The economics of off-shoring clinical trials
The drugs industry insists that the same strict standards apply to foreign trials as to those conducted domestically, according to a Reuters report.
"We have exactly the same protocol and exactly the same standards for our trials around the world,'' says Roche Holding chief executive Severin Schwan. "Some years ago quality might have been a real concern. Today the situation is different. This is a reason why more trials are being conducted in emerging markets.''
Switzerland-based Roche, the world's largest maker of cancer drugs, is also conducting more trials overseas because the healthcare authorities in certain countries to see data collected from their own populations.
"I see this as an opportunity. A broader range of patients can take part in our trials and the patient population of our trials becomes ethnically more diverse ... If we do not include a certain portion of patients in our global trials, some countries might delay the approval of certain drugs,'' Schwan says.
However, for drug companies looking to globalize clinical trials, two factors are considered: time and money. The clock is always ticking down to the next drug patent expiration, and taking six months off drug development timelines can spell hundreds of millions of dollars of extra sales.
So, many in the industry are still working out just how much cheaper it really is to do clinical research in internationally.
In 2008, former GlaxoSmithKline chief executive Jean-Pierre Garnier published estimates in an article for the Harvard Business Review, stating a midsize company with 60,000 patients in clinical trials could save $600 million a year by switching 50% of its trials to low-cost places such as India and Latin America.
"The economics are not nearly as attractive as once thought,'' Getz says. "Clearly, companies want to test their drugs in markets where they hope to commercialize a new treatment, so that is a driver for deciding where to conduct clinical studies. But given the increased operating costs and the inefficiencies, which can sometimes result in delays in some parts of the world, I think companies will begin to rethink just how many countries they wish to use.''