Pharma Sales v. Device Sales
The Similarities
There are several similarities between pharmaceutical sales and medical device sales. In both professions, we are trying to educate doctors and other medical staff that the features and benefits of the products that we represent are better than that of our competitors. Both types of sales representatives provide lunches, samples, marketing tchotchkes and other forms of entertainment.
Medical devices span several different categories. There are disposables, capital equipment, surgical, non-invasive and diagnostic to name a few. Disposables medical sales are similar to pharmaceutical sales in that there is a high likelihood of repeat business. For instance, if you represent a manufacturer of medical latex gloves and the purchasing manager is convinced that you have the best product (whether it is based on product feature or price), then they will most likely re-order from you again. Similarly, a physician will continue to write your drug if he or she believes it has the fewest side effects in the class.
Just as in pharmaceuticals, where you are concerned with formulary issues, many hospitals participate in buying groups. You need to check with the purchasing department to see if the hospital has pre-negotiated prices with a buying group such as Novation or Premier. In addition, MDR does an annual survey of medical device manufactures. Only hospitals that have purchased equipment are asked to participate in the survey. The survey covers equipment price, quality of the equipment, and the level of service and support. Many hospitals have access to this information and if you are involved in a competitive bid situation, the MDR rating will be used in the purchasing decision. Government agencies have their own contract and pricing.
If you are not part of a purchasing group, you are locked-out of those accounts. Just like when a physician goes off formulary and needs to document a prior authorization, a department director will have to do the same if they decide to purchase equipment that is not part of the buying group. Such justification can reach over 300 pages, and many directors believe it is not worth the fight. As a medical device representative, it is your job to differentiate your product enough with the decision makers so they will want to write the justification.
These are where similarities between pharma sales and device sales end.
The Differences
The goal in pharmaceutical sales is to increase the number of prescriptions (“scripts”) written by physicians in your assigned geographical area. In medical devices sales, the goal is get the purchase order. In pharmaceutical sales, the results of your efforts are rarely instantaneous; weeks may pass before you know if the lunch you provided increased the writing habits for your drug at that particular office. With medical devices sales, you know at the end of the day if you did a good job, because you either got the purchase order or you didn't. You don’t have to wait a month to see if your numbers go up.
Traditional salespeople that work in different industries will have more in common with medical device representatives than their pharmaceutical counterparts. A software sales person will have similar skills that a medical device representative will need. These selling skills include, but are not limited to prospecting, forecasting, negotiation and servicing.
Whereas pharmaceutical companies may provide their representatives with a targeted list of physicians, medical device representatives will spend much of their time prospecting for new hospitals, medical offices and clinics within their territory. With prospecting, there is a lot of cold calling. It is critical to network and ask for referrals in medical devices sales. The sales cycle is usually longer, and device representatives have to work harder to maintain relationships. Once a purchase is completed, a hospital may go five or ten years before they need to replace the equipment. This is especially true of capital equipment purchases. In pharmaceutical sales you follow a routing schedule and see many of the same physicians again and again. In device sales, you will usually cover a larger territory, but the bigger the territory, the greater the opportunity.
Forecasting is much more relevant in device sales and you have more power to influence your forecast. One of my best quarters when I was in pharmaceuticals sales was when I went away on vacation. It turned out that I was giving away too many samples, and when I was no longer there to provide free samples, physicians had to write my product and my numbers reflected this. As a medical device representative, your numbers will suffer unless you actively go out and close deals.
When the medical device that your represent is involved in a competitive bid situation, the department manager is not only looking at the features and benefits, but the price of each machine. If your equipment is not the least expensive, you will need to negotiate different areas of the contract to win the bid. One way to accomplish this is to monetize the value of the follow-up service and training. Back when I was carrying the bag in pharma sales, I was able to treat a physician to a round of golf or a nice dinner, but no more. With medical equipment, there seems to be fewer restrictions, though this is certain to change in the near future. You can’t offer a perk for every script that a physician writes; however, as a medical device representative, you are usually able to offer certain incentives to help close a deal. These incentives might include better payment terms, special financing, extra training or a bundled discount.
As a pharmaceutical sales representative the only follow-up that is absolutely required is to report any adverse events. As a device sales representative, your level of follow-up will depend on how good your company's technical support team is. Fortunately, I did not a good technical support team – I say “fortunately” because I became the front-line support for hospitals in my territory. This allowed me to develop a closer bond with the hospital staff and it helped me learn my product inside and out.
Should you switch?
Both positions will have their pros and cons. Pharmaceutical sales is more stable and routine. Device sales have longer selling cycles and less stability; I find this exciting and challenging.
Before considering a switch to medical devices sales, ask yourself a few simple questions:
Do you like cold calling?
Do you enjoy traveling a large territory?
Do you work well with long selling cycles?
Do you enjoy negotiating and closing deals?
Do you want to be in direct control of your success of failure?
If you answered “yes” to all of the above questions, then think about working with a recruiter to enter the device sales arena. There are some entry level device sales positions available, but they will require some work to find. Find time to practice your selling skills. Try getting a part-time job working at Nordstrom or other retail store. This will allow you to become more comfortable cold-calling and closing sales.
