The Scrip Clinical Research 25
The big boys remained entrenched at the top of the CRO League Table in 2009, but further down the ranks a string of partnerships, acquisitions and delistings added flavour to a dynamic market sector, writes Jonathan Hare.
The year 2009 was a tricky one for many CROs. The clinical outsourcing
industry had grown substantially in the previous two years (double-digit
growth was the norm for most of the leading firms), but as the economic crisis tore into pharma’s research spending, with a particularly negative effect on early-stage research, many CROs saw revenues slump as customers delayed or cancelled projects.
Clinical-stage CROs were hit less hard than those generating the bulk of their revenues from preclinical research – none of the major clinical CROs suffered quite as much as Charles River Laboratories, for example – but growth was still a fraction of that of the previous year. Still, the picture was not entirely dismal. For many of the biggest firms, the pharma industry’s efforts to fundamentally reshape the way it goes about
drug development began to manifest in the form of long-term strategic partnerships and innovative outsourcing arrangements.
The total market for clinical outsourcing, including preclinical and laboratory research as well as clinical trials, was estimated at around $22 billion in 2009, up from a little under $20 billion in 2008, according to consultancy Business Insights. The weak economic markets of 2009 motivated pharmaceutical firms to concentrate their resources on projects most likely to generate a near-term return. This was evident in the relatively sluggish demand for preclinical research. The bulk of growth came from Phase I-IV clinical trials, revenues from which increased by an estimated 18% during the year, although reports of project delays and cancellations suggest that the number of trials
actually being performed was slightly down.
top firms overshadow the rest
The CRO sector is dominated by a handful of very large players. Market
leader Quintiles Transnational is a private company, making it difficult to equate a precise figure, but SCR estimates that the top five clinical CROs held around 39% of the total global market in 2009, a little less
than that for 2008, which our estimates put at approximately 41%. For the top 10 firms in 2009, the figure was closer to 50%. Nevertheless, even as consolidation continues, the industry remains very fragmented, with more than 1,100 active CROs, although the majority of these are very small.
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Preferred partners strike gold
Quintiles cleaned up in the first three quarters of 2010. Things would have been different had
the CRO not secured a major preferred partnership deal, explains Joanne Payne.
Scrip Clinical Research recorded 131
individual trials with start dates
between January and September 2010.
In this figure, 22 individual CROs were
accounted for, 54 trial sponsors and 14
sponsor collaborations. 17 different therapy
areas were counted, and 25,747 patients
enrolled.
In terms of key partnerships, one major
contract, signed between AstraZeneca
and Quintiles Transnational, skews the
extrapolated data on account of the huge
number of trials covered by this single deal.
The data show that AstraZeneca alone
outsourced a total of 24 Phase I trials
to Quintiles in the nine-month period.
In collaboration with other compound
developers, such as Targacept, Bristol-
Myers Squibb, Pozen and MedImmune
(AstraZeneca’s biologics subsidiary), it
outsourced five trials, bringing the total to 29.
Quintiles also benefited from its
development contract with the Japanese
pharma company Eisai, which will develop
six potential oncology products through
to Phase II proof-of-concept for 11 solid
tumour indications. These trials take up five
places in our CRO Watch data, all beginning
in March and April.
Interestingly, if Quintiles had not secured
these preferred provider deals, the number
of trials it performed would have dropped
from its overall figure of 47 down to 13,
meaning that it would have conducted
fewer trials than rival CROs. Parexel
International, for example, won the contract
to conduct 16 new trials that we are aware
of, and PPD supported 15 known studies.
This shows that preferred partnerships
are becoming, if not the ‘bread and butter’ of
CRO business, a key catalyst to CRO activity.
As our CRO league table shows, they are a
very welcome addition to the transactional
business of providing clinical research services
to the biopharmaceutical industry.
With this in mind, Quintiles was the
CRO co-ordinating four of the largest trials
we have data for over this nine-month
period. Four Phase III studies, sponsored
by AstraZeneca and compound developer
Targacept, began recruiting a total of 6,116
patients with depression.
The studies are designed to assess the
effectiveness and safety of flexible doses of
TC-5214, when used as an adjunct therapy
in patients suffering from major depressive disorder who are currently failing to
respond adequately to antidepressants.
The trials are taking place at sites across the
US, Canada, the Czech Republic, Finland,
Estonia, France, Germany, Lithuania, Sweden and Puerto Rico.
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CRO 2.0
John Ratliff, chief operating officer of Quintiles, puts his company’s success down to its
‘four Cs’ offering, the decision in 2003 to return to private ownership and its ability to build
intimate customer relationships more typical of those offered by small start-ups. And one of
these days, writes Joanne Payne, people might stop calling it a CRO.
John Ratliff is 20 minutes late. When he
does make an appearance he apologises
profusely, explaining he had been with
the head of clinical at Millennium. “I was
always taught that the customer comes
first,” he chuckles in his West Virginian drawl.
This customer-centric focus could indeed
be the reason for my talking with the chief
operating officer of the largest CRO in
operation; not that Quintiles refers to itself
as a CRO, “because of the breadth of our
offering”, explains Mr Ratliff.
However, it comes top of the newly
published Scrip Clinical Research 25, a league
table of the top 25 CROs. It is also ahead
of its nearest competitor CRO, Parexel
International, in terms of the number of
trials completed. SCR CRO Watch data show
that, according to clinicaltrials.gov, Quintiles
started 47 trials between January and
September 2010. Parexel International had
a total of 16 studies.
When asked the secret to Quintiles’
success, Mr Ratliff highlights several factors.
Firstly, the “tremendous foresight” of its
founder and CEO Dr Dennis Gillings, and
the type of service offering that allows the
company to do away with the term CRO.
Its status as a private company, and its blendof science- and business-based personnel,
are also vital to its ferocious success.
entering the CRO world
Mr Ratliff comes from the business side of
Quintiles’ employee see-saw. He worked
for IBM for 19 years, and then with
telecommunications company Acterna
for four years, before joining Quintiles
in 2004 as chief financial officer. He was
promoted to chief operating officer and
president in 2006 and today is responsible
for the direction of Quintiles’ daily global
operations.
Several things drew Mr Ratliff to work
with the company, primarily the fact that it
is a service-based firm, a business model he
knew well from his time at IBM. Secondly,
the business is private, owned primarily by
Dr Gillings and private equity investment.
And thirdly, it is an international operation;
Quintiles does 60% of its business outside
the US, and again Mr Ratliff has experience
in this type of firm. “I wake up with Japan in
the morning,” he says, “and go to sleep with
New Zealand, with the US and Europe in
the middle.”
A successful business, as Quintiles
undeniably is, tends to be guided by focus
and strategy, and the right individuals to
persevere with that strategy, of which
Mr Ratliff is one. Dr Gillings attributed
Mr Ratliff ’s promotion in 2006 to his greater
role in driving commercial activity. “Nine
out of 10 companies have a strategy; it is
only one out of every 10 that executes on
that. We have a lot of capabilities within the
leadership team, as well as personnel that
are in front of our customers, so it is the
execution of that strategy that leads to a
successful outcome,” explains Mr Ratliff.
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 |
 eProgress
CRF Health has enjoyed increasing growth in the ePRO market.
CEO Rachael King explains the strengths of the company and where
it is headed for the future.
 Who are CRF Health and what do you do?
RK: CRF Health is a provider of electronic patient-reported outcome (ePRO) solutions for
the pharmaceutical industry. We’re a technology-enabled service company.
What’s your background, Rachael?
RK: I’ve got a degree in natural sciences from Cambridge. I’m a pharmacologist
by background and I worked for Pfizer for about 12 years, first of all as a discovery
pharmacologist and then in its biology computing group in an IP role. I then joined a small
Swedish company called MiniDoc where I stayed for another 12 years, first as a project
manager and by the end as company secretary and managing director of the UK
part of the company.
That company changed names many times; it became Araccel, then etrials; now it’s
merged, and also went public during the time I was there. That was a huge learning curve,
going from a large company to a tiny one and assuming many additional leadership
responsibilities; I learned a lot about finance and HR, as well as other departments. Nearly
five years ago I joined CRF Health as operations lead in Europe, and two years ago was
appointed as CEO.
Have you faced any challenges as a female CEO?
RK: CRF Health has a primarily European board of directors who all take people on their
merits. Gender has not come into it at all, so I’ve not really had any issues with credibility.
There is a style difference, but I don’t know whether that’s because I’m female, or just
because that’s me. Of course, in the pharmaceutical industry, there are probably more
women in the clinical trial arena than there are men, so it is very much a female-based
industry. I think the main personal challenges I face are just the normal ones that working
mums have, juggling the responsibilities of children and running the home with a busy job
and travel.
As a specialist in ePRO, could you explain how it’s affected the pharmaceutical industry
and how it’s changed since you joined CRF Health in 2006?
RK: In some ways it’s certainly improved the quality of patient-reported data, and over
the past five or 10 years we’ve seen much more emphasis, particularly from regulatory
agencies, on asking patients how they feel about their symptoms and ensuring that the
data are really good quality, rather than the paternalistic approach of the investigator
deciding how the patient is. This regulatory drive, particularly from the FDA, has caused a
growing acceptance of electronic methods rather than paper. I think the growth of ePRO
has accelerated. It’s a really good thing, because you’re actually getting direct feedback from
patients about their well-being.
You said that the market has grown considerably since you joined in 2006. How does
this compare to the growth of the EDC market in 2000-2006?
RK: I think the EDC market has grown more quickly. It’s now very unusual, particularly in
the US, to see a paper-based Phase II or Phase III study. They are done electronically. The
primary drive, though, for the growth in EDC was cost-efficiencies and the ability to create
databases much more quickly. I think the push to ePRO is driven more by the regulatory
environment and pursuit of quality. There are some cost-savings, but the reason behind the
growth is primarily quality rather than efficiency, whereas I think with EDC it was more about speed and efficiency. Not all trials have a patient reported
outcome, whereas all trials have a requirement for EDC.
What about CRF Health? Do you think the company is growing
at the same rate as the ePRO market, and what can you attribute
its growth to?
RK: I think CRF Health is growing much faster. In 2009 we
saw something like a 75% increase in net order intake. In 2010
we’re looking at another 50% growth in net order intake. We are
outpacing the ePRO market.
This growth is down to a combination of good sales presence,
high quality work, the very high percentage of repeat business that
we’re getting, as well as the fact that we innovate and are launching
new products. So we maintain and support our old systems and
products but continue to innovate with new service offerings and
products that work in the field. We’ve had very, very few issues with
any of our newly launched products, and I think customers desire
that reliability.
How is CRF Health different to its competitors?
RK: It’s all about continuous innovation while maintaining support
for our oldest products and services and looking to the future at all
times. We do invest heavily in R&D.
Health compete with these?
RK: Although there’s an “e” in ePRO technology, paper is still
very dominant; we also offer electronic diaries based on two main
platforms, Palm and Windows Mobile devices, that patients take
home. We also have the trial slate for site-based assessments and
are looking at other options too, such as IVR which, although not
actually interactive voice, is a simple number-based system that
we would be able to offer in partnership with a telecoms company,
should customers require it for certain types of trials. Then there’s
mPRO, using either a web diary or text messages for collecting
information, which we will be offering by the end of Q2 2011.
We will also have a digital pen system, and we’re investigating
partnerships to make that available.
The reason you need to offer all of these is because different
options work in different trials, countries and settings. So, what
we’re offering is the ability to provide the best solution for a
particular client, in a particular trial, in a particular region. It’s
being able to offer all the solutions we can, including advice and
help, to direct customers to the best solution, rather than trying to
persuade them to buy the solution we already have.
How has CRF Health’s technology platform allowed the company
to expand its service offerings and give it the competitive edge?
RK: Because we have a true platform and a designer, it means that
customers can use the same design on different platforms. So if, for
example, they’ve developed an asthma questionnaire for their Palm
devices, it’s very simple for us to put that on a Windows Mobile, or
to mix and match with other options so they can view all their sitebased
assessments through the same portal. Being able to offer such
fully-integrated solutions makes it cheaper and more efficient for
the end user, because they don’t have to keep learning new systems
for each of the technology offerings.
How can a sponsor make an informed decision on the best ePRO
option for their trial?
RK: This is where our experience can really help. We look at
their protocols and, through our PRO consulting group, we can
help tailor exactly the right solution. For example, if they’re only
recording three answers twice a month, it may be that an IVR
solution is the most efficient; if it’s a very intense study then we
may recommend eDiary. So we review the protocol, needs and
locations of their study and compare them with the historic data
we’ve collected across all studies, regions and therapeutic areas. We
can then help guide sponsors to the solution that will give them the
best quality data.
Is ePRO about science or technology?
RK: I think it’s about science, technology and service in equal
quantities. There’s a lot of science in selecting the right questions to
get the right answers in the right context, but the technology’s got
to be reliable – if it isn’t, you not only lose data, but you also lose
patients’ motivation. If something doesn’t work, they won’t use it.
So, it’s important that science and technology are wrapped in really
good service.
Being a global organisation, do you see a difference in the
adoption rate from paper to paperless ePRO in different
continents?
RK: Yes I do, but I don’t know whether that’s because of culture
or cost, or whether it’s purely regulatory. The FDA has been
explicit in its guidance document that sponsors need to be able
to confirm the exact date and time of all entries that can’t be done
on paper. So, if you’re submitting your data to the FDA and it’s a
labelling claim, then you need to use an electronic method. Europe
is following and has a very high usage of ePRO. You see less in
the Far East; it’s still very much paper-based, but that could be
because the regulators there don’t require it, or it is generally a more
conservative approach, or it could be that the cost of data entry
from paper is very low in some Asian countries. But if it’s a global
study submitting data to the FDA, then it will almost certainly be
electronic.
Where do you see CRF Health in five years’ time?
RK: We probably are in the top two of the ePRO vendors now. I
think we will be the number one ePRO vendor and I think we will
be offering the full range of ePRO solutions in five years’ time.
So, whatever your ePRO needs are, we will be able to meet them.
I think the mix of the technology offered will probably be a little
different; we’ll probably still be offering all the things we currently
have, but the adoption of the web diary and mPRO will most likely
be beginning to overtake the eDiary solution. We’ll be doing a lot
more work in the late phase studies as well.
For more information on CRF Health and its services,
visit www.crfhealth.com |
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