Don't Approach Strategic Partnerships With A Procurement Mentality

By Rob Wright, Chief Editor, Life Science Leader magazine

Steve Cutler, Ph.D., group president global clinical research services, has over 23 years’ experience within the pharmaceutical and contract research industries. Prior to joining ICON plc, a global contract research organization (CRO), Steve held a variety of executive-level positions with Kendle, Quintiles and Sandoz (now Novartis). During a recent trade show, Steve took the time to provide industry insight, answering questions posed by Clinical Leader around current trends and what it takes to develop successful strategic partnerships.

Clinical Leader (CL): Among the challenges that the industry is facing, which do you see as being the most important?

Steve Cutler: The key issues in our industry are driving down costs and use of technology to make that happen. I think that the CRO industry is entering an interesting period over the next 5 years. We are changing how our partnerships with sponsors work, moving from being a ‘yes’ or ‘no’ service-based industry to being what I hope is a much more a partnership of equals, such that a CRO can say to a sponsor, “Don’t do it that way because we have done it that way and it doesn’t work. Here are two alternatives and we think this is the right way to go.” A true partnership, where both partners have equal status, is more productive, enables more rapid decision making and is more cost effective. Within ICON, I am looking for us to become equal partners, to be more assertive and willing to have some tough discussions with sponsors when we really don’t believe that they’re doing the right thing. I remember being at another company where the attitude was that if the sponsor wanted you to do it a certain way, you would do it that way despite your experience, which told you with near certainty that it was going to have a poor outcome. We need to get away from that mindset, which you can do when you have balance in the partnership. You can escalate issues and get the right solution. This is the only way for the industry to grow. The key to success for a CRO is to be an assertive, pragmatic, active and focused partner.  I believe having good competitors is also important.  A rising tide raises all ships, so the better our competition, the better we have to perform. These are the main challenges we have – not just as an organization but as an industry.

CL: What advice do you have for bio and pharma execs who are seeking to develop strategic partnerships?

Steve Cutler: There are two sides to this: relationships and operations. On the relationship side, despite what we say, we are all scientists and love the data but people and relationships are very important for strategic partnerships. Firstly, I would advise a company that is considering one of these relationships to assess the culture of a potential partner to make sure it is in line with their own. If they are very quantitative or perhaps more financially orientated than your company, it may not work well. On the other hand, if they are a very passive organization compared to yours, that may not work well either. The cultures of both partners need to be well aligned and, to do this, you need to meet at the senior-management level and work with the company so you can get a sense of the culture. Secondly, you need to forge good relationships based on honesty and transparency with the key people who will be working on a project. That may not necessarily mean the CEO but you need to have people who can get things done and can bring the attention of the organization to the issues you will inevitably encounter. You need to have people focused on building relationships and not acting as just a service provider. You have to meet with and have dinner with those people. It’s like a marriage; you really have to take it very seriously to make it work.

On the operations side, governance is very important.  Set up a steering committee that meets on a regular basis to check how the partnership is working, to see what is going well and what needs to be improved. You need to have very honest discussions and to invest the time. Depending on the size of the partnership, you may need to have a more operational oversight group as well.  It is advisable to determine very clearly what you want to achieve and develop and agree a clear set of metrics and goals for both partners that can be measured on a regular basis so you can monitor how the partnership is developing.  I would advise building strong relationships with advocates of the partnership at all levels within the sponsor company to ensure that trust is built, issues are kept in perspective and objectivity is maintained.  It is about executing, building trust and respect and being a little creative.

With our strong partnerships, we sit down and brainstorm. We really try to be innovative with our partners. I think the contract needs to have some sort of negotiated service agreement (NSA) that sets out terms and obligations that are a win-win scenario. CROs need to make a reasonable profit. Sponsors need to have trials done faster, better and cheaper. Approaching the CRO from a purely procurement point of view is not really a strong basis for a collaborative partnership. Sponsors need to be comfortable with the CRO making a sensible profit. CROs need to be comfortable with holding prices and taking the overall cost of development down.  The goal is to spend less on a per-trial basis in the drug development process but expand margins because we sensibly and appropriately innovate.

CL: What are some of the current concerns in the CRO market?

Steve Cutler: I think the major concern is the increasing cost of drug development. Some of the numbers being quoted around the cost of developing drugs are quite significant. More than a billion dollars is pretty common now. I don’t believe this is sustainable given the pressures sponsors have in the areas of government pricing, regulatory requirements and the challenges of managing ever increasing amounts of data.

I think the CRO industry has an opportunity to be more cost-effective in the way we perform trials. For example, ICON is developing technology geared towards remote monitoring of clinical data in real time.  Benefitting from the FDAs recent guidance on centralized monitoring our ICONIK tool allows us to review accumulating data much more systematically and efficiently than on-site CRAs can do now.  The central monitor using ICONIK can highlight issues at sites that on-site CRAs who trawl through individual CRFs would only rarely identify.  For example on a recent trial we identified a site that was clearly under reporting AEs – our central monitor had been able to easily compare the various event rates - on the basis of patient exposure to the drug – and show that compared to other sites in the trial the site had some issues.  One of our on-site monitors was sent to the site a.s.a.p. to correct the issue which would, in the past, only have been found when the trial data was being analyzed at the end of the study.  In this way we feel we can fundamentally change the way clinical trials are conducted – by doing less low value-added work and focusing on systematic real time data review.

The biggest concern I have as an operator within pharmaceutical development is making the cost of drug development more manageable than it is presently. In so doing, pharmaceutical companies will be better able to innovate.

CL: What are some of the innovations that you see taking place industry wide that are helping to drive down drug development costs?

Steve Cutler: A major innovation is in the area of data access; rapidly transferring data from the clinic/patient to a database so it can be reviewed by clinical research staff and medical experts in near real-time. In the past, especially with paper-based systems, there was a 2–3 week delay between data collection and having it available for review in a systematic way, i.e. across clinics, off-site and countries. We are now developing technology using the iPad through our recent Firecrest acquisition that really does collect data on a real-time basis.  This allows for the people monitoring clinical trial programs, to be able to ‘look over the investigators’ shoulders’ as they enter patients into trials, means that they can ensure patients meet the entry criteria and are being appropriately treated and that investigators are clearly documenting any adverse events. In a matter of minutes, we can now see the day’s data, analyze any trends or identify inconsistencies and thus, allows us to intervene faster and more effectively than we have in the past.

In our industry, a clinical research associate (CRA) will often arrive at a site only to discover a full-blown problem. We are trying to be more proactive so the CRA is at the site very early in the process and they are equipped with data on potential and real issues that they can sort out issues before they become major problems. A recent example is a site where blood pressure values always ended in either a 0 or 5. It wasn’t a huge issue but it wasn’t the level of data recording we were seeking. We sent a CRA to the site to explain the importance of being accurate down to the last mm of mercury, not to round it up or down to 0 or 5. Little things like this, as well as more important issue like adverse-event reporting, can help us to focus our valuable resource on launching trials and appropriately collecting the data at a much lower cost.