Unemployed Drug Reps: "Go East, Young Man (and Women)"
Pharmaceutical sales reps: Are you sick of seeing headlines about layoffs at virtually every major pharma company? Wish you could turn the clock back to when everyone was hiring and new reps could name their price? Now you can -- if you're willing to live in Japan. And speak Japanese.
In a recent note to investors, Wall Street analysts Jefferies & Co. discussed prospects for InVentiv Health, a pharma marketing agency that supplies contract sales reps to drug companies. InVentiv and Jefferies believe Japan offers a virtual Shangri-La for drug reps: The country is the second-largest market in the world, it has lower than average numbers of reps, and its patent cliff doesn't hit for another seven years. It is literally the U.S. in the 1990s, Jefferies says:
There are 50k-55k reps in Japan (compared to 75k-80k in the U.S.). The market is clearly quite large, and penetration by contract sales companies is low.
A significant number of products approved and launched in the West have yet to hit the Japanese market. Management cites Nexium as one example. These upcoming launches will need sales & marketing resources.The only fly in the ointment: Japan's government has the power to negotiate and control drug prices.Japan's patent cliff problem lags the U.S. by about 7 years. Pharma companies still need to hire incremental reps to grow products, yet they don't want to make today's U.S. problem tomorrow's Japan problem. Because Japanese labor laws are restrictive, it makes sense for pharmaceutical companies to hire incremental reps on a contract rather than permanent basis.
And finally: There are similar opportunities in China with Eli Lilly.
Below: The Cult playing "Go West" in 1984.