Drug Discovery Outsourcing Market Forecast 2015-2025

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Drug Discovery Outsourcing Market Forecast 2015-2025

Opportunities for Leading Companies

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Contents 1. Executive Summary

1.1 The Drug Discovery Outsourcing Market Overview

1.2 Drug Discovery Outsourcing Market Segmentation

1.3 Why You Should Read This Report

1.4 How This Report Delivers

1.5 Key Questions Answered by This Analytical Report

1.6 Who is This Report For?

1.7 Methodology

1.8 Frequently Asked Questions (FAQ)

1.9 Associated Reports

2. Introduction to Translational Regenerative Medicine

2.1 What is Outsourcing?

2.2 What is Drug Discovery Outsourcing?

2.3 Why Outsource Drug Discovery?

2.4 A Common Drug Discovery Model Includes Pharma Collaborations with Academia

2.5 The Outsource Model for Drug Development Increases Innovation

2.6 Outsourced Processes in Drug Discovery

2.7 Challenges with Drug Discovery Outsourcing

2.8 Emerging Markets are a Popular Destination for CROs

2.9 Strategic Partnerships to Acquisitions

2.10 Recent Drug Development Outsourcing Agreements

2.11 Glossary of Terms Related to Drug Discovery Outsourcing

1. Report Overview

2. An Introduction to Drug Discovery Outsourcing

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Contents

3.1 Drug Discovery Outsourcing: Global Market Overview

3.2 The Global Drug Discovery Outsourcing Market Sectors

3.3 The Global Drug Discovery Outsourcing Market by Sector, 2014

3.4 The Global Drug Discovery Outsourcing Market by Sector, 2015-2025

3.5 The Changing Market Shares by Sector, 2015-2025

3.6 The Global Chemistry Services Outsourcing Market, 2014

3.6.1 Libraries

3.6.2 Building Blocks

3.6.3 Compound Synthesis

3.6.4 The Global Chemistry Services Outsourcing Market Forecast, 2015-2025

3.7 The Global Biology Services Outsourcing Market, 2014

3.7.1 Target Identification

3.7.2 Target Validation

3.7.3 The Global Biology Services Outsourcing Market Forecast, 2015-2025

3.8 The Global Lead Optimisation Market, 2014

3.8.1 ADMET Screening: Prevents Late Stage Failure of Clinical Trials

3.8.2 The Global Lead Optimisation Market Forecast, 2015-2025

3.9 The Global Lead Identification and Screening Outsourcing Market, 2014

3.9.1 Methods of Screening in Drug Discovery

3.9.2 Primary Screening

3.9.3 The Global Lead Identification and Screening Outsourcing Market Forecast, 2015-

2025

3. Global Drug Discovery Outsourcing Market and Service Area

Submarkets, 2015-2025

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Contents

4.1 Drug Discovery Outsourcing Overview

4.2 The Leading National Markets in the Drug Discovery Outsourcing Market, 2014

4.3 The Leading National Markets in the Drug Discovery Outsourcing Market, 2015-2025

4.4 The Changing Market Shares of the Leading National Markets in the Drug Discovery

Outsourcing Market, 2015-2025

4.5 CAGRS of the Leading National Markets in the Drug Discovery Outsourcing Market, 2015-

2025

4.6 The US Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.7 The EU5 Drug Discovery Outsourcing Market by Region, 2014

4.7.1 The EU5 Drug Discovery Outsourcing Market Forecast, 2015-2025

4.7.2 CAGRS by EU5 Region, 2015-2025

4.7.3 The EU5 Changing Market Shares by Country 2015-2025

4.7.3.1 The German Drug Discovery Outsourcing Market Sales Forecast, 2015-

2025

4.7.3.2 The UK Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.7.3.3 The French Drug Discovery Outsourcing Market Sales Forecast, 2015-

2025

4.7.3.4 The Italian Drug Discovery Outsourcing Market Sales Forecast, 2015-

2025

4.7.3.5 The Spanish Drug Discovery Outsourcing Market Sales Forecast, 2015-

2025

4.8 The Japanese Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.9 The Chinese Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.9.1 Challenges to China’s Growth

4.10 The Indian Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4. The Leading National Markets in Drug Discovery Outsourcing

Market 2015-2025

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Contents 4.11 The Brazilian Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.12 The Russian Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.13 The South Korean Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.14 The Mexican Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

4.15 The Rest of the World Drug Discovery Outsourcing Market Sales Forecast, 2015-2025

5.1 Drug Discovery Outsourcing: A Fragmented and Growing Marketplace

5.2 Characteristics of Leading Contract Research Organisations

5.2.1 A Highly Quality Workforce

5.2.2 Emphasis on Intellectual Property Protection

5.2.3 Long Term Working Relationship

5.2.4 Success in Project Completion

5.2.5 Internal Drug Discovery Programmes

5.3 Service Offerings of Leading Companies in the Drug Discovery Outsourcing Market

5.4 Albany Molecular Research (AMRI)

5.4.1 Sales and Recent Financial Performance, 2011-2013

5.4.2 AMRI’s Drug Discovery Services

5.4.3 Internal Portfolio of Drug Discovery and Development Programme

Collaborations

5.5 Aptuit

5.5.1 INDIGO: Accelerating Early Drug Candidates

5.5.2 Aptuit Clinical Trial Supplies

5.5.3 Strategic Partnerships, Acquisitions and Divestitures

5.5.3.1 Divestiture of Aseptic Clinical Manufacturing

5.5.3.2 Aptuit’s Extended Partnership with GSK for Verona Centre

5.5.3.3 Partnership with Siena Biotech

5.5.3.4 Partnership with Laurus Labs

5. Leading Companies in the Drug Discovery Outsourcing Market in

2015

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Contents 5.6 Charles River Laboratories

5.6.1 Sales and Recent Financial Performance, 2011-2013

5.6.2 Charles River Laboratories: An External Acquisition Strategy

5.6.2.1 Acquisition of ChanTest

5.6.2.2 Acquisition of Galapagos’ CRO Services Division (BioFocus and

Argenta)

5.6.2.3 Acquisition of VivoPath

5.6.3 Charles River Laboratories: Revenue and Financial Analysis, 2014

5.6.3.1 Charles River Laboratories: Financial Performance by Business

Segment, 2013-2014

5.6.4 Charles River Laboratories Sales Forecast, 2015-2025

5.7 Covance (Acquired by LabCorp)

5.7.1 Covance: Historical Revenue and Financial Performance, 2010-2013

5.7.2 Covance: Early Stage Discovery Efforts

5.7.3 Agreement with Sanofi

5.7.4 Agreement with Kellogg Company

5.7.5 Agreement with BioPontis Alliance

5.7.6 Agreement with Indiana Clinical and Translational Sciences Institute (CTSI)

5.7.7 Agreement with Eli Lilly

5.8 Cyprotex

5.8.1 Historical Revenue and Financial Performance, 2011-2013

5.8.2 Cyprotex: Revenue by Region, 2013

5.8.3 Cyprotex: Revenue Analysis and Forecast 2015-2025

5.9 Domainex

5.9.1 Drug Pipeline

5.9.2 TBK1/ IKKε Inhibitors

5.9.3 Methyltransferase (KMTS) Inhibitors

5.10 Evotec

5.10.1 Strategic Action Plan

5.10.2 Evotec: Revenue and Financial Analysis, 2010-2013

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Contents 5.10.3 EVT Integrate and EVT Innovate

5.10.4 Partnerships with Pharma for Drug Discovery

5.10.4.1 Partnership with Sanofi

5.10.4.2 Extended Partnership with Evotec

5.10.4.3 Partnership with Johnson & Johnson

5.10.4.4 Partnership with AstraZeneca

5.10.4.5 Partnership with Bayer Pharma

5.10.4.6 Partnership with Boehringer Ingelheim Pharma

5.10.4.7 Collaboration with CHDI

5.10.4.8 Collaboration with Janssen

5.10.4.9 Collaboration with MedImmune

5.10.4.10 Collaboration with UCB Pharma

5.10.5 Evotec Sales Forecast, 2015-2025

5.11 GenScript

5.11.1 GenScript: Agreements and Partnerships

5.12 Pharmaceutical Product Development (PPD)

5.12.1 PPD: Agreements, Strategic Partnerships and Private Merger

5.12.1.1 Acquisition of Acurian

5.12.1.2 Partnership with Elan

5.12.1.3 Partnership with GSK

5.13 Quintiles

5.13.1Quintiles: Historical Revenue and Financial Performance, 2009-2013

5.13.2 Development Deal With Merck

5.13.3 Quintiles: Acquisition of Advion Bioanalytical Labs

5.13.4 Quintiles: Shedding Jobs

5.13.5 Quintiles Sales Forecast, 2015-2025

5.14 Selcia

5.14.1 A Strong Natural Product Chemistry Track Record

5.14.2 Initiative with the University of Edinburgh

5.14.3 Collaboration with Cantab

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Contents 5.15 Viva Biotech

5.15.1 GPCR Targeted Discovery Programs

5.15.2 Antibody Therapeutics Discovery

5.16 WIL Research Laboratories

5.16.1 Focus on Preclinical Research

5.16.2 Acquisition of Ricerca Biosciences LLC

5.16.3 Acquisition of Midwest BioResearch

5.17 WuXi Apptec

5.17.1WuXi AppTec: Service Offerings

5.17.2 Acquisition of NextCODE Health

5.17.3 WuXi AppTec: Historical Revenue and Financial Performance, 2009-2013

5.17.4 WuXi AppTec: Laboratory Services Sales Forecast, 2015-2025

6.1 Drivers and Restraints in the Drug Discovery Outsourcing Market, 2015-2025

6.2 SWOT Analysis of the Drug Discovery Outsourcing Market, 2015-2025

6.3 Strengths

6.3.1 Cost Reduction: A Central Driver for Outsourcing

6.3.2 Accelerating the Discovery of Drug Candidates

6.3.3 Growth of Virtual Pharma Companies

6.3.4 Reduction in R&D capacity Within Big Pharma

6.4 Weaknesses

6.4.1 Slowing Trajectory of Growth for R&D Spending

6.4.2 Increasingly Saturated Market Requires Companies to Quickly Evolve

6.5 Opportunities

6.5.1 The Available Scope for the Expansion of CROs

6.5.2 Targeted Therapies: Advances in Biologics and Orphan Drugs

6. Qualitative Analysis of the Drug Discovery Outsourcing Market,

2015-2025

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Contents 6.5.3 Increasing Development of Biologics and Biosimilars

6.6 Threats

6.6.1 A Competitive Market is Increasing Consolidation

6.6.2 Threat of Private Public Alliances

6.6.3 Intellectual Property Leaks

6.6.4 Challenges of Technology Transfer

6.7 Porter’s Five Force Analysis of the Drug Discovery Outsourcing Market

6.7.1 Threat of New Entrants: Medium

6.7.2 Power of Suppliers: Medium

6.7.3 Threat of Substitutes: Medium

6.7.4 Power of Buyers: High

6.7.5 Rivalry Among Competitors: High

7.1 Interview with Dr Mario Polywka, Chief Operating Officer, Evotec

7.1.1 Bridging the Gap Between Academia and Big Pharma

7.1.2 Evotec: Specialises in Certain Disease Therapies

7.1.3 Complete Drug Discovery Outsourcing: A Growing Trend

7.1.4 Strategies for Drug Discovery Outsourcing Expansion

7.1.5 Building Trust in Collaborations

7.1.6 Evotec: Proven Track Record of Success

7.2 Dr John Davis, Director of Discovery and Dave Roberts, Business Development Director,

Radiochemistry, Selcia

7.2.1 Growth in the Full Spectrum of Outsourcing Services

7.2.2 Natural Products: Increasing Source of Drug Discovery

7.2.3 Strong Pool of Early Drug Candidates

7.2.4 Overcoming Drug Discovery Challenges using Drug Discovery

7.2.5 Selcia: Regional Base of Clients

7. Expert Opinions

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Contents 7.2.6 Drug Discovery and Emerging Technologies

7.2.7 MedChemPlus Projects

7.2.8 Varied Customer Base

7.2.9 CROs: Improving Drug Discovery Productivity Levels?

7.3 Interview with Dr. Paul Overton, Executive VP, Business Development & Marketing, Aptuit

7.3.1 End-to-End Drug Discovery Integration Growth

7.3.2 Whole Project Externalisation

7.3.3 Drug Discovery Outsourcing: One of Aptuit’s Fastest Growing Services

7.3.4 Aptuit INDiGO® Program

7.3.5 Aptuit Implementation Drug Discovery Acquisitions

7.3.6 Aptuit: Adding the Intellectual Capabilities for Drug Discovery

7.3.7 Several Partners in the Drug Discovery Model

8.1 Market Overview

8.2 Lead Optimisation will be the Fastest Growing Sector

8.3 The Drug Discovery Outsourcing Market in Emerging Market Show Huge Gains

8.4 Continued Growth in Alliances and Collaborations

8.5 Concluding Remarks

8. Conclusion

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Drug Discovery Outsourcing Market Forecast 2015-2025: Opportunities for Leading Companies

Table 3.5 The Chemistry Services Outsourcing Market Forecast: Revenue ($bn), AGR (%), CAGR (%) by Sector, 2014-2025

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025Chemistry Services ($bn) 5.7 6.4 7.4 8.3 9.3 10.1 10.9 11.7 12.5 13.3 14.0 14.7AGR (%) 14.0 14.5 13.0 11.0 9.0 8.0 7.0 7.0 6.6 5.3 5.0CAGR (%) 2014-2019CAGR (%) 2014-2025

12.3 2019-2025 6.59.1

Figure 3.8 The Chemistry Services Outsourcing Market Forecast: Revenue ($bn), AGR (%), 2014-2025

3.7 The Global Biology Services Outsourcing Market, 2014

In 2014, the Biology Services sector accounted for 30.0% of the global drug discovery outsourcing

market, making it the second largest sector in the market. The Biology Services sector is classified

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

AGR

(%)

Reve

nue

($bn

)

Year

Source: Visiongain 2015




Figure 4.18 The UK Drug Discovery Outsourcing Market Forecast: Revenue ($m), AGR (%), 2014-2025

Table 4.14 The UK Drug Discovery Outsourcing Market Forecast: Market Size ($bn), Rank, Market Share (%) and CAGR (%), 2014-2025

2014 2019 2025Market Size ($bn) 1.0 1.9 2.9Global Market Ranking 3rd 4th 4thGlobal Market Share (%) 7.1 7.0 7.1

2014-2025 CAGR (%)Market Outlook

2014-202510.0

Positive

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

0.0

500.0

1000.0

1500.0

2000.0

2500.0

3000.0

3500.0

AGR

(%)

Reve

nue

($m

)

Year





Table 5.2 AMRI: Service Offerings and Descriptions, 2015

Services Offerings Description

Assay Development and DesignDesign of assay to meet client objective, including development of cell-lines and reagents

ScreeningAccess to a range of sample collections for efficiently identifying and optimising lead compounds

LibrariesA series of unique, high purity, small molecular synthetic compound libraries

Lead Optimisation/ Medicinal ChemistryAltering the chemical structure of a confirmed hit to identify an imporved drug lead

Bioanalytical Services

For extraction and and quantitation of drug and metabolites in biological fluids and tissues to support preclinical and clinical studies.

CADD Sophisticated computational software and techniques

In vitro ADMETTo evaluate and improve metabolism, bioavailability, and toxicology of compounds

Natural Product Services Natural product isolation and structual identification

The company’s products include a SMARTSOURCING option, which incorporates a full range of

value added opportunities, ultimately aiming to make drug pipeline development more successful

through information decision making and enhanced efficiency. AMRI currently operates under the

following products and service branches:

• Drug discovery

• Development

• cGMP manufacturing

• Aseptic fill and finish

• Project management

Source: AMRI 2014; Visiongain 2015



5.6.4 Charles River Laboratories Sales Forecast, 2015-2025

For FY 2014, Charles River generated total revenue worth $1297.7m. Charles River will see sales

grow during the forecast period, with the company’s total revenue reaching $1669.7m in 2019 and

$1911.9m in 2025. Visiongain forecasts that Charles River’s total revenue will grow with a CAGR

of 5.2% from 2014-2019 and with a CAGR of 2.3% from 2019-2025. However, it is expected that a

strong driver of this growth will be Charles River’s discovery services. Charles River experienced

strong growth in 2014, benefiting from the early discovery acquisitions, which include Argenta,

BioFocus, and ChanTest, which contributed 9.3% to consolidated fourth-quarter revenue growth.

Although visiongain does not predict as strong a growth in 2015, there will still be continued growth

attributed to the early discovery acquisitions deals in 2014. Visiongain forecasts that Charles

River’s total revenue will grow 7.0% in 2015, reaching $1297.7m. However, strong growth is

predicted with Charles River’s continuing focus on acquisitions opportunities in the early discovery

space.

As pharma companies increased their focus on strategic outsourcing, Charles River can harness

their scientific expertise and operating efficiency to be able to take advantage of the growth

demand for early stage R&D services. The steps being taken to improve the company’s

information technology platforms will also contribute to revenue growth during the forecast period.

The acquisition of discovery assets in oncology and CNS, the two therapeutic areas which

represents the largest investment of R&D funds by pharma and biotechnology companies will help

drive Discovery Research Services (DRS) sales growth over the forecast period. Charles River will

benefit in the early drug discovery industry because its offers clients a single source for services

across the discovery spectrum. This will be particularly important over the forecast period because

there is a trend for biopharmas to make earlier and earlier go or no-go decision on molecule

progression to regulated testing.

The pursuit of large partnership opportunities, such as the one with AstraZeneca, will enhance

Charles River’s ability to accelerate sales growth over the longer term.

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Drug Discovery Outsourcing Market Forecast 2015-2025