The manufacturer’s brand team is naturally the top dog in any marketing line-up—except in a co-promotion. Then, suddenly, there are two alphas who have to figure out how to pull together.
We harnessed a panel of industry experts, and asked them how they make co-promotion work:
- What earmarks most clearly signal, “This is a co-promotion opportunity”?
- What are the keys to setting up a successful inter-organizational structure? How do you reduce friction and increase responsiveness?
- What are the warning signs that the co-promotion might be going off the rails? How do things go wrong?
The opinions expressed by the authors in the Think Tank section are their own and do not necessarily reflect those of their affiliated companies or organizations.
Director of Research
Cutting Edge Information
Clarifying roles and responsibilities sounds simple, but coordination and communication have a way of breaking down in co-promotions. Think about it: internal communication is itself a challenge, so it should come as no surprise that bringing a partner-cum-competitor into the mix creates a few new hurdles.
The issues start at the top. Once the management team is in place, regular and candid communication takes on critical importance. Partner groups meet regularly in person and by teleconference, but a deal’s real foundations are built upon the informal phone calls and e-mails exchanged by counterparts working within the product teams themselves. Constant communication helps these individuals stay connected to both the brand and each other, and face-to-face meetings are a preferred medium for meetings. “When you’re face to face,” noted one individual, “things get done.”
If it starts at the top, this spirit of coordination trickles down through the ranks. District managers and sales reps align schedules, call messages, and promotional programs in their efforts to work together. Partnering reps can also communicate important information, such as where a particular physician’s interests lie, to help their counterparts. To coordinate such efforts, the most effective reps rely on a mixture of both formal monthly meetings and more informal communications, such as impromptu meet-ups in physician parking lots as well as e-mails and texts.
It is up to district managers to develop reps’ communication and coordination skills in the field. While many companies allow their district managers to simply coach their own reps, other companies prefer that the DMs themselves communicate with their counterparts. By developing relationships at this level, the companies benefit from better field coordination—and more organic conflict resolution when issues do arise. District managers communicate in the same ways as sales reps: through e-mails, phone conversations, or formal breakfasts.
Co-promotion success relies on companies establishing sound communication and coordination among counterparts throughout both organizations, ranging from upper-level management down to reps in the field. Teams pay this concept a lot of lip service, but if stakeholders don’t focus on making a partnership work at its most human level, good feelings and optimistic goals may quickly give way to less harmonious—and less successful—collaborations.
Senior Vice President, Strategic
Planning and Account
A co-promotion relationship makes the most sense when two conditions can be met:
- The company seeking the co-promotion partner lacks category expertise, target customer relationships, or a sufficient sales force for successfully launching a new product.
- The company finds an organization with deep therapeutic category expertise and excess detailing capacity, and this second company does not compete directly in the target category of the first company.
When both of these conditions are met, a very powerful business relationship can be created.
The key to success with a co-promote relationship is transparency (…and a clearly written contract). Goals and operating principles must be communicated plainly through all levels of both companies’ marketing and sales organizations.
Because success will often be decided at the rep level, it is critical that all reps buy into the co-promotion. This starts at the top, with leadership establishing a culture of collaboration and trust between the two companies that is ultimately communicated throughout both organizations.
Also essential to an effective co-promote relationship is the establishment of governance committees, clear roles and responsibilities, and detailed processes. Governance committees consisting of senior leadership play a critical role in everything from goal-setting and instituting business rules to aligning regulatory points of view. Explicitly written roles and responsibilities facilitate day-to-day guidance, and eliminate the ambiguities that can unravel a strong partnership. Processes mitigate differences between the partner companies, ensure smooth functioning, and provide structure for the business relationship. Nailing down the particulars of these elements in the early stages will contribute to the maintenance of an effectively functioning partnership, even when the companies’ players change over time.
In spite of proactive unification efforts, however, inter-company challenges can still arise. Discord can develop if organizational goals change for one or both companies, or corporate philosophies become misaligned. I’ve seen disagreements over accounting principles strain a co-promote relationship for years—even when none of the original players were still involved.
SVP, Account Director
Saatchi & Saatchi Wellness
If managing a brand takes coordination and communication, managing a co-promotion takes that times ten. Unfortunately there’s no silver bullet, no ‘magic meetings’ that will make everything run without a hitch. I’ve managed consumer communications on the agency side for a number of co-promotions, and what made all the difference was gaining a better understanding of the challenges my clients faced and using that knowledge to shape how I worked with them.
Clients are often juggling even more than the agency. Clients will often be navigating a co-promotion for the first time and experiencing just how complex it can be. For example, instead of one med/legal review, there may be reviews with their group, with their co-pro group and sometimes with a ‘super group’ (comprised of representatives from each company). They sometimes feel that every effort of theirs has to be doubled. Suddenly the usual inside-the-agency grumblings—“the clients won’t get back to me, med/legal is taking too long, clients can’t make status”—appear in a new light. Understanding the new and added pressure the clients are under allows the agency to better navigate the process.
The basics matter. To a large extent, returning to the basics of good account management is what makes the co-promotion process a success: tight organization, attention to detail, and strong communication. Although there are no “magic meetings,” the on-going status meeting remains the cornerstone for keeping everyone on track. The key is to make these—and all meetings—as action-oriented for the clients as possible. The agency needs to be the driver and keep everyone focused on simple, clear, and manageable goals. Be specific on what client next-steps need to be, so there is no confusion. Finally, in the world of the co-promotion, there’s no such thing as over-communicating. And when you do communicate, always be sure it’s to the whole team, and not just one of the partners. This helps to foster collaboration.
Although co-promotions can be challenging, they can also be extremely rewarding. Recognizing the pressures and complexities faced by the clients and paying greater attention to the details of managing the process goes a long way to making the experience a positive and productive one.
Douglas E. Moore
Principal, Life Sciences Consulting
Co-promotion agreements are usually established when one company (typically a smaller, less-mature, less-commercially capable organization) partners with a larger pharma to have access to its sales force, its customer access, or its other commercialization capabilities.
Clear Signals: A development company (not having a commercial capability yet) with a potential big hit, determining there’s too much at stake to go-italone. A mid-to-large pharma looking to fill out the product line in a therapeutic area. The perfect, and typical match. Generally, the development company will be building out a limited, inaugural commercial capability while concurrently preparing for launch of the product and navigating through a collaboration with a much larger peer. Think: Takeda and Eli Lilly (Actos); OSI and Genentech (Tarceva); Sucampo and Takeda (Amitiza).
It is key that both companies provide sufficient (i.e., significant) time for large-team cross-functional face-to-face collaboration ahead of and throughout the critical pre-market and go-to-market periods. People need to gain confidence in and learn the style of other people “across the aisle” in all the key functions.
Surprisingly, one of the simplest ways to bring the organizations together—the shared electronic repository —is one of the most difficult to establish. Legal hurdles, IT protocols on both sides, “outside the firewall” worries, etc., will conspire in an unholy alliance to thwart the dream of the virtual company. Joint leadership teams need to be developed, but clear accountability needs to be established in all functions and teams…some one person needs to own final decision-making, and escalation and appeal processes need to be in place to efficiently raise and settle issues and challenges.
An early signal that the relationship is going off the rails is when the smaller company (the owner of the molecule) begins “interfering” too much on the commercial decisions and direction of the larger and more experienced partner. This always signals a loss of confidence on the part of the molecule owner, and generally portends a long downward slide.
General Manager, Interpace
BioPharma, Senior Vice President,
Commercialization Unit, PDI, Inc.
A co-promotion opportunity is initially dependent on product value. Then, the product developer’s and potential partner’s goals must be considered. Finally, a draft Term Sheet should address the pros and cons of co-promotion versus solo product marketing. The result? Optimized product value and aligned corporate goals will “shout out” if co-promotion is viable.
An example of a co-promotion opportunity might be an outside-the-U.S. company with a product developed through R&D. The product is out-licensed to a U.S. partner to access cash, market experience and/or launch capabilities; however, the developer maintains a co-promotion option. The developer’s goals are to create shareholder value while establishing a footprint in the U.S. for future product launches. The partner’s goals are to access exceptional products in a therapeutic category where they can extend their portfolio and increase market share. These goals align and create an environment that fosters a co-promotion opportunity.
The key to setting up a successful co-promotion is developing a top-down alignment between the two organizations—a Joint Commercialization Committee (JCC) where top members of both companies are aligned to lead, make decisions and drive success throughout both organizations. Incentives should be aligned throughout the teams. When clear, aligned communication comes from the top in both organizations, a successful co-promotion environment is established and nurtured.
Feedback from the front lines is critical. Signs of co-promotion failure appear here first. Are messages aligned and achieving market penetration? Are teams working closely together? Are communications clear? Are incentives aligned to achieve success? If not, the co-promotion may very well derail. Another warning sign is that market indicators are falling below expectations. In this case clear signs of dissatisfaction with the licensor and the licensee can lead to a failed co-promotion
Ongoing market research and feedback from KOLs, target audiences and market stakeholders will also provide clear warning that the promotion is not where it should be and mid-course adjustments can be made to return to “the success track.”