In the last decade, industry has changed operations of clinical research from a vertical and fixed reporting model, with a large number of in-house professionals dedicated to clinical studies, to a matrix model involving both internal and external resources, and then gradually moved the bulk of the work to Contract Research Organizations (CROs). To discuss why and how this happened is the main purpose of this article, and how it impacted the work done in the countries where the trials are conducted.
Until the end of the 20th century, Big Pharma and small pharma/biotechs behaved very differently in their outsourcing strategies. Smaller companies and biotechs have always relied on outsourcing, because they did not have the manpower to do the work internally. Big pharma, on the other hand, used to utilize internal resources end-toend, that is to say, from protocol conception to execution and oversight, all was done and managed by in-house employees. This was especially true for global trials, conducted in North America, Western Europe, and in what we now call emerging countries. Clinical research was then considered an activity of strategic importance, mainly because it could facilitate market acceptance after the launching. Clinical study protocols, mainly in late-stage development, were conceived at headquarters and implemented by the Medical Departments of the country affiliates, who were responsible for contracting with key opinion leaders to recruit and observe the research subjects. Monitoring was done by pharma employees, who usually developed a good relationship with the clinical investigators and the study site teams. CROs were used for specific tasks and specific regions, since most of them did not have capabilities in every country.
As the industrial approach to clinical research spread from the USA and Europe to most parts of the globe, the number of clinical studies increased continuously and they became larger.1 The pressure for tighter timelines increased, leaving relationships as a second priority. Even Big Pharma started to have difficulties to cope with the increased workload, leading to an increase in outsourcing. CROs also developed to increase their global reach, and became companies as large as Big Pharma, with publicly traded stocks, and aggressive business development actions. Widespread use of ICH-GCP guidelines also helped the multi-regional clinical trials, and the efforts to build world quality standards (see http://mrct.globalhealth.harvard.edu/, accessed on May 3, 2015). In-house Clinical Operations initially saw the CROs as competitors (some still do), but they began to be squeezed by R&D Finance to cut costs and increase productivity, and finally to decrease headcount. The result was an emptying of talents in the pharmaceutical industry, and a transfer of valuable human assets to the competitive employment marketplace of CROs. After just a few years of global contracts transferring the operations, a constant growth of the CRO can be seen, with experienced personnel managing the trials and nurturing the relationship between sponsors and contractors.2
This is not only a non-return path that reshaped pharma industry’s R&D business model, but also a new working approach for the CROs. More and more, the fast growing and competitive CROs landscape was incentivized to put forward a broader range of services with value added propositions. It is not only about cost savings anymore, it goes further to building partnerships. Global alliances with multinational pharma and biotech companies is a prize that sustains this growth and leads to consolidation of international CROs. There is a lot at stake for both sides, with drawbacks that may only surface along the years, but also with evident benefits in the way pharma is investing to innovate. For instance, the valuable knowledge and experience gained about a compound in development is a benefit that goes directly to the CRO hands, and may be passed to future projects from other sponsors. Looking ahead, CROs may possibly evolve to be future competitors in the drug discovery business. From the contractor perspective, the development of trustful relationships, allows them to focus in other innovative activities, and target investments accordingly. There are examples where Big Pharma is currently focusing on: the development of frameworks for a paradigm shift to deliver clinical trials through integrated healthcare systems, building networks with high performance sites key opinion leaders, and investigators shaping the environment, where patient centricity is at the heart of the study success. Technology advances have gained a boost, because CROs must be more efficient to survive and they now have the muscle for investing heavily in technology for clinical trials, leaving pharma more open to other initiatives, such as Transcelerate, for example, a non-profit organization created by several pharma companies in 2012, "to facilitate the implementation of solutions to drive efficient, effective and high-quality delivery of new medicines". (http://www.transceleratebiopharmainc.com/)
The relationship management between Sponsor and CROs has become strategically important, and has promoted greater integration between service providers and sponsors. Feeling that one is an integral part of a drug development process, and not only a service provider, certainly makes a big difference. Having a portfolio drug in development at a CRO could be risky in terms of timelines and relationship,3 so engagement of CRO leaders in the decision making process is of crucial importance. As long as the partnership evolves, industry and CRO leaders must work hand-in-hand to be able to accomplish established deliverables and allow innovative drugs into the market faster. It is a long road that can only be achieved with a win-win scenario, with all parts working together to the same objective: delivering new medicines to patients, faster and more efficiently.
The extent of tasks that may be outsourced was summarized by Lowman et al,3 as seen in Table 1. The most frequent used models currently are the outsourcing of individuals tasks or roles shown in Table 1, or full project outsourcing. In both cases, the relationship between CRO and pharma may take one of two shapes: preferred provider, or strategic alliance. The main question sponsors have to answer in their decision is how much control of the development process they are willing to transfer to the CRO.
Table 1. Functional Roles and Key Activities in Clinical Development Commonly Outsourced. (Adapted from Lowman et al, 2012)
The preferred provider model usually ensures that the contractor will have access to special price and priority with the CRO, in exchange for guaranteeing a big chunk of the work to be outsourced to the provider. The sponsor continues to be responsible for some of the tasks, usually those of oversight and management, for determining the procedures to be followed, and continues to interact directly with outside stakeholders, like investigators and regulators.
The full outsourcing model transfers the whole range of tasks to a CRO, which in turn creates a joint ownership of the development drug or program from the beginning of the planning phase. That gives the alliance a strategic importance for both sides. An additional evolution from the traditional outsourcing is the sharing of common business metrics and goals between pharma and CROs representatives, which goes beyond the contract commitments. With transparency between all parts, and putting CROs in the core role, it is a must to build a sense of collaborative development, so that deliverables are not at risk. From the sponsor's perspective, sharing all the portfolio details, allows a CRO to understand the priorities and be accountable for any negotiated outcome. From the CRO end, a clear understanding of the priorities allows appropriate resources to be allocated and projects to be delivered with efficiency.
In practice, however, it takes time to harmonize companies' cultures and put each and every collaborator on the same page. Until reaching this state, it can be very stressful to deal with sometimes undefined issues such as systems integration for data and payment delivery, different interests from pharma´s medical affairs, complaints from the sites, etc. For each side, there is a learning curve to be followed, which can be achieved faster with an experienced and open leadership team from both sides of the partnership. It is a long way until reaching a healthy and mature relationship, so building trust between all the parts and a culture of partnership are the fastest way to succeed through the process.
More and more outsourcing opportunities will certainly be seen in the next years, not only to specific study activities, such as data management, central lab processing, monitoring, but also for a broader range of business possibilities.
Pharma/biotech and CROs outsourcing indeed has it benefits and drawbacks. It can be a storm to align both parts expectations and interests. On one hand it may bring a lot more operational difficulties as more layers lay between trials decision making, contracts and payments stress, high turnaround of CRAs, longer time to provide answers to the sites and even Investigators relationship being affected with sponsors. On the other hand, the outsourcing allows a more holistic approach as it permits a different management focus to the sponsors and sites. An additional oversight to the study quality can be implemented, environment shaping with regulators and other stakeholders, dedicated personnel to support the development of clinical research sites and even integration between pharmaceutical companies in order to develop systems that facilitate site activities and information exchange.
So, what happened to that old Medical Director, who used to reign over clinical research activities in his/her country? He or she, by and large, lost the business. Internal resources in pharma are now extremely limited, even when the Functional Service Provider model is used. In many cases, the global alliances with CROs took from the local medical area the power to influence clinical research activities in the country. The responsibility for nurturing a relationship with investigators was transferred to a new growing professional job, the Medical Science Liaisons (MSL). The CRO has by and large taken over the decisions and communication with global study teams. The positive aspect for the internal pharma resources that remained is a more globalized relationship with peers with active experience exchanges, less hierarchical layers with more individual exposure and visibility. Also, working in different global initiatives with cross-functional teams empowered individuals to be involved in different scenarios for problem-solving. All in all, despite the difficulties posed by the partnership, new and different careers were developed in parallel, for personnel from both pharma and CROs.
References
- Rettig, R.A.- The industrialization of clinical research. Health Affairs, 19, no.2 (2000):129-146.
- Wadman, M. - The quiet rise of the clinical contractor. Nature, 441, 2006, 4 May 2006: 22-23.
- Lowman, M. et al - Innovation risks of outsourcing in pharmaceutical new product development. Technovation 2012; 32(2):99–109.
Lina Wang, PharmD, MBA is an Investigator Site Development Lead at Pfizer Brazil, performing activities in Latin America countries. She received her degree in Pharmacy Biochemistry at University of São Paulo and concluded Master in Business Administration at Insper, SP. With 13 years of experience in clinical development in Pharma, working closely with CROs and Sites development.
Eduardo F. Motti, MD is the managing partner of Trials & Training Consult (http://www.trialsntraning.com). He has over 25 years of experience in big pharma and CROs, working in clinical development and clinical operations roles in Brazil and Latin America.