2016 CRO Market Size Projections 2015-2020

2016 CRO MARKET
SIZE PROJECTIONS
2015-2020
J A N U A R Y , 2 0 1 6
P R E V I E W O F
C R O
M A R K E T S I Z E
2 0 1 6

REPORT OVERVIEW
What you will learn
Report Structure
The past three years have been
quite eventful in the CRO world.
We’ve had service provider
mergers and we’ve had service
provider mega-mergers. We’ve
had biopharma mergers and
we’ve had biopharma mega-
mergers. We’ve had public
offerings and we’ve had
privatizations. Overall, the CRO
market has been one of the
best performing sectors in the
financial circles.
ISR’s report gives quantitative
insight into the perpetual
question: “What is the size of the
CRO market?” The data provide
a thorough, rational perspective
for clinical development services
segmented by phase, geography,
and service line.
ISR utilizes both publicly available
information and data obtained
through our syndicated primary
market research efforts.
• Estimated R&D expenditures through 2020
• Projected spending through 2020 segmented by source (sponsor type) and by:
• Development
• Phase I-IV Development
• Outsourced Phase I-IV Development
• 2016 Geographic Distribution of CRO Market Size
• 2016 Service-line Assessment of CRO Market Size
• 2016 Phase I-IV Assessment of CRO Market Size
1. Executive Summary
2. Overall Market Size and Growth
• Top-down approach to market size
• R&D sources and distribution
• Model adjustments – From R&D to
CRO market size
• Development spending
• Phase I-IV development spending
• Outsourced Phase I-IV development
spending
• 2016 full model analysis
3. 2016 Geographic Assessment
4. 2016 Service-line Assessment
5. 2016 Development Phase I-IV
Assessment
6. 2015-2020 CRO Market Model
7. 2015-2020 CRO Market Model –
Growth Rates
8. 2014 Public CRO Market Share
Introduction
SMARTER QUESTIONS SMARTER ANSWERS
WHY ISR?
1. ISR has leveraged data
from our primary market
research. These data,
coupled with the “acts and
figures” from secondary
sources, allow for
intelligent projections into
the CRO market size.
2. The use of primary
research data gives ISR
the unique ability to break
down the outsourced
market further than
ever before, by offering
geographic, service
line, and Phase I-IV
assessments.
2016Publication Date
25Pages
24Charts and Graphs
THIS
PREVIEW
INCLUDES
SAMPLE
PAGES FROM
THE REPORT

Introduction
2016 CRO MARKET SIZE PROJECTIONS 2015-2020
FOR TABLE OF CONTENTS, PLEASE DOWNLOAD THE FULL PREVIEW AT:
HTTP://WWW.ISRREPORTS.COM/REPORTS/2016-EDITION-OF-THE-CRO-MARKET-SIZE-
PROJECTIONS-2015-2020/
TABLE OF CONTENTS

Introduction
SMARTER QUESTONS SMARTER ANSWERS
2016 Edition of the CRO Market Size Projections: 2015-2020 5www.ISRreports.com ©2016
INTRODUCTION
Welcome to the third edition of ISR’s CRO
Market Size report� The past three years have
been quite eventful in the CRO world� We’ve had
service provider mergers and we’ve had service
provider mega-mergers� We’ve had biopharma
mergers and we’ve had biopharma mega-
mergers� We’ve had public offerings and we’ve
had privatizations� Overall, the CRO market has
been one of the best performing sectors in the
financial circles� In fact, over the past 12 months
the Dow Jones Industrial Average is down 10%,
while PRA Health is up 78%, INC Research is up
64%, ICON is up 19%, Quintiles is up 6%, and
Parexel is up 2%� Yes, all the CROs have an “up”
before their percentage�
Why all the good news for CROs? As we have
noted in the past, and in this current forecast, the
market for their services is increasing� Sponsors
continue to outsource more of their clinical
development work across a broad range of
services to service providers of all sizes� That said,
for the past few reports on this topic we have
been somewhat pessimistic on the long-range
overall R&D spending by biopharmaceutical
companies� In our 2015 CRO Market Size report,
we projected that R&D spending on small
molecule would decrease by a CAGR of 1% over
the forecast period� Given the overall strength
of the VC market continuing to invest in small
biopharma companies and given large pharma’s
propensity to continue to acquire assets or
companies to strengthen their pipelines, we have
revisited our R&D assumptions� For the 2015-
2020 forecast we have increased both the small
molecule and large molecule R&D figures to
account for the influx in VC-based investment
going mostly to smaller sponsor organizations�
According to PricewaterhouseCoopers (PWC),
since 2010 the average number of VC deals in
the biopharma space is ~490 per year and this
has not fluctuated much over the past five years�
From 2010 through 2013, the average annual
investments have totaled approximately $4�4B
per year� However, in 2014 and 2015 the total
investments rose to $6�3B and $7�4B, respectfully�
When you do the math, not only has the absolute
value of the investments increased, but so too has
the average value per deal (rising from an average
of $9�0M from 2010-2013 to $14�4M in 2014-
2015) – all of which we think point to strength in
the funding market�
As a result of increasing our R&D growth
assumptions, readers of past CRO Market
Size reports will notice a slight-moderate
increase in the CRO market� That said, we will
reiterate what we mentioned in the previous
report: The major lever in CRO revenue is still
the outsourcing propensity/penetration� One
market dynamic we have not accounted for is
the impact of biopharma mega-mergers� We
have not modeled this because we don’t think
there is a lasting macro impact of these mergers�
However, we do think those mergers can and
will have a significant impact on the CROs that
are involved with those sponsor companies�
Another impact readers will note is in the CRO
market share section� With an increased CRO
market, some of the public CROs will notice a
slight drop in their market share� Given that most
of the changes in our R&D model impacted
the small sponsor segment, we think this aligns
nicely with the public CROs’ traditional customer
set (of large sponsors)�
In our view, the pace of change in the CRO
market will not slow down anytime soon� Look
for more mergers as providers continue to scale
up global capabilities and fill in their service
offerings; look for more sophisticated marketing
and branding efforts as the battle for market
share increases; and perhaps look for “non-
traditional” CRO service providers to enter the
market via partnerships or outright acquisitions�
We would also not be surprised to see interest
gaining momentum for a CRO-CMO merger�
S A M P L E P A G E :
INTRODUCTION

Introduction
Model adjustments – From R&D to CRO market size
As previously stated, ISR utilizes a top-down approach to our market sizing calculations, starting
with R&D spending� We then use a series of “deflators” in order to narrow the market applicable to
pharmaceutical service providers� The steps taken for these calculations are outlined below�
R&D expenditures are first analyzed to remove the “R” (research) and we are left with “D”
(development) spending per segment�
Development spending is then analyzed by the amount of spending done for Phase I-IV clinical
studies�
Phase I-IV clinical development spending is then segmented by the outsourcing penetration of each
company size/ organization type to arrive at the market size for CROs�
2016 Phase I-IV
Development:
$78.8B
2016 R&D:
$271.3B
2016 Development:
$110.6B
2016 Outsourcing Phase I-IV
Development Market:
$29.8B
© Industry Standard Research
MODEL ADJUSTMENT
This page highlights ISR’s top-down approach to our market sizing calculations. The
full analysis and figures for the 2016 Outsourcing Phase I-IV Development Market are
available in the full report at www.ISRreports.com.

Introduction
2016 SERVICE-LINE
ASSESSMENT
Based on ISR’s proprietary survey data, we provide an assessment of the CRO market based on the
services CROs typically offer� We certainly understand that the distribution of service costs varies by
study type, phase, compound, etc� However, on aggregate, we believe our data provide one of the
most accurate representations of the CRO market size based on services in the industry�
We use the same data and assumptions with respect to our model working down from R&D to
development to Phase I-IV development activities to outsourcing propensity when working on our
service-line splits�
Table 10: 2016 service-line distribution (%) of the CRO market size
2016
Clinical Monitoring 21�7%
Investigator Payments 13�1%
Data Management 11�3%
Laboratory 10�5%
Project Management 9�0%
Patient and site recruitment 8�5%
Technology 6�9%
Biostatistics 6�4%
Medical Writing 3�4%
Regulatory 2�8%
Imaging 2�7%
Quality Assurance 2�4%
Other 1�3%
Total 100%
2016 SERVICE-LINE ASSESSMENT
ISR provides an assessment of the CRO market based on the services CROs typically
offer, based on ISR’s proprietary survey data.
The following chart has been blinded. The full data are available in the report, which can be
downloaded from www.ISRreports.com.
2016
Clinical Monitoring XX%
Investigator Payments XX%
Data Management XX%
Laboratory XX%
Project Management XX%
Patient and site recruitment XX%
Technology XX%
Biostatistics XX%
Medical Writing XX%
Regulatory XX%
Imaging XX%
Quality Assurance XX%
Other XX%
Total 100%

Introduction
FOR SAMPLE PAGES, PLEASE DOWNLOAD THE FULL PREVIEW AT:
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THE-CRO-MARKET-SIZE-PROJECTIONS-2015-2020/

Introduction
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2016 CRO Market Size Projections 2015-2020

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2016 CRO Market Size Projections 2015-2020