Clinical Research Trial Services
Clinical Research Trial Business Development
Summary - I make about $150K per year working 10-15 hours per week, mostly doing paperwork plus some business to business telephone sales. Some points: 1.) I worked hard to get to this point. 2.) I have a good staff that carries much of the weight. 3.) I am not afraid to pick up the phone and call other businesses.
Longer Version - Physicians are paid by drug companies to conduct clinical trials on drugs in development. This is an FDA requirement on new drugs. These trials can be rather lucrative. Physicians hire staff, invest in facilities, develop overhead, and ultimately, need a steady flow of new trials.
I worked in a related clinical trial business, noticed this and noticed that physicians were willing to pay to have someone help them acquire clinical trials. I knew how to do this, and started this business in 2004.
There is nothing mysterious about what we do. We keep in touch with drug company contacts (via telephone and e-mail), find out about upcoming trials, and get our physicians considered for those trials. I have two employees that do this part-time, both of whom would likely continue with a new owner if he/she so chooses. My employees like the fact that they can work part-time from home and make $20/hour (including incentives).
My main role in the company at this time (I used to do everything) is recruiting new physicians. Physicians are the ones who actually pay us (drug companies do not pay us).
So, we have two sets of clients - physicians and drug companies. We must call on physicians to keep a steady flow of physicians paying us to find them trials, and we must call on drug companies to keep studies flowing in, to keep our physicians happy so they stay with us and keep paying us.
I have found we must recruit about 12 new physicians per year to keep the status quo, i.e. yearly turnover among physicians is about 20%. I have recruited 5 new physicians into the group thus far in 2015, which is a good start to the year.
I currently work about 1.5 hours per week recruiting physicians. This is rather poor on my part, and speaks to why I am selling the business. I have other interests and am apathetic. I make about 30 phone calls per week, recruit one physician per month, so roughly 120 phone calls per physician recruited. If I worked 6 hours per week doing this, 480 phone calls per week, I would make a lot more money. A more aggressive person could make much more money with this business. I've done this for 10+ years, done pretty well, if I get close to my asking price, I can retire. If not, continuing on does not wear me out too much (as my wife likes to point out).
I can provide the buyer with proven salespeople who can find trials. I cannot provide the buyer with proven salespeople who can recruit physicians, since I have always done this myself. However, I once hired a salesperson who did this for us, and she recruited one site in about one month of work before quitting (which was about my pace), so the skill does not seem particularly unique to me.
The more tasks the prospective buyer can do, the more the buyer can transfer expenses to income. About $37K in expenses is payments to my employees (two sales reps and one clerical, we all work 10-15 hours per week). Work 40 hours per week instead of my 10-15 hours per week, you can turn my $166K income into $203K income.
BTW, this is NOT telephone sales to private residences at dinner time. This is business to business calling, during business hours, to physician offices. People like talking with us about what we do. As telephone sales goes, this is fairly pleasant with a relatively high hit rate.
A buyer could take this business in different directions. Do what I do, make about $150K per yr. Hire a manager, make about $100K per yr. Take over all duties, and make $200K/yr.
I have all C-Corporation returns and my 1040 tax returns available for interested parties.