...pharmaceutical and biotech R&D spending has risen rapidly since 2005 and will continue to rise at least through 2009. In 2005, spending totaled $953 billion; next year's spending is expected to reach nearly $130 billion.

Key words: clinical research, contract research organizations, investigative sites, R&D

**********

Investigative sites continue operating under financial pressures even as contract research organizations (CROs) have had very profitable run in 2007. Competition among research sites grows as sponsors and the larger global CROs are placing more studies globally. CenterWatch data show that pharmaceutical and biotech R&D spending has risen rapidly since 2005 and will continue to rise at least through 2009. In 2005, spending totaled $95.1 billion; next year's spending is expected to reach nearly $130 billion. If trends continue, by 2010, R&D investment will have increased 50% in five years. Yet U.S. investigative sites remain squeezed financially. Experienced research centers find themselves answering RFPs from longtime clients, asking them to bid against competitor sites. Invoices for recruitment advertising and other basic expenses go unpaid for 90 days or more, and sites can wait six months after the close of a trial for final payment from the sponsor. Sponsors are also placing an increasing percentage of new studies at sites outside North America. Though nearly three-quarters of new studies were initiated in the United States and Canada last year, as recently as 2003, sponsors were initiating about 80% of new studies in North America.

Sponsor spending on CROs and other R&D suppliers has now surpassed 20%, and will approach one-quarter in 2010, according to CenterWatch data. Total R&D growth in the industry has hovered around 8% during the past two years. Meanwhile, site expenses are at an all-time high, particularly salaries. The nursing shortage has left sites at the mercy of the current RN rate, which has skyrocketed and shows no signs of stabilizing. Highly trained site personnel such as clinical research associates (CRAs) and contract and financial specialists are also in demand and charging a premium for their skills.

Compounding the escalation in expenses are increases in startup delays, putting financially precarious sites even farther out on their financial limb. According to CenterWatch data, just 7% of trials in the United States begin on schedule. More than 70% are delayed for more than a month.

Long-established sites that have built their reputation on quality, specialization, and speed are finding that cost is becoming more of a factor in terms of having studies placed with them. "There's not a complete...

NOTE: All illustrations and photos have been removed from this article.



More articles from Research Practitioner
FDA seeks advisory committee consumer representatives.(Regulatory Upda..., March 01, 2008
FDA final guidance on bioresearch review and inspections of medical de..., March 01, 2008
FDA draft guidance on distributing articles about unapproved drug/devi..., March 01, 2008
FDA draft guidance on developing drugs for ABOM.(Regulatory Update), March 01, 2008
FDA/IDSA community-acquired pneumonia workshop transcript.(Regulatory ..., March 01, 2008

Looking for additional articles?
Search our database of over 3 million articles.

Looking for more in-depth information on this industry?
Search our complete database of Industry & Market reports by text, subject, publication name or publication date.

About Goliath
Whether you're looking for sales prospects, competitive information, company analysis or best practices in managing your organization, Goliath can help you meet your business needs.

Our extensive business information databases empower business professionals with both the breadth and depth of credible, authoritative information they need to support their business goals. Whether it be strategic planning, sales prospecting, company research or defining management best practices - Goliath is your leading source for accurate information.