RALEIGH — After moving to the Triangle to be closer to its customers, Clinverse is having some initial success chipping away at a huge market.
The Raleigh startup whose software is sold to drug companies and clinical research organizations that manage clinical trials has 45 employees today, nearly double its total of a year ago. And it anticipates an additional 20 hires over the next 12 months.
The privately held company doesnt disclose its revenue but says its on track to double this year. Steve Ayala, the companys co-founder and president, said Clinverse is contemplating whether it wants to accelerate its growth by raising another round of venture capital. To date it has raised $7.9 million in funding.
The company has a long way to go, but we are making a lot of progress, said John Crumpler of Hatteras Venture Partners, a Durham venture capital firm that has invested in Clinverse. Its still early.
The companys cloud-based software, ClinPay, automates the complex process of paying hospitals, physicians and research centers for work conducted in conjunction with clinical trials.
We spent the better (part) of two and a half years developing this from the ground up, Ayala said.
Launched in 2011, ClinPay is used by more than a dozen customers, including a biotech company that ranks among the worlds top five. (Clinverses customers insist that the company not disclose who they are.) Its currently handling payments to 2,200 investigator sites doctors offices, hospitals and research center in 62 countries.
How big is the potential market? Estimates of the amount paid to physicians, hospitals and research centers each year for clinical trial work range as high as $30 billion, CEO and co-founder Tim Immel said.
Among the CROs
Clinverse was founded in Charlotte in 2008 but moved two years later to the Triangle, which is the epicenter of the CRO industry. There are more CRO companies and workers here than anyplace else.
Understanding ClinPays appeal requires an appreciation of the complexity of the problem it was created to solve. In fact, Clinverse says that the payment process is so complicated that up to one-third of the time devoted to clinical trials is spent on administrative tasks and that the payments themselves are prone to error.
A drug company that wants to conduct a clinical trial that is, test an experimental drug on patients who volunteer to participate pays the investigator sites for the work performed. That includes doctors visits, routine services such as drawing blood, and a wide range of other work that varies based on what ailment the drug aims to treat.
The investigators dont bill the drug companies, however. Instead, the drug company sorts through the massive amounts of electronic data supplied by the investigator including information about the patients health and the safety and efficacy of the experimental drug that is irrelevant to the billing process to determine the services that have been rendered.
To complicate matters, the drug company negotiates rates individually with each investigator site. And there can be lots of sites. One of Clinverses customers is using ClinPay for a clinical trial involving more than 10,000 patients and 300 sites.
Then there are changes that inevitably are implemented as the clinical trial proceeds and the data start coming in.
Almost every clinical trial has an amendment to the protocol, such as a requirement for new procedures, Ayala said.
Manual, painful process
ClinPay automates this entire process and prepares the payment data so theyre integrated with the companys accounting system.
The calculation, tracking and accounting and payment distribution to sites in the clinical trial industry without a system like ours is a manual, painful process, Ayala said.
Immel was inspired to create Clinverse with his long-time friend, Ayala, while working as the chief financial officer of a biotech startup. The company outsourced to a CRO the task of paying clinical trial investigators.
It was very costly and, quite frankly, they did a horrific job, he said.
The kicker was that the investigators were upset that they werent getting paid in a timely fashion.
One doctor was owed in excess of $80,000 and hadnt been paid for six months, Immel said.
Immel decided to bring the task in-house only to discover that he couldnt find any software that did all that he wanted.
At Clinverse, Immel led a team of software developers that invented the patent is pending a way of solving the problem. Although there are competitors, Clinverse touts its software as the most comprehensive by far.
We like these businesses that really address unmet needs, said Crumpler, the venture capitalist.