Global Market Outlook on Early Phase Clinical Trials
- The current phase I clinical trial market is valued at $14 billion and is expected to grow at a CAGR of 3–4 percent until 2018. The comparatively slow growth rate is a result of trials being conducted on a smaller population (20 -40) of volunteers, unlike late stage trials
- The FDA and other local regulatory bodies are providing further guidance and revisions for data and safe monitoring for early phase trials as a result of trial failures. The average per study cost for a Phase I trial is valued at $4 million with clinical procedure costs being the highest at $476,000 which contributes to 22.2 percent of the overall trial cost as of 2015
- South Korea is found to be the most attractive early phase destination based on the availability of global and regional suppliers, patient pool and regulatory scenario of the country
US and Europe will remain key regions for early phase trials holding greater than 70 percent market share. However, South Korea with its regulatory flexibility is an emerging destination with a CAGR of 8.2 percent, almost twice as rest of the world
Early PhaseCRO Market and Spend by Therapeutic Area
- The outsourced phase I market is estimated at $8 Billion and is growing at a CAGR of 3-4 percent. This market is comprised by CROs, Research Centers, Academic Institutes etc
- From the entire outsourced Phase I spend of $8 billion, pharma spends approximately $5.5billion with CROs for carrying out their early phase studies while the rest is carried out in-house or in collaboration with academic institutions
- The FDA and other local regulatory bodies are providing further guidance and revisions for data and safe monitoring for early phase trials, i.e. phase I trial, as a result of trial failures. The average per study cost for a phase I trial is valued at $4 million with clinical procedure costs being the highest at $476,000 which contributes to 22.2 percent of the overall trial cost
Growth Drivers and Constraints
High Trial Complexity:
- Early phase trials has the highest protocol complexity (14 percent) and a high work burden of 9.5 percent, since it involves healthy volunteers and patients. In-house facilities needs to have sufficient beds, equipment's and access to patient to carry out these trials.
Patient Recruitment & Regulations
- Country-specific regulations and access to patient populations can be managed efficiently by suppliers as they have local presence and have dedicated patient database
- Due to loss of patents for many drugs in the upcoming years and increase in R&D spend, pharma are looking to reduce costs. Reduction in fixed costs over the long run of the Phase I Unit can be obtained through outsourcing
High Supplier Fees
- High short-term R&D costs due to high supplier fees can be a problem over a short-term period; however, can result in savings over the long term.
- Provisions for unforeseen events (early termination of a project) could cause a sudden pause in trials creating a major delay in trial conduct.
- If a supplier with the right operational capability is not selected, they will be unable to deliver; resulting in increased need for pharma to oversee supplier operations
Complexity of early phase trials, involving both patient and healthy volunteers studies, is the main driver of outsourcing. Though cost reduction is seen over the longer term, high supplier fees initially and quality issues is still a challenge