Why Clinical Trials In The APAC Region Cost Less
By Life Science Leader Editorial Staff
The APAC region hosts over half of clinical trials conducted today, and the numbers keep growing. Many components are driving this trend, including cost-effectiveness. On average, expenditures for procedures, diagnostic tests, and visits are 30%-40% less than in the U.S. and Europe, even though this region boasts state-of-the-art medical infrastructure systems. China and Australia, in particular, offer distinct financial advantages to pharmaceutical and biotech companies looking to reduce clinical trial costs while ensuring high safety standards and quality data.
Why Are APAC Clinical Trials Cheaper?
Numerous factors drive down the cost of clinical trials in APAC countries. First, a large patient pool makes it easier and faster to recruit participants. Costs per patient across all therapeutic areas and phases are also much lower in APAC nations, particularly those in Asia, versus other areas. Additionally, FTE averages vary according to country but tend to be lower than in other regions, and transportation costs are less. Finally, regulatory fees are smaller than in the U.S. and Europe.
China’s Low Costs And Quality Data
As the largest APAC nation, China leads the way in pharmaceutical and biotech research and development, especially in oncology. According to Michael Young, principal for biomedwoRx Life Sciences Consulting, China offers international companies significant fiscal benefits. Expenditures for data management, biostatistics, lab testing, and bioanalytics are considerably less than in other regions. The country also offers a large, well-educated, experienced talent pool with lower FTE rates than in the U.S. and Europe.
Meanwhile, China has streamlined its regulatory processes to better align with the rest of the world, and in the last five years, global trial data has become much more acceptable to the FDA, EMA, and other agencies. Therefore, companies can perform research in China and obtain appropriate, quality data they can use in other regions. When companies can avoid duplicating studies in multiple countries, they save millions on trials.
Australia’s Unique Tax Incentive Program
Clinical trials in Australia are also 30%-40% less expensive than in the U.S. and Europe, and this cost differential spans the entire research process, from centralized and local laboratories to doctor and hospital costs. Australia also offers a diverse patient population and a top-notch medical infrastructure system.
In addition, the Australian government provides a distinctive tax incentive for scientific and medical research and development. Since 2011, the country has offered a Research and Development Tax Incentive (R&DTI) program to encourage pharmaceutical and biotech companies of all sizes to conduct research in the country. This program is especially beneficial for small companies and startups.
The R&DTI program offers a tax offset for companies conducting scientific research, including biopharma, therapeutics, and medical devices. The offset covers up to 43.5% of clinical trial-related R&D costs and isn't dependent on the business’s income tax liability for the year. It’s refundable in cash if a company doesn't have tax liability. Organizations can use the rebate to fund further clinical trials and studies in Australia, resulting in a virtuous cycle of increasing critical research while saving money.
Final Thoughts
The APAC region is very attractive to international pharmaceutical and biotech companies looking to conduct high-quality global clinical trials efficiently and more cost-effectively than in other areas. China and Australia are only two examples of countries actively working to encourage investment in clinical research, but the entire region carries cost-saving advantages for large and small establishments. To learn more about how and why APAC countries are a fast-growing market for clinical trial research, visit Clinical Leader Live’s webinar, Asia Pacific The Growing Clinical Trial Hot Spot (clinicalleader.com).