Although pharma companies have restructured and scaled back their workforces in recent years, demand for productivity remains high. Companies continue to see pressure placed on product pipelines from both the R&D side and from a commercial sales perspective. Staffing to meet these constantly changing needs is an organizational challenge facing executive leadership teams and human resources functions alike. Compounding this challenge, the war for talented pharma workers has heated up, fueled by demands for new types of staffing strategies and a new mindset among workers who are rethinking their careers, employer loyalty and how they want to work today and in the future.  

Whether working in a lab on new product R&D or out in the field detailing new therapeutics to physicians, pharma employees are on the front lines of the industry. According to findings from our recent Engagement Index study, a majority of these workers express confidence in the strength of the pharma job market, and almost half of pharma employees expect their current companies to make new hires in the coming months — a surprising sentiment, given the cutbacks many workforces have seen in the past several years. This amplified confidence surrounding the pharma job market and anticipated company expansions could lead to even more heightened competition among pharma employers. Companies will likely continue to redefine their business models and adjust workforce strategies to match an evolving workplace mindset.

As pharma workers grow more optimistic about their industry and the broader economy, many may find the timing is now right to advance their careers. For some employees this may mean looking forward to a raise or a promotion in the coming year. In fact, according to our research, we found 48% of industry workers believe they will receive a raise in 2013, and nearly a third of these employees believe they will receive a promotion. However, not all pharma employees plan to grow their careers within their current company.

We expect many pharma workers will take a more aggressive approach to their job search process and proactively seek out potential opportunities with competitors. With such strong feelings of optimism around their current employers, some may find it surprising that a majority of pharma workers expect to have to switch employers to grow their careers, as opposed to looking for new roles and opportunities within their current firms. In fact, we found that, if presented with the opportunity, nearly half would accept a job offer from a competitor in the next six months alone. At Randstad Pharma we know this to be true, as we have seen candidates take a more proactive approach to their job searching within the past several months. This self-assuredness, coupled with a general sense of job market optimism and anticipated company expansion, could very well lead to a spike in employee turnover in 2013 for many businesses in the pharma industry. 

Expected increases in mergers and acquisitions activity could also lead to a rising demand for new resources, thus further shaking up the staffing landscape for pharma and biopharma companies. As these companies continue to acquire products in an effort to supplement their pipeline or to offset a patent fall-off, many pharma companies will be confronted with a resource gap. To add to this challenge, companies need to move fast to shore up their product development pipelines as competition with generics continues to increase. In these cases, companies that use product acquisition in an attempt to fill the void caused by patent expiries must work under increasingly tight deadlines, adding another layer of complexity to designing the right workforce strategy for maximum productivity, efficiency and results.  In cases of R&D resource gaps, it is common to expect a mix of traditional full-time hires and contingent staffing. This allows for scalability and flexibility, especially in the early stages of development, where it is unknown whether the compound will survive and make it to later phases of development.

Another scenario is when companies acquire already approved products for the purposes of commercialization, leading to an added demand for sales representatives. However, as the American Medical Association reported last year, pharma companies have slashed their sales rep force by about 30% overall. With consolidated staff and rush-to-market sales needs, many companies look to contract sales organizations (CSOs) in order to quickly go to market with an approved product. Sales-force cuts are not new to the industry, and outsourced pharma reps have been a highly sought after solution for several years. This is a trend we anticipate continuing in the future as we expect companies to further expand and contract their headcounts in an effort to constantly maintain margins and adjust to the ups and downs of marketplace demand.

One additional factor affecting resource needs stems from a return in work that had previously been offshored due to quality concerns. A report released by Ohio State University found that drugs produced in offshore manufacturing plants, including those run by U.S. manufacturers, pose a greater quality risk than those prepared in the U.S. The 2011 study demonstrated how difficult it can be to control conditions in offshore plants to deliver best-of-class quality. It is no surprise that in the two years following this study, more companies have brought work back to the U.S. Since these tend to be “clean up” projects that have an estimated end date, the type of resources used to handle this work are for the most part contingent. This allows for a timely solution without having to increase the full time equivalent (FTE) headcount.

While employees may be adversely affected by offshored returns or product acquisitions, from an organizational standpoint, it really comes down to a shift in resources. For example, while patent loss may result in job loss on the commercial side, the savings may be reinvested on the R&D side to help support the development of new products that need to be approved. In general, for a company to truly prepare, the function of workforce planning must be in sync with the mergers and acquisitions (or business development), R&D and commercial functions. Much too often, a company’s response to internal resource demand is reactive instead of predictive. A staffing rush can be avoided by more strategically focusing on workforce planning in the early stages.

As pharma companies are tasked with maintaining the delicate balance of retaining the FTE headcount and layering in flexible contingent staff, and with many pharma workers looking toward competitors for potential employment transition, it is critical now more than ever for employers to make the long-term investment in employee retention strategies. This employee retention function typically lives in the human resources department, though in some forward-thinking organizations, new operations positions are being created that are specifically responsible for employee retention. We have also seen collaborative approaches to this initiative through the creation of task force teams and steering committees focused on talent management and retention.

Most companies have already recognized this need, and employees are beginning to notice as well. In fact, according to our research, 76% of pharma workers believe their current employer is putting effort into engagement activities. However, it is crucial that engagement strategies put in place align with the elements found most important by industry staff. To that end, we asked pharma workers what they care most about. The top five most effective employee engagement activities ranked were

1. offering promotions or bonuses to high performing individuals;
2. investing in employees’ careers through training, professional development, or continuing education;
3. being flexible or accommodating in terms of hours or working arrangements;
4. providing a comfortable and stimulating work environment; and
5. encouraging employees to share their ideas and opinions.

These preferences are in line with what we see in the field, as many candidates appreciate the accommodating nature of contract work, especially in an industry that constantly leans on contingent staff. In the past, most employees believed having a permanent, salaried position was more secure than a contract position. Given the trends in offshored returns and product acquisitions, which lead to rushed resource demand for companies with light workforces, contingent staffing will continue to be a turnkey solution for employers and a flexible option for pharma personnel.

---

Maricela Ostrand is director at Randstad Pharma. She can be reached at maricela.ostrand@randstadusa.com.