CRO R&D companies derive their income mainly from the fixed R&D expenses of these pharmaceutical companies, so they basically do not take risks, resulting in quite stable profit growth for CRO companies.
The pharmaceutical industry has been called "the sunrise industry that never declines", and in recent years innovative drugs have become more and more the focus of the industry, and have even become the standard for pharmaceutical companies to gain a foothold in the market. As a result, many companies have entered the field of innovative drugs, but the R&D capabilities of these pharmaceutical companies are limited, and the demand for R&D outsourcing has been unleashed.
Based on the different stages of customer service in the field of new drug R&D, pharmaceutical R&D services are generally divided into contract research and development services (CRO), contract manufacturing operations/contract manufacturing R&D operations (CMO/CDMO), which correspond to the preclinical and clinical research, customized manufacturing and R&D services in the field of new drug R&D in the different segments of the industry chain, respectively.
CRO industry certainty is too strong, especially the high-quality four diamonds, profitability is quite great. And, because it is mainly charged to the pharmaceutical enterprises rather than health insurance, so it is not only not affected by the collection of procurement, but also in the collection of procurement to force the pharmaceutical enterprises to innovate to benefit from the collection of procurement.
Leaving R&D to specialized enterprises is what makes the CRO track. In the CRO cost advantage as well as set procurement to force drug companies to innovate under the trend, China's CRO industry is just in its infancy, the next few years will remain high growth.