The $17 billion contract research organization (CRO) market is growing 15% annually. CROs currently perform approximately 25% of preclinical drug testing for pharmaceutical manufacturers, and analyst Isaac Ro of Leerink Swann predicts that, due to imminent strains on pharmaceutical firms including lower profits and more regulations, within three years the number will double to 50%. He also predicts that within five years CROs will undertake 50% of all clinical trial work, which includes both late-stage trials, a market worth $9 billion in 2007, and early-stage trials, a market worth $4.5 billion in 2007. Because of the rapid growth rate, analysts also predict that a consolidation is on the horizon, with Covance and Charles River forecasted to be the major consolidators. However, other experts doubt that outsourcing will reach such levels and express concern about overcapacity.

Source: Reuters