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FOR MORE INFORMATION CONTACT:
Gina Blackie
+44 (0)1189333107 / 07775521487
gina.blackie@equaterra.com


LONDON and HOUSTON (May 15, 2007) – In the face of competitive pressures and shrinking profit margins, the pharmaceutical, life sciences, and biotech industries are accelerating and broadening their outsourcing initiatives. That conclusion and the reasons behind it are detailed in EquaTerra’s new Perspective report, entitled Outsourcing Trends in the Pharmaceutical Industry.

The report combines details from EquaTerra’s latest market studies with the insight of its advisors in the pharmaceutical, life sciences, and biotech industries. It notes that reducing costs is the primary benefit these companies seek when outsourcing back office support operations such as IT, HR, Finance & Accounting and Procurement. That benefit is cited by 56 percent of responding companies, while improving business results and enhancing shareholder ROI are the reasons cited by 44 percent.

In EquaTerra’s newly-released Pulse Survey report covering the first quarter of 2007, the firm’s advisors cited pharmaceuticals as the leading vertical industry segment in terms of outsourcing demand. The report also found that outsourcing demand in the pharma industry has increased since the first quarter of 2006.

“Pharma firms are very driven by cost reduction and capital avoidance,” observed Vicki Tauscher Phelan, Pharmaceutical and Life Sciences Practice Lead for EquaTerra. She explained that “Cost structure in pharma has shifted radically, and government buying, cross-border buying, insurance company price controls, generics, and aggressive consumers are all putting pressure on margins.”

The report also disclosed that there is far higher interest among pharmaceutical, life science, and biotech companies than among companies in general in expanding their current use of outsourcing. In this industry, 44 percent said they planned to expand outsourcing into new process areas – compared with 28 percent of companies overall. Also, 39 percent said they planned to expand outsourcing into new geographies or business units, compared with 30 percent of companies overall.
Also, Tauscher Phelan said, there is rapidly growing interest among pharmaceutical companies in outsourcing such areas as clinical data management and pharmacovigilance, the collection and analysis of data relating to the adverse effects of medicines once they are on the market.

Because companies in the pharmaceutical, life sciences, and biotech industries are used to working with partners, outsourcing does not represent a cultural shock to their system, the report observes. Thus they are not as reluctant as companies in some other industries to increase their reliance on outsourcing of back-office support operations such as IT, Finance & Accounting, Human Resources, and Procurement.

EquaTerra’s Outsourcing Trends in the Pharmaceutical Industry also covers:

Ø How pharma companies are responding. For example, they are beginning to aggressively “trim the fat” in overstaffed back office functions.
Ø How service providers are responding. They are working to improve the transition to outsourcing so pharma companies can reap the benefits sooner.
Ø The key questions companies must consider, such as how the service provider landscape fits their current outsourcing needs and how to maximize the effectiveness of their governance teams.


To obtain a copy of this report, please go to: http://www.equaterra.com/KR/research/pharma-perspective-all....


To speak to an EquaTerra expert about the Outsourcing Trends in the Pharmaceutical Industry report, please contact Gina Blackie on + 44 (0)1189333107; 07775521487; gina.blackie@equaterra.com.


ABOUT EQUATERRA
EquaTerra advisors help clients achieve sustainable value in their IT and business processes. With an average of more than 20 years of industry experience in over 600 global transformation and outsourcing projects, our advisors offer unmatched industry expertise. EquaTerra has deep functional knowledge in Finance and Accounting, HR, IT, Procurement and other critical business processes with advisors throughout North America, Europe and Asia Pacific. We help clients achieve significant cost savings and process improvement with outsourcing, internal transformation and shared services solutions. For more information on EquaTerra, please contact Liz Merrick at liz.merrick@equaterra.com; www.equaterra.com.



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