CRO Consolidation to Bring New Developments to Clinical Trials
The M&A trend among CROs and clinical service providers raises concern about sustainability and its impact on their pharma clients, bringing new changes through consolidation.
FREMONT, CA: A company that acquired a contract research organisation (CRO) to leverage its clinical trials and predictive analytics capabilities has shocked the healthcare space and raised various questions about the sector’s future outlook. Few organisations questioned the future impacts this would have on the CRO market. They debated whether this spinoff refers to recent merger and acquisition (M&A) activity growth among CROs and will lead to more spinoffs in the future, as the ongoing consolidation may not be sustainable for the industry.
The combined company was intended to leverage technologies for several purposes. This included improving patient recruitment for clinical trials, increasing efficiency in conducting clinical trials, delivering data quickly to drug sponsors, physicians, and patients, and optimising the increased scale of its central laboratory operations and collective data resources to drive greater R&D productivity for its clients. Many companies have undergone M&A in the CRO space.
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Increased scale, geographic expansion, lower costs, and operational savings are why companies choose M&As instead of building the same offerings internally. Healthcare infrastructure can be a focus area for companies for an M&A as having more healthcare infrastructure control is increasingly crucial for building resilience. There are many similarities between clinical trials and APIs, and access to APIs is key to speeding up clinical trials.
Gaining capabilities in niche areas is also a reason behind increased M&A activities among CROs. This is because numerous larger companies prefer to acquire smaller players or start-ups, particularly in areas related to patient recruitment and monitoring and digital tracking of outcome measures in clinical trials.
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