The role of clinical trial contract research organizations, or CROs, has changed dramatically over the last decade.
While most smaller biotechs have typically tapped contractors to conduct research due to a lack of internal manpower, big pharmas are now also relying on them to test drugs around the world. That's a shift, with these third parties expanding geographic reach, increasing efficiency and broadening therapeutic expertise.
Still, biotechs know they aren't the no. 1 priority of the industry. But they're adapting.
Due to the depth and breadth of trials needed by a big pharma organization, most CROs give these clients preferential treatment, at least according to a small group of biotech CEOs at a panel hosted by BioPharma Dive during the J.P. Morgan Healthcare Conference earlier this month.
"This is my fourth biopharmaceutical development company that I've run as a CEO, and in almost every instance the CROs ...they give you little attention," said Marty Driscoll, CEO of Spring Bank Pharmaceuticals, Inc., which is currently conducting a global clinical trial program in hepatitis B patients and is also moving into an oncology program.
"We get much less attention than the large pharmas where they have preferred arrangements with and the bulk of the revenue is generated in those organizations," he noted.
While most of the CEOs in the roundtable agreed with Driscoll's assessment, the overall sentiment was that working with a CRO — while challenging — is a necessity for a small biotech, with ways to make the relationship beneficial even in the absence of preferential treatment.
"You have to use a global CRO if you're going to be in multiple countries, of course you do," he added. "But my experience is that they're all very much the same as a small biopharmaceutical company despite what they say to you when they're selling you their project. But you manage it, you just understand that going in, and what you focus on is the local people that are actually the ones implementing your trial."
While big pharma turns more often to CROs, the industry itself has been shifting as well. In just the last year there has been an uptick in consolidation in the CRO space.
German CRO Evotec picked up Aptuit for $300 million in August. InVentiv Health and INC Research hooked up in an all-stock merger to create a $7.4 billion company and one of the largest CROs, while Thermo Fisher Scientific acquired Patheon for $7.2 billion. Meanwhile, LabCorp strengthened its position in the space with the $1.2 billion buyout of Chiltern International, following its acquisition of Covance in 2015. And in 2016, Quintiles merged with IMSHealth to create the world's largest CRO in a deal valued at $9 billion (the company now goes by the name IQVIA).
All this wheeling and dealing among CROs has been a boon for big pharma clients looking for greater economies of scale, but not as fortunate for the small biotech, which can be overlooked by these behemoth service providers.
Still, biotechs are finding solutions to dealing with these challenges.
Driscoll recommends developing strong relationships with the members of the CRO team that actually have boots on the ground. Others say it's essential to have your own staff on the ground locally.
"[I]n my last company, we recruited for 230 patients requiring 58 centers in 18 countries. So that's complicated for a rare disease. And so it's difficult. In order to have that touch, you can't just rely on a third party that may have 20 clients that they're trying to satisfy," added Orchard Therapeutics CEO Mark Rothera, speaking about his time heading the commercial organization at PTC Therapeutics.
"It's very important to have your own team establish the relationship with those centers, and the purpose, and what's the whole point of this trial, and get them motivated."
Abivax CEO Hartmut Ehrlich agrees that it's important to establish some of the relationships through your company's own in-house team. The French CEO said there are just certain things that can't be outsourced.
"When you talk about the CRO, it's really important that you realize what do you ask the CRO to do," he said. Because we have one element here which is sort of the excitement of the site, which is the science that is behind it. These are things that you cannot source out.
"But the question around identifying your right study sites, and generating the excitement about your trial, that depends on sort of the questions that you are asking, what is the potential medical need you are addressing, and what are the data behind your ideas around the clinical trial, which has to come from the company," added Ehrlich. "It has to come from your science and it has to come from your relationships with the KOLs."
As Ehrlich alluded to, it's important for a small biotechs to establish what they expect from their CRO from the outset of a project. Communication is one of the key components that can make these relationships thrive. Establishing a point of contact for the company at each site and a point person at the CRO will also smooth things along. Importantly, a biotech should supply a CRO with any scientific knowledge or background that is unique to their current program.
And if all else fails, Rothera suggests a different option.
"One can also work with smaller CROs. You don't always have to work with the really large organizations, and there are smaller CROs that really like to work in sort of more niche areas. And so at Orchard we've deliberately chosen to work with kind of an Orchard-size CRO, because we're not talking about hundreds of centers in this case. We're talking about very specialized centers and fewer of them. And that can be a very good relationship," he said.