Clinical trials stage account for more than 50 per cent of the total cost for developing a new drug. The high profile drug withdrawal of Vioxx has brought around a greater regulatory scrutiny on the way clinical trials are conducted. It has been estimated that an average number of patients per clinical trial has increased from 1,700 during the 1980s to around 4,000 people in the current decade. Not only is the number of patients increasing but also is the number of studies required.
The pharmaceutical companies that are already under tremendous pressure to innovate and deliver are slowly adopting the EDC technologies to streamline the data capture and analysis, to save time and cost. It started as early as 2004 when Pfizer became the first company to submit clinical data according to the standards prescribed by CDISC. Novartis and Bayer have also been active in the usage of EDC technology.
Despite the existence of EDC (Electronic Data Capture) technology for the last two decades, it faces stiff competition from the paper-based processes. In a typical trial, a CRF containing the patient’s data is filled by the participating doctor and submitted to a clinical research associate. This process works fine in smaller trials, but in the case of a large trial with more than 4,000 people, thousands of paper-based CRF need to be filled in. With each CRF containing multiple data fields, close to a million data points need to be entered and analyzed. There is also a tremendous time lag between the time the doctor fills in the CRF and the time it is actually transported to a centralized place and entered into the database. In view of the above-mentioned facts, we can clearly see that paper-based processes are not only having a high risk of error but also are very time consuming.
EDC allows the CRF forms to be electronic, which can be filled and distributed instantaneously in real time over the network infrastructure to the people who need the data. There is also prevalence of another form of EDC, wherein the patient fills in the details using a handheld device or telephone. This kind of process is generally used in trials where the data required can be input by the patients themselves without any complex tests conducted by doctors.
The main business driver for this market is the efficiencies and savings in cost and the time that this process brings around during the clinical trials stage. It has been estimated that close to 25 per cent of the clinical trials use some kind of EDC.
The market, which is in the early stage of adoption is witnessing quite a few announcements of alliances between CROs and EDC vendors who are coming together to offer a better value proposition to the pharmaceutical clients. EDC is one of the few areas, wherein it is the human element of resistance to change from the pharmaceutical companies that is the greatest challenge rather than the technology itself.
This resistance to change has caused a majority of adoption to be done by means of small pilot projects. The overall conservative nature of the pharmaceutical industry towards this technology can be clearly witnessed by the popularity of the ASP model of business in the market.
The ASP (Application Service Provider) model, which helps in ramping up the process with a minimal investment and training also helps to keep the risk of exposure of pharmaceutical companies to a minimum. CROs, which were once thought of as a gate keeper slowing down the adoption of these technologies due to perceived loss in their revenues, are now hastening the adoption process by allying with EDC vendors. A majority of market vendors in this area have been posting robust growth rates to the range of 30-50 per cent. Though the entire growth might not be from EDC solutions alone, it gives an overall picture of the robust growth that the market is experiencing.
Till some time ago, in the market, many pharmaceutical companies wanting to adopt these technologies were waiting for the emergence of few leaders and data standards and were therefore delaying their decisions. However, with the emergence of a few clear leaders and a commendable work done by CDISC in developing and proliferating data standards, the market is witnessing increased interest from these companies. The market is populated by many companies, with a majority of them being funded by VC funds. Though the competition from the in-house EDC software from the pharmaceutical companies is very minimal, they seem to be a little behind in the adoption curve when compared to biotech companies. It has been reported that biotech companies currently account for as much as 60 per cent of candidate drugs in the pipeline and are considered true innovators who are eager to adopt any new technology to push their drug candidates into the market.
Taking into consideration the above-mentioned fact, many small EDC vendors are targeting and working along with the biotech companies to establish a beachhead and generate references to acquire large pharmaceutical companies as its customers. As is the case with any kind of software business, EDC vendors too have a strong contribution to revenues from consulting, training, support and other allied services. With the bargaining power of buyers being high, EDC vendors are trying hard to bring on board as many customers as possible by being totally flexible in licensing.
With the EDC market expected to grow at a compounded rate of 14-15 percent, the market is witnessing a robust growth in view of increased focus from the pharmaceutical companies to further realise the benefits of electronic process. With adoption rates set to reach more than 50 per cent of the total clinical trials in the next 5 years, the market is all set to achieve higher growth trajectory. The CRO’s, depending on their size and capability, adopt a two-pronged approach. The larger CROs partner with a single EDC vendor on a long term basis whereas the smaller ones offer their services to multiple vendors. The smaller CRO’s who would like to call themselves as eCRO’s might find it difficult catering to multiple EDC vendors as the needs are different for different clients. Hence concerns loom large over economies of scale in operations.
A customized EDC system for each pharmaceutical company might be an expensive affair. Instead a single EDC system which can be deployed for usage in different clinical trials is the need of the hour and the goal of every EDC vendor. Multiple one-off deals require huge investment in knowledge transfer, infrastructure and man power training.