Shionogi continues to fully decouple sales agents’ bonuses from sales volumes of antibacterial medicines
Shionogi is steadfast in fully decoupling its financial rewards for sales agents from the volume of antibacterial and antifungal medicines they sell, in order to mitigate the risk of overselling
One of the main drivers for the emergence of antimicrobial resistance (AMR) is the inappropriate use of antibacterial and antifungal medicines. When companies rely on making high volumes of sales, their resulting sales practices can lead to the promotion of overuse and misuse. Steps need to be taken to ensure products are used only when needed.
By avoiding the use of sales agents altogether for antibacterials and antifungals, companies can reduce their risk of overselling to healthcare professionals and the prescription of unneeded medicines. Companies that do retain a sales force can decouple incentives for their agents from sales volumes, so that bonuses do not depend on how much product is sold.
Why does Shionogi lead?
Shionogi was the first large research-based pharmaceutical company to fully decouple its incentives for sales agents from sales volumes. It began in Japan in 2016 and extended the practice globally the following year. The Benchmark recognised this as best practice in 2020.
The company does not link the payment of bonuses to the volumes its sales agents sell. It incentivises agents instead through linking to competencies such as interactions with healthcare professionals and knowledge of AMR. No other company in scope has fully decoupled such incentives for its agents globally. Just as importantly, Shionogi applies this practice globally for all products in scope, and is consistent in maintaining the practice.
No other company has fully decoupled such incentives for its agents
Cipla, the first generic medicine manufacturer to fully decouple its incentives for agents globally, was recognised for best practice in 2020. It now links <1% of its incentives to sales volumes. GSK pioneered the practice in 2013 but now no longer fully decouples. Other companies decouple incentives only for some products and/or in selected regions. Only Shionogi applies the practice across the board.
To improve further, Shionogi could choose to cease altogether the promotion of its products to healthcare professionals. Companies such as Abbott, Pfizer and MSD, which have run decoupling pilot projects, can expand this practice to more countries and products. Incentives for sales agents can be awarded at individual, smaller group or national level. When incentives are awarded at national and smaller group (rather than individual) level, they are linked less directly to total pay, so that when an individual agent sells a higher volume of products, this does not directly increase that person’s total pay. All companies can follow Shionogi’s lead and fully decouple incentives on a global basis, and maintain this practice to minimise the spread of resistance.