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Since 1993, investments from big pharma have helped develop a solid infrastructure favorable to CROs.
Global Trials Activity in the DetailsUkraine Emerges as a Viable Location for Global StudiesWhite Paper: Clinical Trials in Russia, Part 2White Paper: Clinical Trials in Russia, Part 1The Globalization of Clinical Trials
Leading pharmaceutical companies discovered Russia around 15 years ago. The first steps were rather difficult, and only the large multinational goliaths had the ability to overcome the barriers. Since that time, the situation has changed dramatically: ICH-GCP has been accepted as the National GCP standard, thousands of researchers around the country use EDC and Interactive Voice Response Systems (IVRS), and the transnational courier services will deliver study samples and specimen anywhere around the world within 24 to 72 hours.
According to the Federal Service on Surveillance in Healthcare and Social Development of the Russian Federation (RosZdravNadzor, RZN), during the period from January 2004 to July 2007, 305 foreign companies initiated 1003 international multicenter clinical trials in Russia. During the first six months of 2007, the FDA approved eight and the EMEA approved six drugs that had been tested in clinical trials in Russia. Clinical research is no longer exotic in Russia, and the rapid growth of the Russian CRO market is the best proof of it.
According to the Association of Clinical Trials Organizations (ACTO) of the Russian Federation, there are about 55 CROs operating in Russia, and every year, up to five new companies appear on the market. Known foreign players and new local CROs both join in. RZN data shows 57% of all the international multicenter trials in Russia in 2006 were initiated by CROs—the others, by sponsors.
Today, the annual volume of the Russian CRO market is estimated between $150 and $300 million, and 60% of that is shared by the seven top players (Quintiles, PSI Co Ltd, Clinstar, Evidence-CPR, Parexel, Icon, InnoPharm). The scope of CRO services covers all areas of drug development. The prices may vary depending on many aspects, including type of company. All CROs operating in Russia can be divided into three basic groups: global, joint venture, and local CROs.
More than half of all CROs operating in Russia are affiliates of the well-known global companies. These CROs have three basic ways to get to the Russian market. In the first scenario, after having conducted several trials from its offices abroad or via subcontractors, the company then opens its own office in Russia. It registers a wholly owned subsidiary, rents the premises, and hires and trains the personnel—both clinical research professionals and back-office personnel. This greenfield way is the most time consuming, but can to a certain extent guarantee high quality and compliance with the corporate rules and norms. A few examples of companies that have followed this path include Quintiles, which opened its first Moscow office in 1997, Icon (2003), PharmaNet (2004), and PRA (2003).
In the second scenario, the global CRO buys an established business from a local CRO or another international CRO. In this case, the company immediately gets a solid local presence. It can, however, encounter some postacquisition difficulties with the integration of different cultures, processes, and technologies. The level of investment depends on the size of the business being acquired. Companies that went this route include Parexel, which bought a local CRO in 1997; Kendle, which acquired Charles River Laboratories' local office in 2006; and AAIPharma, which acquired a local CRO in 2006.
The third type is the global CRO that prefers to save money on establishing local operations and works via local subcontractors. This approach may significantly reduce investment risks, but a thorough analysis is needed to choose the right local partner. PPD and MDS are examples of this model.
Other examples of global CROs in Russia include Hesperion, INC Research, MB Quest (a member of Pharm-Olam International), and Premier Research. Global CROs whose global resources allow them to offer a full scope of services are reputable in Russia for the high quality of services.
Most companies launch their first office in Moscow, which connects all major local transportation routes. The second office is usually opened in St. Petersburg—the so-called northern capital of Russia from which the northwestern region can be monitored. Then it's off to Novosibirsk, ideally situated for monitoring sites in the Siberian and Urals regions.
Joint venture CROs are established with the help of both foreign and local capital. A local partner can be represented by Russian research institutions or investigators in international studies. As they gain experience and familiarity with CRO practices, the most entrepreneurial ones want to start their own CRO business. Until recently, venture capital wasn't a widespread practice in Russia, so these entrepreneurs utilize their international contacts to attract foreign investments.
The most well-known example of this group is PSI, the largest CRO in Russia with headquarters in St. Petersburg and offices in the United States and six European countries. PSI was founded in 1995 and currently employs more than 600 people, half of them based in the St. Petersburg office. Other examples of joint venture CROs are Evidence CPR (founded in 1989 and headquartered in Los Altos, CA), RCT (founded in 2001 and headquartered in Princeton, NJ), and ClinStar (founded in 2000 and headquartered in San Francisco, CA).
Joint venture CROs have already proven themselves to be professional and versatile organizations that offer a wide range of high-quality services at competitive prices. Most companies have offices in Moscow or St. Petersburg.
The way local CROs are founded is very similar to that of joint venture CROs; the only difference is that local CROs use local capital. Some founders use their personal savings, and some have enough expertise to reach break-even points without external investments. You can find former employees of pharmaceutical companies and CROs among founders of such businesses. During the first 1.5 years, some of these start-ups can go out of business or be acquired by larger players. But their number is steadily growing, and today they account for about 20% of the total number of CROs in Russia.
The largest company representing this group is InnoPharm, founded in 1991 at the Smolensk Medical Academy. One of the top 10 CROs in Russia, it employs about 250 people. Other examples are Almedis (founded in 2006), Lege Artis (founded in 2005), Matrix (founded in 2005), the OCT (founded in 2006), and Synergy Research Group (founded in 2002).
The local CROs have the widest geographical span, with offices in Moscow, St. Petersburg, Smolensk, Yekaterinburg, and Novosibirsk, and typically offer a wide range of services by using their own resources and international outsourcing. The prices are competitive and depend on a company's size and services. The quality of local CRO services is proven by the growing number of contracts with international sponsors. A decade ago, sponsors considered local CROs primarily as a source for clinical research associates. Today, they trust local CROs to conduct and manage international trials, including project management, data management, and biostatistics.
Depending on the data source, the total number of monitors working at CROs in Russia varies between 2500 and 4000. Around 90% have MDs, a good number have postgraduate degrees (PhDs), and many have research experience. Usually, CROs hire personnel whose English language skills are no lower than solid upper-intermediate. If a candidate has no direct experience in clinical research, he or she is required to take a basic GCP training course. Companies offer their own training or may suggest an external course. The number of companies providing external training is constantly increasing, and their services are in big demand.
The choices for fresh CRAs are many—from basic one-day seminars to full-prep CRA five-day programs. After the initial training, personnel development continues, and new hires are trained on the company's standard operating procedures and policies. In addition to GCP and CRA training, many companies offer English language courses for their employees.
During the past several years, Russia has seen a growing number of world-class local project managers who can manage multicenter projects on several continents. These are professionals with many years of experience in different areas of clinical research who can conduct all steps of a trial—from A to Z—and who are equally competent in study design, Gantt chart preparation, and writing in several languages.
According to the Russian Federal State Statistic Service, the total number of physicians in Russia is 690,000. Local experts estimate that 8000, or one out of 86 physicians, are involved in clinical trials. For comparison, in the year 2001 every 14th physician in the United States was involved in clinical research.
Most Russian investigators are GCP-trained, can fluently read professional literature in English, and have good writing skills. Besides money, the motivating factor for their participation in clinical studies is scientific interest. Many sponsors notice that trials with "kick" often perform better in terms of subject recruitment and data quality.
The high quality of Russian clinical research is confirmed by the 36 FDA inspections conducted since 1995 (see Figure 1). No observations (no action indicated [NAI]) were found in 18 of the cases (50%), 17 inspections (47%) ended with the voluntary action indicated (VAI), and only one inspection resulted in the official action indicated (OAI).
There are more than 9500 hospitals in Russia, with a total capacity of 1.6 million hospital beds. According to the RZN report, as of July 27, 2007, 792 Russian sites were involved in clinical trials, leaving the other 92% as untapped potential. Investigative sites have all the necessary facilities for conducting clinical trials, including proper equipment, special storage conditions, and computers with high-speed Internet that support Voice Over Internet Protocol (VOIP). And many experienced sites are equipped with cutting-edge medical equipment. To ensure high recruitment rates, many sites maintain subject databases with a breakdown by different nosologies.
Besides hospitals, there are about 22,800 outpatient clinics in Russia, with a total screening capacity of 3.6 million potential subjects per day. The combination of researchers' professional ties with each other and their personal knowledge of their subjects results in speedy recruitment rates that are three to five times faster than in Western Europe and the United States. The number of investigator sites in Russia is steadily growing, with approximately 60 new centers every year and most of the growth taking place in the regions and not the capitals of Moscow and St. Petersburg.
During the past 10 years, the quality of medical care in Russia has significantly improved, and today hospitals participating in clinical trials can provide services that meet international medical standards. For the past two years, outpatient care funding has dramatically increased from the initiatives of the former President of the Russian Federation, Vladimir Putin.
According to the Russian Federal State Statistic Service, Russia's population in 2007 was 142.2 million. A little more than 42,000 subjects, or 0.03% of the population, participated in clinical studies during 2006. Most of the population—103.8 million (73%)—reside in metropolitan areas, while 38.4 million (27%) live in rural areas. This highly concentrated city population together with the centralized health care system—most centers are located in major cities and large regional hospitals—offers distinct advantages. First, it makes high subject recruitment rates possible. Second, it reduces overhead and transportation costs. Also, monitoring expenses are lower in the cities, since a monitor can visit up to two centers a day.
Traditionally, in Russian public opinion the medical doctor is considered a highly prestigious profession. For that reason, investigator–subject relationships are usually characterized by mutual trust and good rapport. Subjects rarely refuse invitation to participate in a study and are quite cooperative in signing up for additional procedures to help the doctor fight the disease. A high level of education ensures the Russian population properly understands the informed consent form and doctor's instructions and guarantees good compliance. Another big advantage for long-term studies is a low migration rate. This is especially advantageous when compared with the relatively high migration rates in the United States. Subject dropouts in Russia due to migration are seldom.
Sponsors in Russia could enjoy a significant number of treatment-naive subjects, especially in such areas as oncology, HIV, and various types of infectious diseases. Figure 2 shows the leading therapeutic areas for clinical trials in Russia in 2006.
Nowadays, the clinical trial application process is rather transparent and straightforward. According to Article 37 Part 2 of the Federal Law On Medicines, the following documents should be submitted to RZN: an application letter, approval from the National Ethics Committee (NEC), a preclinical study final report, and a drug information leaflet. Although all documents have to be submitted in Russian, experts can refer to the original language of a document in case of uncertainty.
All clinical trials conducted in Russia undergo a mandatory approval process at the NEC, which conducts evaluation of the protocol, the informed consent form, and the investigator's brochure. In addition, NEC thoroughly checks the information concerning drug safety, dosage, and possible drug adverse reactions to ensure the trial is scientifically sound, potentially beneficial, and safe. The committee consists of 36 members, and NEC meetings are held twice a month. The NEC approval process usually takes from four to eight weeks.
There have been recent, positive trends in Russia's drug importation and taxation. The most important news is that the current 18% VAT rate was lowered to 10%. Also, experts anticipate that Russia might join the World Trade Organization (WTO) before the end of 2008, which could result in lower customs and VAT rates on study materials. It is expected that after joining the WTO, Russia will enjoy lower costs and higher quality services provided by courier companies, drug depots, translation agencies, and local laboratories as a result of higher competition between local and international players.
According to ClinicalTrials.gov data from December 2007, there are 344 open clinical trials being conducted in Russia with its population of 142.2 million. In comparison, in the United States, with its 301.1 million population, 11,941 clinical studies are being run at the same time. Therefore, if the United States clinical research potential is set at 100%, only 5.6% of the Russian potential is being utilized.
Most Central and Eastern European (CEE) countries including Russia are well known for high recruitment rates; good data quality; qualified, GCP-trained, and experienced investigators; large pools of treatment-naive patients; and low study costs compared to established markets. Taking into account that Russia has the largest population among CEE countries, it has the opportunity to become the leader in the region.
In the past 15 years, the powerful investment resources of big pharma have created a good infrastructure and established favorable conditions in Russian for the "second wave" of sponsors. This will be middle-and small-sized biotechnological and pharmaceutical companies whose venture capital makes great demands for return on investment. Those companies that decide to enter the Russian clinical trials market will get a head start with more than 90% of the untapped potential and, as a bonus, 55 CROs to compete for their contracts.
The authors would like to thank the following reviewers from whom the article has benefited: Svetlana Zavidova (ACTO), Marina Filippova (PSI Co Ltd.), Leon Dzivinsky (ClinStar), Vladimir Krechikov (InnoPharm), and Sergei Varshavsky (Evidence-CPR).
Igor Stefanov* is director, business development, Synergy Research Group (SynRG), 11, 4th Magistralnaya Ul., 123007 Moscow, Russia, email: email@example.com Pavel Tverdokhlebis director, clinical research, http://www.PharmaNet.com.
*To whom all correspondence should be addressed.
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7. Federal State Statistic Service. Russia in Figures. Resident Population. www.gks.ru/free_doc/2007/b07_12/05-01.htm (Accessed September 10, 2007).
8. http://www.ClinicalTrials.gov. Service of the U.S. National Institute of Health. www.clinicaltrials.gov/ct/action/GetAll?recruiting=true (Accessed September 10, 2007).