Clinical Trials Key Growth Driver

The Value Add of Artificial Intelligence

R&D Composite Success Rate Phase 1 to Filing

^{Source: IQVIA}

AI implementation in clinical trials is expected to improve efficiencies throughout the clinical trial lifecycle.
Cost improvements: Many clinical trials exceed time and costs; AI is expected to improve both.
Improvements in patient recruitment are expected to significantly enhance the identification of appropriate patients, partly through the use of digital twins.
The R&D composite success rate, based on IQVIA data, was 11% in 2023, an improvement over 2022; however, AI can improve operational efficiencies, leading to increased composite success rates.
AI can also help companies navigate the regulatory environment. Implementation of AI by life sciences firms has resulted in the automation of the compliance process, allowing companies to maintain standards and ensure quality management.

Key Takeaway: AI is revolutionizing the life sciences industry by accelerating drug discovery, enhancing precision medicine and optimizing operational efficiency.

Most Active Clinical Trials are Drug Related

^{Source: Clinicaltrials.gov, *Unique Clinical Trials in the United States, Canada, United Kingdom, & Germany}

Halfway through 2024, most ongoing clinical trials are focused on drug-related interventions, followed by biological interventions at 12%. Drug trials test new medications, compare different doses or combinations of existing drugs, whereas biological-related interventions, such as vaccines, are derived from living organisms. Clinical staff, facility requirements and necessary lab equipment often differ depending on the trial type and the intervention being studied.
After successfully completing discovery and design, followed by preclinical studies, the drug then enters Phase 1 of a clinical trial, where it is evaluated for safety and dosages.
In Phase 2, the intervention is evaluated for efficacy and side effects, which can necessitate hundreds of patients.
Phase 3 clinical trials are typically the most expensive, have the longest duration, and may require several thousand participants.
Pending FDA approval, sponsors can design clinical trials that combine two phases to streamline drug development and reduce time and resources needed.

Key Takeaway: As the investigational product progresses through each phase, requirements for participants, staff and clinical space increase.

FDA Approvals on Pace to Reach Prior Peaks

FDA Drug and Biological Approvals

^{Source: U.S. Food and Drug Administration}

After reaching a five-year high in 2023, drug and biological approvals reached 36 approvals combined through the first half of 2024.
Despite approvals for novel drugs lagging last year’s pace, biological approvals are on track to hit a new peak.
Drug approvals are influenced by several factors, such as the complexity of drugs under development and scientific advances in understanding diseases and their targets.
Once a drug is approved by the FDA, it can be marketed and distributed to healthcare providers and patients. This new cash flow enables a company to invest in additional lab space and R&D for projects in the pipeline. To meet increased production needs, manufacturers often need additional space to produce the product.

Key Takeaway: FDA approvals provide several benefits to the life sciences sector, including boosting investor enthusiasm and validating innovative technologies and methodologies often used in drug development.

Site Selection Is Key to Successful Clinical Trials

Active Clinical Trials by Market

^{Source: Clinicaltrials.gov}

Choosing the right site is vital for the success and efficiency of a clinical trial. Inadequate site selection can lead to poor-quality data, elevated costs and prolonged timelines.
To mitigate these risks, sponsors seek sites with a proven track record of success. They look for an experienced and well-trained staff, a large patient population and access to top-tier facilities, hospitals and research institutions.
Despite being in the early stages of development and far from initiating clinical trials, companies often consider the necessary infrastructure for these trials when selecting laboratory space. Trial sites in proximity to a firm's existing footprint offers several benefits, including:

Enhanced communication and coordination between the research and clinical teams
Improved monitoring and oversight
Resource efficiency in allocation of staff and equipment
Familiarity with regulatory standards
Facilitated patient recruitment, as firms leverage their relationship with local healthcare networks

Key Takeaway: Site selection plays a vital role in the success of a clinical trial. Numerous ongoing trials in a market are indicative of its life sciences infrastructure and the value firms place on it.