Future of the Pharma-CRO Relationship: The Integrated Business Model

In September 2016, the CRO-pharma world witnessed a deal touted as “transformative” and “unprecedented” in nature. It’s expected to serve as a template for future partnerships in this industry, where sponsors are usually skeptical about the commitment of the CRO. Takeda and PRA Health entered an agreement which will make PRA Health the primary strategic partner for Takeda. Under this deal, apart from managing an entire pipeline of studies across Phase I-IV, PRA will provide its expertise in pharmacovigilance, and operational services and regulatory services for development and marketed products of Takeda. PRA will also manage operations of Takeda’s facilities in the US and Europe. Almost 300 Takeda employees have the option to transition to PRA in US and Europe. Recently, the partnership extended to Japan, where both companies will establish a joint venture called the “Takeda-PRA Development Center,” each holding 50% of the share. This will involve transferring an additional 140 Takeda employees.

The Current State of Pharma M&A Deals

2015 was a record-breaking year for mergers and acquisitions (M&A) in the pharmaceutical industry. According to data from Thomson Reuters and BioPharma Dealmakers, there were approximately 468 deals involving devices, therapeutic drug assets, diagnostics and medical insurance companies. In 2015, M&A deals represented a 10% increase over 2014 and a 90% increase over 2012, when deal-making was the lowest in that decade.

Digital Transformation in Clinical Trials

To reduce overall costs associated with drugs, pharma companies must look for innovations in the pharma value chain and R&D, especially clinical trials, which represent a huge opportunity. GEP observes that, in this space, digital transformations like wearables, health apps and social media are being increasingly adopted by pharma companies and CROs alike, which will in turn improve the entire spectrum of patient recruitment, engagement and retention throughout the clinical trials study.

Drug Diagnostics Co-Development: A Change in the Clinical Trial Design

The personalized medicine market is growing rapidly with a rise in demand for companion diagnostics. Targeted therapies require a reliable and efficient diagnosis, which generates a parallel demand for companion diagnostics. Drug and diagnostics co-development identify a specific set of patients who benefit from personalized treatments.

Fetal Bovine Serum & Potential Avenues for Sourcing

Sterile filtered Fetal Bovine Serum (FBS) is a critical ingredient in growing cells in-vitro due to its growth accelerating properties. It is extracted from the fetus of domestic cattle when they are slaughtered for beef production, thereby making FBS a by-product of the beef industry. Animal vaccines, pharmaceutical drugs and biotechnology are some key industries where FBS is mainly used in cell culture. In the U.S., FBS has escalated in demand, owing to the growth of the pharmaceutical industry and R&D spend within the States. Severe climate conditions in the last few years leading to restricted availability in the U.S. and worldwide are some major price drivers of FBS. This has further led to numerous mergers and acquisitions among market participants, resulting in only four to five major suppliers of FBS in the United States. FBS can also be imported from USDA-approved countries such as Costa Rica, Chile, Mexico, Uruguay, Honduras, Iceland and Nicaragua. Brazil is the largest provider of FBS in the world but its product is currently not permitted to be imported into the United States.

Biosimilars: A New Era in Therapeutics

Biosimilars are complex and large molecular weight biological compounds produced by genetic engineering. In recent years there has been increasing demand for biosimilars, mostly due to lesser cost of treatment in comparison to traditional drug molecules. Moreover, biosimilar drugs have the potential to reach close to a 30% operating profit margin; considerably high compared to the profit margin of generic drugs, which is around 20%.

Virtual Clinical Trials Landscape

In recent years, there has been an increasing scope of decentralization in clinical pharmaceutical trials. Various pharma companies such as Pfizer and Sanofi are investing in the emerging concept of virtual clinical trials. The average capital cost of conducting the FDA's standard Phase I/II/III traditional clinical trial is around USD 1.3 Billion. However, virtual clinical trials eliminate the cost associated with site selection and clinical research laboratory setup.

How Digital Disruption Is Augmenting Patient Engagement in Healthcare

Eighty percent of Internet users seek online health information, 66 percent of Internet users look online for information about a specific disease or medical problem, and one in 20 Google searches is for health-related information.

A Perspective on Market Access to Immunization

In today’s environment, predominance of deadly infectious diseases coupled with rising healthcare awareness in emerging economies are the major factors driving demand for immunization.

Impact of the IMS/Quintiles Merger

Healthcare Information provider IMS Health is expected to merge with leader in CRO space Quintiles Transnational by October 2016. IMS Health has agreed to buy Quintiles for USD 9 Billion & the merged entities total market capitalisation is worth USD 18 Billion. The merged entity, to be called Quintiles IMS Holdings, will be the house for best of pharma research skills and analytical data.

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