Small companies with big perks

It is a terrible situation: your favourite lunchtime spot gets reviewed by a trendy magazine. For years, you have bought your sandwich expertly prepared. You have learnt the names of the staff and shared jokes with them. However, now everything is changing. A snaking line extends out the doorway; excited people chatter about the meal they will order after the food critic’s praise; and you, from the back of the queue, catch glimpses of the sandwich man chatting and laughing with complete strangers.

What do you do? You find an establishent that will serve you quickly, even if it is a bit smaller and less experienced. You focus instead on its cleanliness, friendliness and efficiency. The sandwich tastes good, yet your doubts about the quality persist, tainted by the unfamiliarity of the experience.

This is quite similar to the worry attached to doing business with a new contract research organisation (CRO). There are plenty of options out there, but the pull of the familiar is strong. However, many companies are offering niche services with big benefits to their partners.

Many large CROs offer a full range of services covering drug development from start to finish. Because of this, they are popular with larger pharmaceutical companies, and they continue to grow and make profits. However, there are some downsides with using these large organisations. They usually have many business units under the same umbrella, often spread across the world. There can be poor integration and communication between these individual units – even though they stand together under one global brand. In short, large companies might not treat every partner as a priority.

Big companies are also more likely to use subcontractors, which effectively outsources the outsourced. This occurs despite smaller providers often having greater flexibility and being more willing to accommodate partners’ needs.

Smaller CROs often offer high-quality service, plus the ability to respond quickly to requests from partners.

However, the size of these niche providers is not always a positive aspect. Smaller companies have reduced capacity and limited global presence. Because of this, they normally attract the business of smaller biotech and pharmaceutical companies, seemingly bound to the law of smaller attracts smaller, while larger attracts larger. However, these days, there are a lot more joint ventures, and mergers and acquisitions happening in the industry, as smaller CROs attempt to broaden their offering.

Elena Smith, director and GCDO programme leader of global clinical development operations at Janssen R&D, says: “There are several benefits of having a preferred partner in a clinical trials setting. There are more potential financial benefits and preferred provider rates due to bulk outsourcing. They also have a clearer understanding of each other’s operating procedures, responsibilities and ways of working.”

Smith, who has more than 20 years of experience in the clinical research industry, started her career as a clinical research associate for a big pharmaceuticals company. She has also worked as a project manager in biotech and in a CRO.

Good for everyone

Smith says that in a mutually advantageous relationship, companies will provide therapeutic expertise, greater knowledge of hospital sites and faster start-up times. “These are very useful for big programmes, but sometimes smaller specialist vendors that are light on their feet are beneficial – for example, in new indications and early phase trials.”

While a reliable CRO is often the best option in most situations, Smith says there are many reasons why a preferred partner might not be available. “Just as pharmaceutical companies have resourcing constraints, so do CROs,” she says. “With a large amount of work to be outsourced, preferred partners may simply not be able to manage the volume of work, and may reach capacity, themselves or see high turnover if there are heavy workloads.

“It is essential to have more than one CRO option available, and for that company to have the ability to perform some work internally, especially when start-up times may often be reduced.”

While a CRO sounds like it could bring a lot to the table, there is no guarantee that it will deliver. It might be hindered by its size, for example. Smith doesn’t believe a niche CRO necessarily offers anything less than the larger companies, but rather that positives and negatives exist for both, irrespective of size.

“Niche CROs can be really beneficial in certain therapeutic indications where they have become experts in clinical trials in that field,” Smith says. “The start-up time to get the CRO on board can be quicker with the smaller companies too, as the leaner management and legal structure allows more rapid decisions around the contracting process. However, niche CROs may not have broad coverage globally, so they are often better suited to early phase trials.”

CROs’ services can come with negative and positive results. Credibility or service delivery issues might emerge. Smith supports the use of CROs and believes they are an integral aspect of the industry’s future success. “I believe there are a lot of misconceptions about working with CROs and they often bear the brunt when things go wrong,” Smith says. “Pharma cannot, however, expect CROs to deliver within unrealistic timelines.

“Pharma should to take into account that CROs need staff for a new trial or programme. But CROs need to be prepared to be more open about resource availability at the time of the bidding process or during work preparation, so that they can also set realistic expectations.”

To improve working relationships, companies must be more flexible and understanding. Pharma companies should understand that if they’re going to use a smaller company, then they may have to deal with the pitfalls or lack of resources that come with it. However, to safeguard against disappointment and failed projects, CROs should highlight and review potential pinch points at the beginning. This will encourage the companies to work together as a single team, committed to finding the best solution. A close, open and trusting working relationship is critical, and having preferred partners can help build such a relationship.

These mutually respectful and advantageous relationships may not be the norm just yet, but Smith says that niche CROs are here to stay, and that they are going to become more entrenched in the pharmaceutical industry. “I believe that there will always be a portion of clinical research that is outsourced to CROs. Whether it is 20 or 50%, it seems to go in cycles. In my view, big pharma has realised that we do need to collaborate with CROs and work together as a team for shared benefit, and to make our clinical trials a success for our patients and the medical community.”

Working with CROs is not yet a standardised process globally, but it does seem to improving. “The use of local CROs in specific countries still seems to be fairly common for biotech companies. For example, using a French CRO for a France-only trial,” Smith says. As this trend continues to grow, the industry will see new CROs management services being embraced by the pharma and biotech industries as outsourcing and costs become more pressing.

However, whether it will become an industry-wide trend or remain localised in certain study areas or markets, niche CROs can work with the companies – big or small – to provide quality service with broad scope and complete professionalism. Buyer beware, however, as sometimes CROS may be more limited than what they first appeared.