Speaking at Icon’s buoyant third quarter presentation, which saw operating income leap 45 per cent to $27m (€21.6m), Gray explained that: “With net new business awarded in the quarter of $350m and our backlog now at over $1.74bn, we are confident…and view 2009 with optimism.”
Gray told Irish newspaper The Post that: “Because the lead times involved in developing new products are [measured in] years, our expectations are that we are not going to see any of the more established companies undertaking any diminution in their research pipelines.”
He added that while the firm was beginning to recognise a more structured approach to outsourcing by big pharma, such moves are as yet only being enacted by a relatively small number of companies.
Gray’s comments contrast with conclusions released in a recent survey by Cutting Edge Information. The analysts reported that there has been a 20 per cent reduction in drug industry spending on clinical outsourcing since 2006.
However, Gray’s observation of shifting demands among pharmaceutical industry customers is echoed in the survey, particularly in comments made by lead author David Richardson.
Richardson explained that drug firms are beginning to insist on “milestone-based payment schemes or are only choosing to outsource clinical development when sufficient resources are not available in-house.”
Positive Q3 continues 9-month growth
According to Icon’s chairman, John Climax the third-quarter gains are part of a year-long positive trend. He said that: “Revenues and operating profits for the first nine months of 2008, at $645m and $73m respectively, already exceed those achieved in all of 2007.”
Climax added that: “Year-to-date new business bookings, at over $1bn, have also surpassed those for the full year of 2007.”