As CROs report their first-quarter financials, Icon has issued some grim warnings about how much COVID-19 and the resultant lockdowns are hitting its business.
The company said it started to feel the hit from the pandemic back in February at its China trial sites (where the pandemic first started). But now, it is starting to feel the bite elsewhere as the virus spreads rapidly across the globe, saying the hit is “prevalent in our clinical business with approximately 65% of our global sites impacted in some way by the pandemic.”
Specifically, it’s seeing site ID and enrollment delays due to “site closures and movement restrictions” on patients.
It said in its first-quarter update: “We are proactively reviewing and agreeing to alternative approaches with customers on a study-by-study basis, including remote and risk based monitoring and ‘at home’ services delivered through our Symphony Clinical Research group. In addition, since mid-March, we are seeing conditions gradually improving in China with sites re-opening and monitoring activities recommencing.”
Given the impact, Icon is now looking to ax costs through a variety of methods, including cutting leadership and employee pay as well as a freeze on hiring new people “in certain business units,” reducing contractor costs and reduction of non-labor variable expenditure. “Measures will continue to adapt as the situation evolves,” it said, though it is not yet cutting staffers.
It’s also withdrawing its full-year 2020 guidance amid the uncertainty. This came on the heels of a solid quarter for the CRO, with revenue hitting $715.1 million, a 6.5% year on year increase (at a constant currency basis).
CEO Steve Cutler, Ph.D., said: “Since March, we have seen the escalation of COVID-19 into a true global pandemic impacting our operations. Accordingly, we are withdrawing our FY20 financial guidance due to the current level of uncertainty. While all efforts are being made to mitigate the impact, the welfare and safety of Icon’s employees, customers and patients remains the company’s highest priority.”