Summary of Key Points
This article addresses the controversy surrounding the notion that "the complete reliance on CROs by Chinese biopharmaceutical companies represents a degradation in their capabilities," arguing that the CRO industry has undergone a fundamental evolution. CROs have transformed from being mere "contract manufacturing facilities" during the era of generic drugs into partners that deeply engage in innovation and provide indispensable technologies in the biopharmaceutical sector. The adoption of CRO services by Chinese biopharmaceutical companies is not a sign of decline but rather an indication of their growing capability to contribute to the industry's advancement, reflecting a shift from merely selling individual molecules to building comprehensive systems.
Detailed Analysis
1. Why does the notion of "CROization" seem demeaning? — Because CROs were once seen as mere "manufacturing facilities"
The common perception of CROs stems from the generic drug era, when pharmaceutical companies knew exactly what they needed (such as conducting bioequivalence trials for generics), and the processes were standardized. CROs simply provided the manpower to execute these tasks, charging based on the number of hours worked or the projects completed, with all risks borne by the pharmaceutical companies. This analogy with manufacturing facilities led to the term "research and development contract manufacturers." In this context, the idea that biopharmaceutical companies are becoming CROs is perceived as a downgrade from innovators to executors, which has sparked controversy.
2. Top-tier CROs have transformed significantly — from executors to innovative partners
With the advent of biopharmaceuticals such as bispecific antibodies, ADCs (antibody-drug conjugates), and cell and gene therapies, the role of CROs has changed dramatically:
- Solving challenges that pharmaceutical companies cannot handle on their own: For example, how to stably express bispecific antibody molecules or how to safely and effectively combine toxic agents with antibodies. These issues require collaborative exploration rather than following a rigid process.
- The nature of cooperation has changed: It is no longer just about the CRO carrying out tasks based on customer orders; instead, there is joint development and profit-sharing. CROs contribute not only manpower but also technical platforms and even funding, sharing risks with pharmaceutical companies.
- CROs have elevated their position in the industry chain: They have moved from being supporting services providers at the lower end of the chain to becoming key players embedded in the core R&D processes of multinational corporations (MNCs), offering innovative infrastructure that supports the entire drug development process, from target discovery to market launch.
3. Examples of the power of top-tier CROs
- Samsung Bio: It has evolved from a generic drug contract manufacturer to a global leader in CMC (Chemical Manufacturing for Pharmaceuticals) services, providing critical engineering support for bringing biopharmaceuticals from the lab to the market. The world's top 20 pharmaceutical companies collaborate with Samsung Bio, often entrusting them with the production of their most important drugs—not because of lower costs but because of its superior technical capabilities.
- IQVIA (formerly Quintiles): It has evolved beyond clinical monitoring to acquiring and integrating vast amounts of data to assist MNCs in designing phase III clinical trials, providing strategic insights based on that data rather than just manpower.
- Nuevolution: With its leading DNA-encoded compound screening technology, Nuevolution can quickly evaluate billions of small molecules. Companies like Merck and Novartis use its platform, which led to its acquisition by Amgen—indicating its transformation into a core component of these giants' R&D teams.
4. Reinterpreting "CROization" — it is not a degradation but a reflection of industrial advancement
The adoption of CRO services by Chinese biopharmaceutical companies represents a shift from focusing on selling individual molecules to providing comprehensive capabilities, such as establishing clinical teams overseas, building registration systems, and expanding commercial networks. This aligns with the evolution of top-tier CROs, which are increasingly involved in upstream innovation. Both biopharmaceutical companies and CROs are moving towards more systematic and innovative approaches, marking a significant advancement in the industry.
5. Traditional CROs are being phased out; only those with core technologies survive
CROs that relied on low costs and high volume (e.g., completing a large number of clinical trials) have largely disappeared. Those that remain possess essential technologies, such as the ability to solve complex biopharmaceutical challenges or offer unique platforms that integrate into MNC R&D processes. This indicates that the industry is evolving towards higher quality standards, and not everyone can simply provide CRO services.
Conclusion
The "CROization" of Chinese biopharmaceutical companies is not a sign of decline but a reflection of the overall advancement of the pharmaceutical industry. Both CROs and biopharmaceutical companies are moving away from simple execution towards more innovative and systematic approaches. The controversy reflects a misunderstanding of the current role of CROs, as the industry has already undergone significant changes.