Why Compliance-Focused Companies Should Demonstrate Appreciation

In our latest content series, our CEO and Co-Founder, Brendan Kamm, recently met with Jonathon Kellerman, Executive Vice President and Global Chief Compliance Officer at Allergan, to discuss why compliance-focused companies should demonstrate their appreciation while adjusting in our virtual environment. Listen to their conversation here!:


Editor’s Note: The transcript of their interview is below. It has been edited and condensed for clarity.

Brendan Kamm: Hi everyone, and welcome to Thnks’ new series of conversations with B2B leaders. My name is Brendan Kamm. I’m the CEO and cofounder here at Thnks. Today I have Jonathon Kellerman with me. 

Jonathon, I’m breaking a cardinal rule of mine. My last conversation was with Coach Michael Blaine from Plattsburgh State University. He’s a big Eagles fan, and I just have a life rule that I don’t speak to two Eagles fans in a row. 

So I’m breaking that rule for you. I want you to know that because your resume, your background, and what you do is so fascinating and so different, I think, from what people think of a chief compliance officer, which I know is your title.

But I’d love for you to just tell everyone a little bit about that background, and maybe how it relates to the changing traditional commercial models that exist in pharmaceuticals. I know that model is changing and adapting to digitization, to everything that’s happening in the world. And you are at the forefront of that. 

So, we’d love to learn a little bit more about you and sort of how it relates to those changes. 

Jonathon Kellerman: Sure. Well, thank you very much. I appreciate you breaking your cardinal rule. I am wearing my Eagles hat right now. Go birds. I think that will just up the profile of the company and the services provided, having more Eagles fans being advisers to what you’re doing.

In terms of where the industry has traditionally been in terms of the commercial model, particularly in the pharma, biosciences, and biotech space, it’s a model that has largely been dependent upon face-to-face engagement, and that face-to-face engagement really drove how products are promoted, how healthcare professionals and healthcare organizations are educated, how they’re engaged to provide feedback to the industry regarding the development of new products.

But it’s always been about some form of face-to-face engagement. The largest spend that a company has generally from an SGNA perspective is in the field force. You know, hundreds to thousands of individuals out in the field every day, trying to get a minute or two of face time with a healthcare professional to talk about one or multiple products, and their safety efficacy and use with their patients.

Another key aspect or a key element to the traditional commercial model is sampling products. Certain products are allowed to be sampled to healthcare professionals.  Many times, most of the times when these reps go into offices, they try to update and provide samples to the physicians that they can use with patients that fit a certain type of medical profile.

But again, predicated on that face-to-face engagement. Then you have the engagement side of things as well beyond promotion. You have advisory boards, you have consulting arrangements where pharmaceutical companies, med device companies, biotech companies, are doing legitimate programs, but bringing together, physically together, a number of healthcare professionals at a location, flying them in, setting them up in hotels, and running live face-to-face engagement-type situations to either get information about the development of products or to get their feedback on a specific product that’s in development or early stage research. The key underlying common factor here is that face-to-face engagement.

That has been driving the traditional commercial model, across the pharma and life sciences space. I think that is what’s starting to change now. 

Brendan: You and I had talked about, when we first met months ago, the idea of the cost of that, and how that sort of needs to change, or the model, as you continue to work. I’m sure it’s been accelerated given the current environment of social distancing in that we just don’t put a bunch of people in a room together these days.

So, in the pharma industry, how are people thinking about engagement? Not just in 2020, but more broadly, what’s in store for that engagement and how has that changed?

Jonathon: It’s an interesting transition, and then your point about what we had discussed before, companies spend upwards of billions of dollars in just the field force and field force support. Like I said, the largest part of an SGNA spend really is around these field forces and the activities, legitimate kind of business interactions that they do, predicated on these face-to-face interactions. 

What has been brewing in the industry for a long time is a concept of a change of the commercial model, moving away from spending billions of dollars on fuel forces and trying to integrate new platforms of engagement using technology, and using other digital platforms and social media to begin to engage healthcare professionals differently either through—some good examples would be, instead of actually having a large field force of reps running around every day, trying to get to eight to ten different physicians, they could do that virtually using technology that exists today, particularly things like Zoom and webcasts, etc, where you can virtually have a detail with the healthcare professional, and do that without having to leave the comfort of your home. 

That could be just as productive, getting a few minutes of a physician’s time, using that type of a technology, and then reducing the cost and the need for as many reps as well as all of the costs associated with the reps being out in the field. 

So there’s different models being thought about whether it’s the virtual detail, whether it’s remote sampling, so instead of actually going into a physician’s office, going to their sample closet and physically moving from your car into the sample closet, samples of different products.

You can do that now remotely, using online tools and capabilities to obtain authorizations from the healthcare professionals and then mailing samples in, that’s another way. And then even the engagement of healthcare professionals for vital programs like advisory boards or an engagement of a physician for a certain type of consulting arrangement—all of that can be done virtually right now through the technology that’s available, in Microsoft Teams or Zoom, or what have you, you can do a virtual advisory board where you get all of the key opinion leaders together and do this virtually through a moderator, and have the same level of efficacy of these programs, and the same type of impact, and the same type of outcome in terms of information, without having to pay the cost of flying them in, putting them in hotels, having meals, etc.

All of a sudden now, the industry has been thinking about these ways to reduce costs while maintaining the impact of these interactions. What COVID has done, it has accelerated companies looking at ways to integrate these new platforms in a way that they had not originally planned.

Most companies are still using the traditional models prior to COVID. Some have been experimenting with different models, but no one had really gone the full distance to convert to a virtual type of commercial model. COVID forced companies to do that. 

Some sectors either stopped altogether, in terms of the type of physician engagement, given the types of services that the doctor has provided, others had to, out of necessity, rethink this in order to have any type of face-to-face engagement. It had to be done virtually. 

So companies tried to quickly, and reactively, implement technologies that would allow them to offer to the healthcare professionals, to the healthcare organizations, a means for that face-to-face detail, that face-to-face promotion, whether it be a couple minutes of the physician’s time via technology, via these technology platforms, implemented new ways to do sampling, through these remote sampling technologies now, and using electronic signatures online, a means of tracking information via technology, and then of course companies are continuing to do advisory boards or various types of engagements, but they’re doing them virtually now. 

They’re finding that, as they get smarter and better with the technology, they can maintain the same level of efficacy and the impact of these programs while reducing the cost.

So now all of a sudden you’re not spending on travel, you’re not spending on hotels, you’re not spending on meals. That money is being saved. You’re spending a lot less on licensing technology platforms to engage, and in many cases, you’re requiring fewer individuals to be able to engage with the healthcare professionals from a promotional perspective.

All of that now is consolidating the costs associated with the SGNA for maintaining a commercial model. What we’re seeing—and it’s been early. I mean, to be honest, this has been a four-to-six month window now—but we’re finding that companies are demonstrating that these types of engagements remain impactful.

They remain effective, and they’re able to continue to promote, to educate, and to engage, in a very productive way using this technology while lowering costs. So just to a large extent, COVID accelerated what had been brewing in the background in this industry for probably the last decade—the concept of changing this commercial model and how companies actually engage with the healthcare community.

Brendan: It’s interesting. As you say that, I think about some of the clients we have at Thnks across industries, and we’re seeing a lot of those same things where they used to hop on a plane and fly out and they have a nice “thank you” dinner with that new client they signed, or that renewal of the contract.

It’s necessarily becoming a digital experience now. I love that because I don’t think  you need to be there in-person. That’s my whole thesis here. I actually think if you bought someone a cup of coffee every day for a month, that actually is going to go further as a thank you than a single dinner. 

For the same price, you could probably do it for a whole quarter or half a year. I love those types of things. So, I guess that leads me to a bit of a leading question to you. As you talk about these new engagement strategies in pharma, how did gratitude and appreciation play a part in that?

Especially given, from the Thnks lens, we love gestures of appreciation, but you know, in a compliance role, and you’re kind of interesting because you’re in a compliance, but also, operational, almost COO type of role. How can people in those roles help facilitate that change, especially given that there are a lot of rules and regulations around the industry you come from? 

Jonathon: It’s an interesting question. To a large extent, the compliance community is building the plane as they’re flying with respect to these new ways of engaging. As we talked before, the pharma industry itself had been thinking about this for a while, changing the model.

But traditionally has been slow to change—and that’s just a fundamental characteristic of the industry. It’s very slow to change. It’s worked in the past this way, and it’s cumbersome to make a big change like this using technology and using various digital platforms to engage professionals.

But, as you said, COVID has shown that you can still maintain effective engagement while using these different platforms and reducing costs. So people now have a small amount of data, probably somewhere between four and six months of data, that shows that they’re able to maintain sales levels, or at a minimum, maintain effective engagement this way.

I think that the concept of gratitude, in my opinion, becomes even more critical when you are eliminating or reducing the actual face-to-face contact with your customers, whether your customer is the healthcare professional, the healthcare organization, or even a patient, when you eliminate or significantly reduce that face-to-face contact, where you can shake someone’s hand, where you can tell them “thank you,” where you can engage them in a productive way, the concept of gratitude has to evolve as well as the concept of the engagement. 

I think it is critical that companies think more creatively and innovatively about how they demonstrate their appreciation, how they bring the concept of gratitude into this new model. Most companies have CEOs that are very forward-thinking and have some type of initiative around what they call, “customer centricity” and the key to customer centricity is understanding your customer, understanding their needs, and finding productive ways and impactful ways to engage with them and to show the appreciation for them as the lifeblood of what we do every day in this industry. 

So this concept of gratitude becomes, in my mind, as the model changes, even more important, even more critical, particularly for commercial businesses and in large parts, and part of the R&D space as well.

Even internally with your own employees, this concept of gratitude takes on a higher level of importance, and companies should not only be thinking about how to engage, but they should be thinking about new ways to show that appreciation, to show that gratitude, and to align their actions with their culture and with their concepts around this idea of customer centricity. 

Now that to me is a no-brainer. Companies should be doing that right now, and thinking about leveraging tools and technologies—platforms like Thnks, where you can quickly, easily, and in a cost-effective way, show your gratitude towards your customers, towards patients, towards your employees.

That would enhance the engagement experience with those individuals. So to me, that  avenue, that new kind of platform of showing thanks, showing gratitude, is critical. You bring up a very good point though. The challenge with it is navigating the regulatory landscape. One of the first challenges is, the industry is working at a very fast pace now being very innovative, very creative, particularly in terms of using technology, being virtual, using digital platforms, using social media. 

However, they’re doing it in an environment where the laws and rules were written over 75 years ago, and they didn’t necessarily anticipate companies doing things this way. Those laws and rules were largely written for the old commercial model.

So, we are trying to figure out how to change the model, how to better integrate this concept of gratitude in an environment where the laws and rules aren’t particularly clear yet on what is appropriate and what is inappropriate. 

So we’re working closely with our peers, working closely with regulators, working closely with the commercial leaders, to try and find a way to integrate this concept of gratitude in an appropriate manner.

But there are challenges because the regulators could perceive certain types of activities as inducements, or as means to inappropriately encourage health care professionals or healthcare organizations to either purchase or prescribe a product or to impact its formulary status within a hospital or health system, etc.

So it’s not that we can’t do it. It has to be done within certain guidelines, which means professionals like myself and the compliance community need to think of ways now to adapt policies and procedures, and in particular, controls around monitoring activities, to ensure that these new types of expressions of gratitude are done so in an appropriate manner.

So, the question is, “How do we do that?” I think that’s the inflection point where the industry is right now, working together to think about, “How do we ensure that we’re not only changing the commercial model, but we’re changing the infrastructure behind the commercial model, behind the scenes, to be able to manage these new engagements, these new means of engagement, these new platforms, but also new ways of showing gratitude by using platforms like Thnks in a compliant manner. That’s where the industry is right now. 

Brendan: It’s fascinating how something as simple as buying someone a cup of coffee can become quite complicated quite quickly, given all the rules and things you have to deal with.

I guess it kind of leads me to my next question, which is, you’ve obviously got a wealth of knowledge and experience in the highest rates in the pharmaceutical industry, prior to that, the highest rates in big four accounting firms. In a lot of ways, you’ve got the exact career that so many people are looking for. You’re moving into this advisory and getting more involved in startups.

So many people would love to follow in your footsteps. Do you have a piece of career advice you would give to someone looking to do what you’ve done? 

Jonathon: First and foremost, I think the best piece of advice I could give anyone who works in my space is don’t be afraid to be business-friendly. Don’t be afraid to embrace change. Don’t be afraid to innovate. 

Compliance does not have to look like compliance ten years ago where it’s a reactive, kind of police-type of organization that says, “You can’t do this, you can’t do that.” Don’t be afraid to embrace change, innovation, and creativity, and compliance.

If compliance is going to be impactful and effective for the new world order in pharmaceutical life sciences, across healthcare, compliance has to change as well. 

To really impact culture, you can find an effective balance between advising your business partners on how to navigate the gray and how to navigate through the guardrails of effective compliance while also helping enabling them to embrace these new technologies, embrace these new platforms, embrace these new approaches to engaging with customers in an impactful and effective way.

There is a way to balance that, and that means think differently about how you recruit people, and what’s the profile of the individuals that you recruit. One good example from what I’ve done historically is, I tend not to necessarily always hire experienced compliance professionals.

I hired a digital and consumer-focused professional who spent most of her time in the retail world, working on digital marketing, working on social media platforms, and she had no history in the healthcare or compliance spaces, and I can teach anyone compliance, but what I can’t teach them is, how do these technology platforms work? How does social media work? How do these digital engagement platforms work? How does a platform like Thnks work? Individuals like that know that. So bringing them in and teaching them what compliance is is the easy part. Bringing them in to be able to educate and change the way we think about and engage with our business partners—that was critical. 

I bring in more data analysts to be able to take the wealth of data that we have, about how we are engaging with our healthcare professionals in a different way, and those data analysts, and those individuals, are thinking of creative ways to monitor the new and evolving risk associated with the changing commercial model.

So my best advice is, don’t be afraid to think differently. Don’t be afraid to do things differently. Don’t be afraid to step out and really engage with the business partners that you work with and think about creative and unique ways, not only to engage healthcare professionals, not only in ways to show your gratitude, but how to set the control environment up in an impactful way to help them do that, achieve their goals, their business objectives, but do so in a compliant manner.

Brendan: I think you’re so spot-on. I can tell you from my career growing up compliance is often granted as the wet blanket, the “no fun” zone. So anyone who’s listened to the last twenty minutes of you talking has a better understanding that it doesn’t have to be that way. It can be creative and business-friendly. People can take that industry and it can be a better part of the business right now. I think that’s super important. 

Now, on to the rapid fire questions. 

So I’m going to ask you three-to-four questions in a row, just top of your head answers, some fun stuff just so we can get to know you better. 

Jonathon: As long as you don’t insult my love of Philadelphia sports, I’m good. 

Brendan: I will let that go so I don’t say anything that I regret later. I’m sitting in Tennessee Titans territory, so I’m out of my bearings . First question: What, if any, activities or hobbies did you pick up while in quarantine? 

Jonathon: I bought a spin bike. Two years ago I got into spin classes, often with my daughter, and was doing that at my gym pretty much four or five days a week, and really missed that.

So I bought a spin bike and now I either ride my bike every day, or I ride the spin bike every day. That’s one of the things that I do to help keep me sane and keep me somewhat in shape. It’s a great way to break up the monotony of being in the house every day.

But, I will say this about the new world order with quarantine, the one silver lining to this, for me personally, is the fact that I have three children. They’re all at home with us, and I get to sit down and have dinner every night with my entire family, my wife, and my three kids.

We cook, we grill, we order-in, but we actually sit down and have formal dinners every night together and we talk, and it’s been the one major silver lining of this whole experience. 

We’ve had this unique opportunity to spend time as a family that we never were able to do before—the concept of five of us sitting down to a formal dinner, for more than one or two nights a week, was virtually impossible given that I work, my wife works, I have three kids that are involved in multiple sports and activities. 

So to be able to say for the past four or five months we’ve had dinner together every night—it’s been a blessing for us, that’s for sure. 

Brendan: I’m in the exact same boat. Actually, as you bring that up, that’s one thing you and I have in common, sort of a love of family time and being proud fathers. 

So I’m going to switch up my last question, actually. I think this is an important one. So I happen to know that your son, Logan, is a tremendous baseball player, a D-I baseball player, and a fantastic catcher.

So my question is, if there’s one thing Logan needs to work on in his game, what is it? What do you have to tell him he needs to improve this season?

Jonathon: The one thing I would give advice to my son about—not that he would listen, he generally doesn’t listen to me. He will listen to you Brendan, before he listens to me.

But the one piece of advice I would continue to give my son is, don’t get in your own head. 

Baseball is a very, very difficult sport to play. He plays a very cerebral position as a catcher. It is the field general out there, and it requires you to be having a short memory, whether it’s at the plate or behind the plate, if something goes wrong, if you call a bad pitch, or if you strike out, you have to forget about that and not let that get into your head, and you have to quickly move on to the next pitch, or the next at bat, and not dwell on what has happened in the past. 

That’s hard to do for any player, let alone someone who is, kind of calling the game and commanding the action that’s on the field every play. My best piece of advice to him is never get into your head. Don’t let it get to you. Move on to the next one quickly, short term memory, and trust your skill sets. 

You’ve been training for well over a decade in a sport that you love. There’s a reason why you’re playing at the Division I level and doing so effectively—trust that. Trust your training, trust your instincts, and don’t dwell on what happened five minutes ago. 

Brendan: You’re talking about baseball, but philosophically, I feel like we could all apply that to our business lives and probably our family lives as well. I think that’s just tremendous advice overall, even outside of Logan and his baseball career. I love that. I think you’re right. 

It’s looking forward. You can’t dwell in the past.

Jonathon: There are a lot of parallels between baseball and life. There’s no doubt about that. I think there are a lot of parallels, which is why I think it is America’s pastime. I think that it relates to people in a way that other sports don’t, and it’s a thinking man’s sport, and it does draw a lot of parallels, and a lot of lessons he learns on the baseball diamond he is applying to his everyday life. 

Whether it’s at work, whether it’s in classes, whether it’s in his personal life, there are valuable lessons he’s learning, now, as a baseball player, that will absolutely help him in life in ways that, otherwise, people don’t have those opportunities.

Brendan: Absolutely. I’m grateful baseball’s back. I’m grateful to you for taking the time to speak with me today, and I’m just grateful that life goes on and we’re all doing the best we can in trying times, and it’s amazing to have people like you advising things, and to be a part of this thing. So, Jonathon, thank you so much for your time today. I really appreciate it.

Jonathon: I want to thank you. I appreciate you providing me with this platform to share with you my thoughts and insights on where this industry is going, on where the changes are, and how individuals like myself can help enable it to be successful. Gratitude is such a critical element to the day-to-day engagement with customers and patients, etc.

Thinking about new and creative ways to use platforms like Thnks to show value, to show gratitude, to align with culture, are so critical now, and they’re going to be an element that will have to be baked into these commercial models. It’s our responsibility to think about how to do that the right way, so I sincerely appreciate your time today and giving me an opportunity to weigh in on this and to help my fellow professionals think about how we need to adapt in this environment as well.

Saying Thnks can help you implement an attitude of gratitude across your business, and throughout its initiatives. Within seconds, users can send gestures of appreciation with professional connections by searching for an expression, creating a customized note, and sharing it via SMS or email. To learn more, book a demo!