A Columbia University professor presents complex mathematical algorithms to an attentive audience of PhDs, MDs, and PharmDs eager to challenge his method of evaluating new pharma product concepts. One by one, he answers detailed questions as the room buzzes with terms such as patient compliance and persistence, physician adoption, and disease management. But this is no medical conference. It is the annual meeting of the Pharmaceutical Management Science Association (PMSA), a small but growing organization whose members help drive the success of pharma marketing and sales efforts by using their expertise in computer science, statistics, applied math, economics, and marketing research.

At PMSA's annual conference, Pharmaceutical Executive got an exclusive glimpse of the challenges and responsibilities of pharma marketers' behind-the-scenes influencers.

A Profession Grows No other high-level pharma industry employee is as invisible as the management scientist who deals with some of the most vital aspects of pharma business: sales force effectiveness, resource allocation, and promotional targeting. In fact, those seasoned experts, with the ear of companies' top management, are so low-profile that some pharma companies don't even have in-house management science capabilities. And, among the companies that do, no two identify that function by the same name. They speak of sales analysis, marketing science, decision support, and operations research, to name a few.

At the organization's annual board meeting, Novartis' Paul Rabideau passed the presidential torch to Eli Lilly's Shawn Sahebi, PhD. [l to r] Standing: Ira Haimowitz, Pfizer; Paul Rabideau, Novartis; Shawn Sahebi, Eli Lilly; Kevin Kirby, GlaxoSmithKline; Sallye Tuttle, Pharmacia. Seated: Sangeeta Tandon (previously at Abbott); Andy Aiken, Eli Lilly; Qiang Ma, Novartis.

Paul Rabideau, director of Novartis' marketing science group and PMSA's immediate past-president, says that low profile can be attributed largely to pharma's slow adoption of the specialty until several years ago, when mass market analytics and computer programming experts left large businesses such as American Express and AT&T to join pharma companies.

Historically, banking, financial, and other consumer-based industries had unlimited access to customer information, so those experts were skilled at turning raw data into marketing insights. But until the early '90s, pharma had only zip-code level prescription sales data, which meant marketers had to figure out who the high-prescribing physicians were based on information from pharmacies located within the same zip code.

"Reps would visit the pharmacy, chat a bit, maybe bring lunch, and ask which doctors are prescribing a lot of their company's drug or a lot of their competitor's drug," says Rabideau. "And the pharmacist might tell them, leading reps to visit those doctors to try to boost sales. That's how reps got paid, by the volume of sales in a particular zip code."

That archaic compensation gauge changed dramatically when companies such as IMS Health began to offer physician-level data to help marketers more reliably segment their markets and target responsive customers. At that point, pharma began asking critical questions affecting management, operations, and resource allocation, including:

• What's the optimal size for a particular brand's sales force?
• Which doctors will respond to detailing and promotions?
• Which promotions are really working?

RAPP II: The Sequel

ROI and Other Holy Grails Management scientists, more than their colleagues in marketing research, are driving the research to streamline industry's marketing spend-the kind of research presented by speakers at PMSA's annual meeting in New Orleans in April. With 234 attendees and 15 exhibitors, it was the association's largest turnout in its 25-year history. Following is a sample of presentation topics:

Sales force sizing. Veteran researcher Andris Zoltners, PhD, founder and managing director of global consulting firm ZS Associates, tackled the sales force sizing issue and warned that the common "carpet bombing" practice of pharma sales won't work much longer. He advises companies to restructure their sales forces to reduce head count, optimize territory size and alignment, include reps in revamping incentive and compensation plans, and re-evaluate their investments in the co-promotion of products and services.

Forecasting. Franklin Carter, an assistant professor of pharma marketing at St. Joseph's University, presented the "call attractiveness model," a statistical methodology designed to predict which doctors will be a product's highest prescribers. Audience members studied his slides-mesmerizing patterns of Greek letters and mathematical symbols-and displayed varying degrees of comprehension. But Carter's most significant conclusion, recognizable to mathematicians and laypeople, was his suggestion that pharma marketers emphasize the following attributes in a physician profile:

• specialist
• solo practice
• affiliated with a large number of HMOs
• sees many HMO patients
• young
• writes a large number of prescriptions per month.

Promotional targeting. In another presentation, Avi Shatz, founder, chairman, and chief technology officer of Intercon Systems, described patient compliance and persistence enhancement programs as "low hanging fruit" that are often lacking from pharma's marketing mix. He argues that such programs not only improve patient outcomes, they also boost pharma companies' revenues, concluding that it's a mistake to treat pharmacy-based DTC promotion as "trade relations." Instead, he says companies should use patient-centric longitudinal data management and analysis to more precisely target consumers that doctors have already qualified as treatment candidates.

Growing Pains Many of PMSA's early leaders who are still active in the association disagree with some current leaders and members who want to invite vendors and outsourcing suppliers to join the board. One pharma company senior manager said that allowing the agendas of consultants and vendors to affect PMSA's educational mission would ruin the organization by diluting its focus. Although that point is understood by PMSA members and industry insiders, Rabideau believes that the line drawn between vendors and pharma companies is an artificial and irrelevant one.

"Why not differentiate between those who are committed to the field of management science and those who aren't," he asks, "instead of who's corporate or academic and who's a vendor?"

A similar, older organization, the Pharmaceutical Marketing Research Group (PMRG), counts employees of pharma companies as full members; vendors and consultants as associate members. Although PMRG focuses more on traditional marketing research than management science, its membership includes many management scientists who regularly attend its seminars and annual conference. But the consensus among PMSA members is that they get more out of PMSA; that the collaborative, academic atmosphere is what keeps them coming back, year after year. Rabideau believes that also may account for the profession's growth in general as well as for the growth at his company, where he's hired 15 people in his division within the last five years-a sizeable increase from the two originally at Sandoz in 1996.

Before physician-level prescription data was available and companies realized the value of management science, those professionals covered two or three brands while their colleagues in marketing research worked one-to-one, sometimes two-to-one, on major brands. The New Orleans conference gave PMSA board members an opportunity to discuss the industry's growing appreciation of what they do and the contribution they make to their companies' sales and marketing endeavors.