ASIA’S CRO MAR­KET ON THE RISE

BioSpectrum (Asia) - - BIO CONTENT - Aish­warya Venkatesh aish­warya.venkatesh@mmac­tiv.com

A Frost & Sul­li­van’s re­cent re­port fore­casts a growth rate of 19.9 per cent for the con­tract re­search or­ga­ni­za­tions (CROs) in­dus­try in Asia Pa­cific (APAC) re­gion in the pe­riod be­tween 2015 and 2020, while the CRO mar­ket in North Amer­ica is ex­pected to grow only at 10.4 per cent CAGR. With a fast-grow­ing pharma mar­ket, large treat­ment-naïve pop­u­la­tion, highly skilled and in­ter­na­tion­ally ac­claimed in­ves­ti­ga­tors, high-qual­ity data, and har­mo­nized reg­u­la­tions, APAC has be­come a pre­ferred out­sourc­ing des­ti­na­tion for clin­i­cal tri­als.

A Frost & Sul­li­van’s re­cent re­port fore­casts a growth rate of 19.9 per cent for the con­tract re­search or­ga­ni­za­tions (CROs) in­dus­try in Asia Pa­cific (APAC) re­gion in the pe­riod be­tween 2015 and 2020, while the CRO mar­ket in North Amer­ica is ex­pected to grow only at

10.4 per cent CAGR. With a fast-grow­ing pharma mar­ket, large treat­ment­naïve pop­u­la­tion, highly skilled and in­ter­na­tion­ally ac­claimed in­ves­ti­ga­tors, high-qual­ity data, and har­mo­nized reg­u­la­tions, APAC has be­come a pre­ferred out­sourc­ing des­ti­na­tion for clin­i­cal tri­als.

Over the past sev­eral years, there has been tremen­dous growth in the num­ber of Asian com­pa­nies of­fer­ing out­sourc­ing ser­vices to the global phar­ma­ceu­ti­cal and biotech­nol­ogy in­dus­tries. The in­creas­ing cost of re­search, the loss of rev­enue from lead­ing block­busters go­ing off patent and the lack of ex­ten­sive in-house R&D in­fras­truc­ture has driven many biotech­nol­ogy com­pa­nies to out­source clin­i­cal tri­als to con­tract re­search or­ga­ni­za­tions (CROs) in Asia. The year, 2017 saw a huge mar­ket com­pe­ti­tion in Asia’s CRO in­dus­try, with many merg­ers and ac­qui­si­tions and CROs com­pet­ing for mar­ket share by en­hanc­ing ther­a­peu­tic ex­per­tise, ge­o­graph­i­cal reach, tech­nol­ogy, and in­creased func­tional ca­pa­bil­ity. With pharma com­pa­nies mov­ing to­ward CROs and spe­cial­ists for their clin­i­cal de­vel­op­ment ser­vices, clin­i­cal out­sourc­ing pen­e­tra­tion has in­creased from 43

per­cent in 2016 to 45 per cent in 2017 says a Clin­i­cal Leader’s re­port.

Glob­ally, clin­i­cal tri­als in­dus­try is ex­pected to grow at a com­pound an­nual growth rate (CAGR) of 12.4 per cent to reach $57.0 bil­lion in rev­enue in 2020 from $31.8 bil­lion in 2015. A quick anal­y­sis of the last few years in clin­i­cal re­search re­veals some en­cour­ag­ing news. Clin­i­calTri­als.gov cur­rently boasts nearly 300,000 reg­is­tered stud­ies as or­ga­ni­za­tions race to bring in life-sav­ing med­i­cal prod­ucts to mar­ket for pop­u­la­tions in need. As per fig­ures re­leased by a re­cent study on clin­i­cal tri­als sec­tor growth across ge­ogra­phies it was ob­served that, Asia was the leader in growth, with clin­i­cal tri­als there in­creas­ing by 188 per cent. China and Ja­pan had about 1,000 and 2,500 clin­i­cal tri­als in 2010, re­spec­tively, but both ended up near 6,000 by 2017. In­dia re­mained stag­nant un­til 2016, and some pol­icy mod­i­fi­ca­tions helped triple the fig­ures in just one year. On the con­trary, in the West, the pic­ture looks quite dif­fer­ent. The West hasn’t seen nearly the level of growth that Asia has dur­ing this time frame. Com­pared to Asia’s growth of 188 per cent, the study found that North Amer­ica ex­pe­ri­enced only a mod­est in­crease of 12 per cent, and that Europe ac­tu­ally de­creased by about 2 per cent.

Asia’s grow­ing clin­i­cal trial land­scape

A Frost & Sul­li­van’s re­cent re­port fore­casts a growth rate of 19.9 per cent for the CRO in­dus­try in APAC re­gion in the pe­riod be­tween 2015 and 2020, while the CRO mar­ket in North Amer­ica is ex­pected to grow only at 10.4 per cent CAGR. Be­side an in­crease in home grown R&D ac­tiv­i­ties, the cru­cial rea­son for this rapid de­vel­op­ment is a shift in clin­i­cal tri­als from West­ern mar­kets to Asian ones. Many fac­tors make Asia an ideal hotspot for con­duct­ing clin­i­cal tri­als, in com­par­i­son to the West. Few of these are large treat­ment-naive pa­tient pools, nu­mer­ous clin­i­cal trial cen­ters with ad­vanced equip­ment and tech­nol­ogy, com­pa­ra­ble in­ci­dence and preva­lence of West­ern dis­eases. Apart from this, Asia’s skilled labour and key opin­ion lead­ers with sub­ject ex­per­tise make the re­gion at­trac­tive for con­duct­ing clin­i­cal tri­als. Data from clin­i­cal tri­als con­ducted in Asia is rou­tinely ac­cepted as part of US Food and Drug Ad­min­is­tra­tion (FDA) and Euro­pean Medicines Agency (EMA) reg­u­la­tory sub­mis­sions. Asia also has some of the world’s

AS PER FIG­URES RE­LEASED BY A RE­CENT STUDY ON CLIN­I­CAL TRI­ALS SEC­TOR GROWTH ACROSS GE­OGRA­PHIES IT WAS OB­SERVED THAT, ASIA WAS THE LEADER IN GROWTH, WITH CLIN­I­CAL TRI­ALS THERE IN­CREAS­ING BY 188 PER CENT. CHINA AND JA­PAN HAD ABOUT 1,000 AND 2,500 CLIN­I­CAL TRI­ALS IN 2010, RE­SPEC­TIVELY, BUT BOTH ENDED UP NEAR 6,000 BY 2017. IN­DIA RE­MAINED STAG­NANT UN­TIL 2016, AND SOME POL­ICY MOD­I­FI­CA­TIONS HELPED TRIPLE THE FIG­URES IN JUST ONE YEAR.

high­est num­ber of state-of-the-art Cur­rent Good Man­u­fac­tur­ing Prac­tice (CGMP) com­pli­ant fa­cil­i­ties out­side the US. Qual­ity in­spec­tions con­ducted in Asian com­pa­nies by US FDA and EMA show low lev­els of ad­verse find­ings, in­di­cat­ing high in­ter­na­tional com­pli­ance to stan­dards. Costs in Asia for pro­ce­dures, di­ag­nos­tic tests and vis­its are gen­er­ally 30- 40 per cent lower than the US and Euro­pean coun­tries. Also mov­ing from be­ing a generic maker Asian com­pa­nies have now em­barked on in­no­vat­ing new drugs adding to the num­ber of clin­i­cal tri­als reg­is­tered in the re­gion. More­over, Asians are be­gin­ning to show sim­i­lar or higher in­ci­dence rates of ma­jor lifestyle dis­eases like the West­ern na­tions, pro­vid­ing a com­pa­ra­ble en­vi­ron­ment to con­duct clin­i­cal tri­als.

Bar­ri­ers in con­duct­ing tri­als in the West

Broadly, some of the ma­jor bar­ri­ers to con­duct­ing clin­i­cal tri­als in the US and West­ern Europe in­volve chal­lenges in par­tic­i­pant re­cruit­ment and re­ten­tion, re­sult­ing in longer time and high costs. Re­cent sta­tis­tics in­di­cate that only 6 per cent of el­i­gi­ble pa­tients in the US ac­tu­ally par­tic­i­pate in clin­i­cal tri­als. As a re­sult, 87 per cent of tri­als in the US are be­hind in their re­cruit­ment and en­roll­ment. Asia is uniquely po­si­tioned to ad­dress this prob­lem, with over 60 per cent of the world’s pop­u­la­tion found in this re­gion. Nearly 2 bil­lion peo­ple live in Asia’s high-den­sity cities, where they can be more eas­ily re­cruited for clin­i­cal tri­als.

As we know, drug de­vel­op­ment process is a long-drawn process, tak­ing an av­er­age of 10 years with clin­i­cal tri­als alone tak­ing six to seven years on av­er­age. The av­er­age cost of de­vel­op­ing a new drug is over $2.6 bil­lion, and is only get­ting more ex­pen­sive. While this up­ward trend is true glob­ally, Asia of­fers im­me­di­ate cost sav­ings. Re­sources and staffing are far cheaper, in China and In­dia, which makes it more cost ef­fec­tive to bring a new prod­uct to mar­ket.

Not only is Asia cost-ef­fec­tive but is also rich in skilled ther­a­peu­tic ex­perts. Many Asian na­tions and sites are global lead­ers de­vel­op­ing drugs for cer­tain in­di­ca­tions. The Na­tional Tai­wan Univer­sity (NTU) Hospi­tal is a lead­ing fa­cil­ity for car­dio­vas­cu­lar treat­ments and has car­ried out more than 500 heart trans­plants as of 2014 with a suc­cess rate ex­ceed­ing 90 per cent. NTU’s Col­lege of Medicine spe­cial­izes in can­cer re­search and clin­i­cal tri­als for novel drugs in par­al­lel with West­ern coun­tries.

Ja­pan, China, Sin­ga­pore and South Korea are front-run­ners in stem cell ther­apy due to mar­ket­friendly gov­ern­ment reg­u­la­tions and sig­nif­i­cant fund­ing. China alone has 17 aca­demic in­sti­tu­tions and hos­pi­tals that con­trib­ute to re­gen­er­a­tive medicine re­search, with 72 on­go­ing tri­als. Many such fac­tors are in­stru­men­tal in plac­ing Asia on the world’s clin­i­cal tri­als map.

Many Asian na­tions are top des­ti­na­tions for clin­i­cal tri­als

In Asia, Ja­pan is the leader in clin­i­cal tri­als. Ja­pan’s im­proved clin­i­cal trial in­fras­truc­ture of­fers a con­ducive en­vi­ron­ment for phar­ma­ceu­ti­cal, biotech­nol­ogy, and med­i­cal de­vice com­pa­nies. Ad­dress­ing a down­ward trend in clin­i­cal trial reg­is­tra­tions and a lag in the avail­abil­ity of drugs within the coun­try as com­pared to other de­vel­oped na­tions, Ja­pan’s Min­istry of Health, La­bor and Wel­fare (MHLW) ush­ered in sig­nif­i­cant changes. These changes in­cluded cre­at­ing a more wel­com­ing and ef­fi­cient ap­proach to tri­als, new con­sul­ta­tion sys­tems, and of­fer­ing new sub­si­dies to lower the reg­u­la­tory and clin­i­cal cost for ex­pe­dited re­view while main­tain­ing global stan­dards such as the ICH-GCP. These changes have helped Ja­pan to at­tract more clin­i­cal tri­als and the Ja­panese CRO mar­ket has been ex­pand­ing for the past over 10 years, and reached ¥172 bil­lion in 2016.

Though less ma­ture than the land of the ris­ing sun, Asia’s other coun­tries- South Korea, In­dia, China, Tai­wan have also made sig­nif­i­cant progress and are promis­ing can­di­dates for in­creased growth in Asia’s CRO land­scape. Among 10 ASEAN coun­tries, Thai­land has reg­is­tered high­est num­ber of clin­i­cal tri­als in the re­gion. Thai­land now has a world-class in­fras­truc­ture, a uni­ver­sal health­care sys­tem, and na­tional poli­cies that sup­port a de­vel­op­ing clin­i­cal re­search in­dus­try.

South Korea ranked sixth in the world for the num­ber of clin­i­cal tri­als con­ducted in the coun­try, and Seoul topped the list with the most clin­i­cal tri­als per city last year. United Na­tions Ed­u­ca­tional, Sci­en­tific and Cul­tural Or­ga­ni­za­tion (UN­ESCO)’s mar­ket re­search re­port states that South Korea ranks first in R&D spend­ing with re­gard to gross do­mes­tic prod­ucts (GDP) at 4.3 per cent of GDP. Marked for its high level of tech­no­log­i­cal and so­cial de­vel­op­ment, South Korea is at­tract­ing more Phase I tri­als. Since early-phase tri­als are only al­lowed in coun­tries where the medicine is orig­i­nally de­vel­oped, this up­ward trend means that this coun­try is mak­ing re­mark­able progress in re­search­ing on new drugs and ther­a­pies.

More­over, Korea also has one of the world’s most ef­fi­cient clin­i­cal trial ap­provals (30 work­ing days), and its med­i­cal in­sti­tu­tions and prac­tices meet the high­est in­ter­na­tional stan­dards. Korea has a re­search­in­ten­sive ecosys­tem com­ple­mented by some of the most ad­vanced IT in­fras­truc­ture and train­ing. With a highly ed­u­cated and mo­ti­vated work­force, Korean com­pa­nies have proven track records in qual­ity and ef­fi­ciency in clin­i­cal tri­als. An­other sig­nif­i­cant ad­van­tage is the ex­ten­sive sup­port pro­vided by the Korean gov­ern­ment for the phar­ma­ceu­ti­cal R&D in­dus­try and clin­i­cal tri­als thus fur­ther pro­pelling the sec­tor.

Tai­wan, too, is show­ing pos­i­tive signs in clin­i­cal trial mar­ket with a con­stant growth trend from 2011. Sim­i­lar to South Korea, Tai­wan also saw a large num­ber of early-phase tri­als, specif­i­cally from 11 Phase I ap­proved in­ves­ti­ga­tional new drugs (IND) in 2011 to 53 in 2016. Cur­rently there are 27 CROs have been present in this coun­try, in­clud­ing global mar­ket play­ers such as Parexel, Co­vance, and IQVIA. The gov­ern­ment is pay­ing se­ri­ous at­ten­tion to clin­i­cal re­search, with 134 hos­pi­tals through­out the coun­try ap­proved by Tai­wan Food and Drug Ad­min­is­tra­tion (TFDA) to con­duct tri­als.

Though In­dia saw a huge down­ward trend in con­duct­ing clin­i­cal tri­als in the past few years, sig­nif­i­cant reg­u­la­tory changes have made the coun­try one of the top clin­i­cal trial des­ti­na­tions in Asia. With key pol­icy changes, In­dia has re­opened doors to con­duct global clin­i­cal tri­als. What’s more, In­dia now has the largest num­ber of FDA-ap­proved phar­ma­ceu­ti­cal man­u­fac­tur­ing fa­cil­i­ties out­side the US, specif­i­cally 119 units. In­dia also has nearly 5,628 com­mer­cial clin­i­cal trial sites.

China is not be­hind too! Though grap­pling with qual­ity is­sues and scan­dals, China too is show­ing pos­i­tive growth in clin­i­cal tri­als space. Fol­low­ing China’s 2017 im­ple­men­ta­tion of Cir­cu­lar 53, huge num­ber of clin­i­cal stud­ies in China can be ex­pected in the com­ing years, say ex­perts. Cir­cu­lar 53 will con­tinue to ex­pand the coun­try’s clin­i­cal trial in­fras­truc­ture, re­mov­ing pre­vi­ous reg­u­la­tory hur­dles and greatly re­duce clin­i­cal trial time­lines. Changes de­liv­ered by Cir­cu­lar 53 in­clude the sim­pli­fi­ca­tion and ex­pan­sion of clin­i­cal trial sites and in­fras­truc­ture, sim­pli­fied ethics com­mit­tee re­view pro­cesses and an ac­cep­tance of for­eign data. Be­sides changes in the reg­u­la­tory path­ways, China is show­ing a promis­ing evo­lu­tion of its R&D ac­tiv­i­ties. It is shift­ing away from generic drug de­vel­op­ment and fo­cus­ing more in­tensely on the de­vel­op­ment of in­no­va­tive prod­ucts. China is in­vest­ing heav­ily in im­muno-on­col­ogy re­search and is a leader in chimeric anti­gen re­cep­tor T-cell (CAR-T) ther­apy where they have over 60 clin­i­cal tri­als un­der­way. This trend is sup­ported by a surge in both pri­vate and pub­lic fi­nanc­ing with Chi­nese ven­ture cap­i­tal and pri­vate eq­uity funds hav­ing raised over $45 bil­lion for in­vest­ment in health­care since 2015.

Glob­al­iza­tion of clin­i­cal tri­als, de­vel­op­ment of new treat­ments such as per­son­al­ized medicine, aug­ment­ing evo­lu­tion in tech­nol­ogy, are some of the key driv­ers of APAC CRO mar­ket. Asia’s phar­ma­ceu­ti­cal mar­ket in gen­eral and clin­i­cal trial mar­ket, in par­tic­u­lar, is on the rise, with South Korea, Tai­wan, In­dia and China be­ing the ma­jor con­trib­u­tors. Since gov­ern­ments in these coun­tries are all pay­ing much more at­ten­tion and op­ti­miz­ing reg­u­la­tions to create the most fa­vor­able en­vi­ron­ment for clin­i­cal tri­als, APAC’s CRO in­dus­try is ex­pected to flour­ish in the years to come.

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