Optimizing Outsourcing in Early Small Molecule Drug Discovery
A Dotmatics report based on an American Chemical Society study to explore trends and needs in Biotech–CRO collaborations
Contents Overview Key Findings and Recommendations 3 Introduction The Rise of CRO Outsourcing in Early Drug Discovery 5 Study Method ACS Survey: Trends and Needs in Early Drug Discovery Outsourcing 9 Results Survey Results 11 Discussion What insights can be gleaned from these survey results? 18 Conclusion Dotmatics Platform 20 Success Stories Success Stories 23
Outsourcing to contract research organizations (CROs) has been a strategic way for companies to navigate rising costs, waning funding options, and growing layoffs
From 2015 to 2021, NME approvals for companies with revenues less than $1 billion grew from 8% to 30%, a percentage nearly equal to the share held by companies whose revenues exceed $10 billion.[1] But challenging this momentum are a number of obstacles, including rising costs, waning funding options, and growing layoffs.
For many companies, outsourcing to contract research organizations (CROs) has been a strategic way to navigate these challenges. While biotech-CRO relationships at the clinical stage are both well established and well scrutinized, there has been limited exploration of how to optimize earlydiscovery engagements.
To remedy this, Dotmatics commissioned the American Chemical Society (ACS) to survey Chemical & Engineering News readers about outsourced small-moleculedrug-discovery projects. Results show that while compound synthesis is the primary early-discovery task outsourced, biotechs are increasingly turning to multiple CROs for help in additional areas, such as drug metabolism and pharmacokinetic studies, as well as toxicology and safety assessment and more.
The survey also highlights the need for solutions to help optimize biotech-CRO collaboration, with both bio-company and service-provider respondents citing datamanagement solutions as their top need.
Abstract
1
Overview
Strategic outsourcing in early discovery can be optimized by improving project-data exchange. A secure client-provider portal can address many of the challenges biopharmas and CROs face around submitting requests, monitoring projects, and delivering and leveraging results.
Overview
2
Key Findings
Biopharmas commonly engage multiple service providers for outsourced projects, which are predominated by small molecule synthesis, drug metabolism and pharmacokinetics studies, and toxicology and safety assessment.
Project-monitoring and data-review tasks monopolize much of the time spent on outsourced projects.
Data-exchange processes are largely rudimentary, but while acknowledged as a top need by biopharma and providers, there was minimal insight into vendors who could help improve data-management processes during early discovery outsourcing.
Overview
3
Recommendations
To optimize outsourcing relationships, biopharmas and service providers engaged in early drug discovery projects should:
Streamline commonly outsourced tasks, such as synthesis or DMPK analysis, by submitting requests and returning results in a united system.
Reduce time spent on project monitoring, report creation/review, and communications by tracking all outsourced projects in a secure project portal that keeps diverse stakeholders informed with up-to-date results and reports.
Directly exchange data from outsourced projects via a secure data-exchange portal, which keeps data current, accurate, and ready for secondary use—all without the timesink of reformatting and transferring data manually.
Overview
4
The Rise of CRO Outsourcing in Early Drug Discovery
After the blockbuster days of the 1990s, biotech stepped up to fill big pharma’s innovation gap and fuel growth for the industry as a whole. But rising R&D costs soon turned up the pressure to run smart and lean.
5
By the 2010s, many companies began outsourcing their compound synthesis. They could focus their money and talent on core design competencies in medicinal chemistry, while passing off the legwork to CROs who could create compounds faster and cheaper. It was a win-win. But, in recent years, even with this synthesis-outsourcing model well established, pressures have continued to mount for a variety of factors.
R&D costs are growing
R&D spending is nearly ten-times more than it was in the 1980s. It can take as much as 12-18 years and $1-3 billion dollars to bring a new drug to market.[2,3]
Funding options are waning
As valuations fell post-COVID, potential partners and investors became increasingly trepidatious; mergers and acquisitions slowed; easy funding and fast-tracked IPOs were replaced with growing demand to differentiate, meet strict development milestones, and offer laterstage assets.[1,4]
Layoffs are lingering
The layoffs of 2022 spilled over into 2023.[5] Many companies have reduced headcount, dropped programs, and refocused efforts, which has forced their teams to trudge along with dwindling funding and staff.
Introduction
6
CRO 2.0:
Optimizing Outsourcing
As the pressure to do more with less grows, biotechs are looking beyond synthesis and questioning what CRO 2.0 might look like.
Could CROs help expand capacity, scale, and pipelines?
What other early-discovery tasks can be outsourced?
Could specialty providers fill talent and technology gaps?
What role will CROs play as the use of AI-and in silicobased virtual screening grows?
What are the hidden costs of CRO outsourcing?
These are essential questions to ponder given how strongly biotechs are betting on CRO outsourcing. By some estimates, biotechs now outsource anywhere from two-thirds to 100% of their R&D activities. For big pharma, that figure is around 45 percent.[6]
Outsourcing is so strong that the global contract research market is expected to reach approximately $163.48 billion by 2029, representing a compounded annual growth rate of around 12% [7]. Reliance on CROs is especially strong among companies working in small molecule drug discovery.[8]
Biotechs now outsource anywhere from two-thirds to 100% of their R&D activities.
In particular, the outsourcing of early discovery initiatives, pre-clinical studies, and drug development efforts are growing at a faster pace than all other segments, including clinical trials and laboratory services.[7]
How can the CRO relationship be optimized, not just task-bytask, but as a whole?
Introduction
7
Despite growing reliance on CROs in early R&D, exploration of how to optimize the biotech-CRO relationship has largely focused on clinical phase projects, where clients say they are looking for CROs to help integrate point solutions, offer end-toend strategic advice, and provide reliable and credible program management.[9] But the success of early discovery outsourcing can also be threatened by multiple factors, such as inefficient data exchange, quality concerns, communication difficulties, and project management challenges. These factors also warrant exploration.
Introduction
8
Dotmatics has stepped in to help do such.
ACS Survey: Trends and Needs in Early Drug Discovery Outsourcing
In an effort to explore trends and needs in early drug discovery outsourcing, Dotmatics commissioned the ACS to survey biotechs and CROs who are collaborating on early small molecule drug discovery projects.
9
Survey Summary
An online survey was made available via email invitation to Chemical and Engineering News readers who selfidentified as working in small molecule drug discovery. It was launched in January 2023 and was available for nearly six weeks. Two-hundred-seventy-eight individuals submitted responses. Key demographics of respondents are summarized in the references.
The survey engaged both biotech/biopharma/pharma companies (“bio companies”) who outsource to service providers, as well as service providers themselves. It asked numerous questions regarding categories of companies engaged, types of projects undertaken, technology solutions employed, data formats and processes used, solution and technology gaps, etcetera.
Overview
10
Survey Results
Responses from bio companies and service providers were largely aligned; for simplicity’s sake, the key results presented herein are those of bio-company respondents, unless otherwise noted.
11
Type and Number of Providers Engaged
Survey results indicated that bio companies engage with a variety of service providers.
Contract research organizations were the most common type of provider engaged, with 84% of respondents saying they outsource to CROs. This was followed by universities, which were engaged by 40% of respondents.
Most companies engage multiple providers at once, as opposed to just one, as shown in Figure 1. Likewise, most providers serve multiple clients.
Variety of types of organizations bio companies are engaging with
Results
Type and Number of Providers Engaged Figure 1 36% 2-3 23% 4-5 23% >5 1% Other 6% 1 40% University/Academic 84% Contract Service Providers 18% Independent Labs 9% Government 9% Government 6% Non-profit Research 8% Hospital/Medical 12
Types of Projects Outsourced
Synthesis remains the most common type of early discovery project delegated to service providers, with 84% of respondents saying they outsourced synthesis. Service-provider respondents also cited small molecule synthesis as the primary service they provide to clients.
However, as shown in Figure 2, it is becoming more common to outsource other types of early discovery work, including drug metabolism and pharmacokinetics studies, as well as toxicology and safety assessment. Also of note is the relatively low amount of high throughput screening being outsourced. Only 36% of respondents said they outsource high throughput screening; similarly only 27% of providers said they typically provide this service.
Results 4
Small molecule synthesis Drug metabolism and pharmacokinetics Toxicology safety Process optimization Formulation High throughput screening Compound QC 84% 58% 50% 41% 40% 36% 29%
and Number
Engaged Figure 2 13
Type
of Providers
Time spent on Outsourcing Tasks
Respondents identified a number of hidden challenges that might threaten project timelines and budget allotments.
Figure 3 illustrates the percentage of time bio-company respondents spent on various tasks when working with service providers. As shown in the figure, a significant amount of time is spent monitoring project progress, as well as reviewing reports and data that providers have prepared.
On the provider side, reviewing experimental data, monitoring projects, and conducting frequent client meetings were the top most time-consuming tasks.
Percentage of Bio-Companies' Time Spent on Various Tasks When Outsourcing
Results
3 Monitoring progress of projects 8% 18% 20% 13% 12% 29% Reviewing reports from providers 11% 26% 24% 11% 12% 16% Reviewing data from providers 11% 26% 23% 13% 11% 16% Conducting regular meetings with providers 18% 34% 17% 12% 7% 12% Conducting regular meetings with providers 21% 31% 24% 17% 5% 25%+ 20% -24% 15% -19% 10% -14% 5% -9% <5% 14
Figure
Factors Contributing to Data Management Struggles
For both clients and providers, a multitude of factors complicate lab data management.
Diverse Stakeholders
Data are used by many different stakeholders across R&D, development, chemistry/manufacturing/controls (CMC), IT, production/manufacturing, QA/ QC, clinical/bioanalysis, process analysts, corporate management, environmental/health/safety, and procurement.
Varied Technology
While a large portion of respondents used electronic laboratory notebooks, around a quarter also relied on a scientific data management system (SDMS) or a lab information management system (LIMS).
Key Regulations
While Good Manufacturing Practice (GMP) and Good Laboratory Practice (GLP) topped the list of regulatory concerns, many respondents also cited clinical and ISO regulations as a priority.
Data Strategy
Both bio-company respondents and providers said their current lab-data management strategy primarily focused on capturing and driving results, as well as on process optimization. FAIR data principles were also a concern.
Results
15
Top Need Identified:
Data-Management Solutions
Faced with these varied challenges, it is no surprise that both bio-company respondents and service providers identified data-management solutions as the number one type of solution that would be “most helpful in managing external drug discovery projects.” In fact, for both groups, the need for datamanagement solutions far outweighed all other needs identified.
Data management solutions were by far the top solution that both biotechs and CROs cited as “most helpful for managing outsourced drug discovery projects.”
Data preparation and cleaning is a well known bottleneck in R&D. By some estimates, up to 80% of R&D data are stuck in different systems and in different formats. As a result, as much as 60% to 80% of a data scientist’s time is thought to be spent cleaning and preparing data for use. Data being exchanged with external service providers complicates matters even more.
Taking a closer look at current datasharing practices in early-discovery outsourcing illuminates why datamanagement solutions are so needed and why so much time is spent monitoring projects and having progress-report meetings. As illustrated in Figure 4, the file formats typically used in outsourcing projects are rudimentary and often necessitate data transcription steps that are timeconsuming, error-prone, and unsecure.
File Formats Typically Used to Transfer Data in Early Drug Discovery Outsourcing Projects
73% Powerpoint 72% Excel 68% PDF 59% Word 21% Access/other databases 19% In-house designed 7% Other Results
Up to 80% of R&D data are stuck in different systems and in different formats.
16
Unnecessary Data Transcription Steps Prevalent in Early Drug Discovery Outsourcing Projects
There is an overwhelming use of officeefficiency programs to present project data; the current status quo is for service providers to pull data out of their systems and prepare progress reports to present to clients. This process is time-consuming and requires constant touchpoints to keep everyone up-to-date. And while the prepared project-update reports may be easy to view, they are not easy to use. Such reports are stagnant and leave the underlying data inaccessible for secondary use. The data cannot be easily uploaded into a client’s databases. They cannot be easily passed into specialty software for secondary analyses or use in machinelearning or AI tools. They can’t easily be collated with other datasets to attain
broader insights. They are not easy to find or use again in the future.
Interestingly, despite acknowledging the strong need for data-management solutions, neither bio companies nor service providers were well versed with the options available on the market to help deliver positive change.
Results
Figure 4 PDF CRO 1 Data prepared to send to CRO 2 Transcribed into CRO system 3 Into prepared to send to client 4 Client transcribes data into their system Biotech CSV XLS XLS
17
As much as 60% to 80% of a data scientist’s time is thought to be spent cleaning and preparing data for use.
What insights can be gleaned from these survey results?
Biotechs/biopharmas/pharmas are often engaging numerous diverse providers, which risks inconsistencies and inefficiencies when there are no standardized workflows or integrated CRO portals in place to securely and consistently capture and review project data.
Synthesis still represents the largest portion of outsourcing, which makes the tasks of target submission, compound upload, and secure registration highly important.
Growing reliance on service providers for work beyond synthesis will demand an end-to-end CRO-management solution that can capture all details and results from diverse types of outsourced projects and analyses. This will require an R&D platform that has the openness to acquire data from all the different types of speciality technology and instruments that internal and external researchers need; such a platform must prioritize data interoperability and seamless data exchange on the backend so biotechs can create a master data source that provides high-level insights across all their diverse projects.
Relatively low outsourcing of lab-based high throughput screening may signal a shift toward AI-based approaches, which will present new challenges for uploading virtual screening results into a united R&D data platform that serves as a single source of truth bridging in silico and lab-based exploration.
Discussion
18
Timelines and budgets can be threatened by the data-and projectmanagement processes common in many outsourced projects.
Reliance on office-management tools to summarize and present results not only demands frequent touchpoints, but it also leaves the underlying R&D data stagnant and unavailable for secondary use. A client-CRO project portal, with real-time reports and repurposable data, could drastically reduce time spent preparing and reviewing reports, holding status-update meetings, and manually transferring or searching for data.
Data-exchange bottlenecks abound. Data capture, transcription, formatting, interoperability, secure transfer, collation, and reporting are all at risk within the current status quo processes; however biotechs and CROs alike are not well versed in the solution offerings available on the market and are instead getting by with workarounds and stopgap processes.
Discussion
19
Dotmatics
can help.
Conclusion
As the market’s first true end-to-end scientific R&D platform, Dotmatics has the power and flexibility needed to support a wide range of CRO collaboration needs within early small molecule drug discovery. From compound design and synthesis to screening, analysis, and registration, Dotmatics can help.
20
Complete CRO Collaboration Hub
Optimize collaboration and secure data sharing between internal colleagues and multiple CRO partners by adopting a complete web-based informatics and decision-support system.
Have one central hub to manage everything: compound design, synthesis requests, reagent and inventory supplies, experiment design and tracking, assay and analytical lab requests, purification and optimization studies, entity registration, documentation and results upload, and progress report creation.
With a unified portal, up-to-date data are safely accessible from one place, keeping all stakeholders on the same page at all times, establishing a united source of truth, and creating the framework needed to support project expansions, whether from adding additional collaborators or adopting new technologies, such as AI-based virtual screening.
Conclusion
Biotech
CRO
CRO
CRO
CRO
CRO
21
Specific CRO Task Optimization
Even at the individual task level, manual data exchange and process inefficiencies can have a major impact—risking error, wasting resources, and stealing researchers’ time away from high-value scientific work. Dotmatics can help optimize tasks common within CRO collaborations, such as:
Target Submission, Compound Synthesis, and Registration
Manage target submission and synthesis requests and then facilitate secure compound upload, whether it be by individual compound or by batch, and with or without registration privileges for CROs.
Assay or Analysis Requests and Results Upload
Manage communication, requests, and back-and-forth data exchange with CROs engaged in tasks such as lead optimization, ADEMT analysis, formulation studies, compound QC, high-throughput screening, etcetera.
Reporting and Decision Support
Create cross-project dashboards and reports to collate data from multiple CROs and attain high-level insights that aid in decision making.
Conclusion
22
Success Stories
Whether you’re a biotech engaging multiple CROs, or a CRO serving diverse clients, Dotmatics can help. Here are a few success stories.
23
Secure CRO Compound Submission at Cereval
See how they did it
Cerevel is a clinical-stage biopharmaceutical company unraveling the mysteries of the brain to treat neuroscience diseases. With Dotmatics, Cereval created a secure process for letting CROs directly submit small molecules and proteins to a registration-approval queue within their R&D platform, all without risk of duplication or security breaches.
This was possible thanks to Dotmatics’ ability to support one-way batch data upload, view-only data access, project and compound aliases, and restricted internal-only access to advanced platform tools, such as sketching and stoichiometric calculations, compound and assay registration, sign-off rights, and report creation.
Results
24
Active-PharmaceuticalIngredient Stock-andShipment System at Debiopharm
See
Debiopharm is a multisite, 400+ person drug development company focused on novel treatments for oncology and bacterial infections. The company has numerous global CROs who they engage for both compound synthesis and analysis. With so many internal and CRO team members contributing to R&D efforts, Debiopharm needed a better system to keep everything in order, from the stock researchers need to conduct their work to the results coming from various types of analyses.
Results
With Dotmatics, Debiopharm was able to move beyond Excel-based network files and into a secure web-based R&D collaboration platform. how they did it 25
Creating the ‘Lab of the Future’ at Global CRO
Leader Charles River Laboratories
As a leading global CRO with over 100 facilities in more than 20 countries, Charles River Laboratories (CRL) supports countless biotech and pharma companies in their drug discovery and development efforts. To best serve their customers and maintain high quality standards in face of continued growth via acquisition, CRL has made a concerted effort to streamline processes and integrate R&D applications as part of a company-wide “Lab of the Future” initiative.
Dotmatics solutions have been a key part of the initiative. Various business units at CRL have adopted Dotmatics ELN, as well tools for database searching, compound registration, and workflow creation; plans are also in the works to rollout additional Dotmatics solutions to new departments and countless more scientists.
Results
how they did it 26
See
Optimize Outsourcing in Early Drug Discovery with Dotmatics
Request a demonstration today to explore how Dotmatics can optimize CRO collaboration and help small molecule drug discovery teams find better candidates, faster.
Request Registration Purification Library Synthesis Compound Synthesis Collate Data Analysis/SAR Hit Selection Idea Generation Compound Design Assay Screening Analysis/QC Characterize In Vitro In Vivo Make Decide Test Analytical Chemist Screening Scientist Cheminformatics CRO Chemist Medicinal Chemist 27
Request a demo
Demographics of Respondents (278)
Bio-Co. Respondents (116)
Location Sector
Group
Job Function
References
Experience North America 74% Europe 14% Asia 10% Central or
South America 2% Pharma 31% Biopharma 31% Biotechnology 31% Industry/
manufacturing 7% Consulting 6% Contract service
providers 2% Independent lab 2% Government 1% Research/Discovery 71% Development 13% Chemistry/ manufacturing/ controls (CMV) 12% Corporate management 3% Production/ manufacturing 1% Researchers/scientists 30% Supervisors 24% Department managers 21% Executives 18% Technician/ technical specialist 3% Product/marketing manager 2% Other 2% 10+ years 75% 5 to 9 years 16% <5 years 2% 28
Service Providers (162)
Location Sector
Group
Job Function
References
Experience North America 57% Europe 20% Asia 15% Central or
South America 4% Other 4% Universities 39% Biopharma companies 22% Other 13% Industry/manufacturing 6% Contract service
providers 14% Consulting firms 6% Research/Discovery 63% Development 16% Other 10% CMC 7% QA/QC 4% Researchers/scientists 37% Supervisors 21% Department managers 20% Executives 12% Other 10% 10+ years 77% 5 to 9 years 14% <5 years 9%
29
Demographics of Respondents (278)
Schur, E., Singhania, A., Infante, K. 5 ways for emerging biotechs to launch smarter. EY. April 8. 2022
Research and Development in the Pharmaceutical Industry. Congressional Budget Office. April 2021.
It will take years for AI use to peak in drug discovery and development process. GlobalData Healthcare. June 13, 2022
Cancherini, L, Lydon, J., da Silva, J.S., Zemp, A. What’s ahead for biotech: Another wave or low tide? McKinsey & Company. April 30, 2021
Armstrong, A., Masson, G., Bayer, M. Fierce Biotech Layoff Tracker 2023: Athenex lets go of 123 employees amid bankruptcy; Novavax lays off hundreds. Fierce Biotech. May 23, 2023
Locwin, B. R&D Outsourcing Trends: Not A Zero-Sum Game. Contract Pharma. October 6, 2021.
Market Analysis Report: Contract Research Organization (CRO) Services Market Size, Share. Fortune Business Insights. March 2022.
Pharma R&D Outsourcing Market–Global Outlook & Forecast 2022-2027. ReportLinker. September 2022.
Blyes, J., Fleming, E., Mirman, H., and The, L. CROs and biotech companies: Fine-tuning the partnership. McKinsey & Company. June 9, 2022.
References
