Functional Service Provisioning and Full Service Offering Combination hybrid model: A perspective | The Financial Express

Functional Service Provisioning and Full Service Offering Combination hybrid model: A perspective

In general, past last decade Pharma outsourcing trended majorly between either as FSO or FSP model; however now the mix model Hybrid approach is gaining lot of popularity.

Functional Service Provisioning and Full Service Offering Combination hybrid model: A perspective
The goal is to have the therapies hit the market at fastest speed and thus by lowering the enormous drug development related cost burdens. (File)

By Sameer Arora

With the gaining popularity of various FSP models on offer on the market, there is an eminent need for selecting the appropriate outsourcing model which can help maintain planned study related budgets and timeline requirements, by employing efficiencies of FSO model and optimization of resources utilization by FSP model. The goal is to have the therapies hit the market at fastest speed and thus by lowering the enormous drug development related cost burdens. It’s far more relevant in current scenario where due to dynamic pandemic probability, there is imminent need to leverage ways and means to have the cost-effective models for achieving the stated goal. The various ways the same can be achieved is either by supporting an internally run study via functional service partnerships (FSP), a completely outsourced study via full-service outsourcing (FSO) and conducting studies with hybrid approaches that include a mix of FSO and FSP strategies.

Here we would discuss the Hybrid approach (i.e., combination of FSP and FSO model approach) and it’s Pros and cons.

In general, past last decade Pharma outsourcing trended majorly between either as FSO or FSP model; however now the mix model Hybrid approach is gaining lot of popularity. Amid the COVID-19 crisis, the total global market (FSO and FSP) for Contract Research Outsourcing estimated at US$44.9 Billion in the year 2020, is projected to reach a revised size of US$67.1 Billion by 2026, growing at a CAGR of 7% over the analysis period. On the other hand, the global functional service providers (FSP) market is expected to reach USD 20,787.30 million by 2027 and register a CAGR of 7.49% 2021 to 2027.

Above numbers clearly depicts both the approaches are well accepted in industry. The market shares of Full-Service and FSP tells us there is a place for both methodologies and both have specific beneficial features which Sponsor are looking for, e.g., Full-Service model has the ‘one-stop-solution’ benefit – with the simple contractual arrangement, the amalgamated team, alongside the potential for cost savings both in efficiency and increased bargaining power, particularly if a sponsor intends to award multiple studies to a single provider. 

On the other hand, FSP have the clear benefit of access to specialist providers/subject matter experts (SME), cost savings from efficiencies, enhanced flexibility on team size and the PNP approach i.e., ‘plug-and-play’ nature of contracts.

And finally, the Hybrid approach ensures encashing best features of both the existing options (FSP and FSO).

Let’s start with an example: take the case of a mid-size pharma company that needs to do a feasibility study and a site survey analysis for their proposed trial for this they can do the same in a simple full-time employees (staff augmentation) FSP model which is a prudent approach and once the Study Feasibility results are ready and the decision is to have the study outsourced so they decide to have Site-ID; Selection and Monitoring and close out provisioned in the FSO model and as they required for specific services like Augmentation of their existing staff with stronger inhouse control on deliverables; flexibility and non-bias approach so DM; TMF and CSR- MW pieces are kept in in FSP model with different CRO vendor- thus providing more efficient balanced approach; this Hybrid approach is now meeting the desired outcomes in a more cost effective manner.

Basic features of Hybrid model:

Benefits of having the Hybrid (FSP and FSO combined) model:

Every outsourcing model be it FSO; FSP and Hybrid has some pros and cons however as Pharma company the Sponsor need to have equal balance between; delivery quality and budget framework.

As of now we would like to evaluate the benefits of having the hybrid approach in detail.

Cost effective approach: Hybrid model, more often than not, tends to be more cost effective as compared to an exclusively FSO model
Stronger Control: Hybrid model gives better control over individual model as majority pieces are managed by CROs in FSO and Critical pieces where sponsor needs to have complete control can be retained as FSP domain.
Objective Metrics: There can be metrics driven approach where there can be direct objective comparison by assessing the KPIs in both the type of models. These KPIs can be developed to compare utilization; productivity and performance in both type of models.
Consistency: For multi study Hybrid model program – in case single FSP is managing same task in multiple studies in a program- it gives better control and consistent approach.
Flexibility: Hybrid model gives more flexibility to sponsor to have the shift from FSO to FSP model without any further vendor qualification. For example, once the main study ends and only long term follow up is remaining then the study can be fully converted from FSO model to FSP model.

Conclusion:

Currently both models FSO and FSP are flourishing in CRO industry. The pharma companies pick and choose any of the two models however industry is now increasingly exploring the Hybrid approach and it’s getting widely popular in outsourcing teams. Rather than embracing one model versus the other; now, we see more and more pharma companies investing in combination of both FSO and FSP as a single combined model to capitalize on their ability to deliver unique and functional solution to Study specific needs with a hybrid approach that gets the best of both models.

(The author is a Director – Lead FSP, SIRO Clinpharm. Views expressed are personal and do not reflect the official position or policy of FinancialExpress.com.)

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