Small pharma demand
“Trials are becoming more complicated, there’s more financial pressure – particularly those drugs incurring effects of patent cliffs, and R&D efficiency has not been great,” Mark Goldberg told us.
“All these pressures are causing pharmaceutical companies of all sizes to rethink their approach.”
Goldberg estimated pharmaceutical companies use commercial service providers for only 40% of the work that could be outsourced, but that would change, he said, as R&D spending grows, especially from small- and medium-sized firms.
Demand from SMEs was strong, with “a positive financing environment and lots of initial public offerings,” said the Parexel President, in part because “60-80% of intellectual property resides in small and medium companies, which is different from years ago.”
Strategic partnerships: ‘more intimate’
“There is a trend toward relationships between CRO and sponsor becoming more intimate and more strategic,” Goldberg told us.
Parexel is known to have strategic relationships with Pfizer and GSK, among others.
“In the old tactical way of outsourcing, we might find out about a project just as resources are needed but we’re not contributing to design the study.”
Now, he said, “we are being engaged more and more for our input and expertise. Then once a programme is up and running, the expectation of our clients is that we be proactive and find solutions to the issues.
“We’re given more visibility into the future of what the pipeline demands are going to be, so we can be prepared with the right resources in the right places.”
Goldberg said risk-based monitoring, a centralised system for clinical trial visits much cheaper than on-site monitoring, was made possible for its subsidiary Perceptive Informatics because firms in partnerships with CROs have made information more transparent: “In order to know when [monitoring] is needed, you need access to the data.”
Commercialisation: ‘another hurdle’
Whereas getting drugs to market used to be pharma’s major concern, commercialisation – ensuring drugs are profitably marketed, to reimburse backers for their investments – has emerged as another demand for outsourcing services, said Goldberg.
“The big hurdle used to be regulatory process. After that, your compound was more or less assured [of market success].”
Now, he said, “payers are creating another hurdle that pharma needs to get over” by increasing pressure on companies to demonstrate their products deliver enough value to justify the original investment.
In April 2013, Parexel acquired Heron Group, a biopharmaceutical commercialisation services provider. Its work involves “helping sponsors put together a portfolio or dossier of data that supports not just regulatory approval, but also reimbursement of a product by a payer, whether an insurance company or a government,” said Goldberg.
This could be “a compilation of the data that’s been acquired during clinical trials or, over time, observational research and additional work in order to build a case [for the product’s value].”