Offshore Outsourcing - Benefiting Today’s R&D

Before I worked for Excelra, I also have worked for WuXi NextCODE. Offshore outsourcing was a term I should have been familiar with, but I never looked it up until today. I looked it up because I needed a way to convey the trend that I was seeing but couldn’t really put a keyword to it. So, first I started searching for outsourcing vs. insourcing, whereby outsourcing referred to an organization contracting out work to a third party while insourcing referred to an organization placing operations and processes on-site within the organization. This led me to outsourcing vs offshoring, which was defined as getting the work done in a different country, usually to leverage cost advantages. Offshore didn’t necessarily mean that the work was also outsource. For example, a company could have a subsidiary in China or India that took advantages of the labor force there while maintaining control over the day to day operations. Offshore outsourcing was specific to the practice of hiring a vendor to do the work offshore, taking advantage of the lower costs as well as the vendor’s expertise, better availability of skilled workers, and speed at which the work could be done. 

What focused my attention on offshore outsourcing and brought me to write this post was a chance meeting with the newest board member of GVK Bio, Dr. Bob Ruffolo a few weeks ago. Dr. Ruffolo is a pharmaceutical industry veteran, having spent over 35 years in R&D for the biggest names in the industry – Wyeth (part of Pfizer today), SmithKline Beecham (now GSK) and Lilly Research Laboratories (Eli Lilly). Since 2008, he has been a consultant for many well-known companies in the industry through his consulting firm, Ruffolo Consulting LLC. During the meeting, Dr. Ruffolo discussed what he felt was the “secret sauce” to his successful career at Wyeth and it was offshore outsourcing to GVKBio. He felt he could do more with the budget given to him. As the cost and time it took to bring a drug to market continued to climb, offshore outsourcing was necessity for Bob and he championed the idea, making many trips to India to help establish the relationship between two organizations. 

This led me to think. Yes, budget was the initial reason for wanting to outsource to India, but what got Bob to continue working with GVK Bio? Bob elaborated further. He said it was the realization that someone else could do the job just as well or even better. He described an instance in which GVK Bio was able to deliver even better results that he could have expected and at a tighter precision that he had seen in-house. Bob talked about GVK Bio and offshore outsourcing as his competitive edge. He was able to deliver on his goals of new IND and NDA applications each year while he was at Wyeth. Bob retired from Wyeth in 2008. It’s been more than ten years. Since then, we have all seen the rise of CRO’s such as IQVIA, Syneos Health, Parexel, PRA Health Sciences, PPD, Charles River, WuXi Apptec, and MedSpace. 

During the past ten years, we also saw the rise of data analytics and the need for computational biologists, data scientists, and bioinformaticians. Full disclosure, my company, Excelra, is the equivalent of a CRO for data analytics. We provide FTE’s as well as FFS for any analytical needs. We are based in Hyderabad, India. Some of the hurdles that the initial CRO’s had experienced in the early day of outsourcing trend, we are also experiencing. However, the benefits of offshore outsourcing are still there. We provide a concentrated and scalable talent pool, especially for data scientists and computational biologists. The cost of our services is lower due to lower cost of labor. The speed by which we are able to wrap up projects help increase efficiencies for pharma’s and biotech’s. Yet, we still have folks resisting the idea of using our services. So, my question to you out there: what’s keeping you from making us your “secret sauce”, your competitive edge? I would like to know. On the flip side, for those who have leverage offshore outsourcing to your advantage, would you care to share how it has benefited you? 

Thanks for reading and please do provide your comments and feedback. See you at the next conference or on a road somewhere.