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Transcript of Executive Chairman Dr. John Climax President Corporate Development Bill Taaffe CEO Peter Gray Chief...
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Certain statements contained herein including, without limitation,
statements containing the words “believes,” “anticipates,” “intends,”
“expects” and words of similar import, constitute forward-looking
statements concerning the Company's operations, performance,
financial condition and prospects. Because such statements involve
known and unknown risks and uncertainties, actual results may differ
materially from those expressed or implied by such forward-looking
statements. Given these uncertainties, prospective investors are
cautioned not to place undue reliance on such forward-looking
statements. The Company undertakes no obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
Forward Looking Statements
Global Full Service Clinical Development
US 53%
EU 38% ROW
9%
Q4 Revenue by Region
GlobalClinical
ICON Latin America5 countries5 Offices153 Clinical Staff
ICON North America2 Countries23 Offices2605 Clinical Staff
ICON Europe/Africa17 Countries20 Offices1980 Clinical Staff
ICON Asia Pacific9 Countries12 Offices478 Clinical Staff
ICON Global - Projects in 50+ Countries
North America2 Countries17 Offices>1,900 Staff
Western Europe / Africa
10 Countries13 Offices>1,600 Staff
Asia Pacific8 Countries10 Offices>450 StaffLatin America
5 Countries5 Offices>170 Staff
Projects in 60+ Countries
Eastern Europe / Russia8 Countries9 Offices> 350 Staff
Japan1 Country2 Offices>80 Staff
ICON’s Global Clinical Footprint
Market Environment
• Continued R&D Spending Growth.
– Phase II / III pipelines strengthening
• Increased Outsourcing
– Being accelerated by activity & funding in Biotech / Speciality
– Globalisation of clinical research
– New strategic thinking / cost containment
• Increasing Regulation
– More patients/ more studies
– Post marketing surveillance 5
Strong Market Environment with...
4000
4100
4200
4300
4400
4500
4600
4700
4800
4900
5000
5100
5200
Source: Pharmaprojects
Up ≈ 23%
The Pipeline continued to fill in 2007Preclinical Compounds in Development
880
930
980
1030
1080
1130
1180
1230
1280
1330
1380
Sep-06
Oct-06
Nov-06
Dec-06
Jan-07
Feb-07
Mar-07
Apr-07
May-07
Jun-07
Jul-07
Aug
-07
Sep-07
Oct-07
Nov-07
Source: Pharmaprojects
Up ≈ 22%
Phase I Compounds in Development
The Pipeline continued to fill in 2007
1800
1850
1900
1950
2000
2050
2100
2150
2200
2250
2300
2350
2400
Sep-06
Oct-06
Nov-06
Dec-06
Jan-07
Feb-07
Mar-07
Apr-07
May-07
Jun-07
Jul-07
Aug
-07
Sep-07
Oct-07
Nov-07
Source: Pharmaprojects
The Pipeline continued to fill in 2007
Up ≈ 14%
Phase II/III Compounds in Development
$18.1
$22.4
$29.2
$33.1
$38.6
$0.0
$5.0
$10.0
$15.0
$20.0
$25.0
$30.0
$35.0
$40.0
$45.0
2003 2004 2005 2006 2007
$Bil
lio
n
Biotech fundraising (excluding debt financing)
Source: Burrill and Company
US Biotech Funding Environment continued to grow
ICON in this Market Environment
14
RFP Value by Market Segment
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2003 2004 2005 2006 2007 2008 2009 2010
(in
mill
ion
s)
Total Large Pharma MidSize Pharma Biotech
2007 Value
54% Increase / PY
Size of Projects
41 > 20 Million
168 > 5 Million
959 < 5 Million
Gross RFP Value by Market Segment(Including RFPs that never progress to award)
Number of Proposals
571
8871014
1118
400
600
800
1000
1200
2004 2005 2006 2007
Average Proposal Size ($ millions)
2.8 3.1 3.6
5.4
0
2
4
6
2004 2005 2006 2007
Strong RFP volume growth, with increasing average proposal value…
Number of New Awards Greater then $5 million
8 14
32
46
0
10
20
30
40
50
2004 2005 2006 2007
…which has led to increasing numbers of awards greater then $5 million.
$127
$165$186 $189 $193
$207
$245$264
$246
$366
Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07
ICON Gross Business Wins - Last 10 Quarters ($ millions)
Overall, Strong Gross Business wins has led to…
$140
$171$166
$157$171
$223 $230
$344
$230
Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07
1.6
1.3
1.6 1.6
1.9
1.3 1.41.6
1.7
Net Business Wins Book to Bill Ratio
.. excellent Net New Business wins and very strong book to bill ratios…
$633
$707
$772$815
$872
$963
$1,049
$1,125
$1,300
Q4 05 Q1 06 Q2 06 Q3 06 Q406 Q1 07 Q2 07 Q3 07 Q4 07
Up 38% YoY
Up 49% YoY
…leading to record Total Backlog levels. ($ millions)
$296 $307
$360
$395$415
$470
$542
$589
$493
Q4 '05 Q1 '06 Q2 '06 Q3 '06 Q4 '06 Q1 '07 Q2 07 Q3 '07 Q4 '07
76%
76% 76% 76%
77%77%76% 76%
77%
Value of backlog forecast to be earned in next 4 quarters
% coverage of next 4 quarters forecast revenues
From this backlog, coverage of next 4 quartersrevenues is robust……..
42.6%
34.6%
30.0%
62.7%
51.1%47.0%
81.4%
72.0%
66.0%
7.8%9.6%12.3%
FY To May 2005 2006 2007
Largest Client
Top 5
Top 10
Top 25
Client Diversity 2005, 2006, 2007
2007 - New Business by
Customer Segment
This has led to a diversified customer base……
….and broad therapeutic expertise.
Revenue by Therapeutic Area 2007
Strategy
ICON’s Core Strategy is Organic Growth,with acquisitions made to add new services or scale.
Capitalise on market fundamentals to drive organic growth in all business units.
Pursue acquisitions to enhance depth and scale of current operations and to add additional complementary services e.g.
Phase I - US
Bioanalytical / Biomarkers
Therapeutic specialists
Safety / Phase IV
Patient Recruitment
Staffing
Cross-sell services to grow sales and margin
Acquisitions to date - 11
• Revenues acquired $114m
• Staff acquired – 1,100
• => Organic growth >80%
Key Strategic Trends
• Strategic v Tactical Outsourcing– More large companies are seeking to use outsourcing strategically rather
than tactically. – ICON fully engaged.
• Globalisation– Growth in Eastern Europe, Latin America and Asia as a venue.– ICON growing rapidly in these regions
• Greater Scientific Involvement– Customers seeking greater scientific input from CROs – ICON has added TAGS, IDS, Imaging, new Lab technologies etc. to
respond.
• EDC– Estimated that over 40% of clinical trials now use EDC– 49% of ICON’s Data Management activity in 2007 was EDC
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
$327$297
$226$157
$456
$631
$760(E)
$0
$100
$200
$300
$400
$500
$600
$700
FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008*
Mil
lio
ns CAGR 32%
* Mid Point of 2008 Guidance issued December, 2007
Net Revenue CAGR of over 30% since 2002 22% Forecast for ‘08
$0.58
$0.94$0.85
$1.35
$2.32(E)*
$1.88
$0.75
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008
CAGR 26%
(E)
* Mid Point of 2008 Guidance issued December 2007
Earnings Per Share Growth
Q4 ’07 Q4 ’06 % Increase
Net Revenue 181 129 40%
Direct Costs 100 73 37%
SG & A 55 38 45%
D & A 5 4 37%_____ _____ _____
Operating Income 20 14 43%
Operating Margin 11% 10.7%
Net Income 16 11 40%_____ _____ _____
EPS (Inc SFAS123R) 53c 39c 36%
Weighted Average no. of
Shares (Inc SFAS123R)
29.9m 29.1m 2.7%
Recent Financial Performance ($ millions, except EPS; includes stock option expense)
FY2007 FY2006 % Increase
Net Revenue 631 456 38%
Direct Costs 355 256 38%
SG & A 188 137 38%
D & A 19 15 27%_____ _____ _____
Operating Income 69 48 45%
Operating Margin 11% 10.5%
Net Income 56 38 46%_____ _____ _____
EPS (Inc SFAS 123R) 188c 133c 41%
Weighted Average no. of
Shares (Inc SFAS123R)
29.7m 28.7m 3.5%
Recent Financial Performance ($ millions)
• Approx. 25% of ICON’s business is generating single digit
margins– Further margin growth in Lab – Improve performance from Phase I and Consultancy businesses – Bring Japan to higher profitability
• Expand margins in Phase II – IV through leverage as
growth moderates.
• Currency Movements creating some “Headwinds”5
Margin improvement is a key focus
May 31, 05
(Year)
Dec 31, 05
(7 mths)
Dec 31, 06
(Year)
Dec 31, 07
(Year)
Net Cash $78.4 $82.3 $98 $23.8
Total assets $347.6 $349.1 $476.3 $693.1
Shareholder’s equity $233.1 $241.6 $302.7 $388.4
Cashflow from operations $23.8 $11.7 $51.5 $42.9
Capital expenditures $15.6 $12.1 $31.5 $75.4
CAPEX Excl. Dublin Extn. $15.6 $12.1 $20.4 $36.8
Shares outstanding 27.8 28.0 28.5 28.8
Summary Balance Sheet and Cash Flow ($ millions)
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’DwyerCOO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
The Globalisation of Clinical Research: Challenges and Opportunities in Argentina, Brazil, Russia, China and India
John W. Hubbard, Ph.D., FCPGlobal President, ICON Clinical Research
Products in Development by Therapeutic Area
Source – BioPharmInsight.com, 2007
Cancer 7,015 104 527 1,537 1,463 2,865 438 81Infectious Diseases 2,963 89 198 350 425 1,325 544 32CNS 2,900 155 211 394 397 1,217 507 19Cardiovascular 2,136 75 219 299 290 739 480 34Hormonal Systems 1,517 71 124 221 266 514 311 10Miscellaneous 1,492 9 8 18 169 1,232 44 12Immune System 1,436 48 93 127 215 731 215 7Gastrointestinal 1,097 49 98 208 176 347 211 8Musculoskeletal 1,088 39 84 177 160 387 222 19Pain 959 60 99 172 147 236 232 13HIV Infections 880 17 45 102 171 453 72 20Respiratory 867 27 56 165 162 309 136 12
Diagnostic / Imaging Agents / Delivery 833 17 23 47 126 508 106 6Genitourinary 670 32 57 134 90 165 186 6Dermatology 661 27 43 141 109 173 151 17Hematological 581 24 39 78 125 198 112 5Eye and Ear 429 20 42 62 84 154 60 7
Total 27,524 863 1,966 4,232 4,575 11,553 4,027 308
Status Unclear
#Products Launched
Pre-Clinical /
DiscoveryPhase I / IND FiledTherapeutic Area Phase III Phase II
NDA / BLA Filed
Total Investigational
Drugs
Global trend for higher costs, more patients and experienced clinical investigators!
Cost perpatient
Cost perinvestigator
Complexity of protocols
• Treatment naïve patients
• Qualified investigators
• Number of procedures, and type of inclusion/
exclusion criteria
Trend Driver
Cost per trial
Cost ofclinical
development
Infrastructure cost
• Number and size of trials• Regulatory requirements
Pharma & Device Industry Challenges
Source McKinsey 2004
• Access to treatment naïve patients, or patients who have only been
treated with older medications
• Emergent disease populations, e.g., Type II diabetes, treatment
resistant infections such as HIV, tuberculosis, hepatitis B & C, and
various forms of cancer, and cardiovascular disease
• Cost and time benefits: Faster patient recruitment and lower cost base
• Since 1990, global clinical research has grown from 28 to 79 countries
and the amount of FDA regulated research has increased 16-fold
• ICH E5 regulations allow the use of foreign data in new drug
submissions
Why Conduct Global Clinical Trials?
PharmafocusAsia, 2005
Drivers of Country Selection
• Medical practice
• Regulatory process
• Commercial and post-marketing value
• Cost of the trial
• Disease demographics
• Speed of enrollment
• Quality, quality, quality
Quality is the key driver: If a country cannot deliver quality, all other benefits are irrelevant
ICON Latin America5 countries5 Offices153 Clinical Staff
ICON North America2 Countries23 Offices2605 Clinical Staff
ICON Europe/Africa17 Countries20 Offices1980 Clinical Staff
ICON Asia Pacific9 Countries12 Offices478 Clinical Staff
ICON Global - Projects in 50+ Countries
North America2 Countries17 Offices1896 Staff
Western Europe / Africa
10 Countries13 Offices1554 Staff
Asia Pacific8 Countries10 Offices448 Staff
Latin America5 Countries5 Offices166 Staff
Projects in 60+ Countries
ICON’s Global Clinical Footprint Eastern Europe / Russia8 Countries9 Offices339 Staff
Japan1 Country2 Offices72 Staff
Key Countries for Clinical TrialsBased on the Overall Country Attractiveness Index1
0 1 2 3 4 5 6 7
China
India
Russia
Brazil
Argentina
United States
Patient Pool Cost Efficiency
Regulatory Conditions Relevant Clinical Expertise
Infrastructure and Environment
1A.T. Kearney Attractiveness Index , Pharmaceutical Executive Supplement, 2006
6.88
5.58
5.55
5.26
6.10
4.90
Clinical Research in Russia, Argentina, Brazil, China and India:Opportunities and Challenges
ICON’s Clinical Trial Experience in Russia
CountryOffice
LocationsServices
Current Staff
Staff by 2010
Number of Ongoing Studies
Russia Moscow /
Novosibirsk
Clinical Operations,
Regulatory/EC/submissions,
>80 250 -
300
~50
Russia: Opportunities and Challenges• Opportunities
– Population of more than 142 million, with only 274 ongoing multi-national clinical trials (only 5% of the clinical research potential)
– Large urban hospitals and medical centers
– 768 Clinical sites registered by the Federal Service for Healthcare and Social Development in the Russian Federation
– High average patient enrollment rates of 4.7 patients/site/month
– FDA has conducted 36 audits since 1995 and ranks #1 in quality amongst other E7 countries
– Low cost relative to Western EU and the US
– Relatively straight forward regulatory and clinical site contracting process
• Challenges– New regulatory requirements regarding the shipment of blood, DNA, and tissue
samples
– Rapidly maturing marketplace Sources: UBC International Clinical Trials, 2007
Russia versus U.S. in Clinical Research
Key Features of a Clinical Trial U.S. Russia
No. of patients across urban life style diseases Medium High
No. of patients with tropical diseases Low Low
Speed of recruiting patients for trial Low-Medium Very High
Speed of conducting a trial Medium High
Follow-up rate of patients Medium High
Number of qualified doctors and clinicians Very High High
Heterogeneous populations High Medium-High
Awareness of ICH GCP guidelines Very High High
Availability of technology to streamline trials Very High Medium-High
Regulatory & ethical issues and barriers Low Low-Medium
Key: Red color = An area of development or current limitation.
ICON’s Clinical Trial Experience in Latin America
CountryOffice
LocationsServices
Current Staff
Staff by 2010
Number of Ongoing Studies
Argentina Buenos
Aires
Clinical Monitoring / Project
Management / Regulatory
Submissions /
Pharmacovigilance
73 145 43
Brazil Sao Paulo Clinical Monitoring / Project
Management / Regulatory
Submissions
33 90 30
Mexico /
Chile /
Peru
Capital
Cities
Clinical Monitoring / Project
Management / Regulatory
Submissions
60 150 >40
Latin America: Opportunities and Challenges
• Opportunities– The seven main Latin American markets add up to 448 million
people with a GDP of US $2.5 trillion in 2006.• Highly concentrated: 70% urban / mega-cities
• Only two main languages
• Counter-season enrollment in Southern Hemisphere
– Led by Mexico, Brazil and Argentina, they are expected to represent a market value of US $52 billion at retail prices by 2011.
Sources: Espicom / PWC
Latin America: Opportunities and Challenges– Between 1995 & 2000, the number of clinical trials executed in the region
rose by a factor of ten.• High quality of medical practice and experienced clinical investigators
• Growing clinical trails sector
– Development of dedicated CT sites, ERBs, SMOs
– Expansion of CROs and Pharma clinical operations
– Availability of GCP/CRA/SC training Courses
– Support services: central labs, CTM logistics, QA consultants
• Challenges
– Regulatory agencies are “stretched” due to lack of resources to meet the clinical trial demand
– Longer regulatory start-up in some countries (e.g., Brazil)
– Evolving regulatory environment– Some agencies are recognizing the need to adapt their regulations harmonization
initiatives, which could enhance the attractiveness of the regionSources: Espicom / PWC
Latin America versus U.S. in Clinical Research
Key Features of a Clinical Trial U.S. Latam
No. of patients across urban life style diseases Medium Medium
No. of patients with tropical diseases Low High
Speed of recruiting patients for trial Low-Medium High
Speed of conducting a trial Medium Medium
Follow-up rate of patients Medium High
Number of qualified doctors and clinicians Very High Medium
Heterogeneous populations High Medium
Awareness of ICH GCP guidelines Very High High
Availability of technology to streamline trials Very High Medium
Regulatory & ethical issues and barriers Low Medium
Key: Red color = An area of development or current limitation.
ICON’s Experience in India and China
CountryOffice
LocationsServices
Current Staff
Projected Staff by
2010
Number of Ongoing Studies
ChinaBeijing /
Hong Kong
Clinical Operations, Regulatory,
Consulting22 130 16
IndiaChennai
Bangalore
Clinical Operations, Data
Management, Biostatistics, IVRS,
Pharmacovigilance, Medical
Imaging
350 550-600 20
China: Opportunities and Challenges
• Opportunities
– Homogenous population of 1.3 billion
– Increasing incidence and prevalence of infectious diseases, cancer, and metabolic disorders
– History of pharmaceutical usage
– Clinical Trial Site Management Regulation enacted in 2004
• Only GCP-certified sites were approved to conduct clinical trials
– Centralized medicine: 80% of medical resources are in large cities
– Strong commercial pharmaceutical market approaching $75 billion by 2010
China: Opportunities and Challenges
• Challenges
– Slow to accept ICH/GCP requirements
– High demand for limited resources
– Inexperienced clinical investigators may under report AEs/SAEs
– Long regulatory approval to initiate clinical trials (6-12 months)
– All regulatory documents must be translated into Chinese and local dialects may be a challenge
– Restricted export of whole blood – Lab analysis and clinical chemistries need to be conducted in the country
– Logistical challenges: Time and costs may be higher than other locations
China versus U.S. in Clinical Research
Key Features of a Clinical Trial U.S. China
No. of patients across urban life style diseases Medium Very High
No. of patients with tropical diseases Low Very High
Speed of recruiting patients for trial Low - Medium Very. High
Speed of conducting a trial Medium Medium
Follow-up rate of patients Medium Medium - High
Number of qualified doctors and clinicians Very High Low - Medium
Heterogeneous populations High Low
Awareness of ICH GCP guidelines Very High Low
Availability of technology to streamline trials Very High Medium
Regulatory & ethical issues and barriers Low High
Key: Red color = An area of development or current limitation.
India: Opportunities and Challenges
• Intellectual Property Changes
– India Patent Act (1970) did not recognize pharmaceutical patents
– India agreed to uphold the Trade-Related Intellectual Property Rights (TRIPS) agreement in 1995 and committed to enforcement by 2005
– Significant expansion of local pharmaceutical and bulk chemical manufacturing
Source: Pharmaceutical Manufacturing and Packing Sourcer, 2006
India: Opportunities and Challenges
• Opportunities– Large English speaking Caucasian population (> 1.1 billion)
– Educated and cost-effective workforce
– Nearly 700,000 hospital beds
– 221 Medical colleges
– Robust IT infrastructure
– FDA has accepted data from India in large pivotal trials
– Improving regulatory approval times for study start-up (12-18 weeks)
– $100 million market in 2007 for clinical trials outsourced to India growing to $1.1 - $1.5 billion by 2010
Source: Pharmaceutical Manufacturing and Packing Sourcer, 2006
India: Opportunities and Challenges
• Challenges
– Concerns over quality of patient data
– High demand for limited resources and experienced clinical investigators
– Large patient populations are dispersed throughout the country
– Infrastructure across the country is under developed
– Less desirable market place for pharmaceutical companies to commercialize products
• Low health insurance coverage
• Limited consumer purchasing power
• Controlled drug-pricing
• Entrenched generic market
India versus U.S. in Clinical Research
Key Features of a Clinical Trial U.S. India
No. of patients across urban life style diseases Medium Very High
No. of patients with tropical diseases Low Very High
Speed of recruiting patients for trial Low-Medium Very High
Speed of conducting a trial Medium Very High
Follow-up rate of patients Medium Very High
Number of qualified doctors and clinicians Very High Medium – High
Heterogeneous populations High High
Awareness of ICH GCP guidelines Very High Low – Medium
Availability of technology to streamline trials Very High Low - Medium
Regulatory & ethical issues and barriers Low Medium - High
Key: Red color = An area of development or current limitation.
• Case Study:
Study No 2: Phase II/III studyType 2 Diabetes-1 protocol
Diabetes Estimates in Emerging Countries
0 10 20 30 40 50 60 70 80 90 100
Total Number of People with Diabetes (Millions)
Mexico
Egypt
Brazil
Pakistan
China
India
2030
2000
Source: World Health Organization & Contract Pharma, May 2007
Regional Performance
Summary Report- Recruitment
0
100
200
300
400
500
600
Screened: Run-In: Randomized Completed:
No
. Of
Su
bje
cts
United StatesIsrael
ArgentinaIndia
Summary Report- Recruitment
0
100
200
300
400
500
600
Screened: Run-In: Randomized Completed:
No
. Of
Su
bje
cts
United StatesIsrael
ArgentinaIndia
US Israel Argentina India Total
Screened 245 215 239 477 1176
Run-In 106 142 140 305 693
Randomized 46 85 84 181 396
Completed 42 78 74 169 363
• Globalization of clinical trials is accelerating and will continue to develop in regions such as Eastern Europe, Latin America, and Asia-Pacific (India, and China)
• There are many challenges and opportunities that must be addressed as the market matures in these regions
• This represents a huge opportunity for CROs who have a global structure and capability to conduct trials in these regions
• ICON is well positioned in these locations and will continue to expand its global clinical development capabilities to meet our client’s needs
In Conclusion….
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
CRO Marketplace Dynamics
Elizabeth ThieleSr. Vice PresidentGlobal Business DevelopmentICON Clinical Research
• Increased Number of Strategic Outsourcing Initiatives– Reduced Oversight Models
– Use of Low Cost Regions for Process Rich Services
– Implementation of Alternative Study Execution Methodologies
– Integration of Technology Based Information Management Systems
• Growing Number of Global Projects Across All Market Segments
Why is Growth so High for CROs…
“Large Pharma & Biotech are Searching for Ways to Stretch R&D Funds & Small Biotech/Emerging Pharma are Holding onto the their Assets Longer”
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2003 2004 2005 2006 2007 2008 2009 2010
Total Large Pharma MidSize Pharma Biotech
66
RFP Flow by Market Segment
2007 Volume
500+ RFIs
1100+ RFPs
- 38% Increase / PY
- Program vs. Project
- 32% Multi-Region
67
RFP Value by Market Segment
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2003 2004 2005 2006 2007 2008 2009 2010
(in m
illio
ns)
Total Large Pharma MidSize Pharma Biotech
2007 Value
54% Increase / PY
Size of Projects
41 > 20 Million
168 > 5 Million
959 < 5 Million
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2003 2004 2005 2006 2007 2008 2009 2010
Gross US (Gross) EU (Gross) ROW (Gross)
68
RFP Flow by Participating Region
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2003 2004 2005 2006 2007 2008 2009 2010
(in m
illio
ns)
Gross US (Gross) EU (Gross) ROW (Gross)
69
RFP Value by Participating Region
• Increased Number of Strategic Outsourcing Initiatives– Reduced Oversight Models
– Use of Low Cost Regions for Process Rich Services
– Implementation of Alternative Study Execution Methodologies
– Integration of Technology Based Information Management Systems
• Growing Number of Global Projects Across All Market Segments
• Incremental Number of Requests for Feasibility Related to Study Design and/or Available Patients
• Greater Demand for Regulatory Support Services
• Overall Demand for “Scientific” Input
Why is Growth so High for CROs…
“With Large Pharma & Biotech Searching for Ways to Stretch R&D Funds & Small Biotech/Emerging Pharma Holding on the their Assests Longer”
• Three-fold Increase in the Number of RFIs Overall & a Specific
Interest in the Universe of Post-approval Services at ICON
• Emerging RFIs Related to “Risk Minimization Action Plan”
Development (starting approximately 1Q07)
• Increased Number of RFIs & 75% Increase in RFPs for 2007
Related to Stand-alone Safety & Pharmacovigilance Work
• Increase in the Number of RFIs & RFPs for Assistance with
Epidemiological Design & Analysis
• Increase in the Number of RFPs for Registries, Particularly
Originating in Europe
Observations in the Post Approval Arena…
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data
Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Global Data Management and EDC
Thomas O’LearyVice PresidentGlobal Head of Data ManagementICON Clinical Research
• What is driving Electronic Data Capture (EDC) Adoption– Number of clinical procedures quadrupled in last 20 years– Data more complex, speed of availability is critical– Paper based processes not scalable– 2005: Watershed year for EDC Market
• Two Enterprise-level leaders emerge in the market place
– 2006: Crossing the Chasm• Industry switched their concerns about not being first to not being last
• Where is EDC headed (2008-2011)– Spending expected to exceed $3.1 billion– Average time to deploy study will be halved
EDC Adoption in the Market Place
• Medidata Rave™ (February 2005)– Non-exclusive agreement
• Phase Forward Inform™ (January 2007)– Rave™ and Inform™ dominated 2007 (about 40% of market each)– Allows us to cover the majority of our EDC committed client base
• Oracle Clinical OC RDC™ (Dec 2007)– Oracle have invested heavily in order to establish market share– Specific clients committed due to heritage
• Niche products emerging (eg Phase I, Late Phase/registry trials)– Medidata and Phase Forward specific products for early and late
phase requirements.– ICON has agreed partnerships with two niche providers– ICON extends clinical reach with such providers
• Recognised as CRO who understands optimal use of technology
EDC Capabilities at ICON
EDC Adoption Metrics
• In the last 4 years– ICON has won 6 times as many EDC projects than pre 2003– EDC Wins have more than doubled year on year
• 8 wins in 2004, 17 wins in 2005, 38 wins in 2006, 79 wins 2007
– Requests for proposals featuring EDC comprised about 52% of our portfolio at the end of 2007 (<1% in 2003)
– Currently over 33% of our projects are using EDC, this is projected to reach 45-50% by the end of 2008, 85-90% by 2010
• Current EDC project portfolio– 116 ongoing EDC studies (plus 37 completed studies)
• 77 studies in Medidata Rave™ • 22 studies using Phase Forward Inform™• 17 studies using other EDC systems (client mandated)
Data Management Locations
Dublin
Edinburgh
Marlow
Chennai
Hong Kong
Philadelphia
North Carolina
San Francisco
Position East Coast
WestCoast
Europe India SupportOffices
GlobalTotal
DM Project Managers
31 5 24 3 1 64
Data Coordinators/EDC Analysts
123 14 80 48 0 265
Data EntrySpecialists / EDC
Testers
24 0 6 53 0 83
Medical Coders 3 1 3 2 0 9
DBAs / EDC StudyBuilders
16 4 15 15 2 52
Total Staff 197 24 128 121 3 473
Data Management Headcount
• Databases set up – 96 (EDC = 29%)
• Edit checks programmed – 89,504
• CRF pages processed – 3,189,323 (EDC = 49%)
• DM Queries processed – 352,169
• All Queries processed – 472,206
• Medical terms coded – 437,111
• Databases closed (final) – 67
• Audits Performed – 30
Data Management Metrics 2007
• Electronic Data Capture– Medidata Rave™ (v5.6.1)– Phase Forward InForm™ (v4.5)– Oracle Clinical RDC ® (v4.5.2)
• Oracle Clinical® (v4.0.3, 4.5.1)• DataFax™(v3.7)• Clintrial™ (v4.4)• OptICON (Integic) - CRF Scanning & Workflow Manager• ICONet – Web Portal Application
• ICOSaurus – coding application• SAS (8.2, 9.1.3)• FrameMaker (v8.0) - CRF design, structured (XML)• E-Diaries (CRF Inc & PHT & Invivodata)
Technology & Capabilities
Technology & Capabilities
Integration with other ICON systems
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
IVR in Clinical Trials & the impact of technology on CR
Malcolm BurgessChief Operating Officer, U.S. OperationsICON Clinical Research
• Interactive Voice Response (IVR)– Interactive Web Response (IWR)
• Utilizes telephone to collect data– Mobile or landline
• Technology used in many different industries– Banking, IT support, etc
• IVR usage in Clinical trials– Been around for 25 years– IWR more recently adopted
• Modern IVR systems integrated with IWR– Allows users to select interface that works best for them
IVR/IWR Defined
• Low cost solution for simple data entry• Enrollment and Randomization
– Prevents over recruitment– Can also be used to recruit patients
• Dispensing pharmaceuticals drugs – according to need or type of clinical trial
• Used to record complete clinical trial data about the recruitment of subjects
• Can be integrated with other tools to manage the clinical study data (CTMS, EDC, etc)
• Maintain a record of drug accountability– Dispensed, used, returned, etc
• Patient Reported Outcomes– Improves Quality and Integrity of data
IVR/IWR in Clinical Trials
• Enrollment– Reduced costs due to over-enrollment of patients
• Randomization– Supports complex randomization and Adaptive trials
• Drug Management– Reduce costs of drug due to less waste
• Patient Report Outcomes– Improve quality and integrity of the data collected
IVR/IWR Cost Saving Advantages
• IVR can be used for Electronic Patient Report
Outcomes (ePRO)– FDA mandates and guidance will drive the number trials
requiring ePRO up significantly
• None of the implementation costs associated with
handheld ePRO solution
• PRO can be submitted using the IVR or IWR
concurrently
• Low cost, Global, Multilingual solution
Electronic Patient Report Outcomes
ICON IVR Metrics
• Current IVR project portfolio– 325 active IVR projects– >650 projects launched since inception in March 2000
• Growth since 2006– 90% increase in per study revenue– 105% increase in total awards
• Staff– 235 global staff– 35 staff in Chennai providing back end support
“200+ ICOPhone dedicated staff worldwide"
ICON Global Reach
Dublin Marlow
Chennai
Philadelphia
Raleigh
Chicago
Houston
• ICON solution (ICOPhone) has been in place for 8 years
• Utilized in over 650 clinical trials
• Integrates with all major CTMS and EDC platforms
• Combines IVR and IWR in a seamless package
• All data is available real-time for decision making
• New technology release– EDGE– Reduce timelines for setup by 50%
ICON Advantage
• Changing the paradigm of Clinical Research– Site Monitors more focused on …
• Site Management• Representing the client rather than monitoring the data
– Data Flow accelerated• Direct data collection from site/patient (eg EDC, ePRO)• On-line (instead of on-site) data review• Majority of query & study management done remotely• Real time data access and decisions (adaptive designs)
– Reduced classical Data Management• No data entry, minimal manual queries – reduced workload• More focus on holistic ‘clinical management’ of the study• More focus on technology, less of a commodity
• But slowly – many still think in the paper paradigm
So where is the technology taking us ……
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global
Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Developments in Pharmacovigilance
Suzanne GagnonSnr VP Global Medical Affairs & Drug SafetyICON Clinical Research
Since 2004:
Increased emphasis on monitoring safety throughout the product life cycle
– Recent withdrawals of several marketed products
– Increased scrutiny of Regulatory Agencies
– Lack of enforcement of Phase IV commitments
– Impression that FDA was not adequately protecting the public health
– Need to respond
Developments in Pharmacovigilance (PV)
Regulatory Agencies’ Response
• FDA’s– Office of Drug Safety
– Office of Surveillance and Epidemiology
• Task Forces– IOM’s 2006 Report on the Future of Drug Safety – Promoting and
Protecting the Health of the Public
• Guidance Documents
• Risk Management
• European Directive on Pharmacovigilance
• Increased Safety Audits
Pharmaceutical Companies’ Response
• Phase IV clinical trials, observational studies, safety registries
• Data basing of legacy cases
• Risk Minimization Plans (RiskMAPs)– Increased outsourcing
– FSP model for safety
– Total product safety support
• Case processing
• Signal detection and analysis
• Drug Information and product complaints
• Regulatory report writing
ICON’s Response
2004…
Global Headcount: 68
Safety Management: 10
Safety Centers WW:
3
Stand Alone Projects
3
Value Largest Project $350K
2008…
Global Headcount: 392
Safety Management: 28
Safety Centers WW: 5
Stand Alone Projects: 16
Value Largest Project: $ >30M
ICON Global Safety Portfolio 2004
ICON Global Safety Portfolio 2007
ICON’s 2008 Plan for Drug Safety
• Safety Alliance within ICON
– Medical Affairs and Drug Safety (Case Processing)
– Lifecycle Sciences Group (Registries)
– Development Solutions (Consulting)
– Medical Imaging (Endpoints)
– Biostatistics (Signal Detection and Analysis, DSMBs)
– Call Center (Safety Reporting, Drug Information, Product Complaints)
– Regulatory Affairs
• Global Safety Marketing Campaign
• Total Product Safety Solution
Off-shoring to Low Cost Markets 2008
• Only certain clients want low cost options off-shore for PV
• Services to be off-shored vary
– Case processing
– Safety Narratives
– Call Center activities
• Not all PV services off-shored easily
• Technology enables seamless interaction between ICON Safety Centers
• Training within the cultural framework is key
• Currently 48 Medical Affairs and Drug Safety staff in Chennai, India
• Plan to increase to > 100 by end of 2008 as workload increases
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate
QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corp Training & Development
Anne Wesler
VP Strategic HR
Eimear Kenny
VP Market Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Jo CoyleVP Quality AssuranceICON plc
Agenda
ICON’s quality framework and philosophy Internal QA Program Client and Regulatory focus The year ahead
Quality is our Focus
External assessment of ICON’s Global Quality System
• Group registration for the whole company
Annual random surveillance audits across regional offices to monitor
compliance - audit frequency is based on office size and number of services
All new offices independently audited to attain registration
• 2007 audit program
USA: PA, FL, NC, CA-Irvine, CA-Redwood City
Europe: IRL, GER, SWE, RUS, HUN, ROW: South Africa, CAN, MEX*, ARG (*new offices registration audit)
The following accreditations are maintained by ICON Laboratories ISO 17025 CAP accreditation CLIA (New York facility only)
ISO 9001:2000 Registered
Quality is our focus…
ICON Internal QA Audits – 2007
Division US EU ROW Total
ICR 221 154 50 425
ICL 54 22 0 76
IDS 30 220 0 250
IMI 23 0 0 23
Corporate system audits 18 43 28 89
346 439 78 863
Division Sponsor
ICR 148
ICL 41
IDS 31
IMI 18
238
Client, Regulatory and ISO Audits – 2007
…Clients check it…
Office Date Region Auditing Authority Outcome
Redwood City, CA Oct 2003 US FDA No findings (no FDA 483)
New York City, NY Mar/Apr 2005 US FDA No findings (no FDA 483)
North Wales, PA May 2005 US FDA No findings (no FDA 483)
Nashville, TN Oct/Nov 2005 US FDA No findings (no FDA 483)
North Wales, PA Dec 2005 US FDA No findings (no FDA 483)
Nashville, TN Jan 2006 US FDA No findings (no FDA 483)
Eastleigh, UK Oct 2004 EU MHRA No critical findings
Dublin, Ireland Apr 2005 EU IMB No critical findings
Eastleign/Marlow, UK Sept 2007 EU MHRA No critical findings
Frankfurt. Germany Sept 2007 EULocal regulatory authority:
RP DarmstadtNo critical findings
Singapore Oct 2005 ROWHSA - Health Services
Authority of SingaporeNo critical findings
…Regulatory Agents inspect it…
Survey Year Comments
William Blair / PharmaMediation
2004 Top CRO for quality and execution.
CenterWatch Survey of Investigative Sites
2005Top 3 CRO for Investigator relationships and site management.
Frost Sullivan 2006Top 3 CRO for timely database lock and key attributes of overall quality, personnel expertise, therapeutic expertise, and project turnaround.
Frost Sullivan 2007 North American Service Provider of the Year
Thomson CenterWatch and William Blair
2007Vendor you most prefer working with based on quality.
Lehman Brothers 2007 Top CRO for quality of global execution.
SGS – ISO Audit Annual Passed without significant comments since 1992
…and Third Parties validate it…
• Integration of new US Phase I facility into Quality System
• Development of the Quality System in new ICON offices
• New ISO registrations in IMI, Brazil, Bangalore and Italy
• Acquire new MHRA Supplementary accreditation for Phase 1 units
(UK)
• Implementation of electronic QA system - improve efficiency in
internal audit process
• Expansion of audit program in ROW region
Quality plans for the year ahead…
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development
Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
Group Director Market
Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Thomas FreyPresidentICON Development Solutions
Regulatory Strategy
Development Plan
IND/CTA
Clinical Pharmacology
Proof Of Concept
Expeditious Drug Development – Enhanced Decision Making
Regulatory Strategy
Scientific Consulting
Pre-clinical
CMC
Formulation Development
Target Product Profile
Expeditious Drug Development – Enhanced Decision Making
Development Plan
Scientific Consulting
Phase I Development Plan & Protocol Design
Proof Of Concept Study Design
Outline Of Phase II & III
Non-Clinical Development Plan
Cost Of Development
Expeditious Drug Development – Enhanced Decision Making
IND/CTA
Regulatory Affairs
Pre-IND Meeting/Regulatory Advice
IND Compilation
Paper & Electronic Submissions
Annual Updates
Expeditious Drug Development – Enhanced Decision Making
Clinical Pharmacology
Phase I
Full Range of Regulatory Pharmacokinetic
Special Populations Studies
PK/PD Studies – Pharmacodynamic Models
Bioanalytical & Immunoassay Analysis
PK/PD Analysis, Modeling & Simulations
Data Management, Statistics, Medical Writing
Expeditious Drug Development – Enhanced Decision Making
Proof Of Concept
Phase IIa
Planning, Management & Execution Of Targeted Proof of Concept Studies
Bioanalytical & Immunoassay Analysis
PK/PD Analysis, Modeling & Simulations
Data Management, Statistics, Medical Writing
Expeditious Drug Development – Enhanced Decision Making
NONMEM - NONlinear Mixed Effects Model-base analyses
– Developed at the University of California, San Francisco
– Licensed to end-users by ICON Development Solutions
– Used worldwide in drug development to quantify exposure (PK) - response (PD) relations in support of internal decision-making and to provide evidence of safety and efficacy for regulatory evaluation.
• ICON Development Solutions provides a proprietary interface
program, PDx-POP, that runs the NONMEM Software Package
in a Windows-like environment.
Expeditious Drug Development – Enhanced Decision Making
Anticipated Added Value For Users:
• To improve numerical stability & computational efficiency
• To ease code maintenance
• To add more modern, robust estimation methods
Anticipated Added Value For ICON:
• Intellectual property
• Enhanced pricing
• Visibility and scientific reputation throughout the industry
Expeditious Drug Development – Enhanced Decision Making
Global Publishing System• GPS is a validated, 21 CFR Part 11 compliant,
centralized system for the organization, assembly, and dispatch of navigable electronic & paper documents to regulatory agencies
• Changing Regulatory Environment – eCTD “requirement” with FDA (January 2008) and EMEA
(2009)– The UK, NL & Belgian authorities are already
requesting electronic submissions
Expeditious Drug Development – Enhanced Decision Making
Submission Source Documents
Document Management System (Documentum)
Publishing Systems (CoreDossier, Insight Publisher)
Submission Sent To Regulatory Authorities (e-Gateway)
Expeditious Drug Development – Enhanced Decision Making
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
Group Director Market
Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP Phase I
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Phase I Developments
Brian O’Dwyer, General Manager & Vice President
Manchester Phase I Clinical Research Unit
• Clinical Trial Directive Implementation in 2004
negatively impacted most of UK based CPUs
• Inadequate business development contributed to the
sluggish business
• High value and high risk studies combined with
significant cancellations aggravated the situation
• Imbalance between high science and low business
acumen
Manchester Phase I Clinical Research Unit
Way to Success
• Maintained scientific strengths complemented by
commercial and operational management– Focus on biomarker models incl. imaging techniques, e.g. CNS,
diabetes, CV– Improved volunteer recruitment & study delivery
• Strengthened business development significantly
• Re-branded to ICON Development Solutions and creating
the “quality” brand image with sponsors
• Increased substantially bed utilization and backlog
MEU Collaboration
• Access to hospital based beds for FIM & complex
studies
• Enhanced flexibility through additional bed capacity
• For MEU access to support services e.g. bioanalysis,
DM, PK etc.
• Access to respiratory patients
• Proof of Concept capability
• MEU is quality unit, close proximity to existing facility &
strong reputation in respiratory internationally
• 85 bed clinical research unit in San Antonio, TX
• Experienced team with excellent market reputation
• Clinical pharmacology platform in the US to complement the UK CPU
• Highly synergistic to our existing Development Solutions business and
service offering
• Healthy client base, RFP flow and new business wins
Phase I Acquisition In The US
• Full spectrum of services to support early drug development from
compound selection to proof of concept (and beyond – RA, PK/PD
• Clients may wish to choose individual functional services or the
integrated IDS package: regulatory strategy, development planning,
operational execution, evaluation and reporting
• The IDS business model is unique in our industry. The competition
offers a similar “shopping list”, but lacks the early phase drug
development integration
Development Solutions - Key Differentiators
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
ICON Clinical Research
Global President
Dr John Hubbard
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
Group Director Market
Development
Simon Holmes
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Robert Scott - EdwardsPresident ICON Central Laboratory
ICON Central Laboratories - Quick Facts:
• 425 staff in 4 Labs – NY, NJ, Dublin, Singapore
• 528 active studies Backlog >$126m
• Won 284 studies in 2007 (Strike rate = 48%)
• Built >600,000 kits in 2007
• Resulted >8,000,000 tests in 2007
• 87% of New Business is repeat
• 70% Clients say we are the best CL! (26%=same!)
Drivers of the Business:
• The search for subjects…– USA remains strong– Classic Europe remains steady– New Europe still growing very strongly– Asia/Pacific showing good growth/high interest
• More complex testing required…– More than just “safety testing”– Biomarkers and esoteric testing
Our Challenges:
• LOGISTICS– Getting a sample into a Laboratory; TIME/COST
• BROADENING MENU of TESTING– New technology, investment, having scale & mass
• FLEXIBLE IT system to support global activity– Data is what we deliver– From a global platform– Serviced & supported 24/7
STRATEGY:
• Expand Network to support market growth– Additional testing in Singapore: June 2008– New Laboratory in India: September
2008– Strengthen partnership in China: Ongoing
• Expand technology base to meet market demand– Ongoing: Example: Flow Cytometry network
• Upgrade IT systems to support business– Ongoing: Pilot phase successful
Global Flow Cytometry:
• Standardized analyzers (BD)
• Custom reagents from central source
• Link all cytometers to central hub for analysis/gating
• Build EDC system and give Client access
• FC is key for Oncology, Immunology, Cell Signaling
• NY, Dublin, Singapore, Japan, Argentina, India
• The challenge in meeting
Client demand for more
complex testing is simple:
VOLUME!
• Unlike Bioanalytical work in
the phase I arena, CL testing
is not batch-oriented.
• Margin comes from being
adept at managing volume.
• Volume, Informatics, Agility -2
0
2
4
6
8
Volume
Margin
Critical Success Factors:
• Global Coverage is essential…– USA, Europe, China, India, Asia/Pacific– Strong Logistics skills
• Broad Test Menu is essential…– 65% of testing is esoteric– Rapid deployment of technology on global scale
• Flexible IT system is essential…– Information to support proactive management– Global data & 24/7 Customer Support
Executive Chairman
Dr. John Climax
President
Corporate Development
Bill Taaffe
CEO
Peter Gray
Chief Financial Officer
Ciaran Murray
ICON Development Solutions
President
Dr Thomas Frey
ICON Medical Imaging
Chief Executive
Dr Ted Gastineau
ICON Central Laboratories
President
Bob Scott-Edwards
VP Corporate QA
Jo Coyle
VP Global IT
Mike McGrath
VP Corporate Training &
Development
Anne Wesler
VP Strategic HR
Eimear Kenny
Group Director Market
Development
Simon Holmes
ICON Clinical Research
Global President
Dr John Hubbard
Commercial VP
Brian O’Dwyer
COO US
Malcolm Burgess
Snr VP Global BD
Elizabeth Thiele
Snr VP Global Medical
Suzanne Gagnon
VP Global Data Management
Tom O’Leary
ICON Contracting Solutions
President
Sean Leech
Ted GastineauCEOICON Medical Imaging
Medical Imaging
• ICON Medical Imaging is focused on medical imaging endpoints for the development of pharmaceutical, biotech, and medical device products.
• Our industry leading technology enables clients through digital asset management, real time information access, and knowledge management.
Medical Imaging
• X-Ray, MRI, CT, Nuclear
Medicine, PET, Ultrasound,
Video, Photography
• Imaging shows how drugs
work inside the body
• Medical Imaging in clinical
trials is growing across
Phase I, II, III and IV
PET Movie
Medical Imaging
• Why?– See and measure structure and
function– Dose effects, target effects, side
effects– Better information faster
– Phase I: Internal decision making/ Compound screening
– Phase II: Dose, Safety, Efficacy, Accelerated Approval
– Phase III: Surrogate Endpoint, Disease Modifying Effect, Safety, Efficacy
Medical Imaging
• FDA Continues to Accept and Promote Imaging
• Critical Path: Janet Woodcock, MD Deputy Director, CMO FDA– “Imaging technologies are currently very important, and will become
even more crucial to therapeutic development”– “FDA, under its critical path initiative, is seeking to advance
development of these imaging biomarkers in an organized fashion”
• Oncology Guidance Document: updated May 2007– Supports the use of Objective Response Rate and Progression
Free Survival…all are imaging based endpoints– “When the study endpoint is based on tumor measurements (e.g.,
PFS or ORR), tumor endpoint assessments should be verified by central reviewers blinded to study treatments”
Medical Imaging
Genentech Clears Hurdle On Cancer Drug AvastinBy MARILYN CHASE and ANNA WILDE MATHEW Wall St Journal February 23, 2008; Page A3
– Accelerated approval based on Progression Free Survival– Independent Review of Imaging data was key
– "We are very confident of the effect of this drug on progression-free survival." said Richard Pazdur, director of the FDA's office of oncology-drug products.”
– “Dr. Pazdur said the Avastin decision didn't represent a shift for the agency, which has considered progression-free survival in a number of other approvals. "We're not boxed in to a survival-only mentality," he said. "We have to demonstrate regulatory flexibility."
Medical Imaging
• Therapeutic Initiatives– Oncology: 40% - 70%– Cardiovascular 40%– CNS: 10%-20%– Musculoskeletal: – Gastrointestinal: – Dermatology:
Medical Imaging
• Cardiac Safety– Cardiovascular function with
CT, MR, Nuclear Med, US, Angio
– Echo growing as measure of cardiac function
– Integrated offering differentiates ICON
– Adjudication of Cardiac Events powered by IMI technology (MIRA)
– Key academic relationships: Harvard, Duke, Cleveland Clinic, UCSF, Oxford (UK)
Medical Imaging
Medical Imaging
Medical Imaging
• Technology– MIRA ™
IMI’s leading image management/project tracking platform• Complete workflow• 24/7 access to images and information• Real time data
– SpeedTrial™IMI’s validated cancer review application
• Image display and analysis• Linked in electronic case report form• Ready to Read in as little as 2 weeks
– Image Knowledge Expert (IKE™)• Image based Educational/Information Portal• Built for Major Pharma• Available for clients and projects
Meta Data Image Storage
Computational Platform: HW-OS
Algorithms
Image Data
Standardization
Common Back-plane
QueryIdentify
RetrieveProcess
Project Management
Clinical DBLegacy Data
Sales and Marketing
User
PET User
MRI User
Remote User
Query
Retrieve Images or Information
Browser Interface
SERIES
STUDIES
PR
OT
OC
OL
S
SIT
ES
CA
SE
S CO
DE
S
Task Lists (Work Flows)
PR
OT
OC
OL
S
FILTERS
TASK LISTS
SERIES FOR PROCESSING
CODES FOR PROCESSING
Sean LeechPresident ICON Contracting Solutions
MARKET DEVELOPMENTS & DEFINITION
Staffing Industry Definition
The staffing industry can be broadly defined as a collection of
business that provides organisations and individuals with a range
of employment related services. The industry has evolved from
what was once very discreet types of businesses, for example
temporary hire, retained search, permanent placement, contract
project staffing and professional employer organizations (PEO) into
one industry with many sectors with the lines of demarcation
blurring as the industry develops further.
DEFINITION
• Shift in Business Models– Temporary to Permanent– Contract Teams– FSP– VMS– Unique Projects
• A Move to Full Service
• Global Positioning
• Fewer Vendors Consolidation(i3, KForce, Kelly, RPS, Inventiv)
• Candidate Acceptance
Move to scale & flexible solutions
MARKET DEVELOPMENTS
MARKET SCALE
WORLD STAFFING MARKETCountry US$B
USA 119.9
Europe
UK 47.8
France 25.3
Germany 10.6
Netherlands 10.2
Switzerland 5.1
Sweden 1.6
Denmark 1.0
Norway 0.9
Finland 0.9
ROW
Japan 26.2
China 2.7
South Africa 2.2
Clinical Staffing Market 2004-206E
0
0.5
1
1.5
2
2.5
3
3.5
2004 2005E 2006E
US
$ B
illi
on
s
Source: CenterwWatch October 2005
CLINICAL STAFFING MARKET
MARKET SPLIT
Regional Clinical Staffing Market Breakdown of Market
ROW 12%
EU 44%
US 44%
75%Temporary Help
15%Place and Search
9%Insourcing
1% Staff leasing
0%
1%
2%
3%
4%
5%
6%
UK
Nether
lands
Belgiu
mUSA
France
Finla
nd
South A
frica
Switz
erla
ndJa
pan
Irela
nd
Ger
man
y
Swed
en
Norway
Spain
Denm
ark
Italy
Poland
China
TEMPORARY STAFF PENATRATION RATES
ICS COVERAGE
INDUSTRY SECTOR GROWTH US 2005
11.50%
-5.00%
8.50%
25.40%
9.70%
-10.00% 0.00% 10.00% 20.00% 30.00%
Total Staffing Industry
Outplacement
PEO/Staff Leasing
Place & Search
Temporary Help
OUR GROWTH
2007 2008
Growth
EUROPE $30m €45m 50%
USA $16m €20m
25%
TOTAL ICS $46m €65m
41%
• Leverage centralised cost/management infrastructure.
• Project/Multiple assignment focus = reduced business/candidate acquisition cost.
• Layered in permanent placement revenue.
• Value added service – More $ same client.
• Candidate market therefore pricing is favourable.
Average Operating Margin
excess 15% within 2 years
OUR MARGIN OPPORTUNITY
STRATEGY
• Full Range of Staffing Services
• Global Infrastructure– Greater scale required in the US; acquisition a
possibility
• Flexible Solutions
STRATEGY
ICON CONTRACTING SOLUTIONS – INTERNATIONAL, NOT YET GLOBAL
SwedenDenmarkFinlandNetherlandsPolandGermany x2BelgiumFranceUK x3
New YorkNorth CarolinaTampa
PERMANENT PLACEMENT
CONTRACT PLACEMENT
FLEXIBILITYTRAINING
FROM ONE ASSIGNMENT TO INTEGRATED STRATEGIC INSOURCING
Permanent Placement
- Executive Search
- Search and Selection
- Basic Search
- Advertising
- Assessments
Contract Placement
- Project based
- Project or functional teams
- Vacancy Management
- Interim Management
- Administration
Training
- Traineeships
- Coaching
- Training and Education
STRATEGIC STAFFING SOLUTION
ICS is the staffing arm of ICON, providing
flexible staffing solution to the Pharma
Industry on an International basis
SUMMARY