Clinical trial supply market thrives in India
With more and more
clinical trials being outsourced to India, it is only logical for
sponsors and CROs to start sourcing the clinical trial supplies from
within India
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India began to utilize the opportunities in clinical
trials few years ago. Some companies grabbed the opportunity,
some looked at it and some simply created obstacles. Now the sector
offers lot of hopes.
Today, after conducting more than 700 clinical trials in India, the
market seems to have matured and more and more companies and service
providers are getting attracted to this promising market. Other
than clinical research organizations (CROs), we now have
support companies like clinical trial supply (CTS) companies, life
science logistics companies, clinical trial material depot providers,
specialized packaging companies, software solution providers, and
clinical trial data management companies and a host of other companies
that have emerged in the last few years are capitalizing on the
clinical trial market growth in the country.
These ancillary industries of particular interest and relatively naive
territory provide huge ‘clinical trial supply
market’ opportunity.
With more and more clinical trials being outsourced to India, it is
only logical for sponsors and CROs to start sourcing the clinical trial
supplies from within India. Prohibitive cost of imported clinical
material, lead time for procuring import license and ambiguous
regulations for imports have created a need for a reliable and
efficient local clinical trial supplies partner with global reach more
imperative than ever before.
As per an estimation study by the global consulting firm, Mckinsey
& Co, European and the US pharmaceutical companies will spend
$1.5 billion (about Rs 7,038 crore) per year on clinical trials in
India by the year 2010. Though there are no scientific estimates
available for determining the share of clinical trial supplies as a
percentage of this total cost, even we conservatively estimate only 10
percent as the cost of clinical trial supplies, we are looking at a
market of around $150 million (about Rs 703 crore). And this market
would definitely grow at a rate faster than the rate at which CRO
industry is growing locally (30-35 percent), as it would not only cater
the domestic trials but also cater to the export market of the clinical
trial supplies.
In India, the CTS industry is still at a very nascent stage with only a
very few companies like Rubicon Research, Bilcare and Thermo Fisher
have forayed into this segment offering varying services and expertise.
Rubicon offers a one-stop-shop for all clinical trial supplies, right
from manufacturing and packaging including labeling, blinding and
randomization to CTM depot services, while companies like Bilcare offer
only clinical packaging services. For Rubicon Research, CTS has been a
natural vertical integration of its formulation development services,
and for Bilcare, it is a diversification from its core packaging
business.
The opportunity for CTS companies lies in offering clinical trials
supplies services to clients including clinical manufacturing,
packaging, labeling, blinding and randomization and depot services.
Services offered by CTS companies should be differentiated value-added
services that can provide the flexible infrastructure needed to
accommodate the complex and variable requirements for CTS. These
differentiators in terms of capabilities have been illustrated below:
Opportunity and potholes
In spite of the high expectations on India to do well in the area of
pharmaceutical R&D, there are many concerns that hinder the
growth. The hindering factors include the lack of adequate skills,
unrealized market potential and inadequate infrastructure in
many areas of CTS, imprecise documentation systems arising out of
ambiguities in the interpretation and implementation of global clinical
trial protocols and requirements for world-wide multi-centered CTM
depot. While India still could offer CTS at economical costs, there are
concerns about the quality aspects. India has for long been viewed as
the low cost destination for clinical trials. The country has
also gained a dubious reputation of low quality, thus marring image in
the process. This would mean that Indian supplies would be viewed with
suspicion, and though, we would be rightly expected to deliver high
quality global supplies, clients from the regulated markets or
otherwise would still be looking at substantial cost advantage. This
cost advantage would be difficult to provide considering the heavy
investments that are needed for putting up a US FDA approvable
manufacturing and packaging plant for CTS supplies, and the
long gestation periods for return on investment, considering the
sporadic and non-cyclical nature of manufacturing and supplies, unlike
a typical supply chain set up.
Therefore, India needs to strike the right balance between quality and
economics in cost. Joint efforts are needed from the industry
and regulatory bodies to ensure that India’s relatively late
entry into the CTS arena is without any regulatory bottlenecks, quality
and cost prejudices.