Undervalued IRC Emerges as a Strategic Asset in Clinical Trials: HuTao Tech Files IPO Prospectus

DIA 2023 China Annual Meeting, the most prestigious and influential global conference on biopharmaceutical R&D, was held at the Suzhou International Expo Center from June 16 to 19. At this year’s DIA China Annual Meeting, hundreds of domestic and international speakers engaged in in-depth discussions on topics of greatest concern to the industry and regulatory authorities—such as drug development strategies, quality, and innovation—where breakthrough exploration is most needed, thereby providing innovative insights to pave the way for faster and better new drug development models.

The DIA China Annual Meeting has spanned 14 years, serving not only as an academic sharing platform for pharmaceutical professionals but also as a crucial stage for CXO companies to showcase their capabilities. Amidst the explosive growth in the number and complexity of domestic clinical trials, CXOs have become powerful partners for pharmaceutical enterprises seeking cost reduction, efficiency improvement, and accelerated new drug launches. However, this booming prospect has driven the CXO industry into severe “involution.” The ability to identify unique value propositions and deliver high cost-performance services has become the key to success in the current competitive landscape of survival of the fittest.

A term frequently heard in the biopharmaceutical industry is “involution.” Target selection is prone to involution, as are validated novel therapeutic approaches. At the DIA Annual Meeting, contract research and manufacturing organizations (CXOs) providing R&D outsourcing services also extensively discussed “involution.” With an increasing number of new entrants and a growing number of companies focusing on the same segments, the industry is facing challenges of homogeneous competition and increasingly crowded market tracks.

However, the development trajectory will not be characterized by a “hundred flowers blooming.” In this competitive race of survival of the fittest, comprehensive leading companies hold a competitive advantage. Meanwhile, enterprises with distinct strengths at specific stages of the industry chain and robust flagship products will also stand out. Companies with ambiguous positioning and weak competitiveness will face increased uncertainty.

“Integrated development is beneficial, but it does not mean pursuing every opportunity; the key lies in cultivating one’s irreplaceable competitive advantages,” said Ren Wei, CEO of Beijing Hutao Computer Technology Co., Ltd. (hereinafter referred to as “Hutao Tech”). “Hutao has always positioned itself in clinical operations, leveraging its profound clinical resource advantages. The IRC imaging assessment system we developed, based on hospital-side resources, is an absolutely ‘resilient’ flagship product.” As an emerging digital CRO company in China, Hutao Tech’s core advantage over other CRO firms lies in its deep clinical resources. It positions itself as a bridge connecting both parties—serving as an adhesive between pharmaceutical companies and hospitals—rather than merely taking orders from pharmaceutical companies.

It is understood that 60–70% of the costs in new drug development are incurred in transferring hospital data to Electronic Data Capture (EDC) systems. Consequently, the majority of Contract Research Organizations (CROs) have recognized the necessity of digital investment and are heavily investing in building big data platforms to address issues related to manual data entry and the structured storage and retrieval of clinical data. In contrast, imaging data has received relatively less attention. However, with the increasing number of clinical trials using Independent Review Committee (IRC) assessments as surrogate endpoints, there is now a growing emphasis on imaging data and the quality of image interpretation. Currently, there are few specialized IRC companies, and those performing well are even fewer.

In China’s new drug clinical trial landscape, the Independent Review Committee (IRC) remains a relatively novel concept, and many practitioners still have only a partial understanding of the “independent imaging assessment” services provided by specialized IRC vendors. While IRCs are a critical mechanism for minimizing bias in efficacy evaluation of new drugs, discrepancies in independent imaging assessments remain common in clinical trials. The primary reasons include: inconsistent interpretation of assessment criteria such as RECIST and iRECIST; insufficient expertise in professional image interpretation, leading to substantial variations in efficacy assessment or even reading errors—for example, measurements taken at different window widths and levels, resulting in measurement deviations; the use of differing evaluation criteria, causing significant misjudgments or missed diagnoses; and inadequate understanding of the investigational drug, leading to imaging artifacts such as pseudoprogression or false new lesions.

Unlike routine clinical care, clinical trials impose stringent requirements on image interpretation. Variations in image acquisition and interpretation can significantly bias trial endpoints, potentially leading to trial failure and unnecessary losses. A retrospective study published by ASCO in earlier years demonstrated that investigators tend to overestimate response rates (RR) and progression-free survival (PFS) compared with Independent Review Committee (IRC) assessments, resulting in erroneous conclusions of exaggerated efficacy. This may partly explain why some newly approved drugs have provided little to no additional clinical value post-launch.

“IRC has become an invisible asset for innovative pharmaceutical companies to further seek differentiation and enhance the competitiveness of their product portfolios.” Ren Wei emphasized that while independent blinded review is important, the core of IRC setup is not limited to blinding; the key lies in improving data quality to accelerate clinical trials and empower the value of endpoints for new drugs.

“The IRC industry’s most pressing challenges are efficiency deviations and quality control,” said Zou Bing, Head of IRC Business at Hetao Technology. Many IRC companies focus heavily on sponsor requirements while paying little attention to the conditions and workflows at the source of imaging data generation—the hospital side—which can lead to efficiency deviations. For example, in most IRC workflows, CRCs copy data from the hospital’s imaging system and upload it, only discovering during the upload process that the data is non-compliant. This reactive approach may result in visit window violations, prolonging the overall clinical trial timeline and increasing costs.

From a quality control perspective, it is relatively easy to focus on the quality of internal company processes; the challenge lies in quality control at the imaging source. If deviations occur during scanning, there will inevitably be biases in subsequent image interpretation results, which are bound to bring unpredictable consequences to the sponsor. Zou Bing believes that “solving this problem is quite straightforward: direct efforts toward the hospital side, ensuring that clinical experts understand the trial itself, thereby facilitating faster and better advancement of the entire clinical trial.”

Ensuring the quality of imaging data and having professionals review the images has become a shared expectation in the IRC industry. At a DIA sub-forum, an expert shared a case in which inadequate imaging expertise among investigators led to poor identification of baseline target lesions, resulting in the death of an enrolled patient within days and compromising the overall trial evaluation, which resonated with the audience. High-quality data and assessments not only help meet stringent regulatory requirements but also reduce costs, allowing sponsors to avoid the expenses and time delays associated with re-analysis or re-acquisition of imaging data due to poor quality.

Zou Bing introduced that Hutao’s IRC product is entirely self-developed. With the support of an intelligent system and top-tier imaging expert teams from Beijing Tiantan Hospital, Beijing Chest Hospital, and other leading institutions, the IRC services provided by Hutao Technology can maximize the stability of image interpretation. Furthermore, based on pre-quality control, patient imaging data can be managed at the hospital site in accordance with clinical trial requirements.

“Our focus is on improving quality and efficiency. In addition to implementing full-lifecycle management of imaging data quality, we also prioritize reducing the burden on researchers and empowering them,” said Zou Bing. During the development of the Independent Review Committee (IRC) platform, it was observed that physicians’ image reading workflows require repeated, manual review of historical scans for morphological comparison, assessment of disease progression over time, as well as lesion measurement, annotation, and calculation. This process is not only cumbersome and tedious but also prone to human error. Particularly in large-scale retrospective reviews involving millions of images and thousands of visit cycles, tight deadlines and heavy workloads—compounded by issues such as poor imaging data quality and inaccurate content—pose significant challenges to IRC teams.

“Our IRC system, built on automated computation, significantly enhances physicians’ work efficiency. With the system, tasks that previously took one hour can now be completed in just 10 minutes and sent out with a single click,” said Zou Bing. He emphasized that deeply understanding business logic, meeting user needs, simplifying cumbersome processes, and empowering operations are key to business success.

“Many aspects are not technically difficult; the key lies in having strong hospital-side resources and effective coordination,” analyzed Zou Bing. Taking data burning to discs as an example, since it involves patients’ source imaging data, it requires navigating numerous approval processes and can only be performed when the hospital’s executing department is available, a step that typically takes two weeks. Leveraging its clinical resource advantages, Walnut Tech has achieved real-time integration between its disc-burning hardware and hospital imaging systems, reducing the disc-burning process to just 3–5 minutes. This significantly improves the timeliness of data collection and facilitates the rapid initiation of clinical trials.

The AI algorithm-driven intelligent IRC application, combined with robust clinical coordination capabilities, has established a formidable “moat” for Hutao Technology. Furthermore, the company plans to integrate AI imaging into its IRC service chain, achieving full-cycle management of imaging data from acquisition to interpretation results. Meanwhile, through in-depth collaboration with imaging experts, the company is committed to shaping industry standards for imaging data. “The IRC system offers an excellent user experience and strong user stickiness. To-C users are willing to pay for such a convenient and easy-to-use tool. In this way, while we provide system services to these experts, these physicians also join our expert database. This enables us to work together toward industry standardization and build a better ecosystem for imaging services,” said Zou Bing.