By Mike Gibbons, RICP®

According to financial advisors, the pharmaceutical industry has several facets that set it apart from other industries. For instance, product development can take a dozen years or more, and regulatory oversight can be intense and drawn out. Furthermore, pharma’s business model usually emphasizes healthcare providers and governmental agencies over consumers. 

The pharma industry also stands alone as the sector in which turning a profit is no more important than contributing to public betterment. As such, the entire structure of pharma companies is unique and a little complex.

Pharma employees, whether they work in the lab, an observation room, or behind a desk, are a little different themselves. On the upper end of the salary scale in America, pharma employees have access to certain financial tools and opportunities that workers in other industries do not.

That’s one of the biggest reasons why pharma employees looking for financial advice are better served by finding a financial advisor with direct industry experience. And there are many other compelling reasons why this is the case.

Deeper Understanding of Pharma Challenges

A pharma-centric financial advisor keeps abreast of all the latest developments in areas like:

• Drug development 

• Product innovation 

• Regulatory compliance

• Other industry silos 

They understand the nuances and terminology of the industry and network regularly with experts in their field.

No matter what position you hold, a pharma-focused financial adviser has direct knowledge of all the issues that impact you and your finances. They make recommendations that have worked well for pharma employees in the past and keep an eye on future developments that could impact your finances.

Complexity of Pharma Industry Benefits

Pharma workers have access to a wide array of benefits that aren’t typically available to other industries. These benefits may include: 

• Complicated stock options 

• Grants 

• Drug development bonuses for R&D workers 

• Other pharma-specific vehicles

Stock options in particular can be dizzying to think about. Incentive, non-qualified, and performance-based stock options come with complex conditions, and performance-based stock options can come with complicated incentive structures. 

Pharma-focused financial advisors have seen many of the unusual conditions of these industry benefits. As a result, they can help you navigate your options more efficiently.

Pharma Workers Are Generally Paid Well 

Pharma workers tend to be on the higher end of modern salaries. This can bring some unexpected complications, though you might find it a “good problem to have.”

Those who are adept at investing and increasing their wealth could find themselves pushed into a higher tax bracket if their investment returns are great. Someone who’s just entered that stratosphere might be caught unprepared and run into cash flow problems.

Pharma-focused financial advisors have seen this happen too. They have developed strategies that can help moderate your wealth over the long term so you don’t get hit with surprise fees.

Navigating the Long Drug Pipeline

The approval process for new medical treatments, including pharmaceuticals, takes much longer than most other industries. Development is extremely expensive and takes place in a high-risk, high-reward structure. Many pharma companies offer stock options or other bonuses to those who have hit performance milestones.

This is one of the trickiest aspects of running a pharmaceutical business. It operates quite differently than the product development cycle of, say, a kitchen appliance. As an industry that hinges on this long pipeline, its employees are generally geared toward framing their finances against it as well.

While a pharma-focused advisor has no impact on the drug pipeline, they understand it as well as anyone outside the lab. They can tailor their financial advice to employees who direct drug development and take a longer view of their future.

Find Unique Solutions With a Pharma-Focused Financial Advisor

Whenever you can find an advisor in any field who specializes in your field of interest, you’re likely to get more targeted and directed guidance. Given the complexity and volatility of the pharma industry, that’s especially true for pharma-focused financial advisors. 

Advisors at Gibbons Financial Group have extensive experience helping the pharma industry work toward financial stability. Call 224-419-5550 or email me at Mike@gibbonsfinancialgroup.com to schedule a complimentary consultation. And be sure to join our free webinar, Retiring Early From Pharma.

About Mike

Michael J. Gibbons is founder and president of Gibbons Financial Group, an independent advisory firm providing custom-tailored financial planning and investment management services to pharmaceutical and healthcare professionals and their families. Mike has over 25 years of experience and spends a significant portion of his day working with pre-retirees and retirees, focusing on asset management, Social Security and pension planning, as well as retirement income preparation. 

Mike has degrees in both business and psychology from Lake Forest College and currently holds his Retirement Income Certified Professional (RICP®) designation from the American College. Mike was named a Five Star Wealth Manager for 2016 and 2018* Mike is heavily involved in his community, having served on the Village of Gurnee Police Pension Board as a Community Volunteer and the St. Patrick’s Parish Financial Board. When he’s not working or volunteering, Mike loves playing golf and spending his time with his wife and children. To learn more about Mike and how he can help you, connect with him on LinkedIn, visit his website, and register for his free webinar, Retiring Early From Pharma, created specifically for professionals retiring from the pharmaceutical, biotechnology, and healthcare industries.

*Award based on 10 objective criteria associated with providing quality services to clients such as credentials, experience, and assets under management among other factors. Wealth managers do not pay a fee to be considered or placed on the final list of 2016/2018 Five Star Wealth Managers.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.