Revenues reported by contract research organisations (CROs) rose more than 10% last year to reach $13.6 billion, driven by greater demand for outsourced clinical services
Overall, the CRO sector is benefitting as drugmakers look to outsourcing partners to offset the high cost of bringing new therapies to market, according to a new report from GlobalData which looks at the performance of around 40 of the top contractors.
Among the trends identified in the report is an expansion in the CRO market in emerging markets such as the BRIC (Brazil, Russia, Indian and China) countries.
Combined revenue for the CROs covered by the report in the BRIC regions increased almost 15% on 2011 levels to $394 million, and GlobalData expects this trend to continue into the near term, with CROs looking to increase their share in these lucrative markets.
The sales increase has been mirrored by a flood of investment and business activity from CROs in emerging markets in 2012, according to GlobalData analyst Adam Dion.
“Asia, Central and South America, as well as Eastern Europe, have become attractive regions for pharmaceutical outsourcing as a result of easy access to a large number of treatments, low labour and manufacturing costs, and highly skilled medical workforces,” said Dion.
“However, having an on-the-ground regulatory support and local infrastructure are key to implementing a successful product commercialisation strategy in these emerging markets, particularly in China and India, where approval timelines are considerably protracted,” he added.
Growth in the CRO sector over the last year “was largely fuelled by Quintiles”, according to the report, which notes that the market’s largest CRO contributed around $397 million of the $1.2 billion market increase seen over 2011.
Quintiles’ revenue grew by 12% year-on-year to $3.7 billion in 2012, demonstrating considerably larger growth than its closest rival, Covance, which grew 4% to $2 billion.
Quintiles was also effective at turning its order backlog into revenue, and winning new business contracts in emerging markets in Europe and Asia, notes the report.
