Do Niche CROs have a Role in Drug
Development?
Dr Nermeen Varawalla, MD, DPhil (Oxon), MBA
President & CEO
ECCRO
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Role of Specialist CROs in Drug Development
Agenda
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Definition and place in CRO Market
Industry Analysis
Sponsor’s Perspective
Best Working Practices
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Segmentation of the CRO Industry
Main Categories of CROs
Large Full
Service Global
• Over 75% Market Share
• Enjoy disproportionately large share of sector growth
• Annual Revenues range from $250M to over $1B
Mid-Sized
• Approx. 15% Market Share
• At risk of being “squeezed” between two groups
• Annual Revenues range from $50M to $200M
Niche /
Specialist
• Less than 10% market share
• Highly fragmented, usually privately owned
• Include regional, therapeutic & functional specialists
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Complexity of Drug Development is Increasing.
•Increase in Mean Number of
diagnostic procedures performed per
subject
•Driven by
• regulatory need to enhance
pharmacovigilance
• quest for improved efficacy and
outcome data
•Global reach escalating
•Spend per accrued subject increasing
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In the Post Credit Crunch Environment
Imperative to
enhance the cost
effectiveness of drug
development is huge.
Real pricing
pressures and
competition amongst
CROs.
William Blair and Company, LLC, April 2009.
Survey of 19 biopharmaceutical sponsors
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Sponsors want more for less from their CROs
CROs able to meet
sponsor
expectations are
valued and rewarded.
William Blair and Company, LLC, April 2009.
Survey of 19 biopharmaceutical sponsors
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Engaging a Specialist CRO
Common Reasons for Selecting a Specialist / Niche CRO
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Expertise in a geographical region
Strength in a function
Relationships with leadership
Track record of delivery
Innovation and consistent quality
However,
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Fragmented market with a handful of leading players
More than 30% of respondents have no experience with niche vendors
Consistent usage is rare
William Blair and Company, LLC, April 2009.
Survey of 19 biopharmaceutical sponsors
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Engaging Niche CROs: Customer Views
Large Pharma
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Mixed Resourcing: in house +
full service preferred provider
Growing aversion to change
orders
Recognise and value specialist
expertise
Expect large CRO to subcontract as needed
Virtual Model
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Limited in-house project / vendor
management resource
More personalised & better service
from similar sized vendor, hence opt
for mid-sized
Cash available for high value
projects, but must be wisely deployed
Big is not always beautiful
ECCRO survey of 6 sponsors, August 2009
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The role of Specialist CROs
What do Specialist / Niche CROs offer?
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Best in class expertise in a region or function
Customised, flexible service
Engagement of experience
Potential to innovate and be creative
Drug development today needs big and small vendors
How best to work with Specialist / Niche CROs?
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Provision for resource cost for multiple vendor management
Niche CROs must fit in with big, global player
Clear and consistent value delivery
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Questions…..
Dr Nermeen Varawalla, MD, DPhil (Oxon), MBA
President & CEO
ECCRO
London, UK
Tel:
E-mail:
+44 207 1210173
[email protected]
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