The Covid-19 crisis has disrupted clinical trials around the globe, many of which are investigating treatments for life-threatening diseases such as cancer. Yet the disease is also proving to be a catalyst that may transform the pharma industry’s approach to trials for good, creating a wave of attractive investment opportunities among young healthtech companies. 
For good reason, the pharmaceutical industry is cautious with new approaches and, critics would say, has been slow to adopt technology throughout clinical trials. Often, the biggest competitor to automation is still paper. Covid-19 has presented the clinical trial industry with considerable short-term challenges, which threaten a large proportion of pharmaceutical companies’ drug development programs with delays and cost overruns, and which is forcing changes to methods of setting up and conducting clinical trials.
Many of these changes involve the use of technology, both software and hardware. What’s impressive is the speed of adoption of some of the new technologies, something that would have been unthinkable this time last year and that has been facilitated to some extent by regulators and governments working hard to update their guidance. The hope is that the longer-term opportunities technology offers to improve patient recruitment, clinical trial conduct, data capture and time to market mean that the changes we’re seeing now are here to stay.
Change is on the horizon
The world is currently conducting the biggest home working experiment in history. This has forced many industries and authorities to change practices, including pharmaceutical companies and their regulators. Products such Zoom and Microsoft Teams have demonstrated that it is perfectly feasible to conduct many activities virtually, with all the associated distancing and efficiency benefits.
In response to the pandemic, the US Food and Drug Administration (FDA) and European Medicines Agency (EMA) have moved fast to issue guidance on clinical trials affected by Covid-19, relaxing rules such as allowing protocol amendments and encouraging sponsors to virtualise patient visits. Our experience suggests regulators are ambivalent about technology and highly supportive of anything that can increase standards of patient safety.
These dynamics have created strong incentives for pharmaceutical company executives to look for technology solutions to address the challenges currently facing them. Many of the life science software companies in our portfolio and others we have been speaking to tell of a flurry of interest from pharmaceutical companies and contract research organisations (CROs) who are now reviewing new technologies to see whether there is anything they should be deploying immediately.
Sales cycles for technology vendors in the industry seem to have shortened considerably. Partly driven by the move to virtual meetings, software and technology vendors are reporting better access to more senior pharmaceutical company executives, who now take time to engage and focus on their attention on new technologies. It helps that software vendors can effectively demo their products through videoconferencing without travel and scheduling challenges slowing them down.
Which technologies will win?
Whilst many life science software companies have seen a temporary decrease in revenues at the peaks of the pandemic in the developed world due to the general decline in business activity, many feel bullish about the longer-term prospects. One only needs to look at the stock market valuations of companies such as Veeva, the life sciences cloud-computing company, to see the optimism the market and investors have about the industry.
We believe that companies offering the tools that enable decentralised, virtual or site-less trials, remote patient engagement and data capture will be the ones benefitting most from the changes the clinical trial industry is undergoing. For example, umotif, a company we invest in that has a suite of electronic patient data capture tools for real-world and interventional clinical research, has seen a surge in demand from existing and new customers.
Another example is our portfolio company Cisiv, which provides a flexible platform for decentralised trials for real-world research settings and which is seeing strong interest in its solutions from contract research organisations and sponsors. Finally, Raremark, another portfolio company, has a novel patient engagement technology that enables the finding and remote engagement of rare disease patients. These patients are hard to reach in normal times and so the company is reporting strong demand from rare disease-focused pharmaceutical companies that are keen to continue to engage with its target patient populations.
We have been investing in digital health for the best part of a decade. Never has the pace of change been more rapid. The Covid-19 pandemic is a major crisis and a tragedy for many. For forward-thinking healthtech companies, it presents a significant opportunity to help catapult the life sciences industry into the future.
Christoph Ruedig is partner at Albion Capital. The views expressed above are his own and should not be taken as investment advice.