Survey of Finnish vendors serving the pharmaceutical industry
What is required for business success?
This survey identified 43 pharmaceutical outsourcing vendor companies whose range of services is distributed over the entire value chain of pharmaceutical R&D. Nonclinical contract research including disease models is provided by six vendors, whereas 13 provide clinical trial services and nine companies are engaged in contract manufacturing. The rest of the companies are active in biostatistics, bioinformatics, and diverse special services. The majority of the vendors are either microenterprises or small enterprises. Only eight are medium-sized or large enterprises employing more than 50 people. The companies are often spin-offs of university groups and are characterized by a high level of know-how. The large enterprises are established companies with a longer life-span or the result of recent consolidations. The turnover of the three largest companies accounts for 58% of the entire business volume (€94 M out of €162 M).
The global pharma outsourcing business has undergone constant change during the past decade, reflecting the challenges of and trends in the pharmaceutical field. Clinical research organizations (CROs) actively form mergers and strategic partnerships with their pharma clients, becoming continuously larger and better able to offer an increasing service portfolio. Yet smaller pharma clients are best served by outsourcing vendors of equal size. In addition, there are niche markets for specialized services. In Finland, the number of clinical trials has seen a significant decrease during recent years, which is reflected in the declining turnover of CROs engaged in clinical trials.
According to the survey, the main challenges facing outsourcing companies are:
The interviews revealed the following keys to success:
Successful companies have typically understood the importance of serious marketing efforts with face-to-face contacts in order to acquire international customers. Business growth has been obtained through consolidations (domestic or international), by networking with companies offering synergistic services, or through strategic partnerships. The last alternative was the strategic choice of a large renowned company manufacturing active pharmaceutical ingredients. In addition, the mindset of a successful company includes the flexibility and sensitivity needed to adjust the company’s strategy to the rapidly evolving environment.
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