Going global a necessity

April 7, 2009 – 3:58 pm by Michael Christel

Such is the reality for contract research organizations these days if they want to maintain success. Just ask RPS Inc., a self-proclaimed “next generation CRO� and provider of integrated clinical research services to the biopharmaceutical industry. In just the last few months, the Pennsylvania-based company, in response to escalating global demands, has laid down much-needed business roots overseas.

First was the acquisition of three mid-sized CROs in Europe (see here and here). Then late last week, RPS agreed to buy Beijing-based CRO Paramax International Inc.

“In order to continue the growth of RPS and by demand of our sponsors, we’ve had to globalize the company,� RPS CEO Dan Perlman, just back from a trek to China, told me this week. “We started with acquisitions in December throughout Europe. Now we’re using China as our base in Asia. As of last Friday, we’ve also incorporated Korea. I think you’ll see us go widespread throughout Asia in the next month.�

RPS’ work in these regions will largely focus on its core specialty – providing integrated R&D outsourcing services for clinical trials.

“[Sponsors] have been asking us to do them globally since they’re very comfortable with them in the United States,� Mr. Perlman says.

RPS does offer full-service clinical development solutions as well.

“To survive in today’s world, you have to have full-service global [capacity],� Mr. Perlman says. “I think the future is with these integrated programs.�

According to Mr. Perlman, the integrated model benefits large drug developers the most because they already have significant infrastructure in place.

“One thing this industry didn’t do is separate the difference between large pharma, medium, and small pharma,� Mr. Perlman says. “They have different needs. With a large pharma, these integrated programs work very well. With some mediums, they do quite well, but they would not work in small pharma.�

Soon-to-be acquired Paramax also has operations in Shanghai, China, which will serve as RPS’ Asian hub of sorts as the company eyes further expansion in the region.

“If you look out three years from now, the industry will be significantly growing there,� Mr. Perlman says. “It’s got the patients, it’s got the costs, it’s got the market. There’s very little it doesn’t have, except from a regulatory point of view, it’s not ideal. But they’re working to get that done and we would expect rapid expansion there.�