CRO industry 'disrupted,' with Parexel, IQVIA 'weakly positioned' to take pandemic hit: Moody's

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A report out by financial consultancy Moody’s has found that the COVID-19 will hit the CRO industry but hopes impact will be limited.

As FierceCRO has reported, Moody’s notes that the CRO industry “is being disrupted” as pharma clients cancel or suspend new and/or ongoing tests, but says “quantifying the impact is difficult” because biopharmas “often contract with several CROs across their pipelines, and for different drug development services.”

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But the firm predicts that in the coming months, there will be “far more delays and temporary suspensions of clinical trials,” mainly down to travel limitations in countries where clinical trials are run.

But analysts at Moody’s predict that outright trial cancellations will “be limited,” although warn they “will rise” if restrictions continues in the second half of this year.

Its report: US Pharmaceutical Services: Coronavirus-related disruptions to pharma clinical trials are negative for CROs, still expects liquidity profiles among the CROs “to remain good throughout 2020.”

But it warns some companies, specifically point out IQVIA and Parexel, are “operating with elevated financial leverage and are more weakly positioned at their current ratings, with limited cushion to absorb earnings declines.

IQVIA is however working within the pandemic, and this month kick-started a new matchmaking trial service to “accelerate treatment and vaccine development” against COVID-19.

Parexel said that it has “temporarily put a hold on new patient screenings and enrollment in our four global Early Phase Clinical Units across the globe while continuing to support the patients participating in ongoing studies in compliance with CDC guidelines for care in a healthcare setting,” in letter on its corporate website. 

Parexel told FierceBiotech: “The temporary hold on new patient screenings and enrollment is specific to our four global Early Phase Clinical Units. These units remain open and are conducting ongoing studies, but have halted new enrollment to ensure Parexel is supporting safe social distancing with patient safety as our primary goal. We will resume new enrollment at EPCU sites as soon as it is appropriate to do so, taking into account local, governmental and regulatory advice. For all other studies, we are working to keep clinical operations progressing by leveraging remote monitoring, telehealth visits, and other aspects of home-based care and decentralized clinical trials.”