With an overarching goal of optimizing collaborations in the drug development industry, Nice Insight developed a quarterly survey where prospective, current and past customers evaluate the communications and performance of 100+ contract research organizations. By conducting primary research on both outsourcing practices and contractor performance, the information generated can help save time and money spent on the partner selection process by enabling the sharing of knowledge among peers on the sponsor side of the industry. Additionally, CROs can review quantified feedback from sponsors to gain an understanding of how well their businesses are known and perceived across the pharmaceutical and biotechnology industry.
Developing the research tool started with identifying the drivers that influence partner selection, as well as understanding the nuances of the different types of outsourcing relationships—including tactical service providers, preferred vendors and strategic partnerships—and the value each type of relationship can bring to a sponsor. The Nice Insight team conducted in-depth interviews with industry executives in order to design a survey that would offer insight on key performance measures across the industry. We’ve learned in this short time since publishing the first report in March 2011 that the right relationship between sponsor and CRO will open the doors to further innovation.
Nice Insight’s survey randomly presents approximately 30 questions to each respondent in order to collect baseline information with respect to customer awareness and customer perception. Five levels of awareness, from “I’ve never heard of them” to “I’ve worked with them” factor into the overall customer awareness score. The customer perception score is based on six key drivers in outsourcing: quality, innovation (which replaced accessibility for 2012), regulatory compliance, pricing, productivity, and reliability. Respondents rank the drivers to determine the weighting applied to the overall score.
The value of the information available through Nice Insight lies in helping users to quickly identify potential partners, while establishing industry benchmarks that show where each CRO is positioned relative to industry averages and its direct competitors. In the first year, the survey evolved rapidly as direct feedback from Nice Insight clients helped identify further areas of curiosity—such as when (during which phase of development) sponsors are most likely to engage outsourcing services. Survey respondents revealed a dramatic change in early-stage practices, with fifty percent indicating that the company they work for engages CROs during the discovery phase—a practice almost unheard of a decade ago. As intellectual property rights and regulatory standards strengthened, the complexity of projects offered to subcontractors increased.
A key benefit of finding the right CRO to engage for discovery work is the increased potential for more molecules to pass into preclinical trials. After all, “it has been estimated that a 10% improvement in predicting future failure before the initiation of expensive and time-consuming clinical trials could save upwards of $100 million on the costs associated with drug development.” As such, the drug development industry has shifted attention towards developing, authenticating and executing more proactive testing standards in earlier stages.
Seven contract research organizations that offer drug discovery and toxicology services received CRO Leadership awards (with a score of 75% or greater) in both the productivity and regulatory compliance categories, indicating these businesses would make solid partners for increasing the number of candidate molecules in the development pipeline. Based on the customer perception scores assigned by Nice Insight survey respondents, the top CROs for discovery and preclinical work are: Aragen Bioscience, Bertin Pharma, Covance, GenScript Corporation and MPI Research.
MPI Research led the group with the highest score in the productivity category, at 79%. Bertin Pharma received the highest score for regulatory compliance at 80%—the only business that offers drug discovery toxicology testing to receive an “excellent” score. Covance was allocated the greatest market share for toxicology among these leading CROs, receiving 14.45% of business from Q4 respondents. Toxicology market share was representative of a trend Nice Insight continues to see in the data—that awareness ties directly to market share, and businesses with greater awareness continually receive greater market share allocations, oftentimes in spite of competitors with higher customer perception scores.
Consequently, it is essential for contract service providers to continually communicate their presence and offering to the industry at large, as well as develop targeted messaging for specific audiences. This combined approach increases the likelihood of being on the radar of outsourcing sponsors in general and the possibility of being considered for specific project. As entry into the market becomes more challenging,
CROs can benefit from keeping up on outsourcing trends, especially how practices and desired services vary among the different sponsor groups, and arming themselves with information. Both sponsors and CROs can benefit from understanding how customer perception serves as a short-term measure for maintaining clients and customer awareness serves as long-term measure of sustainability.
*CRO Leadership Awards were based on Q4, 2011 survey results. Q1, 2012 results are currently available on niceinsight.com