Global Pharmaceutical Contract Sales Outsourcing (CSO) Landscape in 2022 and Beyond Pharma Companies Rely Heavily on CSO to Drive Growth

  

Global Pharmaceutical Contract Sales Outsourcing

Faced with mounting pressure to launch new drugs faster while reducing costs, pharmaceutical companies have increasingly relied on contract sales outsourcing (CSO) over the past decade. By outsourcing their salesforce to specialized CSO providers, drug makers can avoid the high upfront investment required to build and maintain an in-house sales team. They are also able to redeploy capital towards R&D and bring therapies to market more quickly.

A 2021 survey found that over 80% of major pharma companies now use CSO providers in some capacity. This trend is expected to continue growing as blockbuster drugs lose patent protection and the industry faces new competitive pressures. CSO allows pharma companies to remain agile and focus resources on developing the next generation of treatments.

North America Dominates CSO Spending

The majority of Global Pharmaceutical Contract Sales Outsourcing spending still occurs within the lucrative U.S. market, which demands a large salesforce presence to influence prescribing decisions. According to a recent report, North America accounted for over 65% of the global CSO market in 2020. With its large patient population and concentration of specialist physicians, engaging healthcare providers across different regions in the U.S. requires specialized teams.

However, other regions are growing rapidly as focus shifts to emerging markets. Latin America, the Asia Pacific, and Middle Eastern markets collectively made up over 25% of the global CSO market last year. As these regions experience rising incomes and healthcare investments, international drug makers are turning to regional experts to promote their products. Countries like China, India, Brazil and Saudi Arabia now rival developed markets in terms of pharmaceutical spending growth.

Rise of Full-Service and Multichannel Providers

Earlier Pharmaceutical Contract Sales Outsourcing (CSO) models primarily centered around outsourcing sales representatives and related sales operations. However, providers have significantly expanded their service offerings to meet evolving industry and client needs. Today's leading CSO firms handle the full gamut of commercialization activities from marketing to distribution.

They leverage data analytics capabilities and digital/virtual platforms to engage healthcare professionals through multiple channels beyond just field sales. This allows clients to maximize promotional impact while reducing costs. The share of "full-service" CSO contracts, which encompass clinical trials to post-marketing support, has grown substantially. By outsourcing everything apart from core strategic decisions, pharma companies achieve maximum flexibility and operational scale.

New Focus on Specialty and Rare Disease Therapeutics

An area that has witnessed explosive CSO growth is for specialty and rare disease drugs. These treatments target smaller patient subsets with complex conditions, requiring specialized detailing. Due to the high per-patient drug costs and concentrated physician base, pharma firms rely heavily on CSO expertise to ensure broad access and reimbursement.

Providers have invested heavily to build deep therapeutic knowledge across various specialty therapy classes like oncology, immunology, and neurology. They work closely with clinical leaders, patient advocacy groups and payers to facilitate nationwide launches. This domain competence, coupled with ability to rapidly deploy specialized field teams, positions CSO firms to maximize the adoption of high-value specialty medicines.

Artificial Intelligence Gains Foothold in Sales Enablement

Artificial intelligence (AI) and machine learning are increasingly leveraged by CSO companies to enhance sales effectiveness and oversight. Using past prescriber behavior and extensive patient data, algorithms recommend optimized sales call plans tailored to each healthcare professional's treatment patterns and interests.

AI is also being deployed to monitor field activities in real-time, identify patterns, and provide actionable intelligence to sales managers. This allows for prompt corrections when reps go off-script or face resistant accounts. Speech recognition and sentiment analysis further help assess call quality and opportunities for improvement. With healthcare moving online due to Covid-19, AI will play a vital role in powering novel digital sales solutions.

New Geographies Present Major Growth Avenues

While North America and major European markets still anchor pharmaceutical spending, the importance of emerging regions continues rising. By 2025, developing nations across Asia Pacific, Latin America, Eastern Europe, Middle East and Africa will account for over a third of global drug sales according to industry projections. This growing pie presents tremendous opportunity for capable CSO providers.

Established market leaders as well as regional mid-sized firms have been aggressively building commercial hubs tailored to local regulations, culture and practices. Leveraging their international process infrastructure but local clinical and sales talent, they help overseas biopharma companies execute flawless product launches in these complex environments. Mega-tend in populations and urbanization of developing economies ensure there will be no shortage of addressable patients to drive future revenue pools.

The growing complexity of healthcare systems worldwide, financial pressures on drugmakers to maximize returns, and emergence of niche specialized therapies have profoundly accelerated Pharmaceutical Contract Sales Outsourcing (CSO) trends. CSO is well-established as a core commercialization strategy across major pharma corporations. With continued innovation and focus on high-growth regional markets outside the U.S., leading CSO firms are ideally placed sustain strong double-digit annual growth over the coming years.

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