What is the benefit of outsourcing to a CRO company?

Contract Research Organizations (CRO) are companies that offer services to perform one or more of a sponsor’s trial-related duties and functions throughout the entire clinical research process.

A sponsor may transfer any or all of the sponsor’s trial-related duties and functions to a CRO (as in research support or conducting clinical or preclinical trials for instance), as well as the responsibilities that come with it. Outsourcing part of the process to a CRO is thus a major decision in any clinical research, usually made because of budget or professional know-how and knowledge issues.

Drug discovery is a long and arduous process that can rack up a costly tab. Only around 12% of drug candidates ever make it to market and the entire process costs around 2.6 billion dollars on average – no matter if they succeeded or failed. This is why more and more pharmaceutical companies and other research sponsors turn to specialized CROs who can help with a drug’s chances of making it to market by bringing a unique expertise and perspective to the process.

Hiring a CRO to reduce costs

At its core, outsourcing is more about reducing risks than it is about reducing costs. As a matter of fact, keeping skills in-house is a drain on resources and time; indeed, you need to hire the right people, manage them properly, pay them a competitive wage, invest in research & development and manufacturing infrastructure, etc.

All while not even being certain of your returns on investment. This is why hiring a CRO is a better option if you do not have unwavering faith in your organization’s ability to perform (and eventually succeed) at the tasks you need done in your research.

CROs are hired for specific results, and are paid depending on the delivery of said results, while keeping the necessary talents and investments in-house does not carry this same “obligation” of results (but still need the pre-emptive investments).

For instance, if you need the construction of a physiologically relevant cellular model (a cellular model that “behaves” more closely like humans, so the tests you perform on it yield more usable data for human applications) for the preclinical development your drug candidate and your in-house team is not specialized in this field or you are not certain enough that they can produce the desired results, instead of taking the time and money out necessary to implement and train the necessary technology and talent, just outsource the task to a CRO.

Not only are they specialized in the services they offer, they are also contractually obligated to deliver the agreed upon level of service. Hiring a CRO may thus not only increase success rates and accelerate drug discovery and development, it can also potentially lead to higher profits.

Letting a CRO handle a complex task they are specialized in

The most recent technological and scientific advancements in cell and gene therapies, antibody drug conjugates, products that use cytotoxic compounds, and in vitro and in vivo processing methods have made drug development an even more complex task than it already was.

Retaining the required in-house talent and training them, as well as investing in the proper infrastructure so they can do their job represents a sizable investment on the medium to long term (and even on the short term if you wish to build the capacity to perform some drug development tasks in-house “from scratch”).

This is yet another argument for employing a CRO: as they are specialized in the services they provide, their entire business model revolves around these services and nothing else. Ergo, CROs have to make up for the lack of innovation in pharmacological companies at large, since to stay in the market they have to keep up to date with latest innovations and even drive them to keep an edge over their competitors.

Many of them are dedicated to continuously developing and improving technologies to provide the highest performance standards, accuracy, and efficiency in their field.

It is highly likely that a CRO specialized in pre-clinical testing will actually perform better at the tasks associated with that stage of development. Such as mRNA production (a fast-emerging class of biotherapeutics, as evidenced with the rapid development of mRNA vaccines against COVID-19) or a biomarker screening service (a way to look for genes, proteins, and other substances called “biomarkers” that can provide information about diseases) than most in-house pharmaceutical departments may.

As their business model does not necessarily revolve around this in-house department staying competitive and ahead of technological progress in the field to “survive”.

A CRO that does not outperform most in-house departments in pharmaceutical companies for specific services does not stay in business very long.

Hiring a CRO to help reduce time to market

As we have seen, CROs being specialized in the services they provide, they already have the infrastructure and talent required for the performance of their tasks more efficiently.

For instance, signing with a CRO for preclinical development is a sure-fire way to obtain more complete data on the drug candidates being tested, and therefore ensuring higher success rates for the later stages of the drug development process.

A significant time saving

In the same vein, being more experienced in the field means they can detect potential mistakes sooner and provide advice to correct them before they even happen down the road. The drug development process being costly and time-consuming, it is therefore in a pharmaceutical company or study sponsor’s best interest to consider CRO outsourcing as it can help with both these hurdles. Reducing time to market is reducing costs and risks associated with the research.

All in all, outsourcing at the preclinical R&D stage can be the best course of action – especially if a pharmaceutical company chooses to buy-in molecules at a later stage of development, instead of taking a shot at a drug candidate that may not make it to market or even yield interesting data. That being said, the most competitive CROs can also provide effective molecular assays to assess which ones have the most potential of yielding actionable results to help you bring a brand new treatment to market.

Choosing the right partner

However, outsourcing is not a magical solution to all your problems. It can take time and resources to manage the outsourcing process, which could well make the trade-off less interesting than having had in-house development in the first place.

We should not forget that removing internal R&D teams can weaken a company’s knowledgebase. This is why CRO selection is so important: you have to choose your partner correctly; thus, prefer a company with a track record of success, a compatible business model, and that has measurable key performance indicators in place as well as an innovative, advanced technological model.

Choosing the right CRO for the task and your needs is however sure to save you a lot of time and money.


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