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Five industry veterans discuss the growth, impact, and evolution of outsourcing.
As pharmaceutical companies are tackling more complex issues, they are looking for allies to help them navigate these challenges. This requires more of a partnering approach, whether that means portfolio management, financial risk-sharing, outsourcing an entire function, and/or both clinical development and commercialization in non-traditional and emerging markets.
How can outsourcing be expected to help transform R&D? And, in turn, what are the barriers to transforming R&D?
John Ratliff (President and COO, Quintiles): We've had success primarily because we can manage clinical trials and commercialization projects predictably, and with greater efficiency based on the scale of our operations. We are now conducting more clinical trials than any other entity. This allows for faster, smarter decision making, allowing biopharma to focus its resources on its priority products.
We're also able to develop new models and endpoints, for example, through the use of biomarkers. Biomarkers can be game-changers within product development. Quintiles recently worked with a customer to improve the robustness of a reagent they had developed internally for use in an early phase setting.
In parallel, a diagnostic company built a kit for the assay that would be used to stratify patients in global Phase II and III trials. Our experience with the prototype assay and global laboratory network allowed us to work seamlessly with the diagnostic company to deploy the kit in our laboratories. We then were able to bridge the gap between biopharma and diagnostic companies with seamless development and deployment of an assay.
This enables the customer to enroll fewer patients in the Phase II trial because they will be able to pre-select those patients with the highest probability of responding to the candidate drug while maintaining the same statistically powered trial. In short, this use of a biomarker can make development faster and less expensive. If the kit pans out in Phases II and III, it can then be employed by the pathology community in selecting patients for the therapy once the drug receives approval.
The most daunting barrier to transforming R&D in the biopharmaceutical industry is legacy. Biopharma has worked with an approach for many years that worked quite successfully with blockbuster drugs. It's tough to change a model that has brought success and saved or enhanced literally millions of lives. Today, as they're getting into some of the more complex disease areas, our customers are feeling the pressures of ballooning costs, patent cliffs, and a regulatory environment which has become increasingly demanding. All of these factors combine to form huge barriers.
Facing all of these pressures, biopharma companies are faced with choosing what they will and won't do as a future strategy. A big factor there is identifying their actual intellectual property. It's here that we as the outsourcing community bring a lot to the table.
The ability to operate successfully in emerging markets could be a barrier. We've attempted to anticipate both the problem and the opportunity by employing 20,000-plus employees in 60 countries. Large global trials require a large number of participants, often in the tens of thousands. This makes access to patients critically important now and in the future. To aid access we've developed online resources such as ClinicalResearch.com/ and iGuard.org/.
When it comes to R&D, what are the opportunities to improve the return on product development and approval expenditures?
James Macdonell (VP of Solutions, Patni Life Sciences): Undoubtedly, the most important decisions are the efficacy and safety decisions to select the research initiatives that will survive the regulatory process attrition and yield newly approved drugs with a substantial portion of the patent protection period still intact. These decisions must be made as early in the development process as possible.
Continuing to invest in a compound that ultimately fails gets progressively more costly as the investment continues. Early correct selection of "approvable compounds" is the most important means to improve the return on product development and approval expenditures. It is not a matter of "failing fast" but rather "succeeding fast."
The second most important control point is to reduce the duration of the clinical study. Extended phases and delayed activities including selection of the clinical research organizations; patient recruitment; data collection; data cleaning; adverse event analysis; statistical studies; and submissions and requests for additional research all add to the duration, cost, and loss of return on the clinical investment. The third control point is improved efficiency, improved data management, improved access to existing data, and optimizing investments that are not product development oriented.
There are best practices in clinical and clinical IT that drive improvements on the return on product development, reduce duration of studies, and yield the efficiency improvements stated above. These include:
As senior management turns its attention to these initiatives, a company's outsourcing partner's capability in clinical studies, clinical applications, technology, and regulations, along with its ability to deliver strategic services at optimal pricing, will be critical to the provider's success.
What has been the impact of the growing prominence of India and China, which both showed significant GDP growth despite the financial turmoil in United States and Europe?
Stewart Geary, MD (VP and Global Safety Officer, Eisai Company, Japan): My personal view is that it points to two important ways forward for the industry: First, China and India are growing as markets for pharmaceuticals with prospects for sustained growth rates much higher than in the developed world as their economies grow and the percentage of the economy devoted to healthcare increases. Both of these large countries have a diversity of domestic manufacturers and marketers of pharmaceuticals. Foreign companies bring to the markets a wealth of experience in clinical development and reputations for quality and consistency in manufacturing which give them potential advantages if they can provide products at accessible prices. Second, and related to the key question of providing innovative pharmaceuticals at prices healthcare systems can afford, both India and China need to be integrated into pharmaceutical supply chains in ways that assure quality and lower the "costs of goods" for multinational pharmaceutical manufacturers for both small molecule drugs and newer "large molecule" biologicals. Neither high quality nor low cost are accomplished without careful planning—the companies who learn to achieve both sides of this combination reliably will have an important tool in overcoming the patent treadmill that the industry currently finds itself struggling to outrun. Although the development of new medicines which create significant advances in patient care will always be key to our industry, I believe we are too quick to assume that everything else that goes into delivering medicines of high quality to patients falls automatically into place. Working to be successful in China and India while at the same time harnessing those countries' abilities for the international pharmaceutical market may help the industry take this lesson to heart. Large pharmaceutical companies would be wise to devote more resources to developing their presence in these markets than their current world market share suggests. Smaller venture companies should keep in mind therapeutic areas such as chronic hepatitis or infectious diseases, which are of greater importance to the developing world. Both smaller and larger companies need to understand when and how to—and, equally important, when not to—go to these markets for clinical trial sites used in global new drug applications.
With healthcare reform now a reality, drug makers are facing comparative effectiveness and outcome-based pricing as lawmakers seek to expand healthcare access while cutting costs. How does a CRO work with sponsors to determine which drugs are likely to fail and determine the best strategy? What is their role in establishing a clear biosimilars pathway in the United States?
Josef von Rickenbach (Chairman and CEO, Parexel International): The passing of the healthcare reform bill in the United States has removed some of the overhang on the industry. For biopharmaceutical and CRO industries, healthcare reform will be neutral to positive overall. One benefit for the biopharmaceutical industry is that roughly 30 million new customers will now have some type of insurance coverage to pay for prescription drugs.
Based on several market dynamics, including healthcare reform, we have seen an increasing focus in our consulting area related to guiding clients with reimbursement and market access strategies. Companies need to understand the needs of both regulators and payers if they want to achieve commercial success. Our experts help biopharmaceutical companies understand market access implications during development, in order to better leverage evidence-based or outcome-based medicine, and eliminate access hurdles by demonstrating patient, payer, and provider value.
The healthcare reform bill has also created a regulatory approval pathway for biosimilars with a requirement for extensive clinical testing. Our experts are assisting companies in discussing their development plans with regulatory authorities, then deciding on whether to participate in the biosimilar opportunity or pursue traditional biologics license application pathways instead. We've worked on half of all biosimilars on the market today and have supported the first approval for a biosimilar product in Europe.
How has outsourcing continued to evolve in your sector during the past 18 months and why?
Evan Demestihas, MD (CEO, The Medical Affairs Company): In the last several years we have seen a significant shift in the outsourcing of medical science liaison type of personnel (MSLs). It is now much more common in the realm of R&D compared to its traditional roots within company's commercial-side medical affairs departments. Outsourced MSLs continue to be deployed as field-based medical affairs resources supporting both peri-launch and commercially available products, with the common objective of educating their key opinion leader physician audiences on the disease state, treatment options and, in an unsolicited manner, new product developmental advancements that may significantly alter the current standard of care. It is without question that the industry has recognized the MSL, whether outsourced, internal, or a mix of both is a proven strategy in support of launching and/or supporting a company's commercial portfolio.
As product candidates have become more advanced, having complicated clinical trial protocols as part of their design, R&D executives have come to recognize the traditional administrative-type clinical research associate (CRA) resource they utilize (the majority of which is outsourced) simply do not possess the clinical skill sets necessary for educating principal investigators, site personnel, and surrounding community physicians about these complex protocols, disease states, and inclusion/exclusion patient criteria. Expanding upon the proven MSL clinical resource concept, R&D has deployed clinical trial liaisons (CTLs)—individuals distinct from CRAs in that they are significantly more educated and knowledgeable around the scientific premise for the clinical studies being conducted. CTLs provide valuable insight to practicing physicians who are then in a better position to refer appropriate patients to be considered for enrollment in the study. This of course can lead to quicker enrollment and eventually more timely completion of pivotal trials that can significantly hasten the approval process. The financial impact of an earlier NDA filing are obvious and many organizations have become increasingly aware of the significant value CTLs can provide.
As the pressures on R&D have accelerated over the last several years, the outsourcing of this function has become more commonplace. Unable and/or unwilling to hire internal personnel to provide this valuable service, pharma has evolved the model of outsourced MSLs to now include outsourced CTLs. Contract medical organizations have significant expertise in effectively managing these personnel and clearly understand the regulatory and compliance factors critical to their proper use to the extent that outsourced CTLs are now one of the fastest growing segments of the contract field-personnel sector.
Editor's Note: This article was adapted from an article that appeared in the November 2010 supplement Inside Outsourcing, produced by Advanstar Communications' Pharma/Science Group.