Clinical Trial Logistics: The Trial of Emerging Markets Page 1 of 2

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Clinical Trial Logistics: The Trial of Emerging Markets

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Category: Clinical Trial Services | 21/10/2005 - 15:57:07

A key reason for spiralling R&D costs and delayed product registration is a failure to recruit patients on time. It is
estimated that 80% of clinical trials fail to recruit on time1. The expansion of clinical trials into new regions offers a
solution to this issue, but this approach is not without difficulties. This paper is intended to provide a brief overview of
some of the logistical issues involved in performing clinical trials in emerging markets.

Changing Times

In Western Economies, the traditional recruiting ground for the majority of clinical trials, pharmaceutical companies
compete for the same limited pool of investigators and patients. This contributes to the recruitment delays described
above. Emerging clinical trial countries offer access to large patient populations, the majority of which are treatment
naïve. This has not gone un-noticed by the pharmaceutical industry, as shown by the growth in the number of trials being
performed in countries in Latin America, Eastern Europe and Asia.

According to an independent CRO the most attractive emerging market currently is India, a country that only adopted
patent rules in line with the World Trade Organization (WTO) in the early part of 2005. Currently in India there are
approximately 70 to 80 hospitals, both government and privately owned, that are conducting a clinical trial on behalf of
overseas pharmaceutical companies.

With its population of 1.08 billion citizens (July 2005), and the use of English as the primary language used in the
collection and storage of technical date, the advantages of India are clear. Clinical trial market growth is not simply
limited to India. China reported a 4-fold growth in ongoing clinical trial projects from 2001 to 2003 (982 trials in 2001,
growing to 4307 in 2003)2. Similar growth has been seen in other regions such as Central and Eastern Europe (average
growth of 30%/year over the past decade)3 and Latin America.

While faster patient recruitment offers significant benefits to our industry, it is important to take other factors into
consideration when planning a clinical trial in an emerging market. Clinical trial logistics (getting medication to patients
and samples back for analysis) in these regions is a key area of concern.

Logistics issues

While not a logistical issue, the time required to obtain regulatory approval has a direct impact on the shipment of
medication into many emerging countries. Regulatory authorities and ethics committees in many countries have not yet
been given the opportunity to increase their internal resources to cope with the growing demand for clinical trials. China
is a good example of such a country.

Regulatory approval to perform a clinical trial in China can take up to a year. While this is offset by the rapid recruitment
rates offered by that country, this should still be borne in mind when planning a trial. Other key issues are listed below.

—In many emerging markets, import licences are required for each shipment of drug into the country. These can take
weeks or even months to obtain. As a result, direct-to-site shipments from a centralized warehouse outside of the
country can become impractical. In many countries, the qualifications of importers (e.g. pharmacists) and the type of
company performing the import (e.g. Sponsor, distributor or CRO) can add complexity to the process.

—Customs regulations in these countries are also complex and are strictly adhered to by customs staff. Any issues with the
shipment itself, or the accompanying paperwork, can result material being held in customs for prolonged periods. With
the current growth in temperature-sensitive products and time-sensitive shipments, a strategy to avoid these issues is
essential.

—Many of these countries suffer from poor infrastructure in comparison with their western counterparts. Not only can it
take considerable time to reach the country if material is shipped from a depot in Europe or the US, but significant
additional time needs to be allowed once drug reaches the country.

—Inadequate training of site staff in the correct procedures for receiving medication and returning samples can also lead
to supply chain problems.

In this paper we will examine key issues we have come across, and will discuss possible approaches that can help mitigate
their effects on clinical trials.

Choosing appropriate partners

When outsourcing clinical trials to a new country, local knowledge of the regulations and import procedures related to
clinical trials in that country is essential. Some companies have used their own affiliate companies in these countries to
assist in the process. While this strategy has undoubtedly worked for some companies, we have seen a rethink towards
this approach on the basis of affiliates’ lack of appropriate storage capacity or conditions or trained staff.

Local CROs, and international organizations with a strong local presence, can provide an answer. As the clinical trial
markets in these countries grow, the number of CROs with local knowledge is also increasing. While these companies may
offer strong assistance in gaining regulatory approvals and may be able to advise on logistical issues, our experience is
that only a minority of these companies offer the ability to actually perform logistical services themselves. In such cases
it may be necessary to also identify a local logistics company with appropriate pharmaceutical and clinical trial
experience to support the activities of the CRO.

The value of local knowledge in these countries cannot be understated. We recently heard of an incident in one country
where an import licence could not be obtained in time for a first-patient-in date because the regulatory authorities in
that country closed their office for a month for their annual holidays. Information like this can only be acquired through
on-the-ground experience.

Clear identification of roles and responsibilities

As a company involved in managing the clinical supply chain in emerging markets on behalf of our clients, we see this as
the major issue affecting the smooth operation of the clinical supply chain. It is important that sponsors clearly define
their expectations from a third party company, and that all third parties are realistic about the level of service they can,
or are willing to, offer.

For example, if a CRO is responsible for obtaining import licences and regulatory approval, is a separate company allowed
to manage the import and onward distribution process? We have seen issues where a CRO has obtained an import licence,
but did not wish to become involved in logistics issues.

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Our local depot agreed to take on this responsibility, only to find that they could not deal with customs delays directly
because they were not named on the import licence. In this instance, we were able to avoid a problem because the CRO
was able to delegate authority (via Power of Attorney documentation) to our depot. This is not possible in all countries. If
the sponsor and all third parties agree in advance who is responsible for what, and whether this arrangement is possible
in a particular country, problems of this nature can be avoided.

If it is likely that a country in which the trial sponsor has limited experience is to be included in a clinical trial, it is
important that planning and identification of potential issues starts as early as possible. In some countries, for example,
it is only possible for the trial Sponsor to obtain import licences. Items such as Power of Attorney documentation can take
several weeks to obtain, so need to be planned in advance. In our experience, few of the issues we come across are
insurmountable. However, without advance planning a manageable issue can still cause a major headache.

Depot Strategies

For maximum visibility of inventory levels and maximum flexibility or drug supplies, a centralized distribution strategy is
ideal. For example, limiting distribution to a small number of regional hubs means that medication does not have to be
committed a specific countries in advance. Recalling medication once shipped to a country that then fails to meet
expected recruitment levels is a difficult process. However, shipping medication from these hubs to study sites within
countries with difficult import regulations can be subject to delays.

For these countries a local drug repository within the country limits the occasions on which drug passes through customs,
minimizing the administration associated with imports and reducing the risk of delays. We recommend a strategy that
involves a combination of both of these approaches, based on the choice of countries participating in the clinical trial.

Communication of inventory levels between regional hubs, local depots and Sponsor/Contractor is essential if a reliable
supply of drug is to be maintained. This can be achieved via a simple paper-based system, through which the
sponsor/contractor receives regular reports of on-site inventory. Sponsors and contractors can then re-supply depots
when inventory levels reach a pre-determined trigger level that takes into account the time required to ship fresh stock
to a depot and projected recruitment rates.

Although this approach works, telephone and web based tools such as IVRS allow real-time monitoring of recruitment and
inventory levels in each location. Some IVRS companies (e.g. ICTI, Clinphone) also offer demand-forecasting tools that
can further assist this process.

Other considerations

It is critical not to underestimate the importance of training site personnel in correct receiving processes for clinical trial
medication. The reasons for this are self explanatory for cold-chain shipments. Delays in receiving these materials,
stopping temperature recorders and transferring to appropriate storage areas remain a key reason for ‘out of spec’
shipments of refrigerated and frozen materials.

Confirmation that shipments are received is another important issue. As mentioned above, accurate visibility of inventory
held on site and in depots is critical to supply chain management. If sites do not confirm receipt of medication, this can
impact on the entire process.

The return of clinical samples to central laboratories for testing is another key issue in emerging markets. Many doctors
are becoming involved in clinical trials for the first time and are shipping hazardous materials to central laboratories
without appropriate training or IATA certification. This can have serious legal and cost implications for the Sponsor.

When planning shipments to and from a new country, it is also important to ensure that any supply chain also includes
management of inventory of items such as specialized shipping systems, training of depots/sites to use these correctly
and even whether items such as dry ice are easily obtained locally. For example, if a cold-chain shipment requires use of
a validated shipping system established by the Sponsor, is the same system available locally in the country? If not, it may
be necessary to supply depots with these materials. Budgets need to include the cost of supplying these, which can be
significant.

Another cause of delays we have seen is setting up a process for paying import duties in target countries. One way of
achieving this is to lodge money with the chosen importer, so that these fees can be paid as and when they arise. We
have seen instances where a Sponsor has waited for confirmation of the amount of duty due before wiring money to the
importer, who then has to pay customs before supplies are released. This can have a severe impact on shipment
timelines, especially where cold-chain and time-sensitive shipments are involved.

Conclusions

If pharmaceutical and biotechnology companies are not already performing clinical trials in emerging markets such as
India, China, Eastern Europe and Latin America, all indications are that they soon will be. While these regions offer
significant advantages in terms of large populations and increased speed of recruitment, they also bring complexity to
the clinical trials planning process.

Much of this complexity is manageable, and will become less of an issue as the industry becomes more familiar with
operating in these geographies. In the meantime, assistance is available from a range of local and international service
providers who have already experienced the highs and lows of managing the clinical supply chain in emerging markets.

1 J King. Ten Ways to Faster and Easier Patient Recruitment. R&D Directions, April, pp 34-46, 2004.
2 Managing Clinical Trial Logistics in Asia. Next Generation Pharmaceutical. Spring/Summer, pp 143-144, 2005.
3 B Golubtsov and F Kermani. Coming of Age in CEE. Good Clinical Practice Journal, July, pp 15-18, 2003.

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