More than one third of clinical trials conducted by pharmaceutical companies are now being outsourced, a new report has found.

The shift is also accelerating in cost terms. The portion of global research and development expenditure outsourced to contract drug developers reached US$36.6 billion in 2011, up by 6.6% from US$31.8 billion in 2009, notes the report by Kalorama Information.

In the same vein, the share of drug development expenses dedicated to in-house core activities declined from 74% to 62% over the last year.

“In past editions of our outsourcing market studies, we found that outsourcing moved from ‘should’ to ‘must’ for manufacturers,” Kalorama Information comments. “This trend has only continued in the past two years.”

Post-approval boom

The report on Outsourcing in Drug Development: The Contract Research (Clinical Trial) Market also identifies post-approval or Phase IIIb/IV studies as a fast-emerging “hot opportunity” for contract research organisations.

While the key objectives of post-approval trials are to satisfy regulatory commitments and extend knowledge about a product’s efficacy, safety and effectiveness in actual-use settings, they have also evolved into “a powerful tool for companies to distribute their drug more broadly and for longer periods”, Kalorama Information says.   

Historically, Phase II-III trials were the first wave of clinical research operations to be outsourced, the market researchers point out.

However, growth in R&D spending on Phase I trials began to outpace Phases II-III in 2003, and Phase I remained the fastest-growing segment of drug development until around 2006. Today, growth in Phase I trials and Phases II-III is about equal, Kalorama Information adds.

Increasing complexity

Publisher Bruce Carlson puts the continuing trend towards R&D outsourcing down to the increasing complexity of regulatory requirements for drug development over the last 20 years, “requiring pharmaceutical companies to generate great quantities of more complex data to gain regulatory approval”.

Many pharmaceutical and biotechnology companies “bring only a limited number of compounds to market and have relatively little experience dealing with the regulatory environment”, Carlson adds.

“So they are outsourcing to companies that can take a drug through the regulatory process, and most importantly, reduce the time required to bring a drug to market.”