Life Sciences Industry Panel Series: Part 2 – Choosing NetSuite

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The coronavirus pandemic has nearly impacted every business in some way or another, and biotech organizations are no exception. We recently sat with a panel of life sciences executives to discuss how the pandemic has impacted their businesses, and while each had different experiences, all of them noted how much technology helped them persevere, especially when it came to automating business processes. Last time, we discussed how the pandemic impacted these particular life sciences businesses. Now we’re getting into why these life sciences organizations chose NetSuite for their ERP platform.

From starter software to NetSuite

At Sikich, we often see that a lack of controls can initiate the need for a new ERP system. In particular, we see a lot of companies start with QuickBooks in the beginning and move to a more robust ERP as the company picks up speed. Paul Griese, the founder of In the Black Consulting, said he noticed a similar trend. “Typically, companies start out on QuickBooks, and QuickBooks is a great starting point because it’s pretty cheap and really easy to use. But I think that the Sox controls and Sox compliance is a big driver [to move away from QuickBooks],” Griese said. “As companies are thinking about raising capital for clinical trials, being Sox compliant is first and foremost with the auditors.” “But there’s a lot of other benefits of moving to NetSuite [from QuickBooks],” he continued. “The reporting functionality and saved search can really allow organizations to build custom reports that are helpful for being more efficient. I think that having that additional reporting functionality really helps organizations assess how they’re spending their money and make sure they’re spending their money wisely as they’re developing their product pipeline.”

NetSuite for the IPO

Kevin Nee, the controller at Collegium Pharmaceutical, explained that Collegium couldn’t stay with its old system when moving to the IPO phase. He explained that the organization wanted to make sure it had a system that “better leveraged approvals for SOX prior to that [IPO] happening.” The tech team turned to NetSuite for the transition, because they “felt it gave the right amount of approvals and things in the system that could be leveraged for SOX but was also intuitive enough and flexible enough to support the finance side without over-complicating things.” He went on to say that NetSuite helped them figure out everything the company needed to do for SOX. Nee also added that NetSuite helped them pinpoint how inefficient they were with everything they were having to do outside of their old system. With NetSuite, they were quickly able to see how much they could leverage this system to achieve the SOX goals as well as customize it for their particular business operations. “NetSuite has a great ability to customize reports, but I think one other thing that we focused on was when we do controls or we do things, when we tie out stuff to NetSuite, can we leverage those canned reports? Can we set things up so that when we do stuff, we don’t have to take things and manipulate them and we can make it as straightforward as possible,” Nee explained. “Creating custom reports is great for people in FP, and we wanted to make sure that we had the flexibility to do that. But I think what’s been really beneficial to us is trying to keep things simple, figure out what the requirements are, figure out what the process should be, and then leveraging the technology to make that happen, as opposed to letting the technology determine what your process should be.”

NetSuite makes auditing easier

Kuram Choudhry, the accounting manager at Imara, Inc., echoed Nee’s sentiments on SOX compliance and simplifying reports. He said that NetSuite was “a great system specifically when it came to SOX.” However, he pointed out how much NetSuite helps his department with the monthly close process. For starters, “being able to just see the steps that we need to take and having clear evidence that you’ve taken those steps, from an auditor’s perspective, that’s key.” He explained that audits are more digital now than they were before, since the audits are able to rely on the data output from the ERP. With all of that fresh data, the auditors can take a risk-based approach based on the data and analytics they are now able to do. “This is the first year we have NetSuite, and I’m going to say I’m most looking forward to the audit to be able to say, okay, a lot less work I need to do,” Choudry joked. This post is part 2 of a 7-part blog series from our Life Sciences Industry Panel regarding adapting to new technology. You can watch the full webinar here. The next post in the series will discuss managing relationships with CROs and other vendors during the pandemic. Follow the entire series here.
This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

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