In drug discovery outsourcing, pharmaceutical companies currently have the ability to contract out parts or all aspects of the early-stage drug discovery process to an external provider, otherwise removing the need for expensive in-house manufacturing capacity. The drug discovery operations are typically contracted out to a third-party, such as CROs or to an academic laboratory that specializes in drug discovery. Thus the drug discovery outsourcing process typically involves two organizations entering into a votive agreement; where the academic laboratory or CRO performs the drug discovery work in return for research funding or payment, creating a long lasting inter-company relationship which can bridge the globe.
Outsourcing of drug discovery saves time, costs and efforts of the pharmaceutical & biological companies. Moreover, companies who provides outsourced services for drug discovery are equipped with developed infrastructure, highly developed technological front, and skilled expertise. Rapidly progressing technologies, reduced turn-around time, increasing strategic partnerships & development of biosimilar, biologics, and orphan drugs are some of the driving forces for the growth of the global drug discovery outsourcing market. The market scope for drug discovery outsourcing market is massive, however an upsurge in CROs, regional expansion, niche CROs and public-private partnerships is leading to increased competition that is restraining the growth of this market.
Most work currently outsourced to CROs is from the development stage of the drug discovery cycle. Functions such as preclinical studies may optimally be left to CROs as they have fast turnaround times and offer cost-effective services. Furthermore, clinical trials are now progressively being outsourced, with CROs playing a vital role in scheduling trials and collecting/analyzing the data.
Typical functions in the discovery phase outsourced to CROs include target identification and validation, high-throughput screening and lead optimization. Although most pharmaceutical companies synthesize their own candidate drugs based on a well-defined target, some CROs are dedicated to custom synthesis services emerged in recent years.
Also, the development in vitro toxicology screening assays and absorption, distribution, metabolism, and excretion studies are areas that can be outsourced. Functions that pharma are commonly outsourcing at the present time include those involving functional genomics and lead identification. Functional genomics is an area where pharma companies are reported to lack expertise; therefore, it makes sense for the industry to outsource or collaborate with academics for this highly specialized function.