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International Clinical Trials

The Long Road Ahead

As new technologies emerge that are designed to help both site and sponsor meet their budget needs, Lori Shields at Medidata Solutions Worldwide identifies the potential increased revenue from an approved study drug if agreement were faster

Preparing and negotiating budgets for a clinical trial tests the relationship between a sponsor and site to its fullest. The sponsor and the site want to negotiate a fair price for the investigative work, but the sponsor obviously doesn’t want to pay more than necessary, and the site does not want to receive less. As with many clinical trial activities, technological tools are now being employed that help guide budgeting and negotiation to an equitable budget for both sponsor and site. Aside from the need to agree on fair compensation, contract and budget negotiation have been found to be the primary cause for delays in study start-up (1). In 2000, The Pharmaceutical R&D Compendium estimated a single day of delay in getting a drug to market cost companies at around $1 million (2). In 2003, the estimated loss had increased to over $1.5 million (3). At that level of increase, we could be experiencing lost revenue of $3 million per day in 2012. To counter this trend, new tools and methods are now being employed that offer more efficient and faster processes for developing and agreeing on the compensation.

Other benefits of newer tools include higher clarity in presentation of the budgets, pinpointing the difficult parts of a study, and trial progress reporting that both helps you manage site recruiting, while increasing compliance responsiveness.

This article explores two of the new approaches targeting increases in study efficiency. The first involves a measure of study complexity and its use to fine tune a budget to meet more closely the needs of the site and sponsor. The second involves integration of the steps that flow from protocol design, to preparing a budget for the protocol, to delivering the budget to the sites.


Driven by findings at the Tufts Center for the Study of Drug Development, the complexity of a protocol has emerged as a significant trial metric (4). While the metric has a number of applications, one of the best ways to understand the appropriate compensation for a study is to know the amount of work effort a site will be required to expend in implementing a sponsor’s study design. There are different ways to calculate work effort: the total number of procedures per completing patient can be counted, or the number of visits or number of unique procedures, or a specific work value to each procedure can be determined and multiplied by the frequency of each of those procedures. The tally is then compared to the results from similar protocols to understand the relative complexity of that study in relation to other studies of the same phase and indication. The budgeter now has actionable information with which to make better decisions regarding the appropriate total compensation.

Complexity of a protocol here refers to the calculation of work effort units for each procedure and the sum total of those units of effort, or ‘site work effort’. True study complexity also takes into account not only the site work effort of implementing a protocol, but other factors such as the enrolment issues that might be present due to the eligibility criteria of the study, the geographic placement of the study and regulations specific to those areas, competing studies, tolerance of a patient for the study, and so on.

Many departments responsible for forecasting and budgeting maintain their own history of costs negotiated in past studies. Fortunate are those whose company has given them the opportunity to supplement that information with industry data from their peers, typically supplied in the form of low, medium and high costs paid for each procedure. Often, a company will mandate which cost level should be chosen. These mandates are sometimes directed to cover all studies, or a certain therapeutic area within a company portfolio, or perhaps on previous history with certain geographic regions within a country. Today, by understanding the relative work effort a study requires, the budgeter can more accurately choose the appropriate cost level for a study and apply higher compensation for site personnel in studies that require higher effort. Indeed these also tend to involve a higher volume of data being captured, entered, monitored, and so on. Or, a lower cost can be chosen when the relative work level is low. When studies are budgeted at a salary rate, as are most global studies, adjusting for effort is especially critical as effort will then more directly correlate to the payment.

Over the last five years there has been a dramatic increase in inclusion of a ‘site start up cost’, above and beyond the initial payment percentage (5). Usually sponsors find it difficult to know how much to allocate for this fee, and there are sponsors who have not yet made a policy decision to retrieve those funds from non-enrolling sites (refundable start-up costs). Consequently, overpaying here can be quite costly. Making use of the comparative work effort of a study can help the budgeter adjust the benchmark and historical costs they have available for study start-up fees at the site level. Choosing the correct start-up compensation up front increases the chances of speedy budget negotiation.

Sites also are interested in the relative complexity of study design. How many times has a negotiator heard a site say ‘Your studies are more complicated than sponsor X’s studies’? But in addition to allowing the site to use this information as a negotiation tactic, it also provides the sponsor with the opportunity to address the issue up front. By stating their knowledge of the relative site work effort, and assuring the site has been taken into account in preparing the budget, the situation can be completely diffused. Both parties can now view the study more clearly. Sites can staff appropriately – perhaps the sponsor will even be aware that certain sites will need additional training. Investigators can use the information to appropriately set the expectations of study subjects, forewarning them of particularly difficult visits ahead of time to help protect against early withdrawal from a study.

A newer item appearing on negotiated investigator grants is reimbursement of site personnel for time spent with monitors. This is a normal function of a clinical trial, and should already be covered in any additional time paid for the investigator, study coordinator or nurse (assuming exams and other procedures are already paid for separately). However, when negotiators find themselves in a spot between a study team who insists on a particular site, and a site insisting on having that additional monitor fee, knowing the work effort of your study can be of great benefit. More work effort typically translates to more case report form complexity – which can lead to a greater number of queries, and more time with the monitor spent resolving those queries justifying a site’s higher fee.


Fair market value is the ‘price’ that is agreed to by a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts (6). Assuming that the budget was prepared with the work effort of the study in mind and by accessing reliable benchmark data, the budgeter has taken into account the ‘relevant facts’. Once the budget is prepared, there are a few distinct approaches to the next steps of negotiation and making sure the other party also has the relevant facts.

One option is to send every site the same budget, and wait for the changes to return. Another is to prepare regionally specific budgets, and a third way involves fine-tuning each budget specific to a site. All three options are valid, all have positives aspects and all have a few negatives. In many cases we live with just one approach for several quarters of the year, then tire of the negatives associated with that approach, so cycle to another. What is interesting is the influence the sites themselves can play in this decision – if one sponsor is using a methodology that the site finds preferable, the site will often elevate this fact to a sponsor who is using a less-preferred methodology (all information shared during negotiations is technically a negotiation ‘chip’ in the game).

Negotiation Style 1: The All-Out Push

This negotiation style takes a single budget and pushes it out to all sites. The benefit of this style is that the least amount of work is done up front, but there can be two painful results from this style. If the budgeter has ‘over-compensated’ for the study, many sites will quickly accept the budget, leaving the budgeter with the sinking realisation that they put too much money on the table. The other result is that each and every site will counter offer, requiring extensive negotiation time – both internally, to ‘sell’ the new budget up the chain, and externally with the sites, to find the area of agreement.

Negotiation Style 2: The Regional Approach

This style takes some additional time up-front to customise the budget to simply account for the real cost of living differences that occur geographically, and is usually not too time consuming (7). Most sponsors today use this approach with good results. It is still difficult to control change if the overall template budget had been significantly over- or under-compensated. Some sponsors mitigate this chance by phased negotiations – testing the budget with a few key sites in different regions before sending the regional budgets out in bulk.

Negotiation Style 3: The Fully Customised Budget

The methodology of completely customising each site’s budget is not new but is not widely used. Taking into account an individual site negotiation history can be an enormous up-front investment in time, but there are clear indications that this effort can significantly reduce negotiation cycle times as well as further the ‘partnership’ feeling a site has with the sponsor. So how can we get to this stage without completely ruining our timelines up front?


Time and money management gurus have touted onetouch management for years, and still do (8). It’s an effective, efficient way to reduce repetitive tasks while boosting productivity. While technology can sometimes be the culprit in enabling our ability to touch tasks more than once, integrated data systems can work for us when streamlining our workfl ow (9).

Today there are many choices available to companies looking to streamline workfl ow. Additionally, moving away from processes that ‘silo’ information is increasingly important. When bits of information are stored in a way that they are ‘tagged’, the metadata tag closely defines the information and enables it use across an organisation. Appropriate re-use and sharing of metadata insures consistency among departments while encouraging company collaboration and shared company standards.

Imagine a world where the study design information is captured as metadata and then shared downstream to a budgeting system, a data management system, a payment system, and a clinical trial management system. Using standards readily available today, this world can be ours. By taking advantage of the metadata as structured, searchable data, we can adopt a system that allows us to manage information in a way that allows us to act on it.

Structured study design information from a protocol can be transferred directly to a budgeting tool, where a budgeter can then quickly get to the decision-making process of fine-tuning instead of concentrating on the more tedious data entry. Intelligent decisions specific to geography or specific investigative sites are the most important part of good budgeting; allowing the technology to take care of the more mundane tasks. The completed budgets can be quickly loaded to an on-line negotiation tool permitting sponsors, or sponsor designates, and sites to follow the negotiation. Changes (or counter-offers) can be highlighted for quick notification. Comments for each change can be stored for future reference and as a proof of compliance. It is critical to remember that the true definition of ‘fair market value’ is the price that is agreed to today by two parties who are not under undue infl uence. Managing the reasoning behind each change during the negotiation is documenting how the fair market value price was arrived at, and is the proof of compliance in the final numbers. Look for an online negotiating tool that stores this information automatically, and allows reporting from it.

An electronic negotiation tool can provide other benefi ts as well. Negotiation cycle times are reduced simply by displaying how long each participant has had their turn. Dashboard views can be created showing where the overall spend is, what the status of the study negotiations are, and allowing a negotiator the ability to spot areas that require more specific attention or escalation. If company policy is for a study budget to be negotiated at the line item level, future negotiations with the same site can be speedily brought to closure because the last available negotiated cost is available for quick re-use. Pair negotiated milestone compensation values with data showing milestone completion from an electronic data management system, and the issue of late site payments, or invoices that are not itemised, is solved.


The industry has come a long way in increasing the speed with which we can electronically capture and analyse data collected in clinical trials. That same technology is now available to single-thread study design, budgeting, negotiating compensation to investigators and making payments with itemised invoices. These advances give sponsors the advantage needed to automatically document all transactions needed for a fair market value compliance programme, as well as provide reporting capabilities that might be required in the US pursuant to the Sunshine Act in the near future. It is tedious and time-consuming to track by hand the specific steps taken to establish a fair compensation offer along with reasons for change which occur during a negotiation. Companies need to adopt the appropriate technology to manage the task and allow it to do the work required. Turning words into searchable, actionable data is what is needed, and the capabilities are indeed available today.


  1. CenterWatch Survey of Investigative Sites in US, 2009
  2. Kermani F and Findlay G, The Pharmaceutical R&D Compendium, 2000
  3. Space S, Site Strategies to Improve ecruitment Advertising Effectiveness, CenterWatch Monthly 1: pp9-13, 2003
  4. Getz et al in American Journal of Therapeutics September/ October 2008 and Tufts Center for the Study of Drug Development, Impact Report 12(3), May/June 2010
  5. Shields L, Pepe S and Campo R, Sponsors Pay Heed, Applied Clinical Trials, pp46-48, August 2007
  6. United States versus Cartwright, 411 US 546, 93 S Ct 1713, 1716-17, 36 L Ed 2d 528, 73-1 US Tax Cas (CCH) ¶ 12,926 (1973) (quoting from US Treasury regulations relating to Federal estate taxes, at 26 CFR 20.2031-1(b)
  7. Shroff K, Six steps to streamlined contracting of sites for clinical studies, Journal for Clinical Studies 3(2): pp30-31, 2011
  8. Visit strategy/ as accessed 8 August 2011.
  9. Marwaha S, Patil S and Singh N, Using IT to speed up clinical trials, McKinsey on IT, pp12-19, 2007

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Lori Shields is Vice President of Data Operations at Medidata Solutions Worldwide. Lori is responsible for data quality and analytics, clinical data coding, and client relations. Lori also recently guided the development of two new products, both powerful additions to the family of clinical trial budgeting applications. Lori has been featured as a speaker at numerous industry conferences including the Model Agreement Group Initiative conferences, the Drug Information Association and the Center for Business Intelligence. Lori was honoured to be named one of the PharmaVoice 100 Most Inspiring People in 2009. Email:
Lori Shields
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