Companies that did not consider virtual clinical trials were forced to rapidly implement new technologies and procedures to maintain business continuity. Research shows that many companies will continue to use virtual trials after the pandemic.
Listed below are the key macroeconomic trends impacting the virtual clinical trials theme, as identified by GlobalData.
Long-term cost-effectiveness of virtual trials
Cost is often cited as both a benefit and a barrier to virtual trials. The initial set-up costs of virtual trials can often exceed those of traditional trials, as they cover harmonising data sources and platforms, the cost of technology for patients and sites, and training and coordination costs. Cost savings, however, can be made in the long term with virtual trials. Using technology to improve patient recruitment and retention rates will translate into faster drug development and approval timelines, allowing a drug to reach the market more quickly.
Other areas where the use of virtual trials can lead to cost savings include the reduction in physical trial sites. It will lead to fewer investigators and less research staff, as well as less requirement for site monitoring and management. There will also be a reduction in travel costs for all stakeholders, from patients to investigators and site monitors.
Increased deal activity in the virtual trials space
A significant increase in all deal-making activity in the virtual trials space has occurred over the past 18 months, which is in line with increased demand for these types of services during the Covid-19 pandemic. Nine mergers and acquisitions (M&As) related to virtual trials were seen in 2020, compared to just one in 2018 and two in 2019.
In 2021, six M&As have already occurred in this space to date including Thermo Fisher’s acquisition of PPD for $17.4bn in April 2021 and ICON’s acquisition of PRA Health Sciences for $12bn in February 2021. Several examples of companies, such as Syneos Health, Signant Health, Covance, and ERT, acquiring companies to expand their virtual trial capabilities also occurred during the year. ERT, for example, acquired wearable company APDM in July 2020 and merged with Bioclinica in December 2020 for its clinical trial endpoint technology expertise.
The number of strategic partnerships in virtual trials increased from a quarterly average of two before the pandemic to 11 between Q2 2020 and Q1 2021. In Q1 2021 alone, 18 partnerships were identified. Most of these deals were between specialist virtual trial vendors such as Science 37, Medable, and THREAD—and clinical research organisations (CROs), eClinical solution providers, or pharma companies.
The number of venture capital (VC) funding deals related to virtual trials increased from six in 2018 to 18 in 2020, with most activity seen in Q3 2020 (ten deals). Specialist virtual trial vendors and eClinical solution providers have been involved in the most funding rounds. Medable, for example, raised $194m from three rounds since 2020, the most recent being a $78m Series C in April 2021 in which PPD participated.
An analysis of GlobalData’s Job Analytics database found that the number of job postings in the space by pharma companies or CROs has increased over the past 18 months, which is in line with increased demand for virtual trials during the pandemic. Data shows an increase from 30 posted jobs in Q3 2019 to 160 posted jobs in Q3 2020, with further increases to over 200 posted jobs in Q1 and Q2 2021.
One potential barrier to hiring in the virtual trial field is a shortage of skills. Attracting qualified and experienced workers to deploy Internet of Things (IoT) solutions and analyse resulting datasets in healthcare is a major issue for the healthcare ecosystem and is expected to constrain market growth. In GlobalData’s State of the Biopharmaceutical Industry 2021 report, for example, lack of specific skills and talents was chosen by the highest proportion of respondents as the main barrier to digital transformation initiatives for organisations.
The industry requires skills in digital, advanced data analytics, and artificial intelligence/machine learning (AI/ML), as well as a flexible and educated workforce. Many pharma companies, sponsors, and HCPs are not fully ready to utilise the data generated by connected medical devices. Recruiting top digital talent is a priority across IoT and connected devices and will be essential for the validation and utilisation of remote technologies in clinical trials.
This is an edited extract from the Virtual Clinical Trials – Thematic Research report produced by GlobalData Thematic Research.