Global CSO market worth $5.6bn by 2015
Falling drug approvals, negative pricing pressures and patent expiration have led to biopharm restructuring operations and laying off in-house sales staff. This has created an opportunity for CSOs which allow biopharm provide sales support without investing in in-house staff.
In its report Business Insights states that these factors underpin the expected growth in the contract sales market. To put the size of the CSO market in context, the pharma industry will spend a total of $200bn on product promotion in 2010, according to the report.
This leaves plenty of opportunities for CSOs and Business Insights believes one area they can grow is in emerging markets. For instance, only a handful of CSOs operate in China. Leading players in China include NovaMed, with 500 staff, and Invida, which is growing from 400 to 600.
India is also viewed as “a large opportunity” for CSOs. Business Insights reports that while the pharma outsourcing sector has thrived sales penetration remains low. With the Indian market expected to continue growing CSOs can prosper in the country.
Changing practices
The report states that adoption of the key account management model places additional demands on CSOs, resulting in longer, more strategic relationships with sponsors.
This mirrors the trend seen by contract research organisations (CRO). Sponsors are increasingly viewing CROs as strategic partners and outsourcing large areas of operations. In response some CROs, namely Charles River Laboratories, have sought to buy to expand their service portfolios.
Other trends affecting CSOs are driven by the increased focus on interactions between physicians and sales representatives. This has led to restrictions on hospitality and created an imperative for pharma to find new sales and marketing approaches.
