New report predicts the global CRO market will be worth $44.4 billion by 2021.

Clinical trials account for the largest share of drug development costs. The desire to cut costs and accelerate development timelines continues to be a driver for outsourcing to contract research organizations able to provide these benefits. A late 2017 report estimates that the CRO market will expand at a compound annual growth rate (CAGR) of 7.4% through 2019. A more recent report published this month by The Business Research Company (BRC) predicts expansion at 12% per year through 2021, with the value of the market reaching $44.4 billion at the end of the period.

Consolidation continues in the CRO industry, with the value of M&A deals in 2-16 reaching $24 billion. Two of the largest CROs were recently formed through megamergers: Syneos Health from the joining of InVentiv Health and INC Research and IQVIA from the combination of Quintiles and IMS Health. The largest players in the CRO space today, according to BRC, are IQVIA, Laboratory Corporation of America Holdings, ICON Plc, PAREXEL and PPD.

Outsourcing to innovative CROs that continually invest in new technologies provides pharma companies access to specialized expertise, the ability to reduce costs and timelines and the opportunity to leverage large data sets from new data sources, and analyze that data using innovative analysis capabilities. With the rise of precision medicine and the growing focus on orphan and niche drugs, CROs also enable pharma companies to conduct customized, innovative trials, even virtual trials, that facilitate the incorporation of patients located in widespread and remote regions.