When quarterly revenue jumps 70 percent from one year to the next, as it recently did for Phoenix Data Systems, something must be appealing to the firm’s electronic data capture (EDC) customers.

The Philadelphia-area firm started 118 new trials for 38 clients during the first 9 months of 2007. Fifteen of those clients are new for 2007. Eighteen of those projects were pivotal Phase III studies. Its backlog is $24.5 million.

“We have a remarkably stable and loyal client base that keeps coming back,” says William Claypool, the firm’s chairman and CEO. “Our technology allows all of our clients to really embrace EDC much more easily than what we’ve heard with competitive systems. The tailored approach for small and mid-sized pharma, and the full service EDC that we provide, has been an extremely popular coupled offering.”

Extra Help

Part of the approach at Phoenix Data Systems is to have a dedicated team for first-time users of EDC. That helps clients have a positive experience the first time out of the gate. “We have set up a group that focuses all their attention on these first-time clients from a process point of view and a technology point of view,” says Claypool.

As his company and other firms report, there is a rapidly accelerating acceptance of EDC. But what is happening to customer expectations?

They may be moving in both directions, Claypool muses. “All of the companies that have survived in the space have been able to execute at a certain minimal level,” he says. “The other expectation is that the add-on services around real time data visualization, reporting, being able to have one’s data at one’s fingertips all the time, and being able to have actionable information on these trials—all of those things are setting the bar higher.”

Those areas, he feels, are where Phoenix Data Systems is especially strong. Says Claypool: “We’ve heard very positive reviews from our clients, not just for the system and its quality but for these follow-on services that are generally integral to our offering.”

Surging Tide

Claypool thinks the acceptance of EDC will benefit many companies in the sector as sponsors use the technology in an increasing portion of new studies. “That trend will accelerate faster than it has in the past. It will pick up speed,” he says. “That will help all the EDC providers enjoy a very good year in 2008.”

His company has always had a more heterogeneous approach to the tools that it would supply, bundling a variety of data management, trial management, interactive voice response, patient diary, randomization, coding and other functionality into its system. “Our IVR system goes directly into our database. Drug randomization and telephonic electronic patient reported outcomes (ePRO), we blend in with our base system. It is the same database. There is no reconciliation required,” he adds. “The safety reporting that comes out of that is very obvious.”

Rising and Falling

The company’s Jim Dorsey, VP of marketing, notes that there is a similarity to all EDC systems that is fully appreciated by many customers across the industry. “People accept that EDC is a good idea,” he says. “Now the focus is on execution and delivery. It’s less about some tweak or some flashy feature, and more about can you support all of my trials? Can you do this Phase III international study and can you do my Phase I’s, too?”

We also heard from Phoenix’s Stephen Boccardo, VP of sales and marketing. He isn’t writing off any competitors. But he does observe that even in a time of widening acceptance of EDC, some formerly competitive EDC firms are faltering. “We seem to be going in opposite directions,” he says. “We’re heading up, growth wise, profitability wise. They seem to be sliding a bit. It’s directly attributable to us winning a lot of business against them.”

Boccardo notes his firm was recently highly rated in a Gartner survey of the larger EDC companies, and says it is ready to play on a loftier tier of the industry where the armies of Phase Forward and Medidata Solutions have established fairly formidable encampments. “We see ourselves moving ourselves up to the top tier,” he says.

At the end of the day, it’s partly about avoiding disappointed customers. Says Boccardo: “They like what we see when we talk to them. Then we can deliver on that. That isn’t always the case, whether it’s EDC vendors or if they’re using a CRO. I’ve been around for 22 years in the industry. You always hear the horror stories. We’ve done good job of providing what people really want.”

Editor’s note: We previous looked at Phoenix Data Systems about six months ago in this story.