We’re not sure if our timing was fortuitous or terrible. Last month, well before a merger agreement that is expected to lead to his company being acquired for $192 million by Parexel International, ClinPhone CEO Steve Kent discussed the state of the industry with ClinPage. At the time, he was vague about the possibility of another bid from Parexel. After the deal was announced, Kent was unable to comment for legal reasons.
In discussing technology in June, Kent was at greater ease. Yes, ClinPhone’s systems stumbled in a major way last summer, with ripple effects that made unaffected customers nervous. But Kent related that many of the company’s clients had returned by the end of 2007 and start of 2008. The company has made new investments in infrastructure and processes. And it’s looking ahead.
Kent estimates that for ClinPhone customers using data standards with gusto, the time needed to build trials has been cut from twelve weeks to eight. In the interview below, Kent reviews other topics: vendor consolidation, interactive voice response (IVR), electronic data capture (EDC), and the general direction of technology in clinical trials.
How are things?
Tons better from last summer. We had some difficulties last year. Some customers went to the competition and got burned. One customer [using a competitor] couldn’t get a study built for seven months.
Is interactive voice response a bit harder than it looks?
There is a newfound respect for some of the complexity of what we do.
Are you happy with the features and robustness of your IVR solution?
We’ve got a best in class solution, not just the resilience of the platform and the capability of the people providing the service, but also the functionality of the system.
What are the key lessons from last summer, when you were digesting an acquisition and listing your shares in London?
We changed a number of the back-end systems at the same time that was going on. None of those things were a problem. The volume of activity meant that some of the oversight that normally took place took a low priority. That was one of the complexities that caused the issues.
More recently, has the pace been picking up?
There is definitely an increase in proposal activity, an increase in interest from both contract research organizations (CROs) and sponsors. It is in part because the market is growing. The traditional drivers for the market are still there. Trials are getting bigger and more complicated and more international.
What are people in the industry struggling with?
The biggest pain point is integration. That hasn’t changed. That’s been the case for three years, probably. Very often [integration] is on the critical path for the project to go live. That’s head and shoulders above any other pain point.
Data standards from CDISC could make the industry more efficient. But will sponsors really be able to enforce standards across geographic and therapeutic areas?
It requires significant discipline within their own businesses and it requires them to adopt or accept process change. We’ve been working with a number of clients to help them do that. There has been almost a leap of faith by some customers to go down that route. They’ve taken a risk, investing time and money. They want a measurable return. They’re not paying lip service any more. They’ve invested. That is a major difference.
What happens when sponsors insist on data standards?
The quality of the data they’re getting is significantly higher. The data is more usable. The last point they’re weren’t expecting. It’s almost a byproduct. But it’s the most important outcome.
What is happening in the clinical trial management system (CTMS) market?
There is much more attention to how you get the data into the system automatically, rather than having large amounts of manual entry. We see the use of the CTMS being much more part of an EDC or IVR system than just a standalone, bolt-on application that you eventually enter data into. There is a very strong desire for people to utilize the data that is in the CTMS in a more analytical way, and managing the investigator-site relationship is increasingly important—essentially, keeping investigators happy.
How is your electronic data capture (EDC) solution doing?
We are adding functionality to the EDC platform. We are receiving quite a lot of success with that product with CROs and sponsors. We launched a combined EDC/IVR and competitive EDC/CTMS at the European DIA show. Those products have done extremely well. There are very important enhancements [customers] can get with that that they can’t get anywhere else. We’ve sold several systems and have three live.
Is there more emphasis on getting better reports out of all clinical systems?
One of the benefits of a combined EDC/IVR or EDC/CTMS product is to pull data out of those applications and present it as if it’s from one basic system. Nobody else can do that. The industry can’t even do that right now. The industry is moving toward that. We’re leading it. The next step is analytics. There are a number of third-party applications you can apply to data sets to provide the analytical content. That is part of our thinking. I don’t want to talk too much about it.
Traditionally, the assumption was that some sponsors wanted to connect individual systems, each described as ‘‘best of breed.’’ Is that philosophy an obstacle to selling combined applications?
We’re not trying to sell the combined solution into big pharma. They want best of breed for each niche application. Then they are trying to integrate that themselves. We are selling [combined solutions] successfully into smaller pharmas and biotechs. Although they’re smaller, the customers we’re dealing with are getting larger. Eventually, this is going to become best of breed.
Are India and China attractive markets to expand into?
We’ve watched others try to do that and frankly mess it up. It is likely at some stage we will have operations in India and China. They will be operations that are geared toward servicing clients rather than reducing our cost base. The priority for us is quality control—absolutely first, front and center.
Does the scale of a clinical trial technology provider matter?
Customers are concerned to be sure they are doing business with companies that have the capability of growing with them. There are a relatively small number of companies that are large enough to be able to do that. We’ve got 750 employees now. There is a very big gap between us and the next player.
Is the concept of adaptive trials just hype?
Adaptive trials is one of these terms which is overused. The realities of the business of deploying an IVRS is that you can change it mid-study. You can re-estimate sample sizes, change the cohort. That sort of thing, we’ve been doing for 5 years. That is almost routine. People will bracket that as being an adaptive trial. It sort of is. But it isn’t what we mean by an adaptive trial.
What do you mean? Dropping a dose? Altering an allocation ratio?
That would be one category. The other category is where you’re using Bayesian mathematics to adapt the design. Those last two are genuinely adaptive. We’ve won about a dozen in the past six months. There are some sponsors using these study types more aggressively than others. One in particular is in the vanguard of this.
How important is electronic data capture?
It is important. It is one of the pieces. It’s a central piece. So is randomization. You must have electrocardiograms. There are several key pieces. You must have safety. Eventually, there will be all-encompassing solutions that cover that. There will be three or four companies out there that have comprehensive solutions.
Is consolidation something that we’ll see, with smaller clinical trial technology vendors merging?
I see that as an inevitable, ongoing trend. There is only really room for 2-3 large players that have the bulk of the market. I am absolutely convinced the clinical trial market will go the same way.
There are hundreds of small CROs unaffected by consolidation.
You still end up with niche players, as you do the in enterprise resource planning (ERP) market. You end up with players who have a particular application for the logistics of refrigeration parts, or some niche of the market. You always will. You have other companies entering the market from a different price point.
Is the growth of SAP a model of what will happen in the life sciences?
Certainly SAP is an analogous situation. It is very instructing to look at how SAP built their position 20 years ago.