How a "Crowded" Future Will Change Incentive Compensation for Oncology Reps

Mike Martin, Principal

The future of oncology is a crowded one—because of all the success that companies are envisioning, and all the new launches with teams and with products, sales reps are going to have a very challenging role to play. We know access is down; it’s going to be hard to get in front of those customers.

So how can we build a compensation plan that really motivates the right behaviors, and motivates them to create the right experience for their customers?

The reps are often very senior. They need to be able to speak at a technical level and have an experience level that gets them access to the key customers, and their pay will reflect that.

In addition, when they actually go into their customers, it is a complex situation with many different stakeholders from account types—hospitals versus clinics versus offices—and even in each of those institutions, talking with the physician, the nurse, maybe a coordinator as well. So you need to have a way in the incentive plan to motivate those different types of conversations, making sure that you are having a full and complete call.

About 70% of companies incorporate compliance into their incentive plan. So the idea behind incorporating compliance is reminding and encouraging reps to follow appropriate behaviors.

Another thing that the IPR results show us is that two-thirds of oncology teams actually use commissions, and this is much, much higher than other sales teams, where it’s typically less than one-third who use commissions.

We can attribute this to probably two different factors. One being, a lot of oncology products have launched recently, and commission plans are the most common plan type at launch. And second, that the data that we have, for competitors and understanding potential, that a single company has is limited. So oftentimes you rely on your own sales data where a commission plan can work well.

One of the things that’s coming up with oncology is a lot of the future launches will be for products that are later in line, or involve biomarkers. And so we’re seeing much smaller patient counts.

You can imagine there’d be situations where a [rep’s] bonus for that period will be based on getting less than six patients on a product. So [if] you think about one patient counting for 20% of their total potential goal, there’s going to be a lot of complexity and things that we need to consider when building out that incentive plan.