• Login
    • Join
  • FOLLOW:
  • Subscribe Free
    • Magazine
    • eNewsletter
    Checkout
    • Magazine
    • News
    • Manufacturing
    • Packaging
    • Development
    • Compliance
    • Top 25
    • Directory
    • Microsites
    • Events
    • More
  • Magazine
  • News
  • Manufacturing
  • Packaging
  • Development
  • Compliance
  • Top 25
  • Directory
  • Microsites
  • Events
  • Current / Back Issue
    Features
    Editorial
    Columns
    Digital Edition
    eNewsletter Archive
    Our Team
    Editorial Guidelines
    Subscribe Now
    Advertise Now
    Top Features
    Bye-Bye China?

    Decentralized Trials Fuel AI Revolution in Clinical Research

    Self-Medication: Flexibility for Patients and Drug Manufacturers

    The Single-Use Mixing Landscape: Evaluating Your Options

    DCAT President Talks COVID-19, Drug Manufacturing and Innovation
    Breaking News
    Online Exclusives
    Industry News
    Collaborations & Alliances
    Promotions & Moves
    Trials & Filings
    Financial Reports
    Bio News & Views
    Custom Sourcing News
    Packaging & Tracking
    CRO News
    Live From Shows
    Top News
    WDSrx Expands Warehouse Network

    Piramal Inks Clinical Supply Deal with Theratechnologies

    Recipharm Signs Manufacturing Deal with Enzymatica

    CDMO Northway Biotech Expands in U.S.

    Global Biosciences Co. Selects ValGenesis VLMS
    APIs
    Aseptic Processing
    Cleaning Validation
    Clinical Trial Materials
    Cytotoxics and High Potency Manufacturing
    Equipment
    Excipients
    Extractables and Leachables
    Facilities
    Fill/Finish
    Lyophilization
    Parenterals
    Process Development
    Process Validation
    Risk Management
    Scale-up/ Technology Transfer
    Solid Dosage/ Creams/ Ointments

    WDSrx Expands Warehouse Network

    Piramal Inks Clinical Supply Deal with Theratechnologies

    Recipharm Signs Manufacturing Deal with Enzymatica

    CDMO Northway Biotech Expands in U.S.

    Lonza to Exit Pharma Softgels and Liquid-Filled Hard Capsules
    Capsules
    Cold Chain Management
    Injectables
    Logistics
    Serialization
    Solid Dosage / Semi-solids
    Supply Chain
    Vials

    WDSrx Expands Warehouse Network

    Catalent Acquires Acorda’s INBRIJA Manufacturing Operations

    Varcode, PL Developments Form Strategic ‘Smart Tag’ Pact

    COVID-19 Vaccine Distribution: The Air Cargo Industry’s Greatest Challenge

    Thermo Fisher Expands Clinical Supply Services in Europe
    Analytical Services
    Bioanalytical Services
    Bioassay Developement
    Biologics, Proteins, Vaccines
    Biosimilars
    Chemistry
    Clinical Trials
    Drug Delivery
    Drug Development
    Drug Discovery
    Formulation Development
    Information Technology
    Laboratory Testing
    Methods Development
    Microbiology
    Preclinical Outsourcing
    R&D
    Toxicology

    Improving Product Profitability

    CDMO Northway Biotech Expands in U.S.

    Global Biosciences Co. Selects ValGenesis VLMS

    Nexelis Acquires GSK Vax Lab in Marburg

    The Future of Clinical Trials Series: Part I
    Filtration & Purification
    GMPs/GCPs
    Inspections
    QA/QC
    Regulatory Affairs
    Validation

    Global Biosciences Co. Selects ValGenesis VLMS

    Gene Therapy Co. Selects ValGenesis' SaaS Platform

    The Year of COVID: How FDA Coped with a Worldwide Pandemic in 2020 and What to Expect in 2021

    Samsung Biologics Adopts Veeva Vault QMS to Unify Quality Management

    CDMO Cognate BioServices Teams Up with L7 Informatics
    Companies
    Categories
    Corporate Capabilities
    Add New Company
    Contract Service Directory Companies
    PCI Pharma Services

    Flow Sciences

    Alcami

    Adare Pharma Solutions

    Cytovance Biologics
    Companies
    News Releases
    Posters
    Brochures
    Services
    Videos
    Case Study
    White Papers
    Jobs
    Contract Service Directory Companies
    Syngene

    Baxter BioPharma Solutions

    Aphena Pharma Solutions

    Reed-Lane

    Emergent BioSolutions
    Webinars
    Live From Shows
    • Magazine
      • Current / Back Issue
      • Features
      • Editorial
      • Columns
      • Editorial Guidelines
      • Subscribe Now
      • Advertise Now
      • Enewsletter Archive
      • Digital Edition
    • Directory
      • Companies
      • Categories
      • Corporate Capabilities
      • Add Your Company
    • Manufacturing
      • APIs
      • Aseptic Processing
      • Cleaning Validation
      • Clinical Trial Materials
      • Cytotoxics and High Potency Manufacturing
      • Equipment
      • Excipients
      • Extractables and Leachables
      • Facilities
      • Fill/Finish
      • Lyophilization
      • Parenterals
      • Process Development
      • Process Validation
      • Risk Management
      • Scale-up/ Technology Transfer
      • Solid Dosage/ Creams/ Ointments
      • cGMP Manufacture
    • Packaging
      • Capsules
      • Cold Chain Management
      • Injectables
      • Logistics
      • Serialization
      • Solid Dosage / Semi-solids
      • Supply Chain
      • Vials
    • Development
      • Analytical Services
      • Bioanalytical Services
      • Bioassay Developement
      • Biologics, Proteins, Vaccines
      • Biosimilars
      • Chemistry
      • Clinical Trials
      • Drug Delivery
      • Drug Development
      • Drug Discovery
      • Formulation Development
      • Information Technology
      • Laboratory Testing
      • Methods Development
      • Microbiology
      • Preclinical Outsourcing
      • R&D
      • Toxicology
    • Compliance
      • Filtration & Purification
      • GMPs/GCPs
      • Inspections
      • QA/QC
      • Regulatory Affairs
      • Validation
    • Top 25 Pharma & BioPharma
    • Contract Pharma Direct
    • Breaking News
    • Online Exclusives
    • Slideshows
    • Experts Opinions
    • Surveys
      • Outsourcing Survey
      • Salary Survey
    • Glossary
    • Videos
    • Podcasts
    • White Papers
    • Infographics
    • Contract Pharma Conference
      • Contract Pharma Conference
      • Speakers
      • Exhibitors
      • Conference Sessions
    • Supplier Microsite
      • Companies
      • News Releases
      • Posters
      • Brochures
      • Services
      • Videos
      • Case Study
      • White Papers
    • eBook
    • Webinars
    • Events
      • Industry Events
      • Live from Show Events
      • Webinars
    • Classifieds / Job Bank
      • Classifieds
      • Job Bank
    • About Us
      • About Us
      • Contact Us
      • Advertise With Us
      • Privacy Policy
      • Terms of Use
    Columns

    Outsourced Pharma Services: 2015 Review & 2016 Outlook

    ...

    Related CONTENT
    • Mogene
    • Recro Gainesville Expands Mfg. Capabilities
    • Diverse Products And Technologies Delivered
    • PPD Expands Vaccine Development Lab
    • UPM Celebrates 100-Years of Mfg. at Tennessee Site
    Chad Moore, Leerink Partners01.28.16
    A number of key themes and drivers are top of mind as 2016 kicks off. But first, I’ll briefly recap 2015, which was good to the publicly-traded pharma services outsourced providers.

    On average the group saw revenue grow, margins expand and, for those that track it, book-to-bill ratios hold steady relative to past performance. Year-to-date, through December 17, 2015, this helped propel the publicly-traded CROs higher by approximately 35%. Over the same period the S&P 500 lost approximately 1%.

    M&A and public equity market activity was very strong in 2015. I expect interest in the sector to continue in 2016. Both strategic and private equity buyers will be attracted to acquiring companies with unique, difficult to replicate capabilities and above-sector growth expectations. In addition, the most attractive targets will have a solid and long-tenured customer base, project diversity, strong management talent, and a clearly defined, achievable growth strategy. An example of a company with these characteristics is Theorem Clinical Research. In September 2015 it was acquired by Chiltern International after a competitive sale process.

    Some other notable 2015 M&A and equity transactions are: Labcorp’s acquisition of Covance; Quintiles’ and Quest’s JV for global clinical trials laboratory services; INC Research’s private equity owners sold shares in two follow-on offerings; PRA Health Sciences’ private equity owner essentially took a loan against a portion of its PRA shares to provide a return to its limited partners; ICON’s acquisitions of MediMedia Pharma Solutions and PMG Research; Wuxi PharmaTech taken private; PAREXEL’s acquisition of Quantum Solutions India; and Charles River Labs’ acquisition of Celsis International.

    2016 Outlook
    M&A activity is expected to continue. PwC predicts that 2016 will be ‘the year of merger mania’ in many healthcare sectors including life sciences and biopharma.

    Assuming the public equity market is accommodative to new issuances I expect to see additional companies pursue an IPO. New issuances could include companies in the CRO and CDMO sectors.

    Scrutiny of drug prices is expected to positively impact demand for medical affairs, comparative effectiveness, Phase IV, HEOR and other post-approval services. These services help validate a drug’s merits, identify the benefits to patients and support prices. Outsourcing of Phase IV/post-approval services is about 30% currently and trails the approximately 50% seen in Phase II/III. Over the coming years I expect Phase IV/post-approval outsourcing to expand faster than the growth of Phase II/III outsourcing.

    How will the biotech funding environment impact the sector? No need to sound the alert yet as biotechs have annually raised increasing amounts of capital since 2011. If the funding window does close for a period of time, customer diversification and relative size will become a focus for pharma outsourcing providers. The most fragile biotechs represent a small portion of R&D spending.
    Larger pharma outsourcing providers should be able to weather a disruption easily due to customer diversification and the small amount of revenue generated from these sponsors. However, some smaller pharma outsourcing providers with meaningful exposure will find rougher waters if its biotech customers are unable to obtain funding at reasonable terms.

    I believe the growth of biologics / biosimilars and particularly the associated complex development, formulation, manufacturing, distribution and administration requirements is creating opportunities for CDMOs and CROs to partner with these sponsors.

    Technologies to improve the quality and efficiency of trials should continue gaining traction and the attention of acquirors. Areas of particular interest include patient recruiting and retention, risk-based and remote patient monitoring, comparative effectiveness, patient engagement including the use of social media and disease-specific online communities, protocol adherence, and analytics to aggregate, analyze and clearly communicate in real-time data to improve quality and efficiency. 

    Given the growth of mobile medical apps, the FDA’s review of them should grow in lockstep. Generally, the FDA deems a medical app a ‘medical device’ if the functionality could pose a risk to a patient’s safety if the mobile app were to not function as intended. The growth in mobile medical apps should benefit CROs that help app developers comply with the FDA’s Level III/premarketing approval (PMA) regulations.


    Chad Moore
    Leerink Partners

    Chad W. Moore, CFA, is a managing director in global investment banking at Leerink Partners. He leads the firm’s outsourced pharmaceutical services and IT investment banking effort. He can be reached at chad.moore@leerink.com or +1-703-216-7120. Note: This article is not a product of Leerink Partners’ Research Department. It represents the opinion of the author and not necessarily that of Leerink Partners.
    Related Searches
    • acquisition
    • fda
    • biotech
    • Phase II
    Suggested For You
    Mogene Mogene
    Recro Gainesville Expands Mfg. Capabilities Recro Gainesville Expands Mfg. Capabilities
    Diverse Products And Technologies Delivered Diverse Products And Technologies Delivered
    PPD Expands Vaccine Development Lab PPD Expands Vaccine Development Lab
    UPM Celebrates 100-Years of Mfg. at Tennessee Site UPM Celebrates 100-Years of Mfg. at Tennessee Site
    Are More CRO Transactions Near? Are More CRO Transactions Near?
    Like the Temperature, It Feels Like Deal Activity is Heating Up Like the Temperature, It Feels Like Deal Activity is Heating Up
    Consolidation in Outsourcing Consolidation in Outsourcing
    ICON Acquires PMG Research ICON Acquires PMG Research
    WuXi PharmaTech, Lilly in Strategic Development Pact WuXi PharmaTech, Lilly in Strategic Development Pact
    Gilead, WuXi PharmaTech in Analytical Testing Alliance Gilead, WuXi PharmaTech in Analytical Testing Alliance
    Chad Moore Joins LEERINK Chad Moore Joins LEERINK's Investment Banking Team
    Clinical Trial Participants: Why So Elusive? Clinical Trial Participants: Why So Elusive?
    WuXi Receives First Approval from Japanese Regulatory Authorities WuXi Receives First Approval from Japanese Regulatory Authorities
    WuXi PharmaTech Reaches $3.3B Buyout Agreement WuXi PharmaTech Reaches $3.3B Buyout Agreement

    Related Columns

    • Clinical Trials | Serialization | Supply Chain
      Anti-Counterfeiting in the Pharmaceutical Industry: An Evolution

      Anti-Counterfeiting in the Pharmaceutical Industry: An Evolution

      Keeping up with counterfeitors in the pharmaceutical industry is no easy task, but patients’ lives depend on it.
      Ben Locwin, Healthcare Science Advisors 10.04.19

    • Biosimilars
      The Bioprocessing Trek

      The Bioprocessing Trek

      Biosimilars are the next speed-bump for CMOs
      Emil W. Ciurczak, DoraMaxx Consulting 09.16.19

    • Clinical Trials
      Synthetic Control Arms

      Synthetic Control Arms

      In clinical trials, they don’t always capture the most important dimensions
      Ben Locwin 03.06.19


    • Biosimilars
      Know the Challenges of  Biosimilar Manufacturing

      Know the Challenges of Biosimilar Manufacturing

      Best practices for a competitive market
      Jerry Martin and Michiel Ultee 09.06.17

    • Biosimilars
      Indian Generic Firms  Expand Biosimilar Portfolios

      Indian Generic Firms Expand Biosimilar Portfolios

      With more players entering the ring, the race to enter the promising biosimilars market is getting hotter by the day in India
      S. Harachand, Contributing Editor 05.09.17

    • Biosimilars
      CMOs & Biosimilars Mfg. in the U.S.

      CMOs & Biosimilars Mfg. in the U.S.

      Biosimilars are moving from novel opportunity to mainstream product
      Eric S. Langer and Ronald A. Rader, BioPlan Associates 04.20.17


    • Biosimilars

      Biosimilars Update

      Fulfilling a dire need, but at what (human) cost?
      Ben Locwin, Contributing Editor 04.03.17

    • Biosimilars | Process Development

      Contract Manufacturing Budget Trends

      Study shows where the money is, and isn’t, flowing
      Eric S. Langer, BioPlan Associates 07.12.16

    • Clinical Trials | Process Development

      China Vaults to the Top of U.S. Biomanufacturers’ Off-Shoring Prospects

      A look at top destinations for future offshoring
      Eric S. Langer, BioPlan Associates 06.02.16


    • Clinical Trials

      Are More CRO Transactions Near?

      When will we see additional transactions involving the largest CROs?
      Chad Moore, Leerink Partners LLC 06.02.16

    • Biosimilars | Clinical Trials | Drug Discovery | Process Development

      Like the Temperature, It Feels Like Deal Activity is Heating Up

      A summary of 2016 transactions so far
      Chad Moore, Leerink Partners LLC 05.05.16

    • Analytical Services | Clinical Trials | Laboratory Testing | Supply Chain

      Analytical Instruments are On-Board with Outsourcing

      Newer process instruments are finally being designed with mobility in mind
      Emil W. Ciurczak, DoraMaxx Consulting 01.28.16


    • APIs | Biosimilars | Clinical Trials | Process Development | Vials

      2015 in Review: 6 Key Trends Affecting CMOs

      A look at major CMO trends ranging from budgets to growth opportunities
      Eric S. Langer, BioPlan Associates 11.17.15

    • APIs | Biosimilars

      API and Intermediate Outsourcing Trends

      One thing’s for sure, when it comes to pharma trends there is no definitive trend
      Ben Locwin, Healthcare Science Advisors 10.07.15

    • Clinical Trials | Drug Development

      Recap of Notable Recent CRO Transactions

      Conditions are expected to remain favorable for M&A and capital markets activity in the pharmaceutical service and IT sector
      Chad Moore 10.07.15

    Trending
    • Lonza To Exit Pharma Softgels And Liquid-Filled Hard Capsules
    • The Future Of Clinical Trials Series: Part I
    • Grifols Begins COVID-19 Plasma Treatment Trial
    • Thermo Fisher Buys Novasep's Viral Vector Manufacturing Biz
    • NovaQuest Private Equity Acquires CoreRx
    Breaking News
    • WDSrx Expands Warehouse Network
    • Piramal Inks Clinical Supply Deal with Theratechnologies
    • Recipharm Signs Manufacturing Deal with Enzymatica
    • CDMO Northway Biotech Expands in U.S.
    • Global Biosciences Co. Selects ValGenesis VLMS
    View Breaking News >
    CURRENT ISSUE

    November/December 2020

    • Modeling Process Safety Workflows in Pharmaceutical Manufacturing Scale-Up
    • Ensuring Quality During the Transfer and Scale Up of Rx Drugs
    • Inspecting the Unexpected
    • Cold Chain Trends
    • Catering for the Complex
    • Biopharma Contract Manufacturing: Robust Growth Ahead
    • DCAT President Talks COVID-19, Drug Manufacturing and Innovation
    • The Single-Use Mixing Landscape: Evaluating Your Options
    • Self-Medication: Flexibility for Patients and Drug Manufacturers
    • Decentralized Trials Fuel AI Revolution in Clinical Research
    • View More >

    Cookies help us to provide you with an excellent service. By using our website, you declare yourself in agreement with our use of cookies.
    You can obtain detailed information about the use of cookies on our website by clicking on "More information”.

    • About Us
    • Privacy Policy
    • Terms And Conditions
    • Contact Us

    follow us

    Subscribe
    Nutraceuticals World

    Latest Breaking News From Nutraceuticals World

    NIH Study Compares Low-Fat, Plant-based to Low-Carb, Animal-Based Diet
    Gadot Positions Mineral Line for Vegan Market
    Nutritfy India to Launch Global Broadcast Channel Covering Nutrition
    Coatings World

    Latest Breaking News From Coatings World

    IGL Coatings Launches Graphene Reinforced Dual System Ceramic Coating
    Miller Paint Declares Simple Serenity its 2021 Color of the Year
    TAUBMANS Paint by PPG Releases ‘Chromatic Joy’ Palettes
    Medical Product Outsourcing

    Latest Breaking News From Medical Product Outsourcing

    TPI Partners with Zeiss
    PPE Moves into New Manufacturing Facility
    Neurent Medical Closes $25 Million Series B Financing
    Contract Pharma

    Latest Breaking News From Contract Pharma

    WDSrx Expands Warehouse Network
    Piramal Inks Clinical Supply Deal with Theratechnologies
    Recipharm Signs Manufacturing Deal with Enzymatica
    Beauty Packaging

    Latest Breaking News From Beauty Packaging

    Lageen Tubes Launches Mono-Material PE Tube Solutions
    Jason Jones Loses Battle with Covid-19
    Weleda Celebrates 100 Years By 'Opening' Its Gardens
    Happi

    Latest Breaking News From Happi

    Sabinsa's Top Scientist Addresses US FDA
    Ipsy Adds New Personal Care Brand
    John Masters Organics Rolls Out Roll-On Fragrances
    Ink World

    Latest Breaking News From Ink World

    Morancé Soudure France Adds Comexi F2 MC 10-color Flexo Press
    THIMM Group Installs 1st Koenig & Bauer CorruFLEX
    Cowan Graphics Adds Fujifilm Inca OnsetX3 HS
    Label & Narrow Web

    Latest Breaking News From Label & Narrow Web

    Lemu Group engineers mask-making machine
    Niagara Label upgrades with Nilpeter flexo press
    Soma partners with Moore & Moore in US
    Nonwovens Industry

    Latest Breaking News From Nonwovens Industry

    Lemu Group Engineers Mask-Making Machine
    Armbrust American Adds Meltblown Manufacturing
    P&G Reports 8% Sales Increase
    Orthopedic Design & Technology

    Latest Breaking News From Orthopedic Design & Technology

    Siemens Healthineers’ DR Systems Cleared by FDA
    Former Medtronic Exec Appointed Zimmer Biomet's Chief Transformation Officer
    SeaSpine Launches Regatta Lateral Plates
    Printed Electronics Now

    Latest Breaking News From Printed Electronics Now

    UDC Subsidiary Adesis' Website Wins 2020 MarCom Platinum Award
    Roadsimple Modernizes Warehouse Ops with Zebra Technologies
    Graphene Flagship Launches Redesigned Website

    Copyright © 2021 Rodman Media. All rights reserved. Use of this constitutes acceptance of our privacy policy The material on this site may not be reproduced, distributed, transmitted, or otherwise used, except with the prior written permission of Rodman Media.

    AD BLOCKER DETECTED

    Our website is made possible by displaying online advertisements to our visitors.
    Please consider supporting us by disabling your ad blocker.


    FREE SUBSCRIPTION Already a subscriber? Login