approximately 2,200 Pfizer sales representatives and managers. But what about the indirect effect on the rest of the industry and on job-seekers who are trying to get into the pharmaceutical industry?

Clearly the most direct impact will be to the individuals who make up Pfizer's sales force. Although companies that are downsizing never make public the exact criteria they use to decide who stays and who goes, they usually use some combination of tenure, sales rankings, and ratings from annual reviews. But speculating about the exact formula Pfizer will use is as pointless as asking the Colonel for his secret recipe.

And what about the job-seekers who were in the middle of the interview process with Pfizer when they announced a hiring freeze a while back and were told, in effect, to stay tuned? I think it's safe to say that it's time to turn the channel. For the most part, they would be smart to focus their efforts on getting jobs with other companies or in other industries.

One indirect effect of Pfizer's cuts is that people seeking sales jobs with pharmaceutical companies other than Pfizer will find themselves in even more of a buyer's market than before. It's widely known that pharmaceutical sales jobs are very tough to get because of extremely stiff competition, and lots of it. Now there will be another 2,200 experienced, well-trained, and unemployed pharmaceutical sales representatives added to the pool of job-seekers. Job-seekers without pharmaceutical industry experience will have a harder time than ever getting in.

Sales representatives who are currently employed with other pharmaceutical companies will also be indirectly affected by Pfizer's downsizing. Why? Because as Pfizer goes, so goes the industry. The top tier of big pharma behemoths -- Pfizer, GSK, Merck, Novartis, and a few others -- has been in a widely acknowledged arms race for years. Pfizer's long overdue and badly needed cuts are just the first stab at reining in this runaway horse of an industry.

In the late '80s, pharmaceutical sales forces, like our hair and the shoulder pads in our power suits, were big. In the early '90s, the industry responded to the threats posed by the Clintons and other vocal critics of the industry's excesses by cutting back on sales forces. Back then, it was unfashionable to call it a layoff or a downsizing -- 'rightsizing' was the euphemism du jour. But for the past decade or so, pharmaceutical companies have again been one-upping each other through sales force redundancy. Why deploy just one sales force when you can have two or three or six mirroring each other? Why be the only company selling your products when you can hire mercenaries in the form of contract sales organizations to overlap your own sales force? Despite this, it's not just critics of the industry who have been calling for change. The CEOs of the big pharma behemoths have been warily watching each other and hoping that someone else would be the first to throw down their weapons so they could all follow suit.

So Pfizer has made the first major will be interesting to see who's next.

  Author: Experienced
    Re: The First Cut Is The Deepest   Log In to Report Post
   Background: I've have 16-years pharmaceutical exp. plus recently completed MBA Duke and have been on several interviews with top firms; however, I haven't gotten an offer. The reason given "we hired an internal candidate who had onocology or medical equipment." Question: In a downsizing market competing often times with internal candidates, how do I get the offer?
  Author: Anonymous Medzilla Reader
    Re: The First Cut Is The Deepest   Log In to Report Post
   I work for Pfizer and will probably be one of those cut. It is not based on sales alone, as I won the top award last year!! I believe that finding a job for the Pfizer employees will be very difficult. The company must believe that too or they would not be handing out great severance packages. They are also concerned about being sued--hence severance packages to assure no lawsuits. (You sign a 17 paqe document giving up your right to sue). However, I must say, Pfizer has WAY TOO MANY sales reps. We have mirrored ourselves right out of offices. Physicians can pick and choose which rep in the team that they want to work with. This is not what companies want, but it is what they have created. As a shareholder, I these cuts are needed. As an employee, I am sad to go, and hope to find a new job soon. I come with more training than almost anyone. I believe that for those not currently in the industry, there are still jobs for you. The experienced Pfizer reps are NOT looking for the entry level jobs. We will take the jobs of being your managers and Sr. Specialty or Therapeutic Reps.
  Author: PharmaVet
    Re: The First Cut Is The Deepest   Log In to Report Post
   I don't think it makes CSOs either more or less desirable.  They're different animals.  Traditional pharma has typically been thought to be more secure than CSOs.  I have never thought that to be true, really, simply because traditional pharmaceutical sales is very volatile anyway.  While the industry as a whole is stable, the companies within the industry beef up their sales forces in anticipation of a product launch, then trim them down again when they lose a patent.  It seems like most companies that have more than one or two products gain or lose a large number of sales reps every few years.  CSO positions are transitory by definition, so it's still volatile...just perhaps more predictably so.
  Author: Anonymous Medzilla Reader
    Re: The First Cut Is The Deepest   Log In to Report Post
   What are your thoughts on going with a contract sales organization like a Novaquest or Innovex. Is the current environment making the CSOs more desirable?

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