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CRO survey: India, China dominate market

24 Nov 2012, BioSpectrum Bureau , BioSpectrum

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Contract and clinical research organizations (CROs) in the Asia Pacific (APAC) region are increasingly being leveraged by the biopharma industry to counter challenges of recession, patent expiry, rising R&D costs and dwindling productivity. BioSpectrum along with CyberMedia Research (CMR), a premier market research firm that specializes in competitive intelligence, advisory and consulting for life sciences and healthcare in the APAC region, carried out the '4th Annual BioSpectrum-CMR Survey' of contract and clinical research organizations (CRO) 2012, with an objective to capture the key trends in the CRO domain in the region.

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This year's survey shows that CROs are being leveraged by the industry for research insights into value, pipeline and processes. CROs are also benefiting from a good understanding of sponsors' systems, metrics, key expectations and work culture, which enable them to reduce drug development timelines, set-up costs and start-up time. The contract manufacturing industry in APAC is one of the fastest growing segments and is set to receive a boost in the coming years. There will also be an intense competition between APAC and Eastern Europe will emerge as the most-favored region for contract manufacturing.

APAC continues to dominate

Cost-effectiveness and the vast patient population seem to be the key driving reason. It is interesting to note that some others have preferred APAC for the readily available manpower with highly developed technical skills for quicker turnaround time in development. For some others, state-of-the-art infrastructure is one of the key reasons for focusing on APAC. However, uncertain regulatory hurdles are the biggest bottlenecks for clinical trials. Regulatory hurdles can be varied, ranging from clinical trial approval processes to requirements for marketing applications, logistics and transportation, and handling of biologic materials.
Click here to see why CROs choose APAC

India, China are hotspots for patient recruitment and trials

Unlike the west, APAC has been a fertile ground for patient recruitment, as the willingness among patients to participate is high, which can be traced to the large available patient pool. In addition, lifestyle and stress-related diseases are increasing rapidly amongst the Asian population, owing to increasing adoption of a western lifestyle. According to the survey respondents, China (19 percent) and India (26 percent), with their vast population, are the two key countries where the willingness to participate in clinical trials is high, followed by South Korea (15 percent).
Click here to see the hotspots for clinical trials in APAC

Quality, reliability, regulatory compliance, pricing, productivity and accessibility are key performance metrics for CROs
Measuring and tracking performance related to study at all stages of the clinical trial life-cycle has been given prime importance by CROs with intent to implementing cohesive strategies for improved efficiency and quality in clinical trials. CROs continue to collect data and metrics related to operational performance.
Click here to see how CROs measure their operational performance

Focus areas for APAC CROs

Contract manufacturing in APAC received a boost as major biopharma companies have started focusing on biologics manufacturing opportunity. According to 12 percent of our survey respondents, they are engaged in biomanufacturing. Early trends indicate that India and China are increasing their contract manufacturing. While some CROs provide a full range of early-to-late stage clinical development projects for their clientele, there are others who are diversifying and building up a niche skill area.
Click here to see the focus areas of CROs in APAC

Revenue is top priority
APAC CROs are gearing up to benefit from the changing ecosystem conditions and the possibilities for strategic partnership and pipeline development opportunities with the biopharma. CROs are working with a diverse set of clientele across the world. Revenue growth is the key priority for 25 percent of the survey respondents. For another 25 percent of the survey respondents, geographical expansion is the most important priority. Also, by expanding geographically, CROs are looking to serve their global clients better.
Click here to see the priorities for CROs in APAC

Average contract size for CROs in APAC is under $50 million
Asia-Pacific is home to mostly small- and medium-sized CROs with small dedicated resources. As per the survey results of the 4th BioSpectrum-CMR APAC Annual Survey, over 90 percent of the CROs operating in the region have an average contract size of $1 million-$5 million with each customer.

CROs focus on oncology
According to the survey, the top therapeutic focus area in APAC is oncology (65 percent). The survey results for the year 2012 are in line with the therapeutic focus area trends captured by BioSpectrum-CMR surveys in 2011 and 2010. The survey also revealed that cardiovascular diseases (25 percent), central nervous system diseases (19 percent), respiratory diseases (18 percent) and dermatology (13 percent) are among the key focus areas of CROs in APAC. Also, CROs are focused on a wide range of therapeutic research areas, including metabolic diseases, infectious diseases, pain management, hematology, anti-infectives, rheumatology, inflammation and ophthalmology.

Monetary benefits for volunteers
According to the respondents, some CROs do provide monetary incentives to participate in clinical trials. However, as many as 59 percent of the CROs surveyed across APAC said they provided monetary benefits, while 41 percent said they did not offer any money. Of the 59 percent who offer monetary incentives, 46 percent offer incentives amounting to less than $50, 36 percent offer incentives upto $100 and 18 percent pay volunteers upwards of $100.

Whats in store for CROs in APAC in the near future?
When assessing the key potential trends over the next three years for the APAC market, the 4th BioSpectrum-CMR Asia Pacific Annual Survey of the clinical and contract research organizations 2012 reveals that 23 percent of the respondents were confident about increasing business contracts. As many as 19 percent were optimistic about an increase in strategic partnerships with biopharma, while 13 percent of the respondents felt niche CROs will proliferate.
What is the business outlook of CROs over the next 3 years?

Survey respondents of this year attributed multiple reasons for their optimism about APAC market opportunities over the next three years, such as availability of experienced CROs, shrinking R&D pipeline of the biopharma segment, increasing R&D investment by the biopharma in strategic collaborations and cost pressures encouraging R&D outsourcing. The survey also revealed that outsourcing to Asia is increasingly moving from a tactical to a strategic imperative building upon the experience and rich expertise available in the APAC region.

As the biopharma segment's development pipelines continue to shrink and come under pressure, APAC will move from being just another market to becoming the central hub of novel drug discovery. As more and more biopharma companies shift their Asia headquarters to China, Chinese CROs are gearing up and adding more emphasis and importance to novel drug development. The Chinese authorities are proactively addressing the regulatory hurdles, while their 12th Five Year Plan has focused on healthcare and pharmaceutical innovation.

As many as 82 percent of the survey respondents indicated that the APAC market will consolidate. The results are on similar lines as the past year. Only 18 percent respondents indicated that the market will remain the same. Some of the survey respondents expect an increase in clinical trial activities over the next three years across phase I-to-IV. According to some respondents, Taiwan, Japan and South Korea are fast emerging as the future hubs of choice for strategic outsourcing.