As medium-sized and large CROs continue their quest to get bigger and get acquired, smaller CROs are on the march around the globe, expanding as best they can to attract contracts from smaller pharmaceutical companies and biotechs seeking something approximating worldwide reach.
Estern Medical CRO, based in Boston but previously focused only on trials in Latin America, is about to go on a hiring spree in order to begin conducting trials in the United States. And Munich, Germany-based Harrison Clinical Research (HCR) has, through a recent acquisition, established a presence in Edmonton, Alberta, Canada; Mexico City, Mexico; and Buenos Aires, Argentina.
Said Jorge Estrella, M.D., Estern’s president and chief medical officer, establishing full-service operations in the U.S., particularly in Boston, will put the CRO in a much better position to handle trials on both continents as clients request them. All of the privately held CRO’s 50 employees are in Latin America, but by year’s end, Estern’s two Boston-area offices will have about 30 additional employees, Estrella said, including regulatory staff, monitors, biostatisticians and medical writers.
This move is in response to clients saying they can’t conduct all of their trials in emerging markets, but must do a portion of them in the U.S., said Estrella.
Estern, launched in 2002, has offices in Mexico City, Mexico; Bogota, Colombia; Santiago, Chile; and Buenos Aires, Argentina, in addition to Cambridge and Boston. The CRO has focused in the therapeutic areas of oncology, cardiology and diagnostic imaging.
Harrison Clinical, in its effort to offer global coverage for less, recently acquired CRO Global IQ, which conducts phase II-IV work in Canada, Mexico and Argentina.
“The addition of Global IQ will be totally complementary, as we have no operational activity in any of these countries,” said Francisco Harrison, M.D., founder and head of HCR, which has been in business for 24 years. The CRO has 12 offices across Europe, one in Russia, one in Israel and one in the U.S. HCR inherited its Princeton, N.J., office three years ago as part of an acquisition.
Harrison said HCR and Global IQ had collaborated on trials over the last two years. He’s especially excited about being able to expand into Latin America. In addition, Global IQ is a member of Research Point Global, a partnership of small CROs that work together to try to offer a global reach.
Harrison said the acquisition should bring HCR’s annual revenue to around $50 million.
The acquisition is HCR’s sixth; all have been funded with the company’s own capital. Harrison said it will enable the 480-employee company to add 58 employees, and he plans to hire 34 more as soon as possible. Employees being sought include CRAs and project managers in Germany, France and Latin America.
HCR focuses on the therapeutic areas of oncology, transplantation and central nervous system (CNS). Global IQ’s areas of focus include oncology and CNS. The company also brings to the table its proprietary data capture system.
Global IQ’s president and CRO Paul Braconnier will stay on to head up Latin American operations for HCR, said Harrison.
HCR serves the medium-sized and small pharma and biotech sector of the industry and also conducts many phase I and phase II proof-of-concept trials for big pharma and big CROs in oncology. Rescue trials, said Harrison, account for about 10% of the CRO’s business.
Are more such buys afoot for HCR? Not immediately, said Harrison. But when it is time, he wants to look within the U.S. “At the moment we just want to take time to consolidate and absorb this one,” he said, “but later we’ll be looking to grow more in the U.S., probably through acquisitions.”
As for Estern’s future plans, Estrella says the CRO is looking to expand into the U.K. and possibly Germany within two years.