Can outsourcing of clinical trials help Pharma companies?

A clinical trial refers to the medical research studies that are conducted to determine the safety and effectiveness of new drugs or treatments. However, falling revenue and unnecessary clinical trial procedures are pressurizing Pharma companies to identify new ways to reduce cost and improve their research efficiencies. One way to achieve cost cutting and reduce clinical procedures is to outsource clinical trials to contract research organizations (CRO).

Clinical Trials. Image source http://gxpperspectives.com/2012/01/19/drug-accountability-in-clinical-trials/

According to latest reports, about 11.6% of clinical trials have been outsourced to Asia in 2011. Outsourcing of clinical trials by Pharma companies is gaining acceptance rapidly in the industry, and there is an increasing trend in outsourcing clinical trials to emerging markets.

Why clinical trials should be outsourced?

As per industry experts, the pharmaceutical industry incurs a cost of $5 billion every year to carry out clinical trial procedures. Pharma companies to some extent can reduce the procedures and cost by outsourcing clinical trials to research organization in onshore or off shore destinations. The companies can outsource some components of clinical trials in which they lack the expertise.

Further, outsourcing of certain clinical trial activities will reduce the workload of in-house team to a great extent. Outsourcing of clinical trial procedures will make sense for the companies especially for short-term researches as they don’t require hiring new staff for a short-duration.  Moreover, in case of new researches, the best possible ways to get things done quickly and accurately is by outsourcing procedures to CROs.

What are the challenges associated with outsourcing clinical trials?

The main challenges in outsourcing clinical trials are as follows:

  1. Delay in contracting: It usually takes three months for companies to complete the contracting procedures.
  2. Difficulty in comparing vendor: Vendors often quote different prices for individual tasks. This makes difficult in comparing vendors in terms of the price they offer.
  3. Difficulty in aligning interest of both the parties: Vendors often fail to align the interest of their client companies with their interests. It is usually seen that CROs have a tendency to give more preferences to research activities of their larger clients and go slow on projects of smaller companies.
  4. Fear of intellectual property theft: There is an increasing risk of intellectual property theft while outsourcing clinical trial activities. Pharma companies should specify the ownership of intellectual properties in the contractual agreement.

The companies should emphasize on the need and importance of accurate data to its vendors. They should measure the capabilities of the vendor and ensure that they have the ability to deliver analysis and results within the specified time.

If planned properly and executed well, outsourcing of clinical trials can save cost, time and effort of a struggling Pharma company.

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