For laboratories experiencing problems hiring CROs, it may be cold comfort to know that plenty of peers share in the misery.

Finding the right kind of contract research organization is a challenge, according to data published by Frost & Sullivan. The business consultancy released a report¹ earlier this year that offered two stark conclusions that keen observers of CRO use will take note of:

• Sixty to 65 percent of US biotechnology firms face challenges identifying the right-sized CRO for their drug development programs.
• More than 50 percent of biotech companies engage with multiple CROs over the course of their programs.

These problems lead to a “less streamlined approach causing cost increases and delays, as well as knowledge and data transfer challenges,” Frost & Sullivan wrote.

As a lab manager, imagine having to relay that less-than-inspiring message to your organization’s executives.

But wait . . . it’s a report about hiring CROs

To be fair, Frost & Sullivan conducted its analysis on behalf of Avance Clinical—a CRO which promoted the findings on its website.

While it certainly is convenient for such a briefing to lean its results toward CRO use, Frost & Sullivan’s numbers are supported by prior data published elsewhere.

For example, in 2022, management consulting firm McKinsey & Company surveyed 80 CRO customers² from both large and small pharmaceutical companies, including biotech firms. A subsequent article noted the disconnect between CROs and biotech firms.

“Biotech companies feel that CROs today do not deliver enough on their need for strategic advice and the integration of technology point solution providers,” McKinsey concluded.

Rising costs point to the role of CROs

Make no mistake about it: There is a need to hire CROs for biotech projects³, particularly as research labs struggle to complete their work.

Sixty to 65 percent of US biotechnology firms face challenges identifying the right-sized CRO for their drug development programs.

Venture capital funding in the biotech sector has fallen dramatically, according to Frost & Sullivan’s analysis: from $11 billion in Q1 2021 to $4 billion in Q1 2023.

On the other hand, research and development (R&D) costs for biologics have gone up, from 40 percent of the biologics R&D pipeline in 2017 to 46 percent in 2023.

“Hence, biotechs need to partner with a CRO that provides the required scientific expertise and industry accreditations,” Frost & Sullivan wrote.

Two prominent areas that can connect a lab with the right-sized CRO include the following, as highlighted by Frost & Sullivan:

• CROs that can assist in submissions to the U.S. Food and Drug Administration (FDA)—A key is to engage a CRO early on in product review with the FDA. “Biotechs looking to FDA approvals are seeking CROs that possess the regulatory track record to assist in the FDA review process from the beginning,” according to Frost & Sullivan.
• CROs that are adept at patient recruitment and retention in clinical trials—Slow recruitment of subjects can lead to costly pauses in trials. “It is imperative that biotech companies partner with a CRO with proven capabilities in rapid startup and patient engagement to avoid delays,” Frost & Sullivan stated.

Other factors to consider with hiring CROs include access to innovative technology, skills at data analysis, and, of course, cost competitiveness.

It’s likely that laboratories that consider these criteria when evaluating CRO selection will have an upper hand over competitors in tight drug research and clinical trial markets.

References

1. “Avance Clinical—The CRO Partner of Choice for US Biotechs,” www.avancecro.com/news/frost-sullivan-analysis-reveals-65-of-us-biotechs-struggle-to-identify-suitable-cro-partner/

2. “CROs and biotech companies: Fine-tuning the partnership,” www.mckinsey.com/industries/life-sciences/our-insights/cros-and-biotech-companies-fine-tuning-the-partnership

3. “Leveraging Contract Research Organization Relationships,” www.labmanager.com/leveraging-contract-research-organization-relationships-26858