IPO-ready WCG Clinical says low R&D productivity rates are an opportunity for a firm with the right mix of technology and knowhow.
The trial training and services firm shared its thoughts on the clinical research sector and wider pharmaceutical R&D market this month in an S1 prospectus filed with the US Securities and Exchange Commission.
According to WCG, while pharma R&D investment has increased – and is expected to reach $195 billion this year – “the 12 leading biopharmaceutical companies realized, on average, a return on R&D investment of approximately 2% in 2018, down from 10% in 2010.”
“This decreasing return on drug R&D is driving a transformation of the industry’s approach to drug development, especially as it relates to clinical trials, which represent the most costly and time-consuming stage of the R&D process and therefore bear the greatest investment risk.”
WCG quoted analysis by the Tufts CSDD suggesting drugs in clinical trial phases each drug having less than 12% probability of receiving regulatory approval to support its view, adding that increasing trial costs and complexity are exacerbating the challenges.
“New therapeutic categories and scientific advances, including cell and gene therapy, and precision medicine, are emerging at a rapid pace and have stimulated new and innovative approaches for addressing oncology and rare diseases.
“These advances have the potential to bring significant benefits, but also result in greater trial complexity and related expenses.”
According to WCG data the average clinical trial protocol requires 263 procedures per patient, up 44% since 2009.
“This increasing complexity is fueling the demand for the new type of outsourced, data-driven and science-based trial solutions that we provide, therefore expanding the size of our market opportunity.
“The key critical pain points that contribute to this time and cost burden are ethical review, study planning and site optimization, patient engagement, scientific and regulatory review, amongst others. Leveraging our strategic position at the center of the clinical trial ecosystem, we have developed a suite of integrated and technology-enabled solutions that we believe have had a significant impact on these existing hurdles.”
IPO
WCG plan to go public – which sets a nominal value of $100million – comes after a series of acquisitions in the trial services space.
In 2019, for example, the firm bought clinical trial consultancies Waife & Associates and Pharmaseek. It also snapped up pain drug trial specialist Analgesic Solutions.
Since then it has bought site specialist Trifecta Clinical and – this May – consultancy firm, the Avoca Group.
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