The clinical data domain is going through major changes and is full of opportunities. This discussion delves into the industry with one of its biggest players.
Sramana Mitra: Let’s introduce our audience to you as well as Medidata.
Tarek Sherif: I’m Tarek Sherif. I’m a Co-Founder, the CEO, and Chairman of Medidata Solutions. We’re a New York-based company but global in operations. We’re focused on helping life sciences companies – biotech, large pharma, and medical device companies as well as academic organizations.
We help them to improve the efficiency, quality, and time-to-market for drugs that they work on and want to bring to market. The company was founded 20 years ago in 1999 the old fashioned way in a very tiny office. Seven folks started it with some friends and family funds. Over the course of a number of years, we built the business.
I’ve raised about $13 million of capital between 2000 and 2009, which wasn’t a great time for starting a company. We went public in 2009. Today, we’re close to three-quarters of a billion dollars in revenue. It’s very profitable. We have market cap of $5 billion and created a lot of value over the years and have a thriving business.
I’d say we’re one of the pioneers in bringing the cloud to life sciences and the healthcare IT. We have a very broad market reach. We have about 2,600 employees currently and 1,200 customers. Our model is Software as a Service. Close to 85% of our revenue is subscription based and 15% is from services. We’ve established ourselves as the global leader in our industry with a vast majority of the largest pharma.
18 out of the top 25 pharmaceuticals use our platform as the infrastructure for developing their drugs. The value proposition that we’ve had historically for our customers is to help them to collect and manage data and provide analytic tools that allow them to improve the efficiency of how they develop their drugs, the time to market, and the expense associated with it. It’s a very complicated and highly regulated process. It’s one that has historically involved a lot of manual processes which drove a lot of the inefficiency.
Over time, technology was brought to bear on some of the problems, but it wasn’t in a unified platform and it certainly wasn’t in the cloud. We’ve helped drive that transformation for our customers. Today, we probably run about half of all the clinical trials in the world that are done electronically. That’s a vast majority of all clinical trials. So we have a lot of data that flows through our infrastructure. We’re one of the mission-critical technology providers to our customers.
Sramana Mitra: There are a few companies that we track closely in your space. One of them being Veeva. Veeva has been a huge success in the healthcare IT space. Like you, this was a very capital-efficient company that went public and has been able to generate a huge amount of revenues. It’s growing very well. How do you position yourselves? What do you do that Veeva doesn’t do? Do you partner with Veeva? Do you compete with Veeva? How does that positioning differentiation work?
Tarek Sherif: Veeva really came up on the CRM side of the business or the commercial side of helping to manage documentation and providing support for sales organizations. We have a very deep vertical expertise in drug development. We actually work with the clinical data. We collect the data for our customers. We help manage it. We tackle the life sciences market opportunity with a very different perspective. It is very research-intensive. It has to do with ultimately their future pipelines of drugs that they want to bring to market. So it holds a very strategic value for them. Again, drug development is really the lifeline or the lifeblood for the life sciences industry. I guess the way I would position it is that we focus on the innovation part of life sciences. Whereas for Veeva, the vast majority of its business is really around helping to manage part of the commercial process and documents versus data.