this presentation explain impact UHC for pharmaceutical business as specially sales force design and strategy to compete this business

1. KEY CHALLENGES AND PRIORITIES IN SALES
TRANSFORMATION : INDONESIA PRESPECTIVE

2. UNDERSTANDING THE MAJOR TRENDS TO 2016 GLOBAL PRESPECTIVE
Mature markets facing low growth, more cost containment
Pharmerging markets to have high growth with mixed fortunes for Originators
On patent brand sales to decline as generics aspire to +/- 80% dispensed prescriptions
Growth will come from specialist driven markets particularly biologics but with biosimilars making little impact to 2016
Europe is under pressure with severe hospital debt and austerity measures
Consolidation within the industry and diversification by originators changing the playing field
Global Pharmaceutical Market and Generics, IMS Kyoto presentation

3. MORE THAN ONE TRILLION DOLLARS OF WORLDWIDE
PRESCRIPTION DRUG SALES EXPECTED BY 2020
Copyright © 2014 Evaluate Ltd. All rights reserved.

4. WORLDWIDE PRESCRIPTION DRUG SALES (2006-20)
Copyright © 2014 Evaluate Ltd. All rights reserved.

5. GLOBAL PRESCRIPTION DRUG REVENUE 2004−2018
comSource: EvaluatePharmaTM, June 2013.

6. PHARMERGING MARKET GROWTH IS DRIVEN BY GENERICS AND
NON-BRANDED PRODUCTS

7. ASEAN TOTAL HEALTHCARE SPEND – OVER $
68 BILLION
Data from World Bank 2011 (latest available)
605 million people
Average age < 27yo

8. 0
5
10
15
20
25
30
35
40
45
50
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
Pharmaceutical Sales In South East Asia (USDbn)
Indonesia
Thailand
Vietnam
Philippines
Brunei
Cambodia
Myanmar
Singapore
Laos
CAGR = compound annual growth rate. Source: BMI
8.4% CAGR
6.4% CAGR
14.1% CAGR
6.4% CAGR
7.1% CAGR
11.9% CAGR
9.4% CAGR
14.4% CAGR
8.8% CAGR
Malaysia 7.8% CAGR
REGIONAL MARKET FORECAST

9. REGIONAL OUTLOOK: ASIA
Health and pharma spending growth rapid, but
slower. Pharma expected to rise faster than overall
healthcare spending.
Expansion will be driven largely by China, thanks to
the rollout of public health programmes.
By 2016 China’s pharmaceutical market will be
bigger than that of Japan, where growth will be
minimal, owing to rising use of generics and market
competition.
India, Indonesia, Malaysia, South Korea and
Thailand will also see double-digit growth, despite
efforts to bolster cheap local production and reduce
drug prices
Global outlook: Healthcare March 2014, The Economist intellegent unit

10. NEW GLOBAL CENTER OF OPPORTUNITY IN ASIA PACIFIC
The Asia-Pacific region, including China, Japan, India, Australia and Korea, is projected to be the
single largest contributor (46%) to global pharmaceutical market growth through 2015. But the shift
won’t come without new challenges.
Without the margins to support large sales forces in the long-term, Asia will be where we crack the code on
remote selling.
80,000
90%
Number of sales reps in China, making it the largest
pharma sales force in the world
Level of deep discounts imposed by some
governments on healthcare products
Pharmafocus, Mark Mallon, regional vice president Asia-Pacific and president China, AstraZeneca, 2012

11. THE EVOLVING STAKEHOLDER LANDSCAPE

12. THE EVOLVING STAKEHOLDER LANDSCAPE CONT’

13. EVIDENCE IN 2014 : PATIENTS BECOMING MORE LIKE CONSUMERS

14. OFF-INVOICE REBATES AND DISCOUNTS WILL REDUCE NET MANUFACTURER SALES
GROWTH BY APPROXIMATELY 25%

15. DECLINING CONTRIBUTION FROM OTC DRUG SALES
17,5% 17,5% 17,9% 18,4% 19,3% 19,9% 20,4%
37,7% 39,4% 40,0% 40,5% 41,1% 41,6% 42,1%
44,8% 43,1% 42,1% 41,1% 39,7% 38,5% 37,5%
2009 2010 2011 2012 2013 2014 2015F
Patented drug Generic drug OTC

16. BARRIERS TO GROWTH
Kpmg.com

17. INTRODUCTION INDONESIA

18. Investment Gateway into Indonesia, Deloitte

19. RISING CONSUMPTION
www.tomcatfuturist.com

20. LIFESTYLE-RELATED DISEASES IN INDONESIA (2014)
Source: WHO

21. INTRODUCTION
WHY IS INDONESIA AN ATTRACTIVE MARKET FOR HEALTHCARE?
Source: Frost & Sullivan

22. LARGE POPULATION
Source: Frost & Sullivan

23. PRIVATE AND PUBLIC HEALTH CARE EXPENDITURE (% OF GDP) IN
2013
Source: World Bank and OECD

24. WHAT DOES THE INDONESIAN HEALTHCARE MARKET OFFER?
Source: http://uk.reuters.com/; Frost & Sullivan

25. UHC (UNIVERSAL HEALTHCARE) POLICY TRENDS
*Instead, Public hospitals strongly support patients with free essential drug, Source: Global Data Country Reports 2013-2014 (2011 to 2013 data)
Public Healthcare Coverage in Asia

26. WHO WILL BENEFIT THE MOST FROM NATIONAL HEALTH INSURANCE?
Source: Frost & Sullivan

27. IMPROVED ACCESS TO HEALTHCARE
Source: MOH Indonesia; BPJS; Frost & Sullivan

28. UNIVERSAL HEALTHCARE COVERAGE (JKN) ROADMAP
(2012)
76.4 m
30%coverage
(2014)
142m
56% coverage
(Aug2015) 150m
63% coverage
(2019)
270m 100%
coverage
Source: Roadmap to National Health Insurance 2012-2019, DBS Vickers

29. HAS THE PATIENT VOLUME INCREASED AS ANTICIPATED?
Source: Standard Chartered 2014; Frost & Sullivan

30. HOW CAN THE PRIVATE INVESTOR BENEFIT FROM THE JKN SCHEME?
Source: Frost & Sullivan

31. INDONESIA HOSPITAL BEDS CLASSIFICATION 2010
Hospital (General and
Specialty)
Public Hospital
Class A (>400 beds)
Extensive specialist
medical services +
extensive sub specialist
Class B (100-400 beds)
Extensive specialist
medical services + limited
sub specialist
Class C (50-100 beds) Has minimum of 4 basic
specialist medical services
Class D (<50 beds) Provides basic medical
facilities
Private Hospital
Priority
General medical services
+ specialist and sub-
specialist
Madya Minimum 4 specialists
medical services
Pratama General medical service
Journal of Hospital Administration, 2013, Vol. 2, No.1

32. TREND NO OF HOSPITAL IN INDONESIA BASED ON CLASS (2012-2015)
43 56 56 60
217 256 295 344
447
631
742
901
251
416
517
473
761
724
618 684
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015
A B C D N Class
h􀀕 p://sirs.buk.depkes.go.id

33. TREND NO OF HOSPITAL IN INDONESIA BASED ON CATAGORY (2012-2015)
1371 1608 1718 1935
348 475 510 527
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012 2013 2014 2015
General Hospital Specific Hospital
h􀀕 p://sirs.buk.depkes.go.id

34. HOSPITALS BEDS GREW AT 20.6% CAGR (IN FOUR YEARS)
Source: Ministry of Health, DBS Vickers

35. INDONESIA HOSPITALS - BREAKDOWN BY OWNERSHIP
Private; 61,40%
Gov't
(provincial,district,municipal);
28,70%
Ministry of Health & other
ministries; 1,70%
Military & Police; 6,80% State-owned; 2,60%

36. INTRODUCTION OF UHC: TIMELINE
*All hospitals refer to p ublic hospitals (which must register with BPJS) and private hospitals which are not required to d o so.
Source: BPJS website, Kompas, Tempo and Indonesian Public Health Insurance website

37. FACT 2015
http://www.bpjs-kesehatan.go.id/bpjs/index.php/home

38. THE RATIO OF PHYSICIANS TO POPULATION ALSO MASKS SIGNIFICANT INEQUITIES AMONG
URBAN AND RURAL AREAS
Source: KKI 2008.

39. HEALTH CARE INVESTMENT REGULATIONS: THE NEGATIVE
INVESTMENT LIST (2013 AND 2014)
Source: Negative investment list — Presidential Regulation No. 39/2014

40. BENEFITS COVERED BY UHC IN INDONESIA, THAILAND AND THE
PHILIPPINES
Source: BPJS, PhilHealth, WHO

41. TREND OF GENERAL PRACTITIONERS (GPS) AND SPECIALIST DOCTORS IN INDONESIA
(2010 – APRIL 2014)
Source: Ministry of Health (see Appendix H); Future need: EY rough estimate

42. NUMBER OF HEALTH CARE PROFESSIONALS BY TYPE (2010–2014)
Source: Ministry of Health

43. PHARMACEUTICAL COMPANIES MUST ADAPT TO CHANGING
LANDSCAPE
Compulsory use of generic drugs, whenever possible. Patients under the JKN
scheme (including COB) do not have much choice, otherwise they will not be
reimbursed by the scheme.
The cap on ceiling prices of generic medicines have been set under Ministry of
Health Decree no. 092/MENKES/SK/11/2012, which means that pharmaceutical
companies’ margins are dependent on government’s pricing policies
Shift in distribution channel, as registered hospitals and clinics slowly take over as
the main distribution channels from physicians and pharmacies. In addition, the
introduction of e-procurement for generic drugs by the government will aid this
apparent shift too

44. KEY 2015/2016 HEALTHCARE MARKET PREDICTIONS

45. SALES MANAGEMENT BEST PRACTICES EXECUTION
ASSESSMENT
Sales Management 2.0 Optimizing Sales Performance 2010 – Volume 3

46. THE SALES FORCE SYSTEM FRAMEWORK
Journal of Personal Selling & Sales Management, vol. XXXII, no. 2 (spring 2012), pp. 171–186

47. INDUSTRIES AND SELLING ENVIRONMENTS WITH VARIED SALES
PROCESS COMPLEXITY
Journal of Personal Selling & Sales Management, vol. XXXII, no. 2 (spring 2012), pp. 171–186

48. SHARE OF ATTENTION – ONCOLOGY SALES REPRESENTATIVE BRAND DETAILS BY
COMPANY (2009 – 2014)
5th Annual Outlookon the Biopharmaceu􀀕 cal Promo􀀕 onal Landscape,February2015Edition |Vol. 9, Issue 2

50. IN EACH PHARMERGING COUNTRY COMPANIES HAVE A WIDE SET OF CHOICES TO
DEFINE THE APPROPRIATE STRATEGY
Key strategic choices
Global pharma market outlook -Elisabeth Beck, © 2013, IMS HEALTH

51. SALESFORCE STRUCTURE AND SALES ROLES ACROSS A BUSINESS
LIFE CYCLE
© 2014 WorldatWork. All Rights Reserved. For information about reprints/re-use, email copyright@worldatwork.org | www.worldatwork.org | 877-951-9191

52. UNDERSTANDING WHAT PHYSICIANS VALUE
Physician Prescribing Trend
What Doctors expect from Medical
Sales Reps?
http://blog.medismotech.com/pharma-selling-what-doctors-want-from-medical-sales-reps/h􀀕 p://blog.medismotech.com/pharma-sfe-sales-force-effec􀀕 veness/

53. THE WINDOW IS EVER SHORTER
Today, only 7% of sales calls
are longer than 2 minutes
Your opportunity will end in:
Based on Canadian Study, Arcus/B.C. Medical Association, 2011

54. THE TEAM IS GETTING SMALLER
(BUT THE SALES GOALS AREN’T)
102,000
REPS IN 2007
75,000
REPS IN 2012

55. What level of face-to-face calls from field based specialists do you expect in order to develop and grow
regional-level thought leader relationships (per year)?
N=28
1-8 callsper year
32%
8-10 calls per
year
25%
10-12 callsper
year
11%
13-14 callsper
year
14%
15-18 callsper
year
3%
19-26 callsper
year
11%
Morethan 26
callsper year
4%
68% call
no more than
1 time
per month
DEVELOPING RELATIONSHIPS

56. PERSISTENCE
Over 30% of leads are never contacted at all.
By just making a few more call attempts, sales reps can experience up to a
70% increase in contact rates.
Source: Insidesales.com

57. FIRST THINGS FIRST :
Rumors of the death of the sales force have been vastly over exaggerated
50-75% of physicians prefer to have
some contact with reps
That’s right: They want to be detailed
Knowledge Networks and Physicians Consulting Network, 2011
Business Insights, LTD, 2009

58. THE SPECTRUM OF COMMUNICATION OPTIONS IS WIDE
© Copyright 2001 by ZS Associates. All Rights Reserved

59. MARKETING OBJECTIVES AND THE MOTIVATORS FOR THE PHYSICIANS’ PRESCRIBING
DECISIONS CHANGE OVER THE COURSE OF THE PRODUCT LIFE CYCLE
© Copyright 2001 by ZS Associates. All Rights Reserved

60. MOST PHYSICIANS SAY INFORMATION FROM PHARMACEUTICAL
COMPANY REPS IS UP-TO-DATE, USEFUL, AND RELIABLE
Source: KRC Research, Survey of Physicians about Pharmaceutical and Biotech Research Activities and Information, Commissioned by PhRMA, March 2008

61. WHAT PHYSICIANS WANT AND NEED FROM PHARMA
http://www.worldofdtcmarketing.com/what-physicians-want-and-need-from-pharma-2013

62. WHAT PHYSICIANS WANT AND NEED FROM PHARMA CONT’
http://www.worldofdtcmarketing.com/what-physicians-want-and-need-from-pharma-2013

63. WHAT PHYSICIANS WANT AND NEED FROM PHARMA CONT’
http://www.worldofdtcmarketing.com/what-physicians-want-and-need-from-pharma-2013

64. BUYER BEHAVIOR MODEL

65. KOL STRUCTURE SHOULD EVOLVE WITH THE COMPANY
In younger, smaller organizations with few products, KOL management should be very hands-on; as an
organization grows and the number of therapeutic areas increases, clinical and commercial leaders
employ more strategic approaches.
KOL Function Maturity
KOLManagementSophistication
New Bio-Pharma
Medical & clinical leaders collaborate
with commercial to develop KOL
strategy
Identify Key Opinion Leaders for
Therapy
Develop excellent relationships with
National KOLs
Develop regional KOLs
Leverage relationships to educate
providers on disease and therapy
Maintain and improve KOL
relationships for existing and
developing therapies
Mid-Cap Bio-Pharma
Medical, clinical & commercial
leaders collaborate to develop
stratified KOL strategy across
therapies
Leverage existing KOL relationships
and experiences to develop KOLs in
new therapeutic areas
Develop and improve systems for
tracking all company interactions
with KOLs
Shift National/Global KOL contact to
dedicated functional personnel for
each therapeutic area
Conduct periodic reviews to identify
and approach new KOLs
Large Bio-Pharma
Continue cross-functional
collaboration to ensure KOL
strategies remain current
Periodic refinements to KOL
management structures based on
experience and changing therapeutic
needs
Focus on continuous improvement in
KOL relationship management and
tracking to optimize systems and
processes for maximum impact
Continue periodic reviews to identify
and approach new KOLs

66. Intangibles
WHAT KOLS VALUE MOST
The open-ended responses were spread roughly evenly across three broad categories: contribution and involvement, rewards
and benefits, and intangibles. Percentages of multiple responses are shown below with representative verbatim values.
Q: What do KOLs seem to value most in their relationship with your company? (please list top three and describe as necessary)
44 46 48 50 52 54 56 58 60
Being on the cutting edge; Involvement in changing science; Clinical studies participation;
Innovative products; Engaging Peers; Chance to Give Advice; Ability to contribute
Rewards and
Benefits
Contribution
and
Involvement
0
Integrity; Ethics; Patient Focus; Honesty;
Transparency; Service orientation; Brand value
Support for research;
Sponsorship; Honoraria; Ability
to publish; CV building; business
perks

67. INNOVATION DIFFUSION CURVE AMONG PHYSICIANS
D
C
A
Cautious Majority
Laggards
Late Adopters
Innovators
B
E
Early Adopters
Target First Movers With Tailored CME

68. VALUE INNOVATION
Product
benefits
Brand
benefits
Service
benefits
Acquisition
costs
Customer Value-surplus
Costs of
- buying
-production
- handling
- services
- etc
Margin
Creation of Customer Value (W. Reijnders 2005)
Price
E.g.:
Information search
Travel expenses
Wait time
Consult or guidance
Annoyances of
Building
Personnel
Others
et cetera
E.g.:
- accessibility
- consult / service
- attitude
problem solving
client directed
friendly
et cetera
Brand characteristics
Confidence
Function
Emotion
Et cetera
Customer desired
product range:
breadth, length, depth
of assortment
Complementarities
Cohesion
Services
Guarantee
Et cetera

69. ABOUT THE 3 RULES Better before cheaper: Don’t compete
on price, compete on value.
Revenue before cost: Drive profitability with higher
volume and price, not lower cost.
There are no other rules: Do whatever you have to in order to remain aligned
with the first two rules.
Invigorating biopharma: How the three rules can drive superior performance, DUPress.com

70. STRATEGIES FOR FOLLOWING THE THREE RULES IN
PHARMACEUTICAL
Invigorating biopharma: How the three rules can drive superior performance, DUPress.com

71. THE EVOLVING STAKEHOLDER LANDSCAPE
Source: Jeff Wordham and Sheryl L. Jacobson, Transforming commercial models to address new health care realities, July 12, 2013, http://dupress.com/articles/transforming commercial models to address new health care realities

72. TRANSFORMING COMMERCIAL MODELS TO ADDRESS NEW HEALTH
CARE REALITIES
Transforming commercial models to address new health care realities

73. NEW COMMERCIAL MODEL PILOTS
Multifaceted
patient-
support
programs
New partnerships
and collaborations
Disease education
and patient
screening
Online communities
to support peer-
to-peer education
and information
exchange
Programs to
diversify the sales
toolkit
Transforming commercial models to address new health care realities

74. CLASSIC BEHAVIORAL SEGMENTS IN A SALES FORCE
Using behavioral segmentation to boost salesforce effectiveness, Copyright © McKinsey & Company

75. PART OF A DOSSIER FOR AN AREA MANAGER
* Manipulating sales to maximize incentives by alternating between excellent and poor performance in successive quarters
Using behavioral segmentation to boost salesforce effectiveness, Copyright © McKinsey & Company

76. RESEARCHING THE INFLUENCERS ON PRESCRIBING A
PHARMACEUTICAL PRODUCT
2012 Update from the Learning & Development Committee, The EphMRA Learning & Development Committee

77. SAMPLE GROUPS USED IN A PHARMACEUTICAL MARKET
The EphMRA Learning & Development Committee

78. ARE SALES REPS NECESSARY?
Although the pharmaceutical sales
force has doubled between 1995
and 2000, the number of audited
calls has only increased by 10%.
Reps average only 2 quality details
per day (quality details includes
discussion of features, benefits, and
data).
Only 43% of pharma reps ever get
past the receptionist
Only 7% of pharma rep visits last
more than 2 minutes
Only 6% of physicians think
representatives are very fair
balanced
Only 8% of calls are remembered
by the physician
56% of physicians think
representatives are more
aggressive today than in the past
Less experienced, younger sales
forces (average age of a US rep is
26)

79. WHAT ARE SALES REPS ABSOLUTELY NECESSARY FOR?
Increase Scripts Written
Deliver Samples
Source of Practical Information for Docs
Cater Lunches for Docs
Compensate for Lack of Trained Hospital/Office Staff
Manage Patient Assistance Programs
All of the Above
None of the Above
19%
13%
24%
9%
7%
6%
8%
14%
© 2007 VirSci Corporation (www.virsci.com). All rights reserved

80. Top Performers
Sales Rep A
Sales Development Plan: Sales Rep A

81. BUT, THEIR EXPECTATIONS HAVE DRAMATICALLY CHANGED
Customized to their practice
Responsive to the conversation
Delivered how and when it’s convenient

82. WHY COACH SALES REPS?
Sales people who receive fewer
than two hours of coaching
per month achieve 90% of quota.
Sales people who receive at least
three hours of coaching per
month achieve 107% of quota.
Sales people who receive 2-3
hours of coaching per
month achieve 92% of quota.

83. A NEW PARADIGM : THE REP RELIANT BLOCKBUSTER
Marketing was the major driver behind the last generation of mass-market, mass-scale blockbusters. But
the new generation of highly specialized, highly expensive drugs requires more individualized selling and
learning. The conventional wisdom about the selling mix is about to change.
Biologics are taking
the lead
Designed for very
targeted patient
populations with few
treatment alternatives
Biosimilars changed
the conversation
New choices in old
categories will require
reps to deliver subtle
value props
New incentives will
shift focus
Incentives will be
weighted to these life-
long, higher-cost
drugs

84. IT WAS SUPPOSED TO IMPROVE EVERY CALL
more personal
more flexible
more effective

85. MAKING THE PACKAGE SALES
A number of converging trends—from more personalized medicine to more commoditized
categories—will prompt a more packaged selling system, one that combines a diagnostic tool
with a proven support system to both identify a patient and help him or her succeed on a given
Rx.
Diagnostic + Product + Support
[more personalized medicines] [more successful patients]
More medical knowledge for reps,
ability to give live demonstrations,
and do hands-on training with staff
New kinds of research and data
that prove the outcomes-based
value of patient support programs