The increasing cost of drug development and commercialization in general – and post marketing surveillance in particular – needs to be at least partially balanced by smarter, leaner, more flexible solutions that contain costs without compromising quality. Outsourcing can be a significant part of the answer, provided that companies work diligently to find the right partner, select the best contracting agreement, and pursue a sound relationship model. 
 
Current Outsourcing Practices 
 
The demand for pharmacovigilance capacity and expertise has been increasing along with more stringent product safety regulations. This is shifting the landscape of pharmacovigilance outsourcing to more complex activities such as signal detection, benefit-risk management, and risk management planning as well as pharmacoeconomics and pharmacoepidemiology. Consequently, many life sciences companies are re-evaluating the way they outsource pharmacovigilance and patient safety services. 
 
Of course, the need for outsourcing varies greatly across companies as it is influenced by a number of factors: the company’s size, the extent of its pharmacovigilance and patient safety resources, and the company’s existing license or development partnerships. There are, however, some generalities related to company size. Emerging and small biotech companies typically do not have drug safety departments and so routinely outsource all safety services, including management of the safety database. This practice allows them to both draw on external expertise and reduce the cost of many internal activities such as recruitment, management, and training.
 
Mid-sized companies generally have the knowledge and resources to accommodate the demands of the global pharmacovigilance environment. Typically, though, they require support to meet the fluctuating resource needs driven by a changing product pipeline. They also have limited geographic coverage and often require additional support in unrepresented countries. While large companies have comprehensive departments with global infrastructures and databases, they often outsource responsibilities to reduce costs or support peak workloads. 
 
Tips for Selecting a Service Provider
 
A wide variety of providers offer contracted safety services, including individual consultants, specialty contract research organizations (CROs), large full-service CROs, and global business process outsourcers (BPOs). Because the goal is to have a cooperative relationship with the provider best suited to the given need, selecting the vendor requires some careful exploration and planning. As preliminary steps, companies should:
 

• Set clear goals and objectives for the engagement/relationship. This entails defining the tasks to be contracted and assessing the expertise available against the level and number of resources required. Factors to consider include:    

                   o   What are the future outsourcing plans? Is this the first in a series of contracts for similar or different services, or is this a one-time request for consultancy?
                   o   How would other outsourced services be connected to this contract?

There may be times, however, when unplanned resource shortages or an unanticipated workload make the scope of work “a moving target.” Outsourcing can still be a positive experience if the sponsor and vendor communicate openly and address issues immediately. Such situations require extreme flexibility on the part of both parties. 

• Conduct due diligence. Companies should check the provider’s references for insight into actual past performance. Having a record of regulatory compliance and low rates of non-conformity usually indicates the existence of a robust quality management system.
• Evaluate the business models offered for the requested service. The model selection will be governed by key factors such as complexity and variability versus standardization, the volume of work involved, and the duration of the project. 

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Types of Outsourcing Models 
 
             Resource-based model: A team is staffed to meet a program’s maximum, projected volume. This is a lower-cost option appropriate for programs with relatively stable and predictable workloads
         Activity-based model: This approach provides flexibility and contains costs when the resourcing strategy is projected based on accurate forecasting. It allows for partially-allocated resources who support additional programs or clients. 
        Blended/transformational model: This is tailored to the company’s unique needs and provides a cost-effective team to support a baseline workload as well as services to support periods of high volume on a per-unit basis. 

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Ensuring a Successful Relationship 
 
Successful relationships between sponsors and outsourcing partners are built on well-defined contractual agreements managed within a configuration that matches the scope of work. Achieving an efficient and effective collaboration involves:
 

• At the beginning of the alliance, defining roles and responsibilities, establishing, communication pathways and escalation procedures, creating a governance structure, and developing contingency plans for both parties. 
• Forming an oversight committee comprised of executives from both parties and their project teams. The committee should hold regular meetings to assess the ongoing relationship and operations. 
• Investing in face-to-face governance meetings to ensure processes remain harmonized, issues are resolved, contract changes are managed, and process improvements are identified to ensure operational excellence. 

Although such steps affect the project budget, they are worthwhile in the long run. With a joint commitment, shared values, high trust, appropriate governance, aligned core competencies and corporate visions, resources can be optimized for the greatest possible cost efficiencies. Success will depend on the level and quality of collaboration. 

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