Medidata widening the gap on trial data competitors, say analysts

10-Dec-2014 - Last updated on 10-Dec-2014 at 12:47 GMT

Medidata: More than just an Electronic Data Capture company, say analysts

R&D investment and an integrated platform are widening the divide between Medidata and its competitors, according to analysts who are confident the trial data firm can achieve target sales of $1bn.

For the nine months ending September 30 2014, Medidata reported revenues of $246m (€199m) but at an investor day this week the cloud-based clinical trial services firm remained confident expansion of its electronic data capture (EDC) platform and enhanced utilisation of collected data would drive sales to the $1bn a year mark.

Medidata’s Clinical Cloud is a software-as-a-service platform used by pharma and contract research organisations (CROs) to address site engagement, patient recruitment and management, study planning and study conduct, all of which the firm estimates to be worth $10bn.

In 2010, the clinical industry exclusively used source document verification (SDV) captured on a paper or electronic case report form, but continued investment in innovation and market expansion, coupled with regulatory encouragement (such as the FDA’s Risk-Based Approach to Monitoring guidance issued last year), has put Medidata in a position to capitalise on the EDC market, the firm said.

Citi research analyst Garen Sarafian agreed: "Management’s primary focus during the day was growth opportunities and value creation for its pharma clients as the company continues its transition from EDC to a platform business model,” he said in a note, adding new customer wins, upsells/cross-sells, platform adoption, value creation/pricing and new solutions were evidence of sustainable 20-25% annual growth.

Jefferies’ David Windley added “Medidata’s integrated platform, investment in R&D, and brand momentum are widening the divide between it and its relatively short list of competitors.”

Currently Medidata has 13 of the top 25 pharma firms as its clients, along with CROs including Quintiles, Icon, PPD and INC.

Medidata’s main competitor is Oracle’s EDC system which Windley said was being used by 10 of the top 25 pharma sponsors. However, “recent conversations with industry veterans actually assuage concerns about a competitive comeback by Oracle,” he noted.

Data analytics and mHealth

One area Windley said the firm has an opportunity to gain further competitive advantage is data analytics.

“Medidata sees a higher share of clinical trials flow through its pipes than do any CROs, or even pharma companies for that matter. Smartly, it has not only been collecting clinical data, but financial and operational data as well,” he noted.

“The value-proposition moves beyond a cleaner, ready-to-close clinical database at trial's end to one that can enhance efficiency, resource allocation, country selection, and other analytics.”

Medidata also spoke about the advent of mobile health (mHealth) to record and analyse clinical trial data through wearable technologies, following an announcement last month the firm had been engaged in proof-of-concept trials with GlaxoSmithKline.

“Although mHealth is stillin its early stages, management expects to expand and target Phase II andPhase III studies as the technology gains greater traction,” Sarafian noted.