The Contract Research Organization Market’s Largest Players Are Investing In Acquisitions As Part Of Their Expansion Strategies
The global contract research organization (CRO) market is relatively concentrated, with a small number of large players. The top ten competitors in the market made up to 47.5% of the total market in 2018. IQVIA was the largest competitor with 8.80% of the market, followed by Laboratory Corporation of America Holdings (LabCorp)with 6.51%. Both these players are investing in acquisitions to strengthen their CRO businesses. IQVIA’s growth strategy includes expansion in strategic growth opportunities and also potential dispositions of assets or businesses, as required. In December 2016, the company acquired Q2 Metrics Inc., which was an IT company serving the healthcare industry using cloud-based portals and proprietary algorithms. The company was acquired for an undisclosed amount. IQVIA is involved in providing technology solutions, advanced analytics and contract research services to the life sciences industry. It was formed after the subsequent merger of Quintiles and IMS Health in October 2016. The company has its headquarters in Connecticut, USA. Quintiles was founded in 1982 and IMS Health was founded in 1954.
The LabCorp’s growth strategy aims at focusing on emerging biopharma segments for its Covance drug development segment, through strategic acquisitions. For instance, in August 2017, the company acquired Chiltern International Group, a specialty CRO, in a $1.2 billion deal. This strategic acquisition will expand LabCorp’s service offerings to their biopharmaceutical customers. LabCorp is involved in offering drug development services and clinical laboratory services. The company was established in 1994 and is headquartered in North Carolina, United States.
PPD, which is another major player in the global CRO market, has adopted a similar strategy of expanding its clinical research capabilities through strategic collaborations. For instance, in August 2019, Evedera, a business unit of PPD entered into a collaborative agreement with Clinical Study Support Inc., a subsidiary of Nippon Biomedical Laboratories Ltd. This strategic move of PPD will enable it to leverage its clinical research and other research service capabilities including clinical outcome assessment development, design and implementation of real-world studies, and epidemiological studies.
Other major players in the market include Syneos Health, PRA Health Sciences, PPD, ICON, PAREXEL, Wuxi Pharma, Charles River, and Medpace. The market consolidation can be attributed to the partnerships and collaborations among the players in the industry to scale up their trials, save costs, enhance their service offerings and expand geographically. The market is expected to further concentrate in the near future with the adoption of acquisition and merger strategies by the players to enter and expand into newer geographies.