What's Causing the Slowdowns in Trial Starts?

Despite an overall rise in R&D funding and M&A activity, clinical trial starts have fallen below pre-pandemic levels. What are the specific factors causing this slowdown, and how do they vary across different company sizes and disease areas?

This year, when we took a look at the planned or actual clinical trial starts, we noted a decline over the prior year and over the year before that, in fact, the total number of trial starts is just under 5020 23. That's down 15%. From the number in 2022. It's down 22%, from the level of 2021. So, it's a significant reset, shall we say back to pre-pandemic level and actually lower than, than it was in 2019, we can attribute this decline to three main factors, about a third of the decline from 2021 to 2023. Is simply due to fewer COVID-19 trial starts. So obviously, in 2021, there was still an enormous amount of activity going on, there is still some activity going on in the past year, but it's well down. And that accounts for about a third of the decline.

Another third of the decline is linked to emerging biopharma companies starting fewer trials. We define emerging biopharma companies EBPs, as companies that are spending an estimated less than $200 million a year on R&D. So, we track those companies as a separate cohort. There, they slowed down their trial starts, we think that that is a direct link to the funding issues that have the set, the particularly the early-stage companies, at least through the middle of last year, I think things recovered in the back half of 2023. But we saw many fewer trials starts. And in particular phase one, trial starts were down significantly.

And then the third reason, and about a third of the reduction comes from fewer starts of trials by larger companies, there were about 500 fewer starts in 2023, than two years earlier. What we see going on here is fewer multi study trial programs underway and starting trials. So, if you go back a few years, and I'll just use Keytruda, as an example, that's a molecule that has had a very, very substantial trial program designed around it. And with multiple trials, starting each year, those kinds of molecules have, there are fewer of them in the in the pipeline now than they were a few years ago. And that's one reason for that decline. We also note that larger companies are starting fewer trials. And partly that's because they are developing fewer late-stage molecules. And part of that is linked to the fact that emerging biopharma companies or small companies are holding on to their molecules longer, and taking them through the full development program, and even through registration, which leaves a smaller pool, if you like, of those molecules for the larger companies to, to be pursuing. So, it's basically a third between those three factors that's driving that decline.