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Insult to Injury: Drug Company Only Wants Sales Reps Without Experience

Japanese drugmaker Shionogi & Co. (4507) has found a new way to cut costs: It now refuses to hire anyone with experience for vacant pharmaceutical sales rep positions. Tens of thousands of drug reps have lost their jobs through mass layoffs in the last three years, so Shionogi's "no-reps" policy will be especially insulting to American salespersons looking for new employment. The pay is also humiliating: $40,000 to $41,000 a year (although there's a $17,000 bonus on offer). Generally, U.S. drug rep salaries hover nearer to the $100,000 range.

Shionogi is little-known in the U.S. but grew its operations here when it acquired Sciele Pharma and its 920 staffers, most of whom are pharmaceutical sales reps. The company has co-marketing deals on Claritin and Crestor, and is developing new antibiotics with GlaxoSmithKline (GSK)

If you want to work for Shionogi in Staten Island, N.Y., however, this is the key qualification:

Supervisors still require experience, and the salary is more reasonable, $100,000 to $110,000.

Shionogi's move is a third new way that pharmaceutical managers have found to cut costs. Layoffs are the usual method, and AstraZeneca (AZN) recently replaced part of its Nexium sales force with a telemarketing center.

To play devil's advocate for a moment: Why shouldn't management start reining in sales rep salaries? As reps themselves have argued repeatedly in court, their job consists almost entirely of strictly repeating a script given to them by management when they meet with doctors. How much experience could that possibly require?


Image by Flickr user Matthew Burpee, CC.
Hat tip to Pharmalot.
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