Contract research organization

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A Contract Research Organization (CRO) is an organization that offers clients a wide range of pharmaceutical research services. In the Code of Federal Regulations (CFR), the U.S. Food and Drug Administration regulations state that a CRO is "a person [i.e., a legal person, which may be a corporation] that assumes, as an independent contractor with the sponsor, one or more of the obligations of a sponsor, e.g., design of a protocol, selection or monitoring of investigations, evaluation of reports, and preparation of materials to be submitted to the Food and Drug Administration." [21 CFR 312.3(b)]

Services offered by CROs include: product development and formulation, clinical trial management (preclinical through phase IV), central laboratory services for processing trial samples, data management services for preparation of an FDA New Drug Application (NDA) or an Abbreviated New Drug Application (ANDA), and many other complementary services. CROs can offer their clients the experience of moving a new drug from its conception to FDA marketing approval without the drug sponsor having to maintain a staff for these services, which often have limited duration. [1]

1 Outsourcing in Clinical Research
2 Reasons for outsourcing to contract research organizations
3 CRO market size and growth
4 See also
5 References
6 External links

[edit] Outsourcing in Clinical Research

Over the last few years, the pharmaceutical industry has seen large companies use ‘downsizing’ strategies more and concentrating resources on core skills. As industry margins come under increasing pressure, companies could begin outsourcing aspects of their development, manufacturing or marketing processes so as to concentrate on their core specialties.

Outsourcing has been particularly influential in the pharmaceutical industry as the success of a large pharmaceutical company depends on competence in fields as diverse as combinatorial chemistry, computer integrated manufacturing and marketing medicines direct to consumers.

External cost pressures have acted as a major driver for the pharmaceutical outsourcing market. At bottom, the outsourcing market has developed in response to the downward and upward cost pressures exerted on pharmaceutical manufacturers’ profit margins. Given that such pressures are likely to increase in the future, CROs will become more and more important strategic partners for pharmaceutical companies. It is, therefore, in the latter’s interest to consider probable developments in the CRO market and its major players.

[edit] Reasons for outsourcing to contract research organizations

Outsourcing offers a number of advantages to the companies. These include:

Reduces the time (8 to 15 years) required to develop and bring a new drug to market
Sponsor can convert the fixed costs of maintaining the personnel, expertise and facilities like data management) necessary for clinical trial management into variable costs
Non-availability of services in-house
Less knowledge of regulatory affairs in a particular country of interest
Increased complexity of clinical trials
Increased amount of data required from clinical trials
Multinational and multi-center nature of current clinical trials
Large requirement of patient populations
Regionalized diseases

[edit] CRO market size and growth

Global industry analysers estimated that pharmaceutical and biotechnology companies spent approximately $57 billion on R & D in 2005, out of which an estimated $14 billion was used for the outsourcing services offered by the CRO industry.This figure is expected to increase further with the broadening of the spectrum of services outsourced to cover the entire value chain. As the outsourced services to India move up the value chain to cover phase 1/2 trials, the total contracts value may go up to $20 billion by 2010.