Benefits of Outsourcing Your Commercial Functions while Avoiding...

Pharma Tech Outlook: Pharma Tech Magazine

Benefits of Outsourcing Your Commercial Functions while Avoiding the Problems

Pharma Tech Outlook | Friday, December 31, 2021

As commercial outsourcing gets more sophisticated; it enables increased innovation by empowering small and ambitious biotech enterprises to bring essential healthcare innovations to market.

FREMONT, CA: Outsourcing is not a new concept in biopharma; contract research, pharmaceutical manufacturing, and sales firms have existed for decades. When done correctly, it may be a valuable tool for increasing operational efficiencies and cost savings—but when done incorrectly, it can create significant issues, higher risk, and lost profit. Beyond sales, what is novel is that both large pharmaceutical corporations and smaller biotech companies are outsourcing larger commercial tasks. The capabilities are exciting and expanding as a result of the increasing optionality. However, there are traps to avoid using this new terrain's potential entirely.

The current frontier of outsourcing commercial functions encompasses various offerings to assist commercial operations, including marketing and sales operations, marketing, and market access (either entirely or partially). These offers can be a la carte or, more recently, as a one-stop shop, with vendors aggregating all of the responsibilities of a large pharma commercial organization and selling them to smaller enterprises as a bundle. While each has its advantages and disadvantages, the truth remains that outsourcing generally provides a slew of benefits to businesses large and small.

Large pharmaceutical businesses have already reaped the benefits of outsourcing in patient and reimbursement centers, contract sales to supplement support for large products, focus on a non-core product, and digital promotion for mature brands. Smaller biotech firms are only now beginning to tap into this wealth.

Historically, when developing biotech businesses considered commercialization, they had two options: construct it internally, which is time-consuming and complex but retains all revenue potential, or license it out, which simplifies and cuts spending but greatly diminishes profitability. Today, numerous vendors provide a third option, providing fledgling biotech startups with a plug-and-play array of goods generally reserved for more giant pharmaceutical corporations.

The advantages include ready knowledge, rapid scaling, and the capacity to right-size at the drop of a hat, with all back-end systems and procedures designed, pre-tested, and previously launched. This will resemble if one will, the debut of a new product in a large pharmaceutical business when all of the people, processes, systems and functions are operational, and the product fits seamlessly.

Instead of thinking, "If you build it, they will come," consider, "If you buy it, it will be faster (and more convenient) than creating it." Essentially, tiny, agile businesses may get critical talent in half the time it takes to acquire it, and if they perform their due diligence, they will know precisely what they are getting and that it will work.

Along with offering critical expertise, outsourcing enables small businesses to scale quickly, giving them the capability of a 300-person corporation in weeks. Significantly reducing lead time allows for significant cash burn reduction since systems, processes, and people may be adequately timed to be in place much closer to launch.

The third advantage of outsourcing is that it enables small businesses to scale up or down quickly without the need to hire (or fire) full-time employees (and the subsequent HR, IT, and infrastructure needed). Rapid pivoting is critical for small, inventive biotech companies to stay innovative and develop sustainably.

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