04/10/12Nimble Approach to Partnerships Will Generate Value for Both CROs and the Pharmaceutical Industry, According to New Study
Dublin, Ireland, and New York, USA, 10 April, 2012 — New research from Booz & Company and ICON plc reveals how to structure R&D outsourcing partnerships to be most effective.
As more and more R&D is outsourced by pharmaceutical companies, a study released today provides new insight into how to structure the relevant partnerships for success. ICON plc (NASDAQ: ICLR; ISIN: IE0005711209), a global provider of outsourced development services to the pharmaceutical, biotechnology, and medical device industries, and global consulting firm Booz & Company co-authored the report, titled “Nimble Partnerships in the Pharma Industry: Well-Designed CRO Relationships Enhance Focus and Flexibility”.
Global pharmaceutical outsourcing is expected to reach $28 billion this year and climb to $35.5 billion by 2015, an increase of more than 10% since 2009.
“Developing the capabilities to partner with clinical research organizations (CROs) is a critical key to success for pharma companies in today’s increasingly complex and competitive environment,” said Matthew Le Merle, a partner with Booz & Company. “But our research clearly showed that most companies are not structuring their CRO relationships strategically. This is wasting time and money they can ill afford to lose.”
The report provides insight into the ways pharmaceutical companies can better engage with their CRO partners to make these relationships as productive as possible.
Key findings include:
“Regardless of the model chosen, a top-down approach to partnerships where the performance measures are tied to the strategic objectives of the partnership is fundamental to success,” commented Ciaran Murray, CEO at ICON plc. “ICON has been successful in building close strategic partnerships by being flexible and innovative in the way that we conduct clinical research and in how we build our partnerships. We also continuously look to expand our capabilities and service offerings in order to ensure that we deliver value.”
Managing partnerships with CROs is an increasingly important capability in the pharmaceutical sector.
Pharma companies currently have a broad strategic rationale for clinical outsourcing and are still experimenting with different CRO relationship models. Four types of relationship models are emerging: Qualified Talent Supplier, Preferred Capacity Partner, Preferred Capability Partner, and Strategic Partner.
To derive sustainable value from these relationships, pharma companies must align the design, structure, and performance measures of their relationships with their strategy.
CROs need to demonstrate innovative approaches in activities that range from monitoring to data-driven insights to employee retention.
Pharma companies that adopt a nimble, capability-centered approach to partnerships, characterized by deep alignment and clarity with the CRO based on complementary capabilities, will be more focused, make better use of their distinct capabilities, and generate more value.
ICON sponsored Booz & Company to gain insight into the ways pharmaceutical companies engage with their CRO partners. Booz conducted 20 structured interviews with executives at the vice president or senior director level in 11 of the top 20 pharmaceutical companies. The interviews were designed to provide a perspective on how to make pharmaceutical–CRO relationships as productive as possible.
To download the report, visit http://www.booz.com/media/uploads/BoozCo-Partnerships-Pharma-Industry-CRO.pdf
About Booz & Company
Booz & Company (booz.com) is a leading global management consulting firm focused on serving and shaping the senior agenda of the world’s leading institutions. Drawing on the talents and insights of more than 3,000 people in 58 offices around the world, we help our clients achieve essential advantage by working with them to identify and build the differentiating capabilities they need to outperform.