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    Home > Medical News > Latest Medical News > The "two-invoice system" and national procurement are advancing. Do pharmaceutical companies choose agents or self-operate for sales?

    The "two-invoice system" and national procurement are advancing. Do pharmaceutical companies choose agents or self-operate for sales?

    • Last Update: 2021-04-18
    • Source: Internet
    • Author: User
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    Medical Network News, April 13 With the gradual advancement of the "two-invoice system" and national procurement, the marketing models of many pharmaceutical companies have changed.
    Some companies canceled all or part of their original agents and replaced them with self-built teams and implemented a self-operated model; some companies disbanded their original teams because of the collective procurement of a certain product; some companies were divided by company offices.
    Channel investment and so on.
    Are these choices correct?
     
    The time is right for the agency system
     
    Company A is a small and medium-sized pharmaceutical company.
    The boss is a real estate company and doesn't know much about drug sales.
    The company has several exclusive proprietary Chinese medicine medical insurance products.
    In 2018, two products were included in the basic medicine catalog.
    The boss believes that the agency system is poor in execution and is not suitable for the future development needs of the enterprise and must be reformed.
    The agents of the old varieties are partially retained, and the two basic medicines are all self-operated.
     
    Since 2018, the company has established offices nationwide.
    The first batch of 15 provincial-level offices with more than 400 people will be established.
    In 2019, the second batch of 10 provincial-level offices will be established with 200 people.
    There are 600 marketing personnel nationwide.
    At the end of 2020, the company invested more than 70 million yuan in personnel salaries, insurance and other expenses, and more than 80 million yuan in development costs.
    The two-year market return was less than 200 million yuan, and the loss was serious.
    In 2021, the company has to reform, the first step is to lay off employees, and the second step is to change the provincial manager to an agent and return to the agency model.
     
      The boss of A business mistakenly believes that the poor execution of the agency model is not conducive to the development of the enterprise, while the good execution of the self-employed team is conducive to development.
    It is obviously wrong to regard execution as an important criterion for measuring the pros and cons of the sales model.
     
       Under the "two-invoice system", it is easier to solve the agent's execution problem, because the money is in the hands of the manufacturer, and the agent must listen to the manufacturer.
    How to improve marketing execution? Efforts can be made from formulating annual indicators, strengthening business guidance, effective assessment, establishing incentive mechanisms, and integrating corporate culture.
     
      The pharmaceutical agency system was developed around 2000 and gradually adopted by most small and medium-sized enterprises.
    It has the following characteristics: 1.
    The agent can be an independent legal person or a natural person, and has a long-term and stable relationship with the factory; 2.
    Only owns Sales agency rights, do not have the ownership of the agent products; 3.
    The agency rights and obligations must be fulfilled; 4.
    The legal consequences are borne by the manufacturer; 5.
    The agent’s income is a commission.
    From these characteristics, the agency system best matches the current market environment.
     
      What are the advantages of the agency model? First, manufacturers make full use of the channel resources of agents to quickly expand the local market; second, manufacturers can focus on production and new product research and development; third, save market costs.
     
      At present, more than 80% of thousands of pharmaceutical companies across the country adopt the agency system.
    Manufacturers use the agency’s hospital and channel resources to quickly occupy the market, generate sales, and create market value for the company.
     
      Office manpower input is large
     
      Company B is a medium-sized listed company, mainly based on OTC and the third terminal.
    The hospital channel only officially started operation in 2005.
    At that time, the company had a cardio-cerebrovascular product listed in the medical insurance catalog, but did not know how to operate the hospital channel.
    Therefore, hiring professional managers, the agent model and the office self-operated model coexist.
    The office mainly focuses on conference marketing.
    After a few years, the offices were all abolished and laid off, and the company suffered serious losses.
     
      In 2013, the product was included in the national essential medicine catalog, and the boss implemented the office model in more than ten provinces that had not been established, and formed a self-employed team.
    There were as many as dozens of salespersons in each province, and as few as a dozen people.
    After a few years , but also the loss of tens of millions, have all disbanded, replaced by pharmnet.
    com.
    cn/" target="_blank">investment , by the pharmnet.
    com.
    cn/agent_product/" target="_blank">agency to develop business.
    In 2020, more than 90% of the provinces of this category have already implemented this category, and the single-variety fare is more than one billion yuan, which has become an important category for the company's performance growth.
     
      The prescription drug market is mainly through the hospital channel, and development is difficult.
    The OTC market and third terminal development are relatively easy, and the self-employed team has strong execution and quick results.
     
      Since the 1990s, most pharmaceutical factories have generally adopted the office model.
    Companies set up offices in various provinces to bear staff salaries, insurance, rent, and market development costs.
    At that time, the market was less competitive, it was easier to enter the hospital, the market development cost was not high, and the enterprise could make a profit.
    With the increasingly fierce market competition and more and more accounts receivable, many companies are overwhelmed and adopt the agency investment system.
    Only a few large companies still adopt the office model.
     
      The self-operated office model has many advantages: First, the team has strong combat effectiveness, the offices are centralized and unified, and "corps operations" are implemented.
    The second is strong execution.
    All personnel are centrally managed.
    The company can penetrate to the end with one shot, and the company’s policies can be quickly implemented.
    The third is that the business is managed by the company, and the goods and funds are safe.
     
      The shortcomings are: First, most recruits are fresh graduates, it is difficult to develop hospitals, and the market development speed is slow.
    Second, the investment cost of human resources is high.
    An employee's salary, insurance, accommodation, etc.
    for a year are no less than 80,000 yuan, and it is difficult for a new salesperson to create benefits for the company within two years.
    In addition, the company's investment in human resources is very large.
    Third, it is difficult to manage.
    There are many conflicts between regions and provinces, and between provinces and representatives, which are prone to infighting.
    Many manufacturers’ negative news comes from internal sources.
    Sometimes, when a representative or manager is forced to resign, a scandal will be exposed immediately.
     
      Two models of innovation and development
     
      There is no marketing model that is the best, and the one that is suitable for business development is the best.
    As the pharmaceutical environment continues to change, various marketing models are constantly merging and innovating and developing to meet the needs of enterprise development.
     
      At present, the office marketing model has also been innovated.
    The functions of the office have changed.
    The past personnel management, hospital development, government public relations, etc.
    have become investment and distribution, agent management, and assisting agents to do government affairs.
    It is no longer the previous "human sea" tactics, and one province handles affairs.
    There are as many as a few hundred people, and as few as dozens of people.
    At present, there are 6-8 people in an office and 2~3 people as few.
    Their job is to attract investment in a refined way, with hospitals as a unit, which can save a lot of labor costs and speed up market development.
    Some oral preparations are based on the prefecture and city as the unit to attract investment.
    In relatively large provinces, there is one distributor in each region.
    This office model has been innovated and developed into the "office + investment" model.
     
      The agency model has also been innovatively developed.
    In the past, manufacturers did not care about anything after recruiting the province on behalf of the province, "one move".
    Now, manufacturers have strengthened the management of agents and services have increased, and academic support and logistical support have been strengthened.
    Some companies still send personnel to the market to serve agents.
    On the one hand, it strengthens the management of agents, and on the other hand, it can also provide nearby agents with "nanny-style" services, which are available on call.
    Manufacturers provide products, funds, and academics, and agents are responsible for hospital development, volume, and payment, with clear division of labor, and their respective resource advantages.
    The manufacturer turns the agent team into its own team, which is truly worry-free and effortless.
      Medical Network News, April 13 With the gradual advancement of the "two-invoice system" and national procurement, the marketing models of many pharmaceutical companies have changed.
    Some companies canceled all or part of their original agents and replaced them with self-built teams and implemented a self-operated model; some companies disbanded their original teams because of the collective procurement of a certain product; some companies were divided by company offices.
    Channel investment and so on.
    Are these choices correct?
     
      The time is right for the agency system
     
      Company A is a small and medium-sized pharmaceutical company.
    The boss is a real estate company and doesn't know much about drug sales.
    The company has several exclusive proprietary Chinese medicine medical insurance products.
    In 2018, two products were included in the basic medicine catalog.
    The boss believes that the agency system is poor in execution and is not suitable for the future development needs of the enterprise and must be reformed.
    The agents of the old varieties are partially retained, and the two basic medicines are all self-operated.
     
      Since 2018, the company has established offices nationwide.
    The first batch of 15 provincial-level offices with more than 400 people will be established.
    In 2019, the second batch of 10 provincial-level offices will be established with 200 people.
    There are 600 marketing personnel nationwide.
    At the end of 2020, the company invested more than 70 million yuan in personnel salaries, insurance and other expenses, and more than 80 million yuan in development costs.
    The two-year market return was less than 200 million yuan, and the loss was serious.
    In 2021, the company has to reform, the first step is to lay off employees, and the second step is to change the provincial manager to an agent and return to the agency model.
     
      The boss of A business mistakenly believes that the poor execution of the agency model is not conducive to the development of the enterprise, while the good execution of the self-employed team is conducive to development.
    It is obviously wrong to regard execution as an important criterion for measuring the pros and cons of the sales model.
     
       Under the "two-invoice system", it is easier to solve the agent's execution problem, because the money is in the hands of the manufacturer, and the agent must listen to the manufacturer.
    How to improve marketing execution? Efforts can be made from formulating annual indicators, strengthening business guidance, effective assessment, establishing incentive mechanisms, and integrating corporate culture.
     
      The pharmaceutical agency system was developed around 2000 and gradually adopted by most small and medium-sized enterprises.
    It has the following characteristics: 1.
    The agent can be an independent legal person or a natural person, and has a long-term and stable relationship with the factory; 2.
    Only owns Sales agency rights, do not have the ownership of the agent products; 3.
    The agency rights and obligations must be fulfilled; 4.
    The legal consequences are borne by the manufacturer; 5.
    The agent’s income is a commission.
    From these characteristics, the agency system best matches the current market environment.
     
      What are the advantages of the agency model? First, manufacturers make full use of the channel resources of agents to quickly expand the local market; second, manufacturers can focus on production and new product research and development; third, save market costs.
     
      At present, more than 80% of thousands of pharmaceutical companies across the country adopt the agency system.
    Manufacturers use the agency’s hospital and channel resources to quickly occupy the market, generate sales, and create market value for the company.
     
      Office manpower input is large
     
      Company B is a medium-sized listed company, mainly based on OTC and the third terminal.
    The hospital channel only officially started operation in 2005.
    At that time, the company had a cardio-cerebrovascular product listed in the medical insurance catalog, but did not know how to operate the hospital channel.
    Therefore, hiring professional managers, the agent model and the office self-operated model coexist.
    The office mainly focuses on conference marketing.
    After a few years, the offices were all abolished and laid off, and the company suffered serious losses.
     
      In 2013, the product was included in the national essential medicine catalog, and the boss implemented the office model in more than ten provinces that had not been established, and formed a self-employed team.
    There were as many as dozens of salespersons in each province, and as few as a dozen people.
    After a few years , but also the loss of tens of millions, have all disbanded, replaced by pharmnet.
    com.
    cn/" target="_blank">investment , by the pharmnet.
    com.
    cn/agent_product/" target="_blank">agency to develop business.
    In 2020, more than 90% of the provinces of this category have already implemented this category, and the single-variety fare is more than one billion yuan, which has become an important category for the company's performance growth.
     
      The prescription drug market is mainly through the hospital channel, and development is difficult.
    The OTC market and third terminal development are relatively easy, and the self-employed team has strong execution and quick results.
     
      Since the 1990s, most pharmaceutical factories have generally adopted the office model.
    Companies set up offices in various provinces to bear staff salaries, insurance, rent, and market development costs.
    At that time, the market was less competitive, it was easier to enter the hospital, the market development cost was not high, and the enterprise could make a profit.
    With the increasingly fierce market competition and more and more accounts receivable, many companies are overwhelmed and adopt the agency investment system.
    Only a few large companies still adopt the office model.
     
      The self-operated office model has many advantages: First, the team has strong combat effectiveness, the offices are centralized and unified, and "corps operations" are implemented.
    The second is strong execution.
    All personnel are centrally managed.
    The company can penetrate to the end with one shot, and the company’s policies can be quickly implemented.
    The third is that the business is managed by the company, and the goods and funds are safe.
     
      The shortcomings are: First, most recruits are fresh graduates, it is difficult to develop hospitals, and the market development speed is slow.
    Second, the investment cost of human resources is high.
    An employee's salary, insurance, accommodation, etc.
    for a year are no less than 80,000 yuan, and it is difficult for a new salesperson to create benefits for the company within two years.
    In addition, the company's investment in human resources is very large.
    Third, it is difficult to manage.
    There are many conflicts between regions and provinces, and between provinces and representatives, which are prone to infighting.
    Many manufacturers’ negative news comes from internal sources.
    Sometimes, when a representative or manager is forced to resign, a scandal will be exposed immediately.
     
      Two models of innovation and development
     
      There is no marketing model that is the best, and the one that is suitable for business development is the best.
    As the pharmaceutical environment continues to change, various marketing models are constantly merging and innovating and developing to meet the needs of enterprise development.
     
      At present, the office marketing model has also been innovated.
    The functions of the office have changed.
    The past personnel management, hospital development, government public relations, etc.
    have become investment and distribution, agent management, and assisting agents to do government affairs.
    It is no longer the previous "human sea" tactics, and one province handles affairs.
    There are as many as a few hundred people, and as few as dozens of people.
    At present, there are 6-8 people in an office and 2~3 people as few.
    Their job is to attract investment in a refined way, with hospitals as a unit, which can save a lot of labor costs and speed up market development.
    Some oral preparations are based on the prefecture and city as the unit to attract investment.
    In relatively large provinces, there is one distributor in each region.
    This office model has been innovated and developed into the "office + investment" model.
     
      The agency model has also been innovatively developed.
    In the past, manufacturers did not care about anything after recruiting the province on behalf of the province, "one move".
    Now, manufacturers have strengthened the management of agents and services have increased, and academic support and logistical support have been strengthened.
    Some companies still send personnel to the market to serve agents.
    On the one hand, it strengthens the management of agents, and on the other hand, it can also provide nearby agents with "nanny-style" services, which are available on call.
    Manufacturers provide products, funds, and academics, and agents are responsible for hospital development, volume, and payment, with clear division of labor, and their respective resource advantages.
    The manufacturer turns the agent team into its own team, which is truly worry-free and effortless.
      Medical Network News, April 13 With the gradual advancement of the "two-invoice system" and national procurement, the marketing models of many pharmaceutical companies have changed.
    Some companies canceled all or part of their original agents and replaced them with self-built teams and implemented a self-operated model; some companies disbanded their original teams because of the collective procurement of a certain product; some companies were divided by company offices.
    Channel investment and so on.
    Are these choices correct?
     
      The time is right for the agency system
      The time is right for the agency system
     
      Company A is a small and medium-sized pharmaceutical company.
    The boss is a real estate company and doesn't know much about drug sales.
    The company has several exclusive proprietary Chinese medicine medical insurance products.
    In 2018, two products were included in the basic medicine catalog.
    The boss believes that the agency system is poor in execution and is not suitable for the future development needs of the enterprise and must be reformed.
    The agents of the old varieties are partially retained, and the two basic medicines are all self-operated.
    Medicine, medicine, medicine
     
      Since 2018, the company has established offices nationwide.
    The first batch of 15 provincial-level offices with more than 400 people will be established.
    In 2019, the second batch of 10 provincial-level offices will be established with 200 people.
    There are 600 marketing personnel nationwide.
    At the end of 2020, the company invested more than 70 million yuan in personnel salaries, insurance and other expenses, and more than 80 million yuan in development costs.
    The two-year market return was less than 200 million yuan, and the loss was serious.
    In 2021, the company has to reform, the first step is to lay off employees, and the second step is to change the provincial manager to an agent and return to the agency model.
     
      The boss of A business mistakenly believes that the poor execution of the agency model is not conducive to the development of the enterprise, while the good execution of the self-employed team is conducive to development.
    It is obviously wrong to regard execution as an important criterion for measuring the pros and cons of the sales model.
     
       Under the "two-invoice system", it is easier to solve the agent's execution problem, because the money is in the hands of the manufacturer, and the agent must listen to the manufacturer.
    How to improve marketing execution? Efforts can be made from formulating annual indicators, strengthening business guidance, effective assessment, establishing incentive mechanisms, and integrating corporate culture.
     
      The pharmaceutical agency system was developed around 2000 and gradually adopted by most small and medium-sized enterprises.
    It has the following characteristics: 1.
    The agent can be an independent legal person or a natural person, and has a long-term and stable relationship with the factory; 2.
    Only owns Sales agency rights, do not have the ownership of the agent products; 3.
    The agency rights and obligations must be fulfilled; 4.
    The legal consequences are borne by the manufacturer; 5.
    The agent’s income is a commission.
    From these characteristics, the agency system best matches the current market environment.
    Medicine Medicine Medicine
     
      What are the advantages of the agency model? First, manufacturers make full use of the channel resources of agents to quickly expand the local market; second, manufacturers can focus on production and new product research and development; third, save market costs.
     
      At present, more than 80% of thousands of pharmaceutical companies across the country adopt the agency system.
    Manufacturers use the agency’s hospital and channel resources to quickly occupy the market, generate sales, and create market value for the company.
     
      Office manpower input is large
      Office manpower input is large
     
      Company B is a medium-sized listed company, mainly based on OTC and the third terminal.
    The hospital channel only officially started operation in 2005.
    At that time, the company had a cardio-cerebrovascular product listed in the medical insurance catalog, but did not know how to operate the hospital channel.
    Therefore, hiring professional managers, the agent model and the office self-operated model coexist.
    The office mainly focuses on conference marketing.
    After a few years, the offices were all abolished and laid off, and the company suffered serious losses.
     
      In 2013, the product was included in the national essential medicine catalog, and the boss implemented the office model in more than ten provinces that had not been established, and formed a self-employed team.
    There were as many as dozens of salespersons in each province, and as few as a dozen people.
    After a few years , but also the loss of tens of millions, have all disbanded, replaced by pharmnet.
    com.
    cn/" target="_blank">investment , by the pharmnet.
    com.
    cn/agent_product/" target="_blank">agency to develop business.
    In 2020, more than 90% of the provinces of this category have already implemented this category, and the single-variety fare is more than one billion yuan, which has become an important category for the company's performance growth.
    pharmnet.
    com.
    cn/" target="_blank">Merchantspharmnet.
    com.
    cn/" target="_blank"> Merchants Merchantspharmnet.
    com.
    cn/agent_product/" target="_blank"> proxypharmnet.
    com.
    cn/agent_product/" target="_blank"> proxy proxy
     
      The prescription drug market is mainly through the hospital channel, and development is difficult.
    The OTC market and third terminal development are relatively easy, and the self-employed team has strong execution and quick results.
     
      Since the 1990s, most pharmaceutical factories have generally adopted the office model.
    Companies set up offices in various provinces to bear staff salaries, insurance, rent, and market development costs.
    At that time, the market was less competitive, it was easier to enter the hospital, the market development cost was not high, and the enterprise could make a profit.
    With the increasingly fierce market competition and more and more accounts receivable, many companies are overwhelmed and adopt the agency investment system.
    Only a few large companies still adopt the office model.
    Enterprise business enterprise
     
      The self-operated office model has many advantages: First, the team has strong combat effectiveness, the offices are centralized and unified, and "corps operations" are implemented.
    The second is strong execution.
    All personnel are centrally managed.
    The company can penetrate to the end with one shot, and the company’s policies can be quickly implemented.
    The third is that the business is managed by the company, and the goods and funds are safe.
     
      The shortcomings are: First, most recruits are fresh graduates, it is difficult to develop hospitals, and the market development speed is slow.
    Second, the investment cost of human resources is high.
    An employee's salary, insurance, accommodation, etc.
    for a year are no less than 80,000 yuan, and it is difficult for a new salesperson to create benefits for the company within two years.
    In addition, the company's investment in human resources is very large.
    Third, it is difficult to manage.
    There are many conflicts between regions and provinces, and between provinces and representatives, which are prone to infighting.
    Many manufacturers’ negative news comes from internal sources.
    Sometimes, when a representative or manager is forced to resign, a scandal will be exposed immediately.
     
      Two models of innovation and development
      Two models of innovation and development
     
      There is no marketing model that is the best, and the one that is suitable for business development is the best.
    As the pharmaceutical environment continues to change, various marketing models are constantly merging and innovating and developing to meet the needs of enterprise development.
     
      At present, the office marketing model has also been innovated.
    The functions of the office have changed.
    The past personnel management, hospital development, government public relations, etc.
    have become investment and distribution, agent management, and assisting agents to do government affairs.
    It is no longer the previous "human sea" tactics, and one province handles affairs.
    There are as many as a few hundred people, and as few as dozens of people.
    At present, there are 6-8 people in an office and 2~3 people as few.
    Their job is to attract investment in a refined way, with hospitals as a unit, which can save a lot of labor costs and speed up market development.
    Some oral preparations are based on the prefecture and city as the unit to attract investment.
    In relatively large provinces, there is one distributor in each region.
    This office model has been innovated and developed into the "office + investment" model.
     
      The agency model has also been innovatively developed.
    In the past, manufacturers did not care about anything after recruiting the province on behalf of the province, "one move".
    Now, manufacturers have strengthened the management of agents and services have increased, and academic support and logistical support have been strengthened.
    Some companies still send personnel to the market to serve agents.
    On the one hand, it strengthens the management of agents, and on the other hand, it can also provide nearby agents with "nanny-style" services, which are available on call.
    Manufacturers provide products, funds, and academics, and agents are responsible for hospital development, volume, and payment, with clear division of labor, and their respective resource advantages.
    The manufacturer turns the agent team into its own team, which is truly worry-free and effortless.
    This article is an English version of an article which is originally in the Chinese language on echemi.com and is provided for information purposes only. This website makes no representation or warranty of any kind, either expressed or implied, as to the accuracy, completeness ownership or reliability of the article or any translations thereof. If you have any concerns or complaints relating to the article, please send an email, providing a detailed description of the concern or complaint, to service@echemi.com. A staff member will contact you within 5 working days. Once verified, infringing content will be removed immediately.

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