Clinical Research Organizations Procurement Intelligence Report, 2024 - 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)

Every organization and its procurement team look forward to negotiating the best deal while procuring a set of products or subscribing to services. Rate benchmarking involves price/cost comparison of more than one set of products/services to analyze the most efficient combination that can potentially help the procurement team in getting the optimum rate.

The benchmarking process involves comparing the rates charged by different CROs for their services to establish industry standards and identify outliers. Rates in the clinical research industry can vary significantly based on factors such as labor, geographical location, the complexity of the study, therapeutic area, and the size and reputation of the CRO. For example, a reputable CRO in the United States may charge an average rate of $2,500 per patient, while a similar CRO in India could charge around $1,500 per patient. It is important to note that benchmarking rates solely based on cost may not provide a complete picture of the quality and value of the services offered. Factors such as expertise, infrastructure, compliance with regulations, and efficiency should also be considered to make informed decisions when selecting a CRO for clinical research studies. Regularly updating benchmark data can help sponsors and stakeholders to make informed decisions and negotiate fair pricing contracts with CROs, ensuring successful and cost-effective clinical trials.

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One of the biggest costs incurred by clinical research organizations (CROs) is labor. This is because CROs hire numerous individuals, such as clinical research associates (CRAs), data managers, statisticians, regulatory affairs specialists, and project managers, to carry out clinical studies. The location of the CRO, the amount of staff experience, and the kind of clinical trial being undertaken can all affect the cost of labor.

According to our research, clinical research associates at Icon receive a 35-40% higher base salary compared to the salary received by clinical research associates working in companies such as IQVIA and Sun Pharmaceutical Industries. However, the year-on-year increment rate in all these companies majorly depends on the Key Result Areas (KRAs).

Organizations may find it cumbersome to continuously track all the latest developments in their supplier landscape. Outsourcing the activities related to gathering intelligence allows organizations to focus on their core offerings. At this juncture, our newsletter service can help organizations stay updated with the latest developments and innovations and subsequently assist in preventing disruptions in the supply chain. We have identified the following developments within the clinical research organizations over the last three years:

• In June 2023, Clinical Research Management (CRM), a global CRO, acquired TrialSpark, a CRO that specializes in decentralized clinical trials, for $150 million. The acquisition of TrialSpark is a sign of the growing importance of decentralized clinical trials. As the industry moves towards more patient-centric trials, decentralized trials will become increasingly common.

• In February 2023, IQVIA acquired Enlight Bioanalytics for $400 million. The acquisition was intended to help IQVIA to expand its capabilities to use AI and ML in clinical trials. The company also said that Enlight Bioanalytics's expertise in decentralized clinical trials would be a valuable addition to its portfolio of services.

• On July 2, 2021, Parexel, a U.S.-based global clinical research organization (CRO), announced a merger agreement under which the company would be acquired by EQT Private Equity and Goldman Sachs for USD 8.5 billion. The acquisition was completed on November 15, 2021. EQT Private Equity and Goldman Sachs are both experienced investors in the healthcare industry. They have a strong track record of investing in and growing businesses and are committed to supporting Parexel's growth and innovation.