Outsourcing Clinical Trial Development and Materials - Pharmaceutical Technology

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Outsourcing Clinical Trial Development and Materials
CROs and CMOs adapt their business models and capabilities to meet sponsor companies' need to reduce costs and accelerate development time.

Pharmaceutical Technology
Volume 6, Issue 34, pp. 44-46

Patricia Van Arnum
In an effort to accelerate drug development and reduce costs, contract research organizations (CROs), contract manufacturing organizations (CMOs), and bio/pharmaceutical companies are implementing new approaches to improve clinical development and production of clinical-trial materials (CTM). These strategies include new partnership models between CROs and sponsor companies, alliances among CMOs, and adding new capabilities in contract services, including biopharmaceutical services.

Strategic partnerships

The changing requirements in drug development are leading CROs and sponsor companies to form more collaborative and strategic partnerships. "Since 2005, the biopharmaceutical industry has seen a steady increase in strategic outsourcing relationships between pharmaceutical companies and CROs," says John Watson, corporate vice-president and president of strategic partnering and integrated drug development at the CRO Covance (Princeton, NJ). "The CRO industry, which primarily started in the mid-to-late '80s and early '90s, has also evolved considerably over the last several years from a very nascent industry—used primarily as spillover capacity—to become strategic partners in drug development. Sponsors have been looking to new strategic/partner-based models of outsourcing such as multiphase integrated development, dedicated capacity agreements, and asset transfers, to help them advance their pipelines and take the time and cost out of drug development," he says.

Covance's 10-year, $1.6-billion drug-development services pact with Eli Lilly (Indianapolis, IN), which was signed in October 2008, shows the trend toward greater strategic partnerships. Under the deal, Covance acquired Lilly's Greenfield, Indiana, preclinical research facility for $50 million, and Covance received a broad range of drug-development services work over the next 10 years for a minimum contract value of $1.6 billion. Covance also assumed responsibility for all of Lilly's toxicology testing and discovery-support activities at Greenfield.

"This alliance has truly been a win-win-win for Lilly and Covance, the employees at both companies, and our communities," says Watson. Since the agreement, more than 95% of the original 264 employees hired from Lilly are still with Covance. The company has added more than 70 new employees to the Greenfield facility and plans to expand staffing with an additional 300 employees as the company is awarded work by other biopharmaceutical companies, says Watson. Since the agreement, Covance also added three new service lines in its biomarkers, nutritional-chemistry, and biotechnology businesses in Greenfield. Lilly and Covance also expanded their existing partnership in March 2010 through a three-year biotechnology services agreement under which Lilly transferred bioproduct analytical testing to Covance's Greenfield facility.

In executing the partnership, the companies share common goals. "Lilly and Covance identified a path to achieving Lilly's goal of '1000 Days to Patient' by reducing drug-development cycle times," says Watson. "1000 Days to Patient" begins when Lilly researchers identify a lead molecule to begin clinical testing and ends when Phase II efficacy studies begin in patients.


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