1: Consolidation and scale of the market
It is well known that fragmentation of the clinical sites business has been identified as a market opportunity by private equity firms. As a result of a PE capital injection, there has been increased merger and acquisition activity within the sector, leading to a level of consolidation that signals a maturing market. This trend culminated at the end of 2022 when Velocity acquired Meridian Clinical Research, creating the largest clinical sites business globally.
Scale changes the relationship between sites businesses and Sponsors to a strategic one.
Larger multi-site networks can enable biopharma and Clinical Research Organizations to circumvent the individual site-selection process, dramatically reducing the time needed to activate sites and recruit patients, which speeds up drug development.
Just as Velocity’s sale to GHO in April 2021 prompted more PE capital to move into the space. Double digits of new PE entrants, including Latticework Capital Management, LVC, BPOC and Grant Avenue, have bought assets in clinical research. We expect more consolidation in the sector this year after the Meridian acquisition. However, a limiting factor could be the fact debt markets are effectively closed due to rising interest rates and inflation. Consequently, some deals may be harder to get over the line.
2: Decentralization has a future but only in hybrid models
There was heightened impetus for decentralized trial methods during the pandemic, as research had to be completed, despite global lockdowns. Whilst the increased use of technology is giving more patients choice in how they take part in research, it probably hasn’t moved on to the extent that advocates had hoped. Tech darlings of this movement have seen significant devaluations, resulting in staffing cuts, which is much aligned with the beleaguered tech sector.
Our patient survey, with over 1,000 respondents across the U.S. conducted in H1 2022, found that patient-facing technology is not widely used in research today and most patient experience of technology is of relatively simple modalities, such as eDiaries. Forty-three percent of patients surveyed had no experience at all with study-related phone calls, texts, or home visits.
Nevertheless, there is a place for patient-centric tech if it is combined with brick-and-mortar site experience. Volunteers of all ages are overwhelmingly willing to use it in future trial participation. The respondents strongly supported the use of e-diaries (82 percent), telehealth visits (78 percent), wearables and home monitoring devices (75 percent), and at-home collection of bio-samples (64 percent) during future participation in clinical research.
Traditionally, Clinical Research Organisations (CROs), like Parexel or IQVIA, have been left to develop technology solutions for patient recruitment but this approach fails to include sites in the design. However, with site networks now achieving greater scale, we are starting to see these companies invest in tech, which a single site would never have had the resources to do.
3: Inclusivity not diversity
Moving the needle on inclusivity in clinical trials is not easy but the industry will continue to prioritize it. Even towards the end of 2022 the U.S. Congress passed the omnibus spending legislation, requiring drug and device sponsors to submit action plans on how they will recruit more patients to trials from traditionally underrepresented populations.
There seems to be a lot of talk and not a lot of action. In 2022, home visits were heralded as the solution to making clinical research more diverse. However, our patient survey found that home visits will not solve racial and ethnic diversity issues, and could even exacerbate them.
Overwhelmingly, 76 percent of participants in Velocity’s U.S. patient survey would prefer to attend a clinic for visits with healthcare professionals and only 26 percent are happy to conduct in-person study visits at their homes. This is even more pronounced among people from racially and ethnically diverse populations. 70 percent of young black women under the age of 35 and 90 percent of older black women aged 55-64 prefer in-person visits conducted at the clinical trial site.
Making clinical research diverse requires investment. Nonprofit and education organizations will lead the charge on this in 2023; commercial players are more likely to struggle to make investment in this area given the financial challenges that go with the current macroeconomic environment.
On a practical level, many sites are located in predominantly white and higher-income areas, making it harder for people from diverse backgrounds and economic circumstances to travel to and similarly, harder for clinical practitioners to reach these communities.
The onus is on larger site networks to make investments and put clinical research sites in diverse areas. On a positive note, Sponsors are very engaged in the conversation and they will ultimately drive diversification in their trials by mandating sites to recruit more inclusive patient populations.
4: The hangover from the “Great Resign” starts to subside
After peak uncertainty during the “Great Resign”, staffing levels are starting to calm. Uncertain macroeconomic conditions and rumors of an impending recession is certainly impacting the employee retention curve. But employers are faced with a new challenge of keeping employees engaged, particularly in hybrid models of both home- and office-based working.
Managers must be trained on how to keep direct reports engaged. Velocity has found that hiring people with less experience and investing in their development has resulted in greater loyalty to the company. We are seeing this approach being adopted more widely in the sites sector.
The importance of ‘water cooler’ chat is becoming more prevalent, which removes hierarchy in communication between a manager and employee. We are encouraging managers to spend time on zoom meetings talking about non-work-related topics in a bid to build better relationships.
Young people are not exposed to the same workplace chatter, when working from home. Whilst the flexibility of hybrid working encourages inclusivity, we are aware how it impacts learning and development and are arming managers to support their teams accordingly.