Parexel reviews strategic partnerships
By Mia Burns
Contract research organization Parexel International has commissioned and released executive survey results in conjunction with the 22nd Annual IIR Partnerships in Clinical Trials. The report, Strategic Partnerships 2013, is the first to explore the current outsourcing landscape and the value Strategic Partnerships provide to biopharmaceutical companies of all sizes.
In today’s marketplace, biopharmas face tremendous pressure with the challenge of accelerating pharmaceutical product development while controlling costs creates a difficult balancing act for industry executives. When compared with 1975, the pharma industry spent equivalent of $100 million in today’s dollars for R&D of the average drug approved by the FDA. By 1987, that figure had tripled, to $300 million, and by 2005, this figure had more than quadrupled, to $1.3 billion.
“I would say that from my perspective that really the most notable finding that came out of the report was that 85 percent of the executives who were surveyed who were involved with strategic partnerships felt that they were positively contributing to the relationships and certainly that is consistent with what we would have felt based on our experiences, but it was nice to get an objective,” says Mark Goldberg, COO, Parexel. “The impression from the marketplace is that this approach to outsourcing makes sense, creates value, and is here to stay.”
For the past five years, a wave of strategic partnerships between biopharmaceutical companies and CROs has been implemented to drive more flexibility, reduce costs, and extend expertise, according to the report. Strategic partnerships have evolved the CRO-sponsor relationship into multi-year, highly-integrated engagements focusing on shared objectives, mutual investment in aligned processes and systems, and early involvement in protocol design and operational plan development.
Despite the evolvement of strategic partnerships, a perception exists that only larger biopharmas would benefit from these types of collaborations. In the report, the volume of work as criteria for strategic partnering was low down on the list, Goldberg told R&D Pharma Business Connect. “I think that is consistent with our view which is that there is value to be created for partners that is not just dependent upon a massive volume of work,” he says. “Now obviously you have to scale the partnership in relation to the amount of work that is included in the partnership and there is some minimal critical mass that you need to have justified by both the CRO and the sponsor to build the right infrastructure and to put the right processes in place to ensure that you have the right governance and that there is alignment between the organizations.”
The report also covers the demands of how a constantly changing development and regulatory environment continually requires biopharmaceutical companies to discover more efficient ways of operating to retain their competitive position in the market. Strategic partnerships must adapt to help companies effectively meet these challenges. But to evolve successfully, CROs must address some of the industry’s concerns with the present state of CRO-sponsor relationships.
As outlined within the report, when considering the relationship today, the executives noted these top five concerns, in order of importance: limited alignment of goals and objectives, inadequate number of “A-Teams”, CRO employee turnover, which can potentially erode team quality, change orders when the initial cost estimates were incorrect, and lack of information sharing.
“Everybody wants an A-Team and everybody deserves an A-Team,” Goldberg told R&D Pharma Business Connect. “Our objective is to deliver an A-Team on all our engagements, whether it’s part of a partnership or not.” Teams that are engaged with partnerships place special investments into training on approaches and processes associated with a partner. This ensures the building of a strong team with an understanding of how to interact intimately with a client with the expectation of a long-term commitment. The relationships yield efficiencies over time as teams experienced in working with a particular partner don’t have to constantly retrain staff. “I think what is really helpful in the construct of partnerships is being able to dedicate teams to a client relationship,” Goldberg said. “We’re willing to make the investment in our people in the context of those relationships to make it successful.”
Posted: August 2013