Can Small And Midsized CROs Survive In Today's Strategic Outsourcing Environment?

By Ed Miseta, Chief Editor, Clinical Leader

In today's outsourcing environment, strategic partnerships seem to be the preferred partnering method for many pharma companies. Bayer HealthCare has strategic agreements in place with Covance and INC Research. Pfizer has similar agreements in place with ICON and PAREXEL. But if pharma companies continue to pursue this type of partnering model, will many of the small to mid-sized CROs survive?

SynteractHCR CEO Wendel Barr thinks so. His contract research organization is one that targets the small to mid-sized biotech companies. In many cases, these companies have very little infrastructure in place. They do have experts in-house, but generally that expertise centers primarily on the drug itself. As a result, these companies must rely on their CRO to provide the needed expertise they are missing, be it scientific, regulatory, or project management.

That different dynamic for the smaller pharma and biotech companies means the outsourcing relationship will be different. “They really need to have confidence in the abilities that CRO partner brings to the table," says Barr. "That is a very different scenario than what you have with the larger pharma companies. Those companies have the capabilities they need in-house, but will outsource to CROs when they lack the capacity to do everything themselves."