CRO Trends in 2015

29 Jan

By Alejandro Zamorano, VP of Business Development, LSN

Alejandro 10*10

LSN maintains regular dialogue with a broad spectrum of contract research organizations (CROs) – from top-tier full service organizations, to small niche-specialized research companies; some are customers of the LSN Company Platform, and others are friends.  Every year we talk to hundreds of business executives in the field. Based on our market insight, here are the top trends we see in 2015.

The Monetization of Data

CROs are beginning to realize the power of their clinical data after years of ignoring this information. Some established CROs are even monetizing their data set by anonymizing the data, providing incredible insight to researchers.  This should also help companies on deciding when a trial should be killed, and whether a drug is a worth pursuing when a sub-population seems to respond the treatment. In an ideal world all clinical data should be standardized for analysis, but this is a great first step.

The Death of the Undifferentiated CRO

The CRO industry has exploded over the past 5 years, and competition is fierce. By searching the LSN Company Platform, one can find profiles of 859 clinical trial providers globally. Standing out amongst the vast herd is becoming harder, and most are competing on location, speed and increasingly price. In order to stay competitive sales teams have started to target biotech companies as early as the discovery stage, in order to form a relationship before others come knocking on the door.

To differentiate themselves CROs are developing and in-licensing unique technology platforms such as unique analytics, manufacturing capabilities, animal models, and biologic expression technologies. In 2015, don’t be surprised if CROs start competing with big pharma for access to these unique technology platforms.

The Search for Patients

Finding patients is often the hardest part in putting together a clinical trial, especially if the trial is in a rare disease field. Today CROs are looking to partner with diagnostic companies to identify specific patient populations for future studies. This close collaboration between diagnostic companies and CROs will change the manner in which the industry conducts its business, and will reap huge benefit to patients looking for access new therapeutics.

Exclusive Agreements with Big Pharma

The majority of R&D expenditure is consumed by big pharma and some CROs are tired of competing with others for a slice of the pie. Thus, larger CROs that have the necessary capacity have started to offer their biggest customers massive benefits to form exclusive partnerships. These include reduced pricing, full time core employees, standardized reporting and analytics, increased transparency, and reserved excess capacity in order to provide services on short notice.  The industry is getting more competitive and exclusive structures is just one of the many ways CRO’s are adapting to this environment.

2015 will be an interesting year for CROs, as the increasing competitive nature of the industry will allow only the strongest, most adaptable companies to enjoy market growth. LSN will continue to track the key market dynamics affecting service providers going forward.

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