The clinical research industry is undergoing a profound transformation, driven by market consolidation and technological innovation. To adapt, clinical research sites are embracing innovation, increased collaboration, and strategic positioning to thrive. The site consolidation trend shows no sign of abating. In this blog post, we caught up with Barry Lake, co-founder of Devana Solutions, a RealTime Software Solutions Company. We wanted to better understand the driving forces behind the site consolidation trend and uncover key investment areas for sites aspiring to accelerate their growth and enhance their appeal to sponsors and investors.
About our in-house industry expert, Barry Lake, Co-Founder and President of Devana Solutions: Before co-founding Devana Solutions, Barry Lake gained hands-on experience in site operations at a clinical research site in Charleston, South Carolina. In addition to managing his own site, he was part of a management team that established an early “network” of high-performing, independent yet affiliated sites that shared marketing and sales resources. He witnessed the emergence of strategic acquisitions and site consolidations, notably in 2015 when PPD acquired Synexus’s approximately 100+ sites and ICON acquired PMG Research’s 12 U.S. sites. In 2019, ICON further expanded by combining PMG’s U.S. footprint with MeDiNova’s European sites, forming the Accellacare Global Site Network, now comprising approximately 112 sites.
Interview with Barry Lake
Q: Can you share your background and how it influenced your journey in the clinical trials industry?
Barry Lake: Before co-founding Devana Solutions, I gained experience in site operations at a clinical research site in Charleston, South Carolina. This first-hand experience of the pain points of running a site, coupled with witnessing the emergence of strategic acquisitions and site consolidations, inspired me to pioneer the Devana, previously PROPEL, platform. Launched in 2016, we built a category-defining product that addresses the challenge with study start-up, pipeline management and business intelligence for sites, sponsors, and CROs.
Q: Can you share your observations on the current trends shaping the clinical research landscape, particularly regarding site success and market consolidation?
Barry Lake: Absolutely. We have been witnessing a significant shift in the clinical research industry, characterized by the consolidation of site networks. Strategic acquisitions and private equity investments are driving this trend, leading to the emergence of larger, integrated site networks. This consolidation presents both opportunities and challenges for sites as they maneuver through the complexities of modern clinical trials.
Organizations transitioning from “boutique” businesses to sustainable enterprises are leveraging capital to increase their scale and value. Successful execution necessitates securing sufficient capital to sustain competitive advantage and drive growth. In the site sector consolidation, winners emerge by executing profitably and strategically accessing capital.
If an organization makes the commitment to move beyond being a boutique business towards building truly sustainable enterprise value through a leading position therapeutically or through scale across a geographic footprint, over time, the leadership will face relentless and ever-increasing pressures stemming from their own commercial success. The good news for these site organizations is they will certainly be much more valuable in private equity’s eyes, assuming their leadership is open to leveraging more capital to increase their scale. Successful execution inevitably requires increasingly larger tranches of capital for any organization to sustain a balance sheet that enables them to maintain a competitive advantage and continue scaling and increasing their enterprise value over the long term.
In other words, when an industry sector consolidates fueled by the efficient deployment of a massive amount of capital at scale (the role of the financial sector in every industry), it envelopes both types of companies in the sector: the losers and the winners. The losers in the clinical trial site sector will be those site organizations that cannot evolve into becoming one of leaders either by not performing profitably or, if they do, in fact, become profitable their ownership fails to seek sufficient capital to shore up their balance sheet and drive their growing dominance.
I foresee that those organizations that fail to access more capital when they need it will be outmaneuvered over the long run by more savvy competitors with stronger balance sheets. As a result, the site organizations on the wrong side of market forces will either go out of business if they are unprofitable or, if they don’t seek more capital to shore up their balance sheet, be forced to eventually sell at a depressed value to a competitor or industry aggregators.
The ultimate winners in this consolidation battle will be those site organizations who execute profitably and then attract and, are willing to accept, additional capital on reasonable terms at numerous inflection points along their growth journey.
Q: How does essential site-based technology contribute to site success in this site consolidation market?
Barry Lake: Technology can be a game-changer for clinical research sites looking to succeed in today’s competitive environment. Electronic solutions that replace error-prone paper-based processes, like Devana, enhance transparency, streamline workflows, and facilitate integration with the industry’s top CTMS providers including RealTime, CRIO, and Clinical Conductor. Devana improves site business operations, accelerates study start-up processes, and fosters efficiency across the entire clinical trial journey, from study start-up, execution to closeout. By leveraging advanced eClinical technology, sites can improve data accuracy, accountability, and position themselves as leaders within larger site networks.
Q: What are some key strategies that clinical research sites can employ to capitalize on growth opportunities?
Barry Lake: Strategic positioning is essential for clinical research sites. By focusing on areas of expertise, building strong relationships with sponsors and CROs, and investing in eClinical technology solutions built for clinical trials, sites can enhance their value proposition and attract increased investments. Additionally, collaboration and networking within larger site networks can open doors to new opportunities for growth and expansion.
Q: What role does Devana play in shaping the future of clinical trials?
Barry Lake: The private equity fueled site sector consolidation has continued to accelerate at a rapid pace in 2024 and Devana remains at the forefront of innovative eClinical solutions purpose-built to help sites scale faster. Devana delivers crucial transparency to site leadership and operating managers, shedding light on the upstream pipeline of trial opportunities and automating study start-up workflows. In fact, on average, sites that have adopted Devana report 76% reduced contract budget and turnaround time, 14 hours saved in study activation, and 40% increased revenue.
And the platform continues to shape the future of clinical trials through strategic partnerships like seamless integrations with industry-leading CTMS providers and cutting-edge new features such as our Query Feature, which allows central team members to query all sites within their network based on a given trial’s specific criteria for capabilities, equipment, and more. They can send new trial opportunities directly within Devana and receive real-time site responses and turnaround timing metrics in return.
Today, we partner with many of the industry’s largest site networks to drive efficiency, compliance, and patient engagement. That’s why Devana is humbled to call virtually every major site network a partner-client. In fact, eight of the top 10 site networks in the world have already adopted Devana. The exponential growth of our site network clients spotlights the tangible benefits of leveraging advanced eClinical technology across the entire clinical trials journey.
Final Thoughts
The momentum behind the site sector consolidation trend is undeniable and continues to gain traction. Whether it’s backing a single large site as a platform investment or spearheading a network roll-up strategy, private equity sponsors are actively seeking opportunities to deploy capital and drive site consolidation efforts.
At RealTime Software Solutions, our team predicts that the consolidation trend will continue to play out similarly across the site sector as it did from the 1990’s through the early 2020’s in the CRO sector. The site consolidation wave will continue until the site space is largely dominated by only a handful of major global site organizations in much the same manner as just a handful of major global CROs control almost 80% of the pharmaceutical sponsors outsourcing spend on clinical trials that run through CROs. As such, it’s crucial for independent site owners to position themselves as market leaders in their respective fields, recognizing that acquisition by larger networks is inevitable for long-term success. By staying ahead of the curve and strategically investing in growth areas, sites can still emerge as industry leaders.
