SAP FOR LIFE SCIENCES IN THE

PHARMACEUTICAL INDUSTRY
STRATEGIES FOR SUCCESS

YOU RE DOI NG A LOT TO I MPROVE THE WAY YOUR
COMPANY OPERATES.
Although there have been some innovative
implementations, as a whole, life science firms must
remain focused on the basics IT investments that improve
operational effectiveness, provide an infrastructure for
information access for internal and external constituencies,
and offer a manageable approach for regulatory
compliance.
Gartner Research Note, Life Science Firms Will Struggle with Sluggish Economy,
December 2, 2003
WHERE DO YOU GO FROM HERE?
CHARTING THE BEST COURSE
The life sciences industry is dynamic always innovating, always in flux. What worked
yesterday might not work today. Thats why pharmaceutical, biotechnology, and med-
ical device companies are constantly seeking better ways to manage complexity, comply
with regulations, cut costs, and boost productivity.
In pursuit of these objectives, life sciences firms are looking beyond standard practices to
new business strategies that promise solid business results. But what strategies and prac-
tices are right for your company? And what are the best solutions for facilitating them?
To answer these questions, companies rely on insights and advice from industry thought
leaders.
STRATEGIES FOR SUCCESS
To relay what industry experts are thinking, SAP Strategies for Success explores the most
recent strategies, solutions, and best practices for each of the more than 25 major
industries served by SAP.
Each brochure in this series reflects the views of independent analysts, industry experts,
and corporate executives on a specific industry. Take a closer look at these strategies,
practices, and tools in the pages ahead, and consider how they can help your business
achieve profitable growth.
Please note that this brochure focuses exclusively on the pharmaceutical sector within
the life sciences industry. For additional information on how SAP meets the needs of
biotechnology firms, medical device manufacturers, and other companies in the life
sciences industry, please contact your SAP representative or visit us online at
www.sap.com/lifesciences
SAP SOLUTIONS FOR THE
PHARMACEUTICAL
INDUSTRY
SAP supports the most important business processes in any
life sciences company and provides tools to manage these
processes for greater efficiency and effectiveness. The solution
map shown on the following page gives you a clear overview
of the business processes relevant to the pharmaceutical
industry. Built using input from customers and industry ana-
lysts, plus the technical expertise SAP has acquired through
extensive business experience and research, solution maps are
multilevel blueprints of processes defined for a particular in-
dustry. They help you visualize, plan, and implement a
coherent, integrated, and comprehensive information tech-
nology solution. They also show how various processes are
covered, including the processes that SAP and its partners
support. With solution maps, you quickly understand
business solutions and the business value they can bring. A
complete library of solution maps, business maps, and
business-scenario maps for the pharmaceutical industry is
available at www.sap.com/lifesciences/businessmaps.epx
Thirty-eight percent of
CEOs worldwide say
structure and business
processes are the great-
est obstacle to pushing
business initiatives
inside their company.
A.T. Kearney study of 251 CEOs
SAP offered an in-depth understanding of what we
do as a business, and a firm understanding of
pharmaceutical manufacturing best practices. . . . What
we needed was an integrated system designed to
provide the capabilities and controls that our business
demands. SAP fit the bill.
Greg Liscio, SAP Project Manager, Lannett Co.
HI GHLY TARGETED SOLUTI ONS . . .

WI TH THE TOOLS TO SUPPORT THEM.
PHARMACEUTICAL SOLUTION MAP
Time to Market
R & D Administration
Drug Discovery
Pharmaceutical Development
Clinical Trial Management
Clinical Trial Supply Management
Regulatory Submission
Product Quality
Procure to Pay
Compliant Manufacturing
Enterprise LIMS
Equipment Maintenance
Time to Value
Supply Chain Planning
Contract Management
Order to Cash
Marketing
Sales Operations and Performance Analytics
Field Sales
Product Safety
Medical Inquiries
Complaint Management
Incidence Reporting & CAPA
Drug Tracking and Tracing
Suppliers,
Partners, &
Regulatory
Agencies
R & D Operations Distribution Sales & Marketing Service Customers,
Channels, &
Regulatory
Agencies
Enterprise Management & Support
Analytics
Financials
Human Capital Management
Corporate Services
Compliance Tools and Validation Services
SAP serves an incredibly diverse set of customers in
dozens of industries, hundreds of countries, and a range of
sizes, from 10 employees to 10,000 and more. Some of these
customers want complete, integrated business systems
while others are just looking to address one business issue
right now.
Jim Shepherd, Vice President of Research, AMR Research Inc., SAP to Use Strong
Profits to Turn [SAP] NetWeaver into a Business Process Platform, January 2005

RI SK REDUCTI ON STRATEGI ES
COMPLY AND THRIVE
Build Compliance into Core
Business Processes
Regulation is no stranger to the phar-
maceutical industry. Today, companies
must comply with the Sarbanes-Oxley
Act, 21 CFR Part 11, the U.S. Health In-
surance Portability and Accountability
Act (HIPPA), GxPs, and regulations im-
posed by the FDA, DEA, EPA, and other
agencies. Because compliance is such a
critical success factor, leading pharma-
ceutical companies are constantly look-
ing for ways to more efficiently account
for and manage the increasingly wide
range of regulations being imposed.
What Analysts Recommend
Companies need to build compliance
into core processes with specific system
capabilities for compliant manufactur-
ing, quality management, product safe-
ty, lot- and serial-number tracking, and
financial recording and reporting.
What SAP Offers
Renowned for its process expertise, SAP
offers a wide range of flexible options to
help companies stay compliant. From
procure to pay, compliant manufactur-
ing, and equipment maintenance to
field sales, sales operations, and labora-
tory information management, SAP in-
tegrates compliance with what
pharmaceutical companies do on a
daily basis.
Life sciences compa-
nies must build an enter-
prise Active Compliance
Management architec-
ture that integrates
customer-facing and
manufacturing compli-
ance processes with IT
applications such as
CRM, manufacturing,
and enterprise resource
planning (ERP).
Roddy Martin, Laura Preslan, and
Marc Meunier; AMR Research Inc.,
The FDA Forces Quality,
Compliance, and Customer
Integration, April 22, 2004
ANALYST S RECOMMEND THESE STRATEGI ES
FOR MI NI MI ZI NG YOUR EXPOSURE TO RI SK.
IMPROVE DATA MANAGEMENT
Integrate Information to Improve Visibility
Most pharmaceutical organizations deal with vast amounts of data across multiple
product groups and manufacturing facilities. The result is often a dangerous lack of
global visibility one that impedes the ability to identify problem areas and makes it
difficult to ensure product safety and maintain product integrity.
What Analysts Recommend
To reduce the risk of product safety problems that can occur due to limited
product-data visibility, companies should integrate information. Supply chain data
should be visible and fully accessible to all process participants to increase control
over discovery, development, and quality processes.
What SAP Offers
With SAP solutions, companies can integrate their business processes for manufac-
turing and operations, resulting in visibility that extends across the entire supply
chain. Using this integrated approach, companies have the information they need to
rapidly identify and fix problem areas with raw materials and supplies and in manu-
facturing, packaging, and quality control.
UNDERSTAND YOUR MARKET
Boost Sales Performance and
Increase Mind Share
For many companies in the
pharmaceutical industry, the R-&-D-
centered business model of the past is
now shifting to a dual-focus model that
increases the role of sales and market-
ing. Pharmaceutical firms are seeking
ways to better segment the market and
identify opportunities. This requires an
understanding of the profile of physi-
cians. How can companies communi-
cate with them, maintain relationships,
and increase mind share?
What Analysts Recommend
To more effectively reach increasingly
segmented market sectors and the
physicians serving these sectors, com-
panies should adopt sophisticated ana-
lytical capabilities to identify appropri-
ate physicians, improve sales efficiency,
and manage relationships. Capabilities
should include multichannel sales and
marketing, sales force automation,
multiple customer-contact points, and
market segmentation analysis to
name just a few.
What SAP Offers
As a leading vendor of customer rela-
tionship management (CRM)
solutions, SAP helps companies
perform market analysis, execute mul-
tichannel campaigns, work with physi-
cians, and gain mind share. SAP also
understands that CRM is a business
practice first and a technology second.
Thats why our trained consultants
help companies implement CRM tech-
nology in a way that enables users to
execute business strategies, quickly and
easily.
PROCESS EFFI CI ENCY STRATEGI ES
FIND NEW EFFICIENCIES
Break Down Organizational
Silos to Improve Investment
Decisions
Disaggregated systems that impede
collaboration and trap information in
isolated silos are a root cause of opera-
tional inefficiency and poor investment
decision making in the pharmaceutical
industry. Leading companies are con-
stantly looking for ways to break down
barriers and enable smoother processes.
What Analysts Recommend
With effective portfolio, project, and
program management capabilities,
companies can improve efficiency, visi-
bility, and collaboration in a way that
helps executives make better
investment decisions. Specific require-
ments include R & D administration,
drug discovery processes, and effective
ways to manage clinical trials and
regulatory submissions.
What SAP Offers
Offering powerful portfolio, project,
and program management capabilities,
SAP solutions enable companies to
break down organizational barriers.
Processes work more smoothly, visibili-
ty is improved, and management has
enhanced capabilities to manage the
portfolio and maximize the
effectiveness of investment decisions.
SAP delivered the tech-
nology and expertise we
needed to successfully
introduce a highly flexi-
ble, user-friendly interna-
tional process, in line
with very demanding
quality assurance
requirements.
Jan-Peter Spengler, Head of
Product Technical Complaint
Handling and Reporting, Aventis
Global Quality Operations
THESE STRATEGI ES CAN HELP MAXI MI ZE EFFI CI ENCY
FOR PHARMACEUTI CAL COMPANI ES.
IMPROVE SALES OPERATIONS EFFICIENCY
Speed Time to Value
By itself, being first to market does not ensure market leadership. Pharmaceutical
companies also need ways to minimize the time between product launch and peak
sales. This is increasingly important as companies lose patent protection for flagship
products and experience precipitous declines in revenue. The risk of negative cash
flow requires that companies execute their sales operations in a highly efficient
manner.
What Analysts Recommend
Companies need a multipronged market strategy that combines elements of
customer-centric marketing, market intelligence, and sales efficiency to realize peak
sales rapidly. Companies also need business intelligence tools for leveraging market
insight, improving campaign management and performance, and for quickly identi-
fying and reconciling charge backs and rebate volumes.
What SAP Offers
Recognized as the leader in the field of process efficiency, SAP offers powerful tools
for shortening the time to peak sales. Specific capabilities include contract manage-
ment, multichannel marketing management, field sales operations, performance
analytics, and efficient order-to-cash processes to speed transaction times.
REDUCE COSTS THROUGH PARTNERSHIPS
Outsource Noncore Activities
While pharmaceutical companies may
consider their core processes to be too
complex to survive outsourcing, there
is an increasingly capable and growing
base of IT service companies prepared
to support noncore activities both off-
shore and at home. For companies that
take advantage of the opportunities, the
cost savings will be significant.
What Analysts Recommend
Outsourcing requires the ability to face
internal processes outward to valued
service partners. This, in turn, requires
greater collaboration capabilities and
the targeted integration of systems to
share information in a global context.
What SAP Offers
The SAP NetWeaver platform helps
companies take advantage of emerging
outsourcing opportunities, independ-
ent of location and time zone, enabling
integration and information sharing
between the parent organization and its
valued partners. As a service provider,
SAP offers hosting services, such as im-
plementation and application hosting,
that help companies ramp up opera-
tions and ensure a smooth transition
process. These solutions and services
facilitate the kind of collaboration
required for successful outsourcing,
around the clock and around the
world.
BUSI NESS TRANSFORMATI ON STRATEGI ES
Schwarz Pharma Deutschland uses the CRM capabilities of SAP software
to create a standardized view of all customer data. In addition to providing
a stable data platform, SAP solutions have helped the company better iden-
tify profitable customers, increase the quality of service, and tailor market-
ing campaigns more appropriately.
JOIN FORCES
Penetrate New Markets for
New Opportunities
The pharmaceutical industry doesnt
exist in a vacuum. To increase revenue
and expand markets, leading companies
are exploring emerging opportunities
in related markets including medical
devices and biotechnology with drug
delivery systems such as drug-eluting
stents or with technology licenses that
augment the pipeline with biopharma-
ceutical lead compounds.
What Analysts Recommend
To successfully leverage existing capa-
bilities for new market opportunities,
companies must have collaboration ca-
pabilities to work effectively with new
partners for developing innovative
technologies and marketing new thera-
peutic treatments that can extend core-
product life cycles and provide an
entree to new markets.
What SAP Offers
With SAP NetWeaver at their disposal,
pharmaceutical companies gain the
flexibility and platform openness
required to quickly integrate new
development partners. SAP NetWeaver
integrates with SAPs powerful capabili-
ties for product life-cycle management
and customer relationship
management allowing companies to
easily extend internal processes to
trusted partners beyond enterprise
boundaries.
THE PHARMACEUTI CAL I NDUSTRY I S CHANGI NG.
ADOPT THESE STRATEGI ES TO STAY ON TOP.
SUCCEED THROUGH COLLABORATION
Increase Collaboration to Address Challenges of Scientific
Complexity
Pharmaceutical companies are tremendously complex and data-intensive enterpris-
es. Increasingly, research organizations must join forces and share resources to make
progress. This makes efficient, effective collaboration a critical factor for business
success.
What Analysts Recommend
To manage interaction among research organizations, companies need flexible col-
laboration capabilities that allow organizations to expose internal processes quickly
and easily. Companies also need the ability to maintain performance levels when ex-
changing extremely large volumes of data, such as during the design phase of a clin-
ical trial or when defining research contracts.
What SAP Offers
With the collaboration capabilities of SAP Enterprise Portal, a component of SAP
NetWeaver, research organizations have the ability to join forces quickly and easily.
Other SAP NetWeaver components, such as SAP Exchange Infrastructure and SAP
Master Data Management, help companies handle complexity with capabilities for
exchanging and managing vast amounts of data.
TRACK PRODUCTS MORE EFFICIENTLY
Use RFID Technology to
Increase Product Safety and
Reliability
The best way to maintain a positive im-
age or avoid a negative one is to pre-
vent accidents from happening. But
when accidents do happen, companies
need to be responsive. In todays envi-
ronment, when the public demands
immediate action, paper-based tracking
processes simply fail to meet the need.
What Analysts Recommend
RFID technology enables companies to
know exactly where their products are
at every stage from the moment
theyre tagged to the time theyre
received. This introduces new efficien-
cies into a companys processes for cor-
rective and preventive action (CAPA)
by speeding the ability to track and
trace everything that is produced and
shipped. This ensures product pedigree
and reduces the likelihood of
counterfeits.
What SAP Offers
SAP Auto-ID Infrastructure a compo-
nent of SAP NetWeaver provides a
ready-made RFID platform that can be
deployed quickly and integrated with
core supply chain and ERP processes.
This gives companies powerful new
capabilities to monitor goods, track
product pedigree, prevent counterfeit-
ing, and maintain a positive public
image.
ARE YOU READY?
STRATEGIES AT A GLANCE
Risk Reduction
Build compliance into core busi-
ness processes with capabilities for
compliant manufacturing, quality
management, product safety, lot- and
serial-number tracking, and financial
recording and reporting
Integrate information to improve
visibility making supply chain data
available to all process participants
Boost sales performance and
increase mind share to identify
appropriate physicians, manage
physician relationships, perform
market segmentation analysis, and
improve customer self-service
Process Efficiency
Break down organizational silos
to improve efficiency and invest-
ment decisions using leading-edge
integration and collaboration capa-
bilities to improve the flow of
information
Improve sales operations efficien-
cy and speed time to value with a
multipronged strategy that combines
customer-centric marketing, efficient
sales transactions, business intelli-
gence, and targeted applications for
managing campaigns
Outsource noncore activities by
improving collaboration capabilities
and integrating systems to enable the
sharing of information in a global
context
Business Transformation
Enhance collaboration capabili-
ties to penetrate new markets
leveraging sophisticated
collaboration capabilities that allow
companies to quickly integrate new
development and marketing partners
Increase collaboration to address
challenges of scientific complexi-
ty using portal and information ex-
change technology to help research
organizations join forces and share
resources
Use RFID technology to increase
product safety and reliability
making it easier to track and trace
products from the time they are
shipped to the moment they are
received
CHANGE I S NEVER EASY. BUT TO STAND STI LL I N
TODAY S MARKET I S TO FALL BEHI ND.
INDUSTRY-STANDARD PRACTICES
VERSUS INDUSTRY-LEADING PRACTICES
Trends show that many companies are moving away from traditional practices and
adopting forward-thinking leading practices to support profitable growth in key
areas.
The business processes and information
systems throughout your company
were developed over decades, and many
of them are undoubtedly considered
very entrenched. Reengineering them
to industry-leading practices wont
happen overnight and requires a strong
commitment at the highest levels. This
is especially true when it comes to inte-
grating processes across departments
and divisions.
The good news is that companies that
persevere can expect the following
rewards:
Faster recognition of peak sales
revenues
Better insight into the overall
business
Streamlining of processes that have
grown overly complex and inefficient
Significant reductions in risk and
exposure
Increased flexibility to respond to
market changes
Improved collaboration and shorter
timelines for company and partner
projects
Maximized return on R & D
investments
INDUSTRY-STANDARD PRACTICE INDUSTRY-LEADING PRACTICE
DATA MANAGEMENT Approached in a disjointed manner resulting
in incomplete data collection and isolated
data warehouses
Approached as a prerequisite for enabling col-
laboration with other research organizations.
Uniform data collection practices and uninhib-
ited information flows facilitate collaboration
and help companies innovate.
COMPLIANCE
MANAGEMENT
Approached as a governmentally mandated
obligation and managed as a separate
process
Approached as an essential and integrated
part of the pharmaceutical process; regarded
as a source of competitive advantage, subject
to efficiency improvements and capable of
delivering higher quality
CUSTOMER SERVICE Approached as a nonessential business area
for companies focused on blockbuster drug
development
Approached as a core element for under-
standing consumer needs and building the
relationships required to improve market
penetration
THE ROAD TO PROGRESS

THE FUTURE LOOKS BRI GHT . . .
EMERGING TECHNOLOGY AND TRENDS
In the years ahead, companies in the
pharmaceutical industry will become
increasingly integrated, leading to new
levels of collaboration, efficiency, and
productivity. Data management and
information access will continue to im-
prove, and companies will develop
more sophisticated collaboration capa-
bilities to facilitate product devel-
opment across distributed teams. Im-
proved collaboration capabilities will
also lead many companies to take
advantage of the growing number of
outsourcing opportunities now avail-
able to the pharmaceutical industry.
In the area of regulatory compliance,
companies will increasingly build quali-
ty and compliance controls into core
business processes. This will help
streamline compliance, reduce time to
market, and mitigate risk.
Finally, the pharmaceutical industry
will make increasingly better use of
CRM technologies to focus on targeted
treatments for niche markets. Taking a
cue from the consumer products
industry, pharmaceutical companies
will adopt idea management and prod-
uct definition solutions to help spur
targeted innovation while simultane-
ously improving sales and marketing
performance.
Customer Relationship
Management
With a new focus on targeted
treatments, companies will move to
multichannel communication strate-
gies to reach the audiences that will
keep them in business and this will
require a more sophisticated approach
to CRM.
Outsourcing and Partnering
As outsourcing partners continue to
prove their abilities and new markets
emerge for combination products,
those companies with the proper infra-
structure to open up processes and col-
laborate in a flexible manner will be the
first to reap the benefits and the com-
petitive advantage.
Human Capital Management
Changes in the pharmaceutical indus-
try require specific new skill sets par-
ticularly when it comes to CRM and IT
management. And as the industry
breaks out of the economic doldrums,
business will grow. The company that
can attract the right employees with
the right skills and retain them in a
competitive job market will boost its
potential for business success.
By working closely
with customers and
opinion leaders on the
future of IT support for
evolving strategic busi-
ness processes and
challenges, SAP clearly
understands its cus-
tomers key business
issues.
Stephen Brown, Director for
Services Leadership, Arizona
State University
Emerging management trends for the pharmaceutical
industry include:

WHEN YOU CHOOSE THE RI GHT PARTNER.
A COMPLETE FAMILY OF
PHARMACEUTICAL SOLUTIONS
SAP continually interviews thought leaders in the pharmaceutical industry to identify
the biggest challenges and trends facing your company today. This knowledge,
combined with our experience with customers worldwide, has led to the most compre-
hensive portfolio of solutions for the pharmaceutical industry.
For example, the robust SAP NetWeaver platform easily integrates SAP and non-SAP ap-
plications for a lower total cost of ownership. The mySAP Business Suite family of busi-
ness solutions built on the SAP NetWeaver platform offers powerful, adaptive
business solutions with best-of-breed functionality, industry-specific capabilities, and
support for collaboration over the Web. And the SAP xApps portfolio of packaged com-
posite applications delivers business-ready scenarios that enable continuous innovation.
SAP also offers affordable, scalable solutions developed expressly for small and midsize
pharmaceutical companies. And we back all our solutions with ongoing support and
services to help you achieve your business objectives and maximize your return on
investment.
For additional information on how SAP for Life Sciences can help your company
operate more efficiently and profitably, please visit: www.sap.com/lifesciences
AstraZeneca is one of
the top-five pharmaceu-
tical companies in the
world. Using SAP soft-
ware to manage its sup-
ply chain, AstraZeneca
has slashed planning
cycles from 14 days to
1 day, increased total
package output by 13%,
and boosted inventory
turns by 14%.
50 074 030 (05/04)

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