Biogen switches to Medidata Rave, tipping balance of eClinical power further still

Biogen ($BIIB) has made Medidata ($MDSO) Rave its primary clinical trial technology platform. The deal, which marks another transfer of business from Oracle ($ORCL) to Medidata, means the Rave provider now has a close working relationship with 18 of the top 25 biopharma companies.

For now, the scope of the relationship between Biogen and Medidata is nonexclusive and limited to Rave, a platform best known for its electronic data capture (EDC) capabilities. But, while the deal lacks the breadth of the enterprise agreements Medidata has struck with Boehringer Ingelheim, Bristol-Myers Squibb ($BMY) and Celgene ($CELG) over the past seven months, it nonetheless marks another shift in the balance of power in the clinical trial technology sector.

In the past, Biogen sourced its EDC system from Phase Forward, a Medidata rival that was bought by Oracle for $685 million in 2010. Since then, Medidata has succeeded in prising a string of Big Biopharma companies away from Oracle, culminating in it having close relationships with 18 of the 25 biggest drugmakers. Biogen, Boehringer and Bristol-Myers have all worked with Oracle and Phase Forward in the past.

When Medidata landed the Boehringer and Bristol-Myers deals it reeled off a list of technologies the drugmakers had signed up to use across their drug development programs. At first glance, the Biogen deal appears more limited. Medidata CEO Tarek Sherif told investors Biogen had committed “to make Rave its primary platform.” Whatever the value of the deal today, it gives Medidata a position from which to push its other products to Biogen. Such cross-selling has been successful with other clients.

The financial implications of these successes were evident in Medidata’s second-quarter results. Sales increased 17% year on year, contributing to investors driving up the price of the stock 15% on the day the results were released. Medidata added 96 new clients in the quarter, a record underpinned by the 32 customers it acquired through the takeover of Intelemage. The company now has 711 clients, a 32% increase year on year.

Some of the success has come at the expense of Oracle. The only recent bright spot for Oracle came last month when Pfizer ($PFE) chose to stick with the company. Riding high, Medidata even used that as a chance to get a dig in at its rival. “It's telling that Oracle recently issued a major announcement just because they renewed one of their existing customers, as opposed to winning a new one. Our retention rate is amazing, and we keep winning and winning new customers,” Sherif said.

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