the challenges of chinese cros business ----- swot analysis · quintiles in china --- 11 years •...
TRANSCRIPT
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The Challenges of Chinese CROs Business
----- SWOT analysis
Mr. Jack Xu, MD, MPH
Vice President, SCRC
June 8, 2012
Shanghai, P.R. China
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???????
2012/6/10 4
From Tikki Pang, Dec 10, 2009
中国致人命的药品问题
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In year 1997, Quintiles
• Started its business in two big countries
Ahmedabad, India Beijing, China
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Quintiles in China --- 11 years
• "Since first establishing its presence in China in 1997,
Quintiles has set up three offices around the country - one
in Beijing, Shanghai and Hong Kong - and will continue to
expand. The company plans to bring its
total number of staff in China from
the present 80 (May 29,2008) to 120
by the end of this year”
Lai-lee Tan, Chairman and CEO of Quintiles China,May 29 , 2008 , INTERFAX-CHINA
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Quintiles in India --- 10 years
• "Since establishing an office in Ahmedabad 10 years ago, we have
added offices in Mumbai and Bangalore with a full complement of
services, expanded our clinical research staff
to 750 and have conducted more than 700
global trials across business lines. ”
Dr. Dennis Gillings,
Chairman and CEO of Quintiles
April 6, 2007
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Why so huge difference?
• What are the main challenges to
conduct trial in China?
• What is the good strategy to
conduct trial in China?
•
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Main content
1.The History of China CROs industry
2.Today’s China CROs: SWOT
3.Future development
My talking is meaning Local CROs’ SWOT!
Thanks
May I ask you two questions?
• How about your experience with China
local CRO, are you happy?
• What is your concern when you choose a
China CRO?
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2011 survey by Avoca group data showed:
The sponsors and CROs relationship?
• The fundamental question is: How are
the two groups getting along?
• Sponsors side:
– Satisfied rate increased to 80%;
– dissatisfied rate 7%.
I think China situation is not as good as this! • http://www.pharmexec.com/pharmexec/Noteworthy/Clinical-Development-
Outsourcing-Are-We-Having-Fun/ArticleStandard/Article/detail/711576 12
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A CRO is a person or an organization (commercial,
academic, or other) contracted by the sponsor to perform
one or more of a sponsor’s trial-related duties and
functions.
What is CRO?
FDA Definition: A CRO is a person (i.e., a legal person, which may be a
corporation) that assumes, as an independent contractor of
the sponsor, one or more obligations of the sponsor, such
as design of the protocol, selection of the research site(s),
monitoring of investigators, evaluation of the study data,
and/or preparation of materials to be filed with the FDA.
See 21 CFR §312.3(b)
ICH Definition:
See GCP §1.20
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Estimated CRO total market ,2007-2015
CRO Market
Source: The CRO Market Outlook, Business Insight,2009
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Revenue forecasts, China CRO Market
Source: The CRO Market Outlook, Business Insight,2007
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1970s Research Institutions in USA (state-owned/private)
— embryo of CRO
1980s New drug development becomes more complex and
time consuming — generate CRO
1990s 14 CROs become the listed companies in USA
— CRO industry
1996 MDS Pharma Service — First CRO in China
Quintiles Transnational, Covance, Kendles follow up
1998 SFDA Established
2003 Chinese GCP — Chinese local CROs
CROs --- A Short Story
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CRO Industry
Worldwide: over 1000 CROs
● A small group of large: full service , 45% of the total market
Quintiles, the market leader with 14% of the global market share
Covance and PPD, holding 10% each
● Small to mid-sized entities: a more limited menu of services
including Niche CROs
China: ● Global CROs >10 (nearly top 10 here)
● Joint Venture about 10
● Local CROs over 200
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Main content
1.The history of CROs industry
2.Today’s China CROs
3.Future development
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China CROs’ scope of work
Product Development Regulatory affairs
Project management Manufacturing
Site management Medical translation
Study logistics, drug supply IVRS
Central lab GXP compliance
Pharmacovigilance Quality Assurance
SAP CRF design
Data management (local) Biostatistics
Medical Writing (local) Etc
No Full service in one company! Both Global and local
More than one CRO for a project!
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Strengths Weaknesses
??
??
Opportunities Threats
?? ??
China CRO industry SWOT
•Different person, different opinion!
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● Cost savings in China, Yes or ?
● Large patient and investigator pools
● Reduce time to complete trials
● Wide range of service
● Experienced in most therapeutic areas
...Hepatitis B, CVS, Diabetes, Liver
cancers ….
SWOT Analysis
--- Strengths
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Availability of Patients for Trials
– Numbers:
• Population – 1.3 Billion
• 250 million covered by insurance
• 250 million partially covered by insurance
• 800 million not covered by insurance
– Concentration of Patients in a few of big
cites
Strengths
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Costs
Item US Cost China Cost
1 Day Stay in Hospital $750 to $1000 $40 to $100
1 Day Stay in ICU $1500 to $2000 $80 to $150
CT Scan $300 to $550 $100 to $150
Pet Scan $2,750 $4,500 $900 to $1,200
MRI $1,500 to $3,500 $150 to $300
EKG $30 $4 to $6
Colonoscopy $375 or diagnostic; $550
for therapy with ablation
$50 to $100
CT Directed Biopsy $325 to $450 $100 to $200
Senior Oncologist
Annual Salary
$225,000 + $40000 + for key opinion
leaders
Strengths
Source: Mark Engel, Drug Development in China: Opportunities and Challenges – A Clinical Trial Perspective
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Costs –
– Pre-Clinical (estimates) • Chemistry – 30% to 60% of the cost of West
• Other Pre-clinical – Toxicology – 30% of the cost of the West
– Animal Testing – 30% of the Cost of the West
– Clinical (estimates) • Phase I – 15%_50% of the cost of the West
• Phase II/III – 20%-60% of the cost of the West
Strengths
Now the situation may not!!
Source: Mark Engel, Drug Development in China: Opportunities and Challenges – A Clinical Trial Perspective
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China CROs weakness
• Lack of professional team
• Small scale business (less than 500 staff-clinical)
• Short history: no global experiences
• Limited operation in China, no global player
• Quality assurance system not robust
• Service Scope is small, no full service provider
• Financial Stability not for sure
• Training system is not well
• The staff turn over rate is too high
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SWOT Analysis
--- Weaknesses ● Long CTA approval time in China
● High requirement of application data
and materials
● Quality of Data
● High staff turnover rate
● Quality control at site
● Blood sample exportation permit needed
...
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Weaknesses CTA approval time
Source: Clinical Trial in China Regulatory Update, Monitor April 2009
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China CROs competition Low Price competition!
Not as mature as a service industry!
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• China market is huge, clinical research
marketing is increasing.
• Regulators are asking for more data to support
claims, requiring more and larger trials
• R&D expansion in China. (all top 10 Pharma
companies have R&D center in China)
Opportunities Increasing complexity of clinical trial
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SWOT Analysis
--- Threats ● Competition from Global CROs
● Growing competition from other
emerging markets (India, Brazil, Russia)
● Merger and acquisition in pharma
industry reduces outsourcing
expenditures
...
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Threats
Most of the service providers detailed in this chapter have grown
considerably over the last five years by expanding their overall global
presence in emerging markets...
Competition from Global CRO
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Main content
1.The history of CROs industry
2.Today’s China CROs
3.Future development
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China CRO industry
just like a small plant!
Need to learn from global players!
Grow up in its Chinese way!
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Tips to be the great CRO(1) • Professional, motivated, dedicated and focused staff with
thorough, up-to-date training (training logs including internal vs external training opportunities)
• Completed and practical SOPs,
• Good Project Management Tools and Project reporting tools, e.g.: internet system, spread sheets, prompt meeting minutes
• Low turn over rate: Stable project team members
• Strong Expertise in target indication: in house vs external consultants
• Large database/network of vetted investigative sites (experienced investigators pool)
• Testimonials customers (sponsors), investigator site good comments
• Good performance and good reputation (Audit reports, inspection outcomes)
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Tips to be the great CRO(2) • Short study start-up times
• Quick Recruitment speed (actual vs projected)
• High Patient/site ratio
• Data integrity/query resolution
• Number of indications patients trials sites countries (where, and since when)
• Strong alliance with Global Sponsors
• Real Drugs brought to market; success cases in phase 1-3
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Tips to be the great CRO(3)
• Demonstrated leadership in industry
organizations
• Repeat Sponsor awards (best recruiting)
• Composition of Scientific Advisory
Committee/Board Members
• Professional certifications (lab professionals)
• Membership in professional organizations:
Association of Clinical Research
Professionals (ACRP); DIA; etc
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Development trend
● Both comprehensive and specialized outsourcing
— one-stop service: from discovery to market
— focus on niche market: eg. hepatitis, cancer
● Improve service quality the implement of GCP、SOP、Regulation…
● Formulate industry norms (be more professional)
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Development trend ● Upgrading management level
speed up clinical trial process
enhance the relationship with site
utilize EDC system
● Industry restructuring
Excel was merged by PPD,
More mergers among the small ones!
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Industry Restructuring : M&A Tigermed tied up with Qiming-Ventures has purchased MacroStat
MacroStat, a specialized CRO in DM and Statistics Analysis
Tigermed, a leading local CRO in China which was invested by Qiming-
Ventures in 2008
PPD has purchased EXCEL with US$ 20 million
PPD has purchased BioDuro (China) with US$ 77 million
PPD, a leading global CRO providing overall outsourcing service
EXCEL, a clinical CRO in Phase Ⅱ-Ⅳ Clinical Trial established in 2000
BioDuro (China), an outsourcing services company spanning the entire
range of drug development
Pharmaron has purchased Bridge Laboratories (China)
Pharmaron, a typical local CRO in China providing overall outsourcing
service
Bridge Laboratories (China), a largest preclinical CRO servicing for
International Pharmas & Biotech
03/2009
10/2009 12/2009
12/2009
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China CRO industry future?
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Quality
• FDA inspection report
• Some successful studies in China
FDA investigators inspections in China
to Feb 2012, total 15
inspections
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崔永元：
我把中国当下知识分子分成三类：一类叫拍案而起；一类叫洁身自好；第三类叫随波逐流。
从历史角度看，最需要的是拍案而起的知识分子。现在中国的知识分子，能做到洁身自好就相当不错了。
哪一次商业炒作，哪一次对消费者、读者、公众的欺骗，后头没有学者、科学家甚至院士帮忙？哪一次没有？
