The COVID-19 pandemic has left its mark on the clinical research and trials sector, but disruptions have only served to temper the steel of long-timers. Clinical research organisations (CROs) are helping pharma companies roll out the COVID-19 trials and while this is a huge business opportunity, it is also fraught with risk. Besides the usual risks associated with testing new products, is the fact that the trials had to be run under severe logistical constraints.
In September, an analysis by Frost & Sullivan informed that with the increased threat of COVID-19 and worldwide lockdowns in effect, the CRO market is experiencing interruptions in ongoing clinical trials and delays in new trials. Recovery is expected to commence from 2023; although it will be staggered, it will take revenue to the original growth trajectory by 2024–2025. As per the revised forecast after the impact of the COVID-19 pandemic, the CRO market is estimated to garner revenue of $63.83 billion by 2024 from $43.03 billion in 2019, at a compound annual growth rate (CAGR) of 8.2 per cent.
The report titled, Hybridisation of Clinical Trial Designs Reviving Global CRO Market Post-pandemic; 2019-2024, reveals that hybrid clinical trials and remote patient monitoring are key trends driving the global CRO market. Hybrid clinical trials leveraging safety-focused, direct-to-consumer logistical solutions are taking centre stage, ensuring research continuity.
Surviving testing times
But disruption is not new to the global CRO sector. India’s CRO sector went through one such upheaval when new clinical trial guidelines were released in 2013-14 but the revised regulations of 2019 have steadied the sector. One of the CROs which seem to have survived this testing time is SIRO Clinpharm (SIRO).
Founded in 1996 by Dr Gautam Daftary, initially as a subsidiary of Bharat Serums and Vaccines, a company set by his father, SIRO is one of India’s earliest CROs.
The company enjoyed a good run, growing as the sector matured in the country, notching up 250+ clinical trials spanning the pharma, medical devices and FMCG sectors.
Regulatory speed breaker
The company took on private equity investors (PEs) in 2007 to scale up but a fresh set of guidelines for clinical trials in 2013-2014 halted not just SIRO but the entire sector.
Meanwhile, the second generation was ready to join SIRO. Post an undergraduate degree from Emory University in Economics and Mathematics, Dr Daftary’s elder son, Akshay started his career at Bharat Serums and Vaccines in 2014, moving to SIRO in 2018. He now serves as a Director, in charge of global business development activities and client management.
Post an undergraduate degree from Babson College with a focus on finance and entrepreneurship, his younger sibling Karan worked at the Puma Group for a while before joining SIRO in 2018. He is now Global VP, SIRO Clinpharm and is in charge of ancillary services including finance, human resources, quality assurance, IT, legal and corporate marketing.
As the second generation at the helm, Karan and Akshay witnessed how the stringent clinical trial regulations of 2013-2014 caused many large global companies to leave India, resulting in a large reduction in clinical trials in India. They narrate this had a sizeable impact on SIRO’s operations as well, which was dependent on winning complex studies from global pharma companies.
According to them, SIRO was slightly better placed to weather the turbulence as before this regulatory downturn, the company grew its medical writing vertical extensively to ensure stability and holistic growth of the organisation. This service offering brought “great stability” to SIRO’s operations with standalone and annuity clients in alternative geographies.
Survival, not revival
Both siblings agree that the new Drugs and Clinical Trial Rules launched in 2019 created a very positive shift in sponsor sentiment and a willingness to return to India for their global clinical trials. This has revived an industry that was undergoing a significant downturn.
The company underwent a brand refresh in 2018 and re-established its core mission of Helping Lifesavers Save Lives. They feel that SIRO has been a perseverant organisation that saw an opportunity in the downturn and hence their success story has been that of “survival, and not revival.”
Charting the way forward, the siblings reflect that there was no one single way of continuing their growth, but a series of factors that helped them maintain their strong position in the clinical research segment.
While growing the India operational team, the duo also has their sights set strongly on establishing an operational presence in the US in medical writing and biometrics.
Meanwhile, Dr Daftary bought back stakes from investors and other shareholders in 2017 to once again become 100 per cent owner, resulting in “simpler decision-making processes, lofty growth ambitions and supply of ample capital” to achieve their growth plans.
Impact of COVID-19 on clinical trials
The importance of clinical research has increased as we grapple with the COVID-19 pandemic and the possibility of more such pandemics sweeping our planet. But out of the disruptions due to COVID-19, came swift changes in regulations, to cope with logistical nightmares posed by lockdowns, heightened fear of transmission of infection, etc. In hindsight, these changes will be for the better.
Akshay and Karan speak about the limited access to healthcare facilities, state-wise regulations in India as well as resource constraints during the lockdowns. While there was an obvious challenge in opening new sites for trials, even running existing ones was a challenge based on strict controls that had been swept into place in the light of the dangerous nature of the pandemic. To ensure the safety of personnel, clinical trials were stopped at several sites.
On the other hand, recruitment challenges were amplified with participants in clinical trials finding it difficult to visit sites as often as required by several stringent clinical trials. Although this impacted SIRO as a CRO, sponsor companies were greatly affected as well due to delay in timelines which in turn impacted their stringently planned clinical pipelines.
The short term impact of COVID-19 was the need to handle many aspects of the trial remotely. To overcome this hurdle, while maintaining strict adherence to clinical guidelines, SIRO decided to initiate remote monitoring which enabled them to continue with sponsors’ clinical trials in the middle of the pandemic. This initiative was greatly appreciated as it enabled studies to continue.
SIRO also took many precautions while sending their employees to offices or sites as and when needed. The Daftary siblings narrate how technology has been a great enabler in transitioning many activities to a virtual activity – as has happened in the past, while technology has been available for long, its adaptation and penetration into specific aspects of business process is greatly facilitated by challenging times like the COVID-19.
They feel that the potential long term impact of COVID-19 would be the continued use of technology to bring about a paradigm shift in how clinical trials are executed, with virtual clinical trials with real-time monitoring through wearables connected to the cloud.
The duo reflect that while the regulations for clinical trials will continue to evolve, one of the main drivers for change shall be the situation that we have seen due to COVID-19.
The pandemic has thrown several challenges to the regulators. Firstly, in terms of fast-tracking a vaccine or a drug for a COVID-19 kind of situation and second, ways and means to overcome the constraints of lockdown like situation on the clinical research.
They anticipate significant changes in regulations to provide for/govern virtual clinical trials/decentralised clinical trials and the increased use of technology in the conduct of clinical trials.
The ‘Good to Great’ approach
When asked about their strategy for the future, the second generation at the helm quote from Jim Collins’ book, ‘Good to Great’, “Greatness is not a function of circumstance. Greatness, it turns out, is largely a matter of conscious choice.” This dictum inspired them to believe that the future lay in their hands and they would need to confront the brutal facts to ensure future growth.
As firm believers of the additive impact of several small and well thought of initiatives, the SIRO team has apparently already laid out the focus areas, dubbed the Five pillars of SIRO, and shared their vision with all employees of the organisation through a virtual meeting labelled ‘SIRO Vision Series’.
The core aim of these initiatives was to build on SIRO’s core competencies in end-to-end clinical service provider space by leveraging innovative technologies, redefining internal processes, building stronger employee engagement, and expanding in alternative geographies.
They narrate how they have seen a stark shift in the industry towards automation of documents and artificial intelligence (AI) which led them to automate some processes and offerings, and documents using AI to ensure the benefits extend to our clients. They also created an Innovation Hub internally, focussed on leveraging technologies to help achieve their innate belief of Helping Lifesavers Save Lives.
Three-pronged approach in the coming year
Scanning the horizon for new growth opportunities, the duo reveal that they are looking at a three-pronged growth approach in the coming year. These include expanding in alternative geographies, adding more to service offerings, and automation of services.
In terms of geographies, SIRO is looking to expand its operational wing to alternative geographies like the US and South East Asia for their ancillary service offerings like clinical data management and biostatistics/programming.
They would be looking to do this through alliances/acquisitions based on compatibility with their current offerings. With the additional service offerings, SIRO took the time during COVID-19 to create a new and more targeted solutions approach for FMCG companies by amending their SOPs and strategy to cater to different requirements of these companies. They indicate that they would be looking to enter alternative segments with a similar focused and customised approach.
A recent example of SIRO’s approach to augmenting their service portfolio is their partnership with Azidus announced this September, to widen their service offerings with healthy volunteer BA/BE studies. It is early days yet, but the duo indicate that both the partners have been having very interesting discussions with their customers and if the early signs are an indication of the times to come, they see a very interesting partnership ahead.
In fact, this has propelled them to explore more such alliances with complimentary service providers which are the key to drug development activities.
Claim substantiation, a sweet spot for growth
The duo believe that India is now emerging once again as a global hub for clinical research. Once seen more as a cost arbitrage, the quality and expertise that comes out of the Indian clinical research sector is clearly evident for the healthcare world to see. From niche to large CRO, India has become a destination for end to end clinical services, aided by its diverse population and favourable regulatory landscape. This potential has led to the mushrooming of CROs as business continues to be outsourced to India from Europe and the US.
In Akshay and Karan’s assessment, one of the areas where the clinical sector is going to play an important part is the consumer health sector. With increased regulation pertaining to claims and advertisements by food business operators with respect to their food products, along with heightened consumer awareness, they see demand for claim substantiation through a structured process as a focus area. We see a similar opportunity in the AYUSH segment. The irony is that while COVID-19 bought the CRO sector to a standstill for some time, it has today created more revenue opportunities.
The duo point out that during COVID, several consumer products claimed to prevent COVID, and the substantiation of their claims has become extremely important. This is where SIRO has come in with prompt professional services and helped design trials to prove the efficacy and safety of new products.
With the easing and streamlining of regulatory guidelines, a large influx of clinical research studies and trials are pouring in India with large global companies considering Indian patients for their global studies. The siblings also see that the sector is now creating more jobs and attracting students to explore this field for potential study and future career.
Current projects of interest and revenue mix
Of the three industry segments that SIRO currently supports, the pharma industry remains, by far, the dominant stream of revenue. In this space, the company is working on a few trials wherein the drugs are being tested in a specific set of COVID patients. They have been a part of initial discussions for conducting full or some parts of Phase III for an Indian company and for an international company.
In medical devices, SIRO is supporting a company extensively for their claim substantiation regarding the virucidal activity of the COVID-19 virus in the environment and helping them with their global regulatory and marketing strategy.
The FMCG sector makes up the third segment, with SIRO reportedly receiving several requests in this space in the last few months to help FMCG companies to substantiate their claims for products that they have made related to the ongoing pandemic. Citing a Gazette notification regarding advertising claims which clearly stated the importance for clinical validation and scientific backing of claims, the SIRO Next Gen indicate they are working with consumer health/FMCG companies to substantiate their claims regarding immunity enhancements in their products and are also in discussions with consumer health and Ayurvedic companies to clinically test products on immunity parameters.
Akshay and Karan anticipate that though the latter two segments presently form a smaller proportion of revenues, with renewed focus and the streamlining of their approach to the FMCG sector, this proportion will grow exponentially over the next few years through increased clientele and geographic reach.
Challenges to COVID-19 vaccination campaigns
India has earned her stripes as the largest global vaccine manufacturing hub, with a fair number of COVID-19 vaccines being researched, trialled and manufactured in the country, and Akshay and Karan have no doubts that India has always been a country to rise up to challenges and pass them with flying colours – and they believe a similar result would be possible when it comes to the COVID-19 pandemic and getting it under control.
But while there is an urgent need to get the vaccine for COVID-19 into the market, they raise concerns about the potential storage and supply issues that would come with it.
They point out that with Phase 2 and 3 clinical trials going on for a wide array of vaccines (40+ global candidates currently), it is important to note that storage conditions for different vaccines would vary based on their chemical composition. In India, there are 3-4 large scale trials going on, and it is believed their temperature requirements would be in line with SIRO service offerings that are offered at their clinical trials supplies warehouse in Mumbai.
For example, they mention that the Johnson & Johnson vaccine is a single shot (dose) vaccine compared to most of its competitors, while also not requiring extremely cold temperatures for storage. Some other vaccines, like Pfizer, require temperatures between -20 and -70 degrees Celsius which require its own cold chain management system. Additionally, during transportation, simple cold refrigerated vehicles would not be feasible to maintain the quality of the vaccine prior to administration.
Another unique challenge they raise is the facility for storage of vaccines at hospitals prior to the administration which needs to be addressed by the governing bodies at a state and central level. However, given India’s large vaccination programme in place, they remain confident that the relevant regulatory and governing bodies would take swift action in these areas prior to large scale commercialisation.
With GenNext firmly at the helm, SIRO seems all set to come out stronger after this disruption as well.