GLOBAL DEMAND FOR SERVICING FSPS

Roberta Duncan22-March-2011

OVERVIEW

Observations and Perspectives Asia and the Global Clinical FSP

Demand Human Capital Clinical FSP Strategy

FSP OBSERVATIONS AND PERSPECTIVES

PARADIGM SHIFTS

Functional Expertise limited service capabilities

Full Service Capabilities with increasing global footprint

Strategic Functional and/or Geographic Alignment

Transactional

Preferred Supplier

Vested Outsourcing / Performance Partnerships

Strategic Alliances

Convert Fixed

Costs to Variable

Costs

Technology

Talent The FSP

Engine

ASIA

UNDERPINNING

Strategic AlignmentFunctional Expertise

‘Think Global, Act

Local”

Science and Innovation

engage earlier in

the supply chain

ExpansionFull Service

Offering

Geographic Footprint

Functional ExpertiseSingle Service

Providers

Off-set sponsor’s capacity

constraints

Leverage technical expertise

IT solutions transcend borders

(a) access talent at lower labor costs (b) centralised service

centers (c) 24 hr work day

Science and innovation

Spurred by (a) “local” talent (b) economic

development strategies (c)

development of clinical research

infrastructure

Functional ExpertiseAligned to (a)

technical know how (b) services associated

with patient access (c) local knowledge

ERA OF MULTIPLE STRATEGIC PARTNERSHIPS

Eli Lilly – Quintiles, Monitoring US and Puerto RicoEli Lilly – I3, Data ManagementEli Lilly – Covance, Toxicology and Early Stage Drug Development

2008

2009Eisai – Quintiles, Oncology pipeline developmentAstraZeneca – Quintiles, Clinical DevelopmentOtsuka – Covance, Clinical Development

Proteome Sciences – Parexel, Biomarker discovery and qualificationBMS – ICON, Global Clinical DevelopmentBMS – Parexel, Global Clinical DevelopmentSanofi-Aventis – Covance, Drug Development

2010

2011Elan – PPD, Global Clinical DevelopmentMerck – Parexel, Biosimilar Clinical DevelopmentTakeda – Covance, Global Clinical Development (emphasis on Asia)Eli Lilly – Parexel, Clinical Monitoring Asia

Takeda – Quintiles, Global Clinical Development (emphasis on Asia)Dako – Quintiles, Personalized MedicineBiomada – Quintiles, Personalized MedicineLondon Genetics – Quintiles, Personalized Medicine

2011

Drivers for Success

ASIA AND THE GLOBAL FSP DEMAND

COUNTRY DATA

Source: World Bank Data Statistics, 2005-2010

ASIAN COUNTRIES: PHASE II AND III MULTINATIONAL CLINICAL TRIALS

Source: clinicaltrials.gov data retrieved by PRTM, “Trends in Asia: Clinical Outsourcing,” March 2010

GLOBAL COMPANY OPERATING IN ASIA (EXCEPT JAPAN)

Source: PRTM, “Trends in Asia: Clinical Outsourcing,” 2010

Elements and Opportunities

ASIA: HUMAN CAPITAL STRATEGY

TALENT

Lower labour rates Highly educated

research talent “Sea Turtles”

Recruitment - Relatively small pool of experienced talent; Rising wages and pay demands

Retention – Poaching; Job hopping; Perception of career opportunities

Blending western and eastern cultures (global integration) – relationship, leadership, delivery, and language

Elements Supportin

g Strategy

To be addressed

INFRASTRUCTURE

Governments prioritizing research in key therapeutic areas

Regulatory agencies adopting more global standards

Growing acceptance of and adherence to ICH-GCP guidelines

Motivated investigators

Data quality and integrity

Intellectual property protection

Regulatory harmonization

Access to patients in rural areas

Informed consent Investigator training

Elements Supportin

g Strategy

Growth Opportunitie

s

SCIENCE, INNOVATION AND TECHNOLOGY

Supply chain management

EDC capabilities Drug discovery

Elements Supportin

g Strategy

Growth Opportunitie

s

Development of R&D biocentres, campuses, and facilities

Research in diseases relevant to the Asian population

Population demonstrating more “typically” western diseases

Questions / Comments

THANK YOU

BACK-UP SLIDES

CRO MARKET SIZE ($US MN)(IN TOTAL AND BY PHASE, 2009)

Source: Primary research with CROs and sponsors, Frost & Sullivan, 2009

2009 India China S Korea Taiwan Singapore

Thailand

Philippines

Tot market size

433 255 65 100 128.4 8.6 45.1

Phase I 48 30 14 11 20.3 0.2 3.6

Phase II 99 52 14 34 33.8 0.9 9.5

Phase III 234 85 23 53 47.3 5.7 22.5

Phase IV 52 88 14 2 27 1.8 9.5

GLOBAL COMPANY OPERATING IN JAPAN

Source: PRTM, “Trends in Asia: Clinical Outsourcing,” 2010

CORE R&D FACILITIES IN ASIA10 PHARMA COMPANIES

Source: “Evolving R&D for Emerging Markets,” Drug Discovery, 9:417-420, 2010

CORE R&D FACILITIES IN ASIA10 PHARMA COMPANIES (CONT’D)

COMPETITIVENESS OF ASIAN COUNTRIESFOR BIOTECH IPOS

Source: Frost & Sullivan, 2009