Model N survey

Model N survey highlights the growing complexity of revenue management

Revenue leakage in contracting and sales execution affects 95% of respondents


For over a decade, the IT developer Model N has been promoting the concept of revenue management (RM) to organize the disparate commercial functions (sales, marketing, trade relations, government pricing, etc.) of life sciences firms to minimize revenue losses from poor contract execution. But over that decade, according to its latest survey of industry managers, the RM process has only become more complex, needed information is harder to find, and the calculations necessary for better performance remain highly manual. Some 63% of respondents believe that “closing all revenue leakage would impact revenues by 4% or more.”

(Model N’s client base is roughly split between life sciences and high tech manufacturing; for the most part, responses from the pharma industry specifically paint a more stressed situation.)

Other highlights from the survey:

  • 73% agree that their pricing decisions leave money on the table
  • 90% of executives report that regulatory compliance is frequently associated with lost revenue
  • 48% report they need to make decisions with incomplete information.

Model N’s solution, not surprisingly, is to address these challenges through its family of tools for channel or payer management, rebate reconciliation, gross-to-net calculations and others. On that front, the company recently announced the latest release of its software, featuring AI and machine learning tools to model commercial situations, provide intelligence for predictive actions and rebate performance over time. In the med-tech arena, it now has the capability to track products by their Global Trade Item Number (GTIN), now becoming a basic way to manage life sciences supply chains.

The Model N 2020 Survey is available at the company’s website, Modeln.com.