Groundbreaking Strategic Partnerships

April 1, 2013
Applied Clinical Trials
Volume 22, Issue 4

How Covance has achieved successful outsourcing relationships with pharmaceutical sponsors.

Covance is one of the world's largest and most comprehensive drug development services companies with annual revenues of $2.2 billion and operations in more than 30 countries. On behalf of its clients, Covance generates more safety and efficacy data for the evaluation of new prescription drugs than any other entity. The company, which employs 12,000 people worldwide, helped develop 32 of the 39 drugs approved by the US Food and Drug Administration last year.

Covance is driven by a strong commitment to people, process, and clients. Covance people are dedicated to the company's vision of bringing miracles of medicine to market sooner with a process excellence mindset that helps its clients reach major drug development milestones faster and more cost-effectively. Covance doctors, nurses, pathologists, scientists, and clinical researchers work side by side with its clients' medical and scientific leaders, providing experienced, ready-to-go teams that help clients bring their new medicines from laboratory bench to bedside. Strong teamwork and innovative thinking exhibited by Covance employees are hallmarks of exceptional client service.

With more than 10 years as a Six Sigma company, Covance works diligently to improve cost, quality, and value for clients. More than 400 employees have achieved Green Belt, Black Belt, or Master Black Belt status. Last year, Covance employees worked on 300 process improvement projects to help decrease development cycle time among other goals, capturing millions of dollars in savings.

Committed to strategic relationships

Among contract research organizations (CROs), Covance is uniquely positioned with a breadth of services that spans from pre-clinical to post-approval, a significant geographic footprint, and industry-leading experience in structuring and managing large strategic relationships. The company's groundbreaking 2008 strategic alliance with Eli Lilly—a 10-year, $1.6 billion service agreement and transfer of the company's Greenfield, IN, research facility—has grown organically to include six new service lines: nutritional analysis, sample storage, biotech services, biomarkers, specialty toxicology, and market access services. The site, once an internal cost center for Lilly, is now a thriving CRO facility that employs 500 people, most of whom are former Lilly employees, and serves more than 100 clients.

To help drive mutual success, the two companies worked together to establish key performance indicators (KPIs) to gauge the quality and efficiency of the contracted work and a joint, multi-tiered governance structure to oversee KPIs, project implementation, and critical milestones.

Two years into the original agreement, the Covance-Lilly partnership expanded to include an additional three-year biotechnology services agreement in which Lilly transferred bioproduct analytical testing to a $15 million biotech facility Covance built on the Greenfield campus.

The Covance-Lilly agreement has helped change the perception of CROs from a tactical provider of drug development services to a true partner. It is considered an industry-leading example of how CROs and biopharmaceutical companies can partner for mutual success.

In 2011, Covance once again led the industry by establishing a strategic relationship with Sanofi that was unparalleled in size and scope. The 10-year, $2.2 billion alliance, which included the transfer of Sanofi sites in Alnwick, England, and Porcheville, France, as well as revenue commitments for a broader range of services, is the largest-ever research and development outsourcing agreement. One of the more significant benefits of both the Lilly and Sanofi agreements is the economic impact on the community. In both cases, jobs were preserved and, in the case of Lilly's former Greenfield site, new jobs were created, and an industry that fosters scientific innovation continues to thrive.

Last year, Covance and Bayer HealthCare established a long-term strategic relationship in the area of clinical drug development including R&D services related to Phase II-IV clinical studies and central laboratory services. Through this relationship, Bayer plans to leverage Covance's broad range of experience and services to attain best in class operational delivery, efficiency, and quality.

As pharmaceutical companies work to reduce their cost structures and make fixed costs more variable, analysts predict that the trend toward research and development outsourcing will continue to grow. Outsourcing partnerships are financially beneficial and build a competitive advantage for both parties, and Covance's capabilities combined with an experienced management team and passion for patients make it an ideal partner for building collaborative relationships, both large and small.

Investing in the future

Covance's central laboratory services has been involved in one-third of all clinical trials and, as a result, has collected more than 20 years' worth of data. This data, combined with Covance's extensive clinical knowledge has been a key differentiator for the company. In 2011, the company launched Xcellerate®, an informatics tool that leverages the company's vast clinical trial expertise and data sources to expedite clinical trials.

By providing cutting edge site and investigator selection tools, clinical trial scenario planning, forecasting, and resource management, Xcellerate enhances the company's ability to increase the predictability of clinical trial performance, and helps to ensure more cost-effective and timely clinical trials.

In addition to Xcellerate, Covance has made significant investments in other information technology assets, which will help it to build world-class informatics capabilities. These technological advances will replace many manual labor-intensive processes with highly efficient reporting tools, providing clients with faster access to information and advanced visibility into critical operational data, allowing them to make more informed decisions at critical junctures along the drug development continuum.

It is clear that technological innovation will change the way drugs are developed, and Covance is committed to help drive this innovation.

download issueDownload Issue : Applied Clinical Trials-04-01-2013