Pharmaceutical companies are using new meetings management benchmark data to continue consolidation drives and develop best practices as definitions of specific meeting types and spend are standardized, according to industry executives. Budgets for internal sales and training meetings seem to be on the rebound, but analysts expect continued cutbacks to physician-attended educational events that in 2004 appeared due to more stringent industry guidelines.
Meetings management firm Maritz McGettigan, which focuses on serving pharmaceutical industry clients, in February will begin to provide benchmarking data to its clients, said vice president of consolidation solutions Dick Zeller.
"2004 was the first year where we began to get consistent measurement across our pharmaceutical customers, so we can now begin to provide them with some meaningful benchmarks," Zeller said. The benchmarking data may include comparisons with other pharmaceutical companies as well as the previous year's internal benchmarking data for clients, he said.
Benchmarks for meetings management have been challenging to develop for the pharmaceutical industry, Zeller said, because of the wide mix of types of meetings held and the dates companies schedule events. One company might hold a number of physician-attended meetings in the first quarter, driving up costs, while a rise in internal training meetings would not have the same effect, he said. Zeller said some pharmaceutical clients in the past concentrated too much on nuances that held up efforts to benchmark.
"We've been able to convince our customers, due to the thirst for benchmarks, to compromise a little bit in the way they look at the data, unless it's absolutely crucial, so that it's consistent with the way we're collecting data from our other customers," Zeller said.
During the past year, Maritz McGettigan has worked with its pharmaceutical clients to standardize the definition of meeting types, the data collected and how that data is tracked, he said. One of the approaches Maritz McGettigan has taken is to benchmark a customer's meetings management against industry trends, such as how the change of a company's group lodging spend compares to that of the overall industry during a comparable timeframe.
Swiss pharmaceutical corporation Novartis, which has American headquarters in East Hanover, N.J., and has used Maritz McGettigan's services since June 2003, has a strong interest in benchmarking, said executive director of business support services Paul Tomaszeski.
"It helps us set objectives for the year, determine opportunities we have in front of us and what's happening in the marketplace, and is very effective in communicating with our management," Tomaszeski said.
New York-based Pfizer Inc. participates in meetings management benchmarking efforts with other pharmaceutical firms, said director of global travel Phil Dunphy. Although he declined to specify with which companies Pfizer is working, Dunphy said the firms share such standard benchmarking data as internal processes, payment mechanisms, policy and internal structure. The challenge is that many companies do not have enterprisewide meetings standards, he said, which makes comparisons of such data as cost savings figures difficult.
"For price benchmarking, I don't think the whole discipline is mature enough to have valid data. We know through the few successes we've had that we're being successful, and the common number that seems to be thrown up is about 20 percent savings," Dunphy said.
Pfizer for the past 18 months has been working on a meetings management policy, Dunphy said, to provide a set of guidelines on when the meeting services department should become involved in an event. Pfizer long has used a decentralized approach to meetings management, but is working on building a "level of consistency" that includes such planning tools as a meetings management Web site, to be launched in the first quarter, he said.
"We're working with all the divisions and markets to see if we can have one official Web site that everyone can go to," Dunphy said.
Pharmaceutical companies seem poised to spend more on internal sales and marketing meetings, Zeller said, but cutbacks on physician-attended meetings made in 2004 are expected to continue in 2005.
"We have seen a reduction in spend in the physician-attended meetings, and a lot of that is driven by the U.S. Food and Drug Administration and compliance issues. Guidelines are being carefully scrutinized and all the pharmaceutical customers are diligently ensuring that they are not overstepping the balance between education and marketing," Zeller said.
Many of those guidelines developed internally by companies are based on such industry policies as those adopted by the Pharmaceutical Research and Manufacturers Association, which drew clear lines on how corporations educate physicians about medical products and drugs to avoid any appearance of influencing doctors to prescribe their products to patients
(Meetings Today, Aug. 2, 2004)."On the physicians' side there are fewer meetings and the ones pharmaceutical companies are holding are smaller," Zeller said.
Strict guidelines also have pushed the issue of compliance within pharmaceutical companies, Zeller said, but many companies avoid strict policy mandates. "Most pharmaceutical companies have tended to be entrepreneurial in spirit and encourage people to find the best way to get it done," Zeller said.
"We're in an evolutionary period," said Connie Bocchieri, manager of group air and meeting services at Pfizer. "We're not a mandate company and one solution is not best for all."
At Novartis, Tomaszeski said the meeting planning department has avoided a policy-driven approach. "Our approach has been: 'Here is the benefit to your area, here are the services that we can provide and here is how we can assist you.' We build a track record of some nice successes that we can share with departments to lead them to want to use our group rather than force them through a policy," Tomaszeski said.
Novartis was able to save $6 million in meetings spend in 2004 through an expansive meetings consolidation and sourcing centralization drive that was launched in 2003
(Meetings Today, July 19, 2004)."Having been at this a year and a half now, we have a greater understanding of our meeting requirements due to the events consolidation," Tomaszeski said. "We can start to package these meeting requirements—basically the meeting buy—and go to some of the hotel chains with that knowledge and negotiate some package deals. That's one of our objectives for 2005."