Top Articles - Finance

Most financial consultants that work for a large global investment firm need about U.S. $50 million of assets under management to make a decent living in a metropolitan region.

Using this as a benchmark, let’s break down what this figure means to you as a client. It’s highly unlikely that a financial consultant has clients that all have account

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

s of $1 million or more, so let’s assume that he or she does not accept clients with less than U.S. $250,000. This could create a hypothetical tier of clients as follows.

# of Clients Account Size Cumulative Assets

20 U.S. $250,000- $

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

500,000 $ 7,000,000

50 U.S. $500,000- $1,000,000 $32,000,000

7 U.S. $1,000,000 + $11,000,000

77 $50,000,000

S

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

o it’s fairly reasonable to think that a successful financial consultant has 77 clients with U.S. $50,000,000 of assets under management.

Now let’s calculate how many hours a year this financial consultant will devote to your accounts. There are 52 weeks a year * 5 days/week * 8 hours a day= 2,080 hours a year that he or she will devote to his/

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

her accounts, assuming that he/she takes no vacation or holiday days. Most firms will tell their consultants to spend about 75% of all of their time every day engaged in sales activities. So that leaves 25% of the time for your financial consultant to dedicate to the management of accounts, or 520 hours (2,080 hours * 25% = 520 hours).

Almost al

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

l financial consultants place their clients into different tiers depending on how much money is invested with them. The U.S. $1,000,000 or more clients would be “A” clients, the U.S. $500,000-$1,000,000 clients would be “B” clients, and the less than $500,000 clients would be “C” clients. Financial consultants universally devote the most time to

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

the accounts of A clients, then B clients, then C clients. To simplify this example, let’s say that the financial consultant spends twice as much time with his A clients than he does with his B and C clients.

If 520 hours is divided in this manner, his 7 “A” clients each receive 12.38 hours of personalized attention a year, and his 70 “B & C”

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

clients each receive 6.19 hours a year. So on average, as an A client, you would receive an average of 1.5 days a year with personalized attention specifically for your account and as a B or C client, less than a full day a year.

For this level of personal attention you receive from your client, your financial consultant may earn $150,000 to $2

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

00,000 a year depending on the payout grid of the firm.

Now let’s consider what an independent financial consultant that devotes 50 times more time to your account than an financial consultant employed by a large global investment house ever possibly could. A great independent financial consultant is independent because he or she wants the flex

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

ibility to pursue superior returns for you versus being constrained by the payout grids of large investment firms that typically never reward great performance but rather just asset gathering.

Let’s consider this scenario. Because an independent consultant may be more discerning as to who he/she takes on a client, let’s assume that he only takes

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

on 20 clients each with accounts between $1 million to $5 million, with a mean account size of $2.5 million, for the same $50 million under management that we considered under our first example.

# of Clients Account Size Cumulative Assets

20

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

U.S. $1,000,000 - $5,000,000 $50,000,000

Now let’s calculate how many hours a year this independent financial consultant will devote to your account, assuming the same conditions as we did under the first scenario. There are 52 weeks a year * 5 days/week * 8 hours a day= 2,080 hours a year that he or she will devote to

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

his/her accounts, assuming that he/she takes no vacation or holiday days. Let’s now assume that since the independent consultant’s operations are much more streamlined and his or her objectives are different, that he spends 70% of his or her time focusing on account management, or 1,456 hours (2,080 hours * 70% = 1,456 hours).

Now all of the i

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

ndependent financial consultants’ clients would be “A” clients so he divides the amount of time spent on each one equally, devoting 1,456 hours/ 20 clients, or 72.8 hours each year to each account. Instead of receiving 1.5 days a year devoted to your account you now receive more than 9 full days a year devoted to your account.

So how much is th

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

is extra devotion worth? Let’s consider this scenario from a U.S. perspective, and you can certainly stretch this analogy to other global markets plugging in the relevant numbers for your market. Most U.S. investment firms tell you to expect about 6% to 8% a year because 98% of the money managers they utilize to manage your money peg their portfo

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

lios to the major U.S. indexes. However, for the purposes of our illustration, let’s take what the S&P 500 has returned over the past decade, roughly 9% depending on what start and end date you use. And even though an investment in the S&P 500, even with the 2006 year-end run, on an inflation adjusted basis would barely be above water for the pa

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

st 7 years, for the purposes of simplification, let’s ignore inflation for the time being. So let’s assume you receive 9% a year, have a $2,000,000 portfolio and pay your financial consultant 1.80% of assets, or an annual fee of $36,000 to earn $180,000 a year.

After five years, net of fees, in a non-taxable account, you would have about $2,826,

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

000 in your account if the fees were deducted at the end of each year.

Now a great independent financial consultant should be able to earn you about twice that 9% rate, an18% annual clip year after year because he or she is spending those extra days maximizing performance versus trying to gather more assets. So let’s say he or she charges you th

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

e same 1.80% of fees. After five years, net of fees in a non-taxable account, you would have $4,237,000 or $1,411,000 more than the financial consultant that is the salesman. In fact, even if the independent financial consultant charged you 12.5% of profits, you would still be left with roughly $4,156,000, or nearly the same amount, after five y

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

ears.

So there’s your answer. With an account of $2,000,000, in five years, a great independent financial consultant could be worth more than a cool $1,400,000 to you. So if you find one, look at these numbers again and be willing to negotiate paying more fees for infinitely better returns and ultimately a much significantly greater bottom line.

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

HTTP = HTML link (for blogs, profiles,phorums):
<a href="http://www.toparticles.org.ua/article/102182/toparticles-How-Much-is-a-Great-Independent-Financial-Consultant-Really-Worth.html">How Much is a Great Independent Financial Consultant Really Worth?</a>

BB link (for phorums):
[url=http://www.toparticles.org.ua/article/102182/toparticles-How-Much-is-a-Great-Independent-Financial-Consultant-Really-Worth.html]How Much is a Great Independent Financial Consultant Really Worth?[/url]

When you are starting a new business in Florida, you can set it up under sole proprietorship, a cooperative, or as a corporation. If you go with incorporating, it is the process of forming a new corporation, which can be set up as a business, a non-profit organization, or a new government of a new city or town.

When you see those announcements about people making tens of thousands or millions of dollars in a very brief period by selling on the Internet…you are not being told the whole story!

Debt consolidation loan is basically for those who are jeopardized by many a loans once at a time. The debt consolidation loans covers all your petty loans and make them a big but a single loan so that you are entitled to pay it off with reduced rate of interest. But it’s seen many people are having the same debt even after a couple of years!

Tags

Links

Top Articles - How Much is a Great Independent Financial Consultant Really Worth?

Related Articles: