Telehealth’s role in the disruption of another healthcare subsector: Decentralized Clinical Trials

Patrick Walsh, Ziegler

Observers of the healthcare industry over the last several decades have witnessed telehealth’s disruption of numerous clinical services and specialties: radiology, behavioral health, neurology, and primary care, just to name a few.

Another healthcare subsector has been undergoing its own transformation with the assistance of telehealth – the “decentralization” of clinical trials.  And while decentralized clinical trials (DCTs) offer present-day benefits for the specific patients whose care is being transformed, DCTs also provide benefits to society at large through the reductions in time and cost needed to bring new life-saving drugs to the market.

What is being decentralized?

For many people learning about DCTs, the first question is how clinical trials work before being decentralized.  The clinical trial landscape is very complicated, but the basic interaction is: a patient who has been enrolled in a clinical trial will periodically report to a trial site to meet with a care team.  That patient will likely be on some sort of experimental therapy regimen, and during the visit to the trial site the care team will evaluate the patient, potentially apply additional therapy, take measurements, and conduct tests, all to monitor the patient’s response to the therapy.  These visits may take place over the course of days, months, or years and they may vary significantly in complexity (e.g., MRI versus a simple blood draw or interview).  The condition of the patient may also vary widely: some clinical trial enrollees are healthy individuals, while many are severely ill and have enrolled in a clinical trial in part because they have exhausted all other options for fighting their illness.

Organizations that collaborate to conduct clinical trials are leveraging technology to decentralize numerous aspects of the legacy “bricks-and-mortar” model.  This decentralization can take many forms, but it is easy to see how videoconferencing, remote patient monitoring, or even a caregiver visit to the home to administer drugs or draw blood, may eliminate the need for a patient to return to the trial site as often – thereby making the trial site less central to the clinical trial.

Why is this difficult?

Some may note that the examples of decentralization listed above are in common use in other parts of the healthcare landscape, and may ask why the decentralization of clinical trials even warrants separate mention.  The reality is that clinical trials are highly complex scientific experiments that seek to control all possible variables so that the effects of the experimental therapy can be isolated and studied.  Clinical trials are subject to significant industry and government regulation, and the data that are gathered from trials and submitted in order to get new drugs approved are highly scrutinized.  Applications can be denied for small departures from protocol or because of insufficient statistical evidence.  Also, there are often massive financial investments riding on the outcome of these clinical trials.

The legacy “centralized” model has developed around the effort to control all of these aspects of the clinical trial.  To now move this complexity out of a purpose-built, controlled environment and run the risk of contamination, botched protocols, errors in data capture, or even violations of privacy makes trial managers understandably nervous.

What are the benefits?

Even given the risks associated with decentralizing clinical trials, there is growing consensus, if not general acceptance, that DCTs are a force for good in the clinical trial landscape.  The bottom line is that the pharmaceutical and biopharmaceutical companies developing new drugs and sponsoring clinical trials want trials completed as quickly and as inexpensively as possible.  Looking through those lenses, many of the benefits of DCTs become quite intuitive:

• Convenience: If DCTs make clinical trials easier for a patient to participate in by reducing the number of trips to the site, patients may be more likely to enroll and less likely to drop out – meaning that the clinical trial can gather its evidence and conclude its study more quickly.
• Lower Acuity: By allowing patients to stay at home, DCTs are not only reducing the burden on ill patients and keeping them away from environments that may be dangerous in an immunocompromised state – it may also allow the trial operators to use extenders and other less expensive forms of labor to perform more mundane tasks, reducing overall cost of the trial.
• Increased Capacity: For many reasons, the number of clinical trials around the world is increasing, which puts strain on the relatively fixed capacity of trial sites. Incorporating aspects of DCTs into clinical trials adds capacity to the overall system, accelerating trials and reducing costs.

The list of benefits continues, and they have been recognized by the industry to such an extent that it is clear that telehealth’s disruption to the clinical trial landscape has affected positive permanent change.

About the Author

Patrick Walsh joined the corporate finance team at Ziegler in 2015. He specializes in mergers and acquisitions, strategic advisory and capital formation engagements for clients in the healthcare services and healthcare information technology sectors.

Ziegler is a privately held, national boutique investment bank, capital markets and proprietary investments firm. It has a unique focus on healthcare, senior living and education sectors, as well as general municipal and structured finance. Headquartered in Chicago with regional and branch offices throughout the U.S., Ziegler provides its clients with capital raising, strategic advisory services, fixed income sales, underwriting and trading as well as Ziegler Credit, Surveillance and Analytics.

Ziegler published a white paper on telehealth, “Deconstructing the Telehealth Industry: Part III.” To obtain a copy of the white paper, please visit: https://www.ziegler.com/telehealth-part-iii.

Disclosures

This document may contain forward-looking statements, which may or may not come to fruition depending on certain circumstances. Information contained or referenced in this document is for informational purposes only and is not intended to be a solicitation of any security or services. B.C. Ziegler and Company | Member SIPC & FINRA