Clinical Trials

Clinical Trials Global Market Outlook:

• The global demand is expected to be $43.7 billion in 2022 and will grow at approx. 6.5—7 percent CAGR through 2020–2026

• Focus on biologics, personalized medicine, and increasing complexity, in terms of protocol, study procedures, trial design, patient recruitment, and globalization of clinical trials demanding regional regulatory compliance are the major factors driving the market

• Availability of a large patient pool, coupled with cost-saving opportunity, due to reduced labor wage, is shifting the focus to the emerging nations

• Large CROs have been continuously expanding their supply base through acquisitions and partnerships to provide integrated services

• Of the site investigators, 52% expect a change in site models that is more inclusive of pharmacies and local or pop-up clinics.

CRO Market Size

• The global CRO market is estimated at $46.7 billion in 2023E, and it is expected to grow at a CAGR of 6.8–7.2 percent to reach $61 billion by 2027F 

• This is due to the increased outsourcing seen from the pharmaceutical and biotechnology companies, with 75 percent comprised by the clinical segment

• The focus of CROs have increased onto various post approval commercial offerings owing to increased development in technology and data analysis

• Although spend on specialty focus, such as rare diseases, personalized medicines, and specialty oncology, has increased, the larger portfolio by spend size would continue to drive the CRO market

• Almost 75 percent of the global CRO market revenue comes from the clinical CRO market. This is directly related to about 70 percent of Phase II–IV activities already being outsourced by pharma companies

• Several Pharmacy chains have entered clinical trial space especially in US like Walmart, CVS Health and Kroger Health

• Emerging markets, such as BRICS (Brazil, Russia, India, China, and South Africa), have seen increased outsourcing in recent years

Cost Drivers and Cost Structure

• The factors that contribute the most to costs across all the trial phases include patient recruitment involving clinical procedure costs, vendor fees, site related costs, clinical procedures cost, data management and central laboratory costs

CRO Market Drivers

• Pharma companies have increased outsourcing their in-house R&D activities to CROs. Owing to COVID-19, industry has witnessed 1.5-fold increase in sponsor and CRO collaborations and interactions

• Large molecule development outsourcing has increased from ~35 percent to 45 percent, due to more supply and availability of reliable single use technology

Cost Containment:

• Pharmaceutical companies one of the major factors is to reduce costs, by lowering their internal capacities in manufacturing and R&D. This leads to expenses being diverted toward outsourcing, making CROs play an integral part of pharma to increase their productivity, access new capabilities, shift fixed to variable costs, and improve their global reach

RealWorld – Data and Analytics:

• As regulators and payers place increasing importance on RWD, pharma is seen to partner with CRO, to support with predictive modeling, analytics, etc. This is driving CROs to either acquire or partner with specialists in this area

• For instance, in January 2022, Medidata announced that it had entered in to an exclusive partnership with Circuit Clinical to expand its DCT capabilities by accessing a network of 90 doctors across 30 site locations

Emerging Markets:

• The emerging markets of Brazil, China, Russia are witnessing increased trials, creating demand for regional CROs, with strong regulatory knowledge. Demand for patient recruitment for niche areas is also driving CROs growth

• Examples: Offshoring of HEOR, pharmacovigilance services to India offer cost saving of ~30–45 percent

New areas of Research and Regulations:

• The increased focus of pharma on large molecule therapy, cell and gene therapy, rare diseases, specialty treatment, point of care assays, and personalized therapy & devices will require clinical trial testing and submission of data to the relevant regulatory authorities

• Also, the depth of regulatory scrutiny has increased, such as early RWD collection and reporting every adverse events, driving increased clinical trials