Demand for clinical trial services will increase in 2024 despite continued macroeconomic pressure on the biotech sector, according to Icon.
The Dublin, Ireland-headquartered clinical research organization (CRO) made the prediction in a full year guidance statement in which it forecast revenue in the $8,400 - $8,800 million range and adjusted earnings per share in the range of $14.50 - $15.30.
CEO Steve Cutler said, “Our outlook for 2024 indicates a positive demand environment across our segments, notwithstanding continuing macroeconomic pressures faced by our customers.”
Cutler also said the CRO plans to invest in automation, innovative tools and initiatives to increase participation for sites and patients in clinical research.
Constructive environment
The guidance, which comes a month before Icon is due to present its 2023 results, is in keeping with comments Cutler at the JP Morgan Healthcare Conference this month.
“The biotech environment, we believe, is stabilizing somewhat now, but there are still some challenges in that space and a number of companies will continue to be under pressure going forward.
“We’ve certainly seen something of a more muted response of the biotech RFPs [request for proposals – when sponsors ask CROs how much an outline project would likely cost] but there’s still overall a very constructive environment for us.”
Access to capital
Similarly, in early January, Icon published an industry survey that suggested biotech R&D spending is likely to increase.
According to the survey – which drew on responses from 130 biotech executives – while challenges remain, biotechs are still finding ways to fund clinical projects.
For example, some 48% of respondents are using partnerships with large pharma as their funding method, while a third have gained investment from venture capital firms.
And – according to Chris Smyth, president of Icon biotech – part of the way they have attracted such backing is to develop clinical trial plans in collaboration with CROs.
“Biotechs must walk a line between de-risking and validating their assets to instil confidence in potential investors while pursuing novel innovation to catch their interest. Ensuring there are robust clinical development strategies in place underpins both these goals.
“Support within the wider industry is available – partnering with large pharma and CROs will help biotechs,” he wrote.
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