Bangalore: When Indegene Lifesystems Pvt. Ltd moves from its 11,000 sq. ft office in a residential area to a 25,000 sq. ft campus in the plush Embassy Golf Links Business Park in central Bangalore later this month, it will mark not only the doubling of its office space but also of opportunities in an area of work—competitive intelligence—that is fast becoming the pharmaceutical industry’s survival strategy.

In the last few months, Indegene has signed a so-called master service agreement with six of the top 10 global pharma companies and more are on the way.

Logical solutions: Indegene co-founder and chief executive Manish Gupta (left) and PharmARC chief executive Amit Sardana. Gopinath Nair / Mint

A set of small Indian companies have come up in this space with products that are allowing the conservative pharma industry to finally farm out services such as deploying and structuring sales force, mapping new markets, analysing clinical trial data to the extent of the investigator details, even replacing the sales force.

“Competitive intelligence is below the radar right now, but all pharma companies, which have been laggards vis-à-vis other industries in adopting technology, will take to it," says Venkatraman Thyagarajan, non-executive vice-chairman of GlaxoSmithKline India and a board member of Tata Consultancy Services Ltd.

Traditionally, the marketing and commercial side of pharma companies, which has the highest spend of about 26% of annual sales of the company, doesn’t include technology, says Thyagarajan. “Now when they are asking, do we need to do everything ourselves, the contracting model is beginning to play out."

And smaller companies are gaining. Indegene was approached by one of the top 10 pharma companies to develop an engaging alternate promotional and marketing channel for one of their key brands. Within five months Indegene built a multi-modal channel that provides Web-based medical information and education including interactive patient cases with branching logic, videos/simulations of patients, webcast events and more.

“This is meant to replace the sales force," says Manish Gupta, one of the founders and chief executive of Indegene, which has revenue of about $20 million and is looking to acquire a US-based company in the field of medical education.

Bangalore-based PharmARC Analytic Solutions Pvt. Ltd, that provides sales and marketing analytics to 80 companies, including 15 of the top 20 global pharma companies, has done sales force sizing and structuring in each of the major European countries for a pharma company.

“Sitting here we could tell them what should be the size of a sales representative’s territory, number of sales rep to be assigned to a district manager, and so on," says Amit Sardana, chief executive of PharmARC, which is now setting up a US arm.

In its February report, Pharma 2020: Marketing the Future, audit and consulting firm PricewaterhouseCoopers said the pharma industry’s future sales force will be dramatically smaller and will require new skills including “an education in science or health, greater understanding of specific complex diseases and the ability to negotiate with powerful payers and medical specialists."

Inevitably, this will require use of more real time intelligence that links to heterogeneous data.

“Today, with too much information from multiple sources, the move in the industry is towards ‘single version of truth’," says Subramanyam V., head, information management, IBM India/South Asia.

Citing an example of adverse event reporting of a drug in the market, he says, the focus now is on getting to the root cause immediately—which could be due to storage, dosage, delivery, even improper vendor qualification of a supplier—and informing the stakeholders in the best possible way, even on mobile phones.

IBM is one of the few companies providing end-to-end products and services in this space, though Subramanyam admits the capability owes much to at least 20 acquisitions that IBM has made in last two-three years. However, there’s room for smaller companies to operate in niche segments.

A 35-year GSK veteran and now a board member of Indegene, Thyagarajan says GSK has now hired a Delhi-based company for its marketing analytics, and is doing “the kind of analysis it has never done before".

He adds that bigger companies such as IBM can do the high-end marketing analytics which require large computing capabilities.

But Thyagarajan’s optimism about companies such as Indegene, which has around 50 physicians on its rolls, goes beyond sales and marketing. For instance, Indegene is building a “Trialpedia", a Web-based platform with 75 clinical trial design criteria that could significantly aid drug developers to search and analyze a specific “endpoint" in a drug trial. Pretty “excited" about this product, Thyagarajan thinks it could fetch Indegene a fortune.

The size of the analytics pie is getting bigger. The industry, Sardana says, will need more analysts which will lead to bigger strategic collaborations. “Probably Infosys today has one floor devoted to Bank of America; that concept of ‘owned development centre’ will come in the pharma analytics business also."

In the process smaller ones may get gobbled up by bigger companies, just like Cognizant Technology Solutions acquired Gurgaon-based MarketRX Inc. in late 2007 for $135 million.

Will Indegene be up for grabs anytime soon?

“At this point of time we think there is an enormous value creation opportunity in helping the pharma industry go through a transformation and we are focused on building a globally competitive pharmaceutical organization geared towards long-term value creation," says Gupta.