Big Pharma farms out safety monitoring to $2B-and-growing industry

Print 03 February 2015
Tracy Staton / FiercePharma

Big Pharma has been hiring out all sorts of functions companies once did in-house: sales, manufacturing, and IT services, to name a few. But according toThe Wall Street Journal, one of the fastest-growing fields for pharma contractors isn't any of these. It's drug safety.

Drugmakers including AstraZeneca ($AZN), Bristol-Myers Squibb ($BMY) and Novartis ($NVS) are outsourcing safety monitoring, sending side effects reports out for analysis and processing. Major consulting firms such as Accenture are picking up the business, which is now worth some $2 billion. And it's only expected to grow, with market researchers forecasting a 100% increase within 5 years.

Much of the actual action takes place in India, where some top outsourcing companies are based, including Tata Consultancy Services; Accenture has a drug-monitoring hub in Bangalore. Companies forward adverse event complaints to their contractors, which add them to databases for reporting to the U.S. FDA. Staffers look for trends and flag the most serious reports.

Some compliance experts aren't happy with the idea. They say pharmacovigilance requires a lot of expertise and training, not to mention tight focus on detail. If contractors fail to recognize a serious pattern, that can put patients at risk and land companies in a lot of trouble.

But the contractors themselves say their staffers are well trained, with college degrees in pharmacy or other specialized healthcare qualifications. And, they say, they're often doing a better job at reporting than their clients did before farming out the work. "The results speak for themselves," an Accenture managing director, Kevin Julian, told the WSJ.

Training isn't enough in pharmacovigilance, though, one compliance-focused attorney told the newspaper. In-house teams aren't just well educated and well trained, but also have plenty of knowledge about their own company's products, Sidley Austin's Scott Bass told the WSJ. "You can't compare the quality of a full in-house multinational pharmacovigilance team with an outsourcing company," he said.

Outsourcing of any kind comes with its risks, of course. Some drugmakers have learned that the hard way, when their contract manufacturers ran afoul of the FDA. Johnson & Johnson ($JNJ), for instance, suffered a long shortage a couple of years ago on its cancer treatment Doxil, after contract manufacturer Ben Venue got into troube for serious manufacturing violations. More recently, several generic drugmakers saw their products suspended in Europe on concerns that a contract research firm had falsified bioequivalence data.

But companies say that close management of outsourcing deals can head off problems. And in-house teams aren't immune to mistakes, either. Roche ($RHHBY) ran into trouble in 2012 for 80,000 U.S. adverse event reports that had allegedly gone uninvestigated for reporting to the EU.

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