Strategic Partnerships between CROs and BioPharma: A necessary evolution?

strategic partnerships CRO biopharmaIn this preview article, CROS NT CEO, Andrew MacGarvey, discusses the changing landscape of strategic partnerships. The full article will soon be available in select industry publications and on our website in anticipation of the DIA Annual Meeting in Chicago this June.

During the last decade, academics have had much to say regarding the “special” moral obligation expected from pharma with respect to drug discovery, drug development and ensuring equality in access to their product. JM Huebner (Journal of Business Ethics, 2014), maintains the common justifications for the obligation fall under scrutiny, however the popular media continues to espouse such expectations. In recent years, there has also been a change in the relationship between CROs and BioPharma, driving a huge increase in the proportion of outsourcing spend going to strategic partners, with larger, public CROs. These providers must demonstrate solid backlog along with quarter on quarter growth to maintain investor confidence.

These considerations in turn drive the financial modelling at these companies. Furthermore, the last economic crisis coincided with a reduction in innovation and shrinking product pipelines. Drug development is changing as new technologies come to the fore and the move from blockbuster business model shifts to a more personalized approach to medicine with patient groups, academic research units, and charitable organizations playing an increasingly important role in drug development. The sector is shifting its focus from massive patient populations and high throughput screening programs to more targeted methodologies that can benefit from these stakeholders.

Within this context, is the role of the CRO facing a natural evolution? For sure, the vendors who engage in strategic partnerships need to demonstrate “value added” service to the primary stakeholders (BioPharma), but is the service provision now in a different context? Are all stakeholders satisfied? Are CROs now accountable for any “special” obligation? The question is whether the CRO model and the strategic partnership must evolve to the 2.0 version. One key area may well be the integration of stakeholders who, while previously involved in drug development, perhaps operated more autonomously. A service provider within a strategic partnership may be required to establish relationships with other players that can help deliver a leaner model.

academic researchA second key aspect will be the “special” moral obligation that CRO will share with BioPharma. The CRO can help to achieve this by peforming pro bono work with patient groups and others to surface viable projects or to provide commercial guidance that can maximize a project’s chance of success. Working in this way also provides the CRO with an opportunity to enter the value of Social Responsibility into a trade-off calculus without undermining the latter. For example, by working with a charitable organization, a CRO can link the expertise that may reside in this external organization with interested sponsors.

This model has proven successful at CROS NT. Over the past few years, the leadership team have included pro bono hours into the annual budget to allow the operations team the chance to work closely with patient groups and charities. This has resulted in benefits to CROS NT in terms of staff satisfaction and retention and to the charitable program by increasing the quality of protocol design and study conduct. The company is now exploring ways of scaling this initiative and bringing more benefit to the drug development process.

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CROS NT Corporate Social Responsibility