ASIA’S CRO MARKET ON THE RISE
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.