Generics taking a greater toll on pharma sales forces

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The number of working sales reps in the US dropped below 93,000 in 2008, from an all-time high of 102,000 in 2005, according to an SDI report. Numbers are expected to decline further in 2009.

A declining product pipeline and budget cuts were contributing factors to the decreasing number of drug reps, however, it's the generic surge that's doing the most damage. In an exclusive interview with MM&M, Jason Fox, associate director, syndicated analytics department at SDI, said that generic availability is affecting the branded side of the pharma industry more than any other factor. “Especially on big companies that have big time products and big time markets. If they are seeing generic products come in, they have to re-evaluate what they are doing from a promotional standpoint.”

Fox noted that cuts in the product pipeline can be a contributing factor for a year or two, and because budget cuts can vary, they don't necessarily result in sales force cuts. Generic erosion, by far, has had a greater impact, he said. 

The SDI sales force data comes in the wake of the most recent announcement of sales rep cuts by a major pharma company. On January 16, Pfizer announced that it might reduce its sales force by one-third, or 2,400 reps. Layoffs would follow the patent expiration of the company's blockbuster cholesterol drug, Lipitor, in 2011. On January 13, Pfizer announced plans to cut up to 800 research jobs in 2009, representing 5-8% of the company's approximately 10,000 researchers.

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