Effectively Managing Scientific, Technical, and Medical (STM) Subscriptions

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By: Beroe Inc. --

09 June, 2019

Effectively Managing Scientific, Technical, and Medical (STM) Subscriptions
ARTICLE

effectively-managing-scientific-technical-medical-subscriptions

By Praveen Ramachandruni, Customer Success Lead and Seenivasa Balaji , Lead Analyst

Abstract

Pharmaceutical and biopharmaceutical companies require scientific, technical, and medical (STM) information, which includes databases, journals, e-books, and magazines, to take informed decisions across business divisions such as R&D, finance, and law. Leading buyers across the globe manage STM information similar to academic libraries; however, the approach to STM management is complex and requires efficiency.

Buyers are finding it difficult to manage STM efficiently despite the supply market being consolidated by aggregators and leading publishers. This is due mainly to the lack of knowledge on internal demand, declining library budgets, limited resources to manage STM, increasing yearly subscription cost, and unorganized purchase practices.

This article tries to establish information on how the STM category is structured, and discusses opportunities available for it while explaining enablers for developing an effective STM category strategy

Category Classification

A majority of Fortune 500 pharma and biopharma buyers are classifying STM information under business intelligence as a parent category. STM information is primarily classified as journal and non-journal products.

category-classification

Current State of STM Category Management

Declining Library Budgets

A majority of Fortune 500 pharma and biopharma buyers are experiencing budget cuts, which restricts their negotiating power with leading publishers. This situation has driven buyers to prefer engagement with aggregators over partnership with publishers. Aggregators offer attractive discounts than leading publishers do, which allows buyers to control spending effectively. In addition, opting for more digital content further enables buyers to manage the category within their budget.

Consolidated Supply Market

The supply market for STM information is highly consolidated, with leading publishers such as Elsevier, Wiley, and Springer dominating the market. A majority of leading buyers conduct business with leading publishers, denoting their significance and relevance, which paves the way for a subscription model. Moreover, favorable research funding policies stimulate an increase in open access (OA) journals. Leading publishers further fuel this process by adopting it as a key business model (e.g., Nature Publishing Group and the American Association for the Advancement of Science [AAAS]). In addition, owing to the rise of digitalization, large publishers have also revamped their subscription model with bundles that allow access to non-journal content, particularly eBooks, reference works, and datasets.

Lack of Knowledge on Internal Demand

STM information is used globally across almost all business divisions such as finance and R&D. Hence, it is challenging to acquire knowledge on internal demand. This results in unwanted purchases that raise its costs further. Moreover, suppliers often hard sell their products with numerous features that may not be relevant for buyers. This contributes to additional cost increase, over and above all kinds of inflation. Global demand level also drives more individual purchases and duplicates purchase of the same content. This, in turn, necessitates streamlining of overall category-related purchases at a global level for buyers.

Best Practices

 

best-practices

 

Opting for only digital versions for ad hoc subscriptions and leveraging more of OA journals will enable buyers to reduce overall subscription costs. Cost optimization in a category can be achieved through demand management.
Biotech companies typically spend less than pharmaceutical companies do on subscriptions and publications. Due to relatively low demand for journals and other information services, biotech companies have limited account attractiveness amongst suppliers.
Hence, buyers will be able to benefit by using a hybrid model, which is a combination of both OA and paid subscriptions of leading publishers.

  • It is essential to identify the demand for research titles by observing two years’ usage history across business functions and users. This will enable the shortlisting of must-have suppliers and budget allocation to derive maximum account attractiveness. In addition, buyers should look for opportunities to reduce ad hoc or local sourcing of articles/journals/research papers out of contracts by developing a centralized internal compliance program that restricts individual purchases by stakeholders.
  • Opting for digital-only versions, especially for ad hoc subscriptions, will enable reducing overall subscription costs by around $500 per title.
  • It is essential to develop or identify key metrics that reflects the value realized out of supplier engagement. This will help buyers properly evaluate suppliers and choose the supplier that optimally addresses their needs.

Supplier Engagement–Best Practices

  • Buyers prefer content aggregators due to the ease they offer in handling licenses with publishers, necessary authentication, and simplified user interface to search for content of multiple publishers and database providers. This type of tool also tracks usage that allows buyers to cut down unnecessary subscriptions. However, it is necessary to evaluate whether aggregators have partnerships with all the required publishers.
  • Content aggregators are typically preferred for STM journals than databases that are still dominated by database providers, such as Informa and Wolters Kluwer.

Key Factors to Consider

  • Number of journal publishers available
  • Number of databases available
  • Tool features (presence of central repository and workflow tools)
  • Provision for print and e-books
  • Different pricing models available (licenses, bulk purchases, etc.)
  • Visualization and analytics
  • Complexities in integration with existing content

Buyers prefer annual license with aggregators by gaining knowledge of aggregators’ packages, databases, and other add-on features. Currently, the role of aggregators has changed from just aggregating the content to providing a unified platform to search for, purchase, and measure usage across the globe to support buyers in managing the category efficiently.

supplier-engagement-best-practices
 

Conclusion

Knowledge of historical usage patterns across business divisions enables buyers to forecast budgets efficiently. This, in turn, enables buyers to engage with the right suppliers based on demand. Engaging with aggregators offers cost advantages over leading publishers and also equips buyers to reduce wastage. Individual purchases can be reduced by framing a proper, global, centralized procurement policy. The future is expected to be driven mainly by digital content, which will be accessed through digital platforms, such as mobile apps and desktop platforms with integration of advanced analytics.




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