The outsourcing of clinical research is a significant part of the product development landscape in the biopharmaceutical sector. According to analysts, the global clinical research outsourcing (CRO) market was valued at $28.75 billion in 2014 and is forecasted to grow to more than $64 billion by 2020, with nearly 75% of all clinical trials performed by CROs.
The continued growth of work outsourced to CROs relative to overall spending on drug development is to some extent an indicator of success: clinical trial sponsors are voting with their pocketbooks, and in response, headcount at CROs has surged. But the data also continue to show significant cost overruns and even more expensive delays (in terms of time to market, a critical driver of revenue in the patent-protected life sciences industry). According to the Tufts Center for the Study of Drug Development, the average clinical development time for newly approved drugs actually increased by approximately 10% over the past 12 years.