Biotech CRO's Earn Large Portion Of High Value Industry
By Cyndi Root
Contract Research Organizations (CROs) stand to earn a large portion of funding in the biotechnology industry, which includes small companies, start-ups, R&D firms, universities, and large commercialized companies. IBISWorld, a market research firm evaluating multiple sectors, says in a report that 2013 saw $262 billion in biotechnology revenue, with an expected jump of 12.7 percent in 2014. IBISWorld issued a CRO report indicating that biotech CROs earned 15 billion in 2013, almost 6 percent share of the biotech industry. David Windley of Jeffries, an analyst company, sees a $91 billion dollar revenue stream in the last year with 44 percent going to the CRO industry.
Measuring Market Share
Industry analysts have estimated the biotechnology market for the last year between $91 and $262 billion. They have estimated CRO share of that revenue between 6 and 44 percent. Therefore, interested parties can rely on a range, between $15 and $40 billion dollars is available to the CRO industry this year, with a strong upward trend. Another way to look at the outlook for CRO companies is to look at the employment figures for the people involved in this industry.
According to a Science article, one CRO firm added about 1000 people recently, including scientists and administrators. This type of mass hiring reflects the CRO industry’s aggressive growth, especially in the past five years. This sector experienced growth when the economy stumbled because cost-savvy pharmaceutical companies realized the benefits of outsourcing.
Top Biotech CROs
Many CRO firms are small with fewer than 100 employees while others are large. Quintiles is the biggest in the world with over 20,000 employees. Other prominent companies include Pharmaceutical Product Development Inc. and Covance. Industry giant Pfizer contracts with Icon and Parexel and is considering adding another CRO to its team.
Companies looking to enter the CRO industry or improve their present position could look to two growing trends. First is data management, mining the data for insights. Second is regulatory affairs, helping biotech companies navigate applications, FDA inspections, and recalls.