Everyone in the pharmaceutical industry knows there’s a big difference between small pharma and large pharma.  Although the regulations, requirements and standards are exactly the same, the cultures and buying behaviors can be quite different.

To add clarity to the discussion LifeSciHub describes and (loosely) quantifies the “Tier” structure of the pharmaceutical industry.  There is no one definition of when a company is medium vs. small, or maybe even on the cusp of being considered “large”.

Context is another important lens that is impossible to quantify here.  Meaning, depending on your point of view, what aspect of industry you are looking at or coming from, these Tier definitions may need to look different.

For now, LifeSciHub offers the following Tier definitions which have been tested and refined for more than 20 years, and across multiple expertise domains, drug sponsors, vendors.  LifeSciHub grants permission to utilize and reference in any capacity.  Comments welcome as well:

Life Sciences Company Size/”Tier” Definitions

This list pertains to clinical stage drug sponsors, defined as drug, biotech, generic, actively engaged in the marketing of prescription medications.

Out of scope:  device, contract research or manufacturing organizations, wholesalers, pre-clinical

Tier Definition:  Sponsors

Tier 1 

Qty (approx.) 20

•      Top 20 global pharma company

•      >$10B US annual sales

•      Multiple (successful)  therapeutic areas

•      Portfolio diversification (beyond pharma)

•      HQ and at least 2 major hubs US, EU Japan, China and significant ROW presence

•      ~50+ open clinical trials

•      Procurement and IT major stakeholders of equal or greater as Business.  Business has to make extremely strong cases to justify choices.  Business can be overruled by Procurement and/or IT in favor of systems that fit powerful IT or spend strategies.

Tier 2

Qty (approx.) 40

•      HQ in a main region, one other substantial region hub

•      ~$5B US annual sales (sometimes companies with very strong pipelines under $1B can also qualify as Tier 2)

•      Significant success in one therapeutic area, demonstrated success in at least one other

•      ~20-50 open trials

•      Business tends to be stronger stakeholders, IT is often subordinate.  Sometimes decisions are made without RFP or procurement involvement.

Tier 3

Qty 500+

•      Post discovery stage ie  testing in human

•      1-<1 marketed product, usually in one market

•      0-$1B annual sales

•      ~0-10 open trials

•      Involvement of sponsor partners is common- these partners may or may not have shared responsibility in certain functional areas such as clinical or regulatory.

Tier 4

N/A

•      Discovery stage

•      Pre-clinical development ie no human trials