Info & Opinion
May 25, 2013
With news about big data, Aetna, Covance, GNS, Scrip, Quintiles, PPD, Icon, BioClinica, Merge, Medidata and GSK.
With news about FDA, CTMS, PMG Research, Inclinix, EMA, Hemofarm, Parexel and the Korea Drug Development Fund
David Underwood of Quanticate says some firms are giving short shrift to the basics of clinical trials
With news about Roche, Quintiles, Allscripts, Janssen, SGS, Oracle, TriReme, OpenClinica and FDA
The gap was glaring. And it has been filled. For the first time, more than a decade after the technology emerged, Parexel can offer customers a viable electronic data capture (EDC) solution.
Last week, the Waltham, Mass. company concluded its $192 million acquisition of ClinPhone, based in Nottingham, UK. Parexel will now have approximately 1,500 people providing technology in clinical trials, making it the largest such operation in the business.
Parexel, of course, is not the first major contract research organization (CRO) to offer software in earnest. But it has made a success of software solutions whether or not they were developed in-house. And because Parexel clearly prefers to offer not just any old pile of code but industry-leading choices, the ClinPhone acquisition presents new challenges to both service- and technology-oriented companies supporting clinical trials. Large organizations seem to be more interested in EDC than ever before: even industry giant Quintiles considered a bid for ClinPhone.
Thanks to its Impact clinical trial management system (CTMS) and the ClinPhone interactive voice response system (IVRS), Parexel now controls the top technologies in two industry niches. Like Bio-Imaging, which purchased Phoenix Data Systems earlier this year, Parexel has apparently decided that owning both imaging and EDC solutions was an imperative. Parexel also offers patient-reported outcome (PRO) solutions.
To hear more about the company’s future, ClinPage rang up Mark Goldberg. A few weeks ago, he was named chief operating officer of Parexel. (ClinPhone’s top executive, Steve Kent, has been named president of Perceptive Informatics, the Parexel technology division that Goldberg continues to oversee.)
A radiologist by training, Goldberg was the architect of Parexel’s vision of combining services and technology. We’d tried to arrange an interview with the guy for years but he always eluded us. (Colleague Suz Redfearn was able to deliver this article on Goldberg, which concerns the firm’s interest in imaging.)
It would be hard to overstate Goldberg’s importance. As his boss, Parexel chairman and CEO Josef von Rickenbach, said in the news release announcing his promotion: “Dr. Goldberg has led the strong performance in clinical research services, our largest business segment, and has helped to build Perceptive Informatics into a leading provider of advanced technologies that facilitate the clinical development process.”
Shortly after the deal closed, Goldberg told us that more than two dozen previous acquisitions give Parexel optimism that the merger will go smoothly. He offered no clues about what would happen to the extra, apparently duplicate systems it now owns (its own IVRS and ClinPhone’s CTMS).
He similarly declined to speculate on what competitors might do, but said Parexel has a unique mix of services and software. “We’re really one of the only companies out there that has brought together the broad global service business and the broad set of technologies that will be embodied in Perceptive Informatics,” he says. “We view that as a differentiator.”
Goldberg says the sponsor community is seeking a mixture of software and services—in brief, a solution. “There is an ongoing convergence between companies that deliver technology and companies that deliver services,” Goldberg says. “There will be a continued convergence between services and technology as part of what clients are looking for. If you look at a lot of so-called technology companies, a large percentage of their revenue is in fact derived from services.”
EDC is only one element in the ClinPhone toolbox. We asked Goldberg how important it was as a factor in the acquisition. “When we look at our clinical research business, the majority, over half, are using EDC,” he says. “Clearly, EDC has become an important technology.”
But Goldberg acknowledged that some customers will prefer that alternate EDC suppliers be used, and that that will continue to be a dynamic in the industry. So the ability to insist that customers use ClinPhone’s EDC product appears limited. Says Goldberg: “It’s not as if we’re going to only offer one option to our customers. That doesn’t work in this marketplace.” He said the firm’s numerous working relationships with other CROs and technology suppliers would continue as they always have.
Having said that, it’s hard not to imagine pricing incentives or other ways Parexel will slowly nudge customers to use more than one of its software offerings. On that front, we asked Goldberg about the “best of breed” bias in the industry, in which many research sponsors pick the best application they can find. Only later, after the dust has settled, do they worry about combining that program or its data with everything else they already own.
We then rambled on for a moment about some sort of clinical trial-oriented Salesforce.com, a hypothetical, futuristic, web-based mega-program that could handle everything now needed in industry-sponsored clinical research—randomization, EDC, CTMS, logistics, safety. We expected Goldberg to dismiss the idea. He didn’t.
“That is a reasonable vision,” Goldberg said. He noted that many Impact customers are already keen to integrate that product with EDC.
Added Goldberg: “The buying practices of every organization that we deal with vary. But we see that clients would get benefits from working with an integrated solution set. That eliminates additional integration work, it eliminates the need to reenter data in multiple systems. There is a true customer benefit to working in a more integrated environment.”
Indeed, he added, he and colleagues at Parexel were surprised by the degree to which their ClinPhone counterparts shared a conviction about the importance of linking clinical applications. It reinforced their hunch the deal would bear fruit. Both ClinPhone and Parexel have extensive experience in tying together disparate pieces of software and data, as clients in biotechnology and pharmaceutical firms routinely demand.
Both firms also have loftier, more long-term visions of solutions that don’t involve traditional, hand-tailored “integrations” that take months or years to sew together. ClinPhone wrote a few articles about its philosophy on this website earlier this year. Here’s one of them.
The significance of the ClinPhone acquisition is hard to gauge. Will other CROs see a need to beef up their internal technology divisions? Will they partner with technology firms more ardently to fend off Parexel, which recently reported a record $964 million in 2008 revenues? On the technology front, will EDC firms offer themselves to well-capitalized CROs?
It’s also possible that little will change. Many sponsors, after all, are sufficiently invested in their EDC solutions that—at first—the supplier landscape could be barely affected. Indeed, one current paradox is that just as EDC is in more demand, with many providers thriving, some second-tier entrants in the space are struggling. So a CRO yearning to buy a less expensive EDC firm could probably wait six months or a year, and see what’s on the market.