US-based contract research organisation (CRO) Charles River Laboratories is restructuring its Preclinical Services (PCS) business and realigning its sales functions in response to the tougher economic climate and the evolution of its clients’ business models.
“In today’s challenging economic environment, we are continually identifying new strategies to enhance customer satisfaction, improve efficiencies and strengthen business operations,” said chairman, president and chief executive officer James Foster. “Our clients are transforming their business models, and in order to continue to provide the superior client service which they have come to expect from us, we must evolve with them.”
According to Foster, the organisational changes in the PCS segment will enhance the CRO’s ability to provide customers with a centralised, integrated global approach to their drug development programmes across all business segments, while the sales realignment will give clients access to “the full breadth of Charles River’s extensive product and service portfolio through a central point of contact”.
The company has created a dual accountability structure in Preclinical Services, with both global functional teams and site-level management. The objective, Charles River explained, was to “elevate the harmonisation and integration of all services across the PCS organisation”, so that service delivery to clients worldwide would be “seamless and consistent”.
Services will also be tailored to individual client requirements, mustering expertise from various facilities to support client programmes “regardless of the specific site at which the programme is resident”, Charles River noted.
Another significant benefit of the initiative is expected to be “the ease with which we are able to leverage our Lean Six Sigma and other process harmonisation efforts to standardise on best-in-class processes across the PCS organisation”, the CRO added. “This will enable us to deliver increasing value to our clients in support of their efforts to reduce drug development cycle time and cost.”
The realignment of Charles River’s sales organisation has already begun and will extend through to the end of the year. The aim here is to “migrate from a sales approach which focuses on our portfolio of products and services to one focused on value-based solutions by customer segment”. As with the organisational changes in the PCS segment, the CRO expects the new approach to facilitate interaction with clients and improve its ability to address specific client needs.
Charles River is establishing a three-pronged sales organisation directed at, respectively, global biopharmaceutical companies, small and medium-sized pharmaceutical and biotechnology companies, and the academic and government sector. Dr Christophe Berthoux, corporate executive vice-president, global sales and marketing, described the move as “the next step in the evolution of our sales organisation from locally to globally focused”.
In February Charles River said it would cut its workforce by around 3% company-wide during the first quarter, as part of a wider effort to “align our infrastructure for enhanced operating efficiency”.
The majority of the job losses were destined to fall in Charles River’s Preclinical Services (PCS) segment. The company has faced softening demand in its PCS business, where net sales dropped by 8.3% to US$158.6 million in the fourth quarter of 2008 and by 17.2% to US$140.0 million in the first quarter of 2009.
First-quarter sales in the RMS business were down by 4.2% year-on-year, to US$161.5 million
RMS succession
The CRO has also announced a succession plan for its Research Models and Services (RMS) segment, where Real Renaud – corporate executive vice president and president, Global Research Models and Services – has announced his intention to retire by the end of 2010.
In the initial phase of a 12- to 18-month transition, Dr Davide Molho has been promoted to corporate senior vice president, North American & European Research Models and Services. In his new role, Molho assumes responsibility for North American RMS in addition to his leadership of the European Research Models and Services business.
