It is almost a decade, India has witnessed a growth in clinical research business. The much-talked about India advantage has translated the foreseen business potential into reality. The scary moments of 1995 on data quality, confidentiality and non-existence of standard regulations and guidelines are no more the issues of concerns. Today we have all the regulations in place including ethical guidelines for good clinical research (GCP), patent act, bioequivalence and bioanalytical guideline, medical devices guidelines, etc. that supported this trend. These regulatory changes have propelled various opportunities in clinical research segment. And sweeping transformations in the outsourcing trends are taking place in the Indian market.

Mushrooming players
The factors of cost, time and quality of output have convinced pharmaceutical sponsors to narrow down to India as a preferred destination in clinical research outsourcing. While mergers and acquisitions are the key mantra with some players, many are expanding their own resources to take up more and more clinical trials. The "head count" issues are no longer a stumbling block for many Big Pharma in their growth plans in India; rather they find it hard to attract, and retain best of the talents in an industry, where demand for skilled resources outstrips the supplies. Today there are as many as 100 service providers, contract research organizations (CRO), site management organizations (SMO), and other logistics service providers. Local and global companies have already set up their operations and expanding their bench strengths to take up more and more outsourcing work in India. With the growth in the industry, several models have evolved to optimize cost and resources.

Project based outsourcing model
In this model, pharmaceutical companies are looking for outsourcing partners, who would perform specific tasks on behalf of the principal sponsors. Amongst the key project specific tasks that are being outsourced to Indian service providers are: monitoring and source data verification, obtaining local regulatory permissions (clinical trial permission, test license, export license and ethics committee approvals), providing local logistics of study set up, drug storage and distribution, and performing the clinical data entry. However, with more global experience in this business over last decade, the trends of outsourcing is moving up towards the tasks with higher value chains like; quality assurance and audits, pharmacovigilance support, discrepancy management and query resolution in data management, statistical analysis and medical writing work. Again, the quality and experienced resources to take up these tasks are limited with many existing service providers.

This model was integrated with time with a popular approach called "Preferred Service Provider", where in many service providers created a basket of services to function as a "Preferred Full Service Provider" including clinical trial management and data management. The big CROs took advantage of this approach to expand their global reach and equipped themselves with global server, software and other infrastructure with addition of user licenses to extend their services globally. Many pharma companies use this model to sign master service agreement to work with a limited service providers, with the principle of partnership.

The project cost of this model is worked out based on time and resources required to perform the tasks assigned to the service provider(s). Depending on the quality of resources, infrastructure and various other overheads, the cost of project varies from one service provider to others. It is not necessary that the lowest bidders win, but rather the best in the bid wins the project.

Functional Service Provider (FSP) model
This is another promising model, gaining importance in Indian clinical research outsourcing environment. In this model, the pharmaceutical sponsors identify one / few Functional Service Providers based on their core capabilities. This model gives an opportunity to the sponsors to work with quality service providers having functional expertise. On hindsight, this model promises the service providers to act as a FSP for certain specified tasks for a particular duration. For example; a sponsor may decide to identify a CRO having strong expertise in monitoring alone and may be another CRO who have expertise in quality assurance and medical writing. A lot of due diligence is required to identify and select a quality functional service provider, as it envisages a comparatively lot term commitment and association, which could spread over different trials.

In this model, the sponsor expects that the service provider would always be with adequate skilled resources to take up the assigned functional responsibilities in time. In a rapidly growing industry, where skilled resources are very much in demand, the sponsor also expects that the service provider should have robust recruitment and retention plan, and arrangements for replacement of skilled resources, in case of unwarranted attrition.

The model is priced based on 'per functional unit cost', could be per day or per visit. For example; the sponsor may pre-decide with the service provider the cost of one monitoring visit of 2 days or per day / per hour cost of monitoring. Depending on the protocol requirement, thesponsor instructs the service provider to undertake number of monitoring visits and the duration of each visit. However, in this model, the functional service provider would expect to negotiate a minimum number of unit tasks with the sponsor to ensure that they make some profit with quality deliverables.

Full Time Equivalent (FTE) model / Contract staffing model
Another model that is becoming popular for a few selected pharma companies in India is the Full Time Equivalent (FTE) Model / Contract Staffing Model. In this model, the sponsor expects to hire contract staff / FTEs though a service provider. The FTEs hired, could be located either at the sponsor office or at the service provider's office. This model ensures that the salary and administration requirement of these FTEs are taken care by the service provider and functional training and technical support to perform the tasks are provided by the sponsors.

This model offers client companies several advantages to:
. Have sufficient personnel at hand for their entire project related requirements and meet the peak time demand, without the need to recruit staff on permanent head count.
. Have access to experienced clinical research staff who are skilled in a variety of job functions which can eventually lead to reduced labour costs
.Reduce time spent in training the staff, and overall conduct of clinical trials
.Improve quality of research through quality staff and supervision
.Retain control over their existing projects without the need to outsource the entire project.
.Provide a solution for the high attrition rate in this Industry. This method allows the sponsor to work jointly with the CRO to provide innovative incentives and support for quality staff retention. This service also guarantees a timely replacement in the face of attrition.
.Minimise long term risk
FTEs / contract staffs are priced based on the cost of their salary, the overheads and the margin. It could be charged to the sponsor on monthly basis.

Outlook
These business models pose numerous challenges to the service providers, especially in the emerging Indian industrial environment, where trained and experienced professionals are limited in numbers. The increase in the number of trials being outsourced to India may lead to sudden spurt in demand for experienced professionals by the pharmaceutical sponsors in different cross functional areas. While several of these outsourcing models are evolving in India, it is not so far tested and proven which among them is the best. There are sponsors, who are extremely new in this territory, are even using a mixed model. Some wish to go a midway between the contract staffing model and the project based model in a particular trial. However, proper planning andthorough implementation of any of these modelswill certainly yield better control with improved quality, timeliness andcost-effective output.

(The author is managing director, Chiltern International Private Limited, Mumbai)