Are We There Yet?

While returning home from the MAGI East 2015 Conference, I happened upon an article about time management.  The article offered the observation by psychologist Guy Winch that people who are chronically late for meetings typically suffer from “. . . blind spots in the calculation of time. They’ll figure out how long it takes to drive from point A to point B, but they won’t account for the time needed to leave their apartment, get to the parking lot, and get in their call.  Small-ticket items add up, causing them to be late.”[i] The article seemed particularly timely.

In more than one session at the conference, either in those I presented or attended, there was discussion about the disparity between how much time is budgeted by a sponsor to complete various protocol required procedures versus the actual time required.

Discussions like those above are necessary and beneficial for maintaining a healthy relationship between Sponsors, CROs, and Investigative Sites.  However, talking simply is not enough.  So let me offer a solution.

The solution is to conduct a time study.  Developed by Frederick Winslow Taylor, the principals and processes for performing a time study are detailed in his book The Principles of Scientific Management.[ii]   Applying this to clinical research, a study is done in which those responsible for performing the individual procedures and tasks required by the protocol (including other study documentation such as the lab manual, eCRFs, training materials, Informed Consent Form (ICF), and monitoring plan) perform “mock” procedures, capturing the actual time required under real-world conditions to conduct the series of tasks required to complete the procedures.  When done properly, a time study provides a realistic view of the time and effort required to conduct the procedures as they would be performed in an actual clinical research site setting.

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A Penny for Your . . . Receivables

For most clinical research Sites, cash flow is a struggle.  Aside from being underfunded in general, frequently Sites historically do a poor job of negotiating their budgets and payment terms and managing their accounts receivables, which creates an even bigger need for financing.

Even when a Site succeeds in negotiating monthly payments, the payments are frequently late, often by months.  The resulting financial gap creates significant stress on a Site’s finances and often leads to Sites losing profit and even closing their business.  According to a recent study completed by Tufts Center for the Study of Drug Development, turnover rates have been getting progressively worse among more active investigators.  “Operating conditions for clinical trials have noticeably worsened in recent years,” said Ken Getz, associate professor and director of sponsored research at Tufts CSDD.  [i] Adjusted for inflation, he says, the typical study grant has been declining 3% a year, on average, on a per-patient basis.[ii]

To remain viable, Sites must establish a source of cash to fund their operations so they are not vulnerable to the effects of late payments.

Funding options vary depending on how long the Site has been in business and how well it has performed in the past.  Some of the options available to the owners of a Site include:

  • Self-funding
  • Personal Line of Credit from a bank
  • Credit cards
  • Home equity loan
  • Advances and start-up fees from Sponsors/CROs
  • Loans or investments by friends and family members
  • Loans or investments by professional investors
  • Small Business Administration loans
  • Bank Line of Credit
  • Receivables financing (factoring)

New sites are particularly challenged with cash flow, since they don’t have sufficient history as a business to obtain loans from convention lenders (Banks and the Small Business Administration) and rarely present a sufficient risk/return profile to attract professional investors (Business “Angels” or Venture Capital).  Consequently, they have far fewer options and usually must rely on some form of self-funding (personal savings, credit cards, loans/investment by friends and family, or factoring.

Even well established sites can have difficulty using a bank Line of Credit (LOC) because accounts receivable outstanding more than 90 days are typically excluded from the Bank’s calculation of what receivables are eligible to fund.

So, what is a Site supposed to do?

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Building a Financial Partnership with Sponsors and CROs

While preparing to lead a discussion titled “Building a Financial Partnership: Understanding Sponsor/CRO Difficulties and How it Impacts Site Billing and Payment” at the upcoming  ACRP 2nd Annual Site Strategy Forum, PCRS Network’s CEO, John Neal, happened upon a blog post by our friends at Clinical Accelerator® that deals with issues between Sponsors and CROs.  This article provides interesting background information to the discussion about Sites building a strong partnership with the Sponsors and CROs with whom they work.

We will touch on the impact of the relationship between Sponsors and CROs in the session at the Site Strategy Forum. We hope to see you there on Sunday, April 26, 2015.

Thank you to Nik Nikitin, CEO of Clinical Accelerator for permission to reprint the article.

An insight into relationships between CROs and Sponsors – Industry survey

Originally posted at on October 22, 2014

The AVOCA group, founded in 1999, is a consulting and survey research firm based in Princeton, NJ.  Each year, AVOCA conducts industry research to measure current trends in clinical outsourcing and produces a report on the results.  This year’s survey, recently published, concerned “Intelligent” Approaches to Clinical Development: an interesting insight into Sponsor – Clinical Research Organisation requirements, approaches and relationships with their general perceptions of outsourced clinical development and application of novel approaches to it.

“Intelligent” clinical development approaches are defined as those that make use of operational (e.g. performance) and/or clinical data, along with appropriate analytical techniques, in order to optimise aspects of clinical development such as protocol design, Investigator selection, patient recruitment approaches, resource allocation (e.g. risk-based monitoring), etc.

127 respondents from 83 pharmaceutical and clinical service provider companies participated in the research.  These individuals reported on how “intelligent,” data-driven approaches are being utilized in outsourced clinical development today, from the perspective of both sponsor organisations as well as the service providers that support them.

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Pain in the Cash!

Clinical research sites (Sites) play a crucial role in accelerating clinical research. The Pharmaceutical industry relies on the independent research conducted at these Sites to assess the efficacy of new drugs developed to help save and improve lives.

When it comes to the financial health of Sites, besides negotiating a budget that covers all direct and indirect costs, and that provides a reasonable profit, nothing is more important than cash flow. Many a profitable Site has closed simply because it ran out of cash while waiting for Sponsor payments.

Because so many Sites initiated to conduct studies under-perform and fall short of Sponsor expectations for enrollment, Sponsors are reluctant to provide study advances. Increased frequency of payment requires additional work on the part of Sponsors or their CROs, so they prefer to pay less frequently than is the norm in other industries. In the absence of start-up fees sufficient to cover the actual costs of start-up, significant advances or timely monthly payments, Sites are left to finance the majority of start-up costs, out-of-pocket costs like subject stipends and outside services (e.g. radiology, specialists, study supplies, etc.), and staff and overhead costs from their own resources.

Even though a Site may generate accrual based revenue by completing study visits, payments from Sponsors may lag by 60 to 120 days or more, depending on the frequency of payments negotiated. While accounts receivable may grow, Sites frequently suffer negative cash flow on the majority of studies they conduct.

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Jack be Nimble

As the world of clinical research continues to evolve, Sponsors and CROs continue to search for the magic formula to select sites that meet quality requirements while also meeting enrollment needs.  At the same time, Sites struggle to get on the radar of Sponsors and CROs in order to be selected to conduct studies.  While some Sponsors and CROs claim to have solved the equation publicly, many of their own employees confide privately that their results vary little from those reported by respected sources like Tufts CSDD that say that approximately 48% of all sites selected to conduct studies either never enroll a single subject or fall short of enrollment targets.[i]

Regardless of what formula is applied by whom, a universal element of the formula is turnaround times.  It seems reasonable that this would play a role in the selection process, since every delay increases costs to Sponsors.  Unfortunately, rarely are Sites provided details of the metrics captured by Sponsors and CROs related to turnaround times and study delays perceived to be caused by Sites.

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Needle in a Haystack

Finding high quality clinical research sites that will perform well on any particular study can be a daunting task. Historically, Sponsors or CROs send blinded study information en mass to sites, study brokers, and others, resulting in hundreds (and, in some cases, thousands) of responses.

Completed study feasibility questionnaires are then evaluated and prioritized, additional follow-up completed, and the field narrowed down to some smaller number for further evaluation. For most studies, as many as three times the number of sites ultimately needed to conduct the study will participate in a Pre Site Selection visit or call. Subsequently, the sites that make the “final cut” enter into the negotiation phase, during which some sites are eliminated from the mix because agreement cannot be reached on either the budget or contract terms. The current process is fragmented and takes months of time and millions of dollars to complete for the typical study, adding to both the cost and the time required to complete clinical studies.

The process described above has remained largely unchanged for decades, rooted in a time when most research was conducted by a fairly small number of Principal Investigators primarily at academic medical centers (AMC). Over the last two decades, a new breed of clinical research site unaffiliated with an AMC has become the norm. Because these sites are independent and can adapt and react to Sponsor and CRO needs more quickly than AMCs, they have become the sites of choice of most Sponsors and CROs.

The majority of this new breed of Site is for-profit and is often dedicated solely to clinical research, providing no standard of care services to patients. That alone contributes to the budget tensions between Sponsors/CROs and Sites, because these sites must be compensated for procedures that would otherwise be reimbursed by insurance and other third party payers as standard of care procedures.

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May I see your report card?

Growing up, report card time was a big a deal.  We were held to high standards.  Good grades drew rewards.  Poor grades led to loss of free time, in favor of more studying in order to improve the grades on the next report card.  The anticipation that came with each report card, and the work it took to “make the grade,” was good.

It continues to surprise me how few Sites receive “report cards” after completing studies.  Even fewer receive performance feedback regularly during the course of a study.  In many cases, the information is available.  Too bad for the Site, Sponsor, and the CRO, because it is impossible to assess how you measure up without feedback.

There are many ways to measure a Site’s performance.  Most Sponsors and CROs use this information to help identify outliers, both good and bad.  It gives them an early warning signal to take quick action with underperforming Sites and provides insight as to what the high-performing Sites are doing differently that results in their better performance.  Since many Sponsors and CROs use this same information to determine whether a Site is considered to conduct future studies, Sites should be keenly interested in receiving feedback on their metrics.

So when should Sites receive feedback?  The answer is “early and often.”  It is critical for Sites to receive information about how they are performing versus how all Sites conducting the study are performing.  At a minimum, Sites need to receive measurements of the number of patients screened, enrolled, and randomized by other sites.

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What can be done to reduce delays in clinical research?

The World Health Organization estimates that over 125,000 people die every day of diseases worldwide.  Infections alone account for 26,000 deaths daily.  That is a staggering number.

It is no secret that it takes roughly 12 years to bring a new drug to market, 6 to 7 of which are the clinical research phases.   In human terms, every day we can eliminate from study delays overall saves lives.

Most people I know who are involved in clinical research are committed to the cause of finding cures and bringing better therapies to market as quickly as possible.  Few have any control though over the activities involved pre and post-clinical trials.  Even so, we can each make a difference where we are.

It has almost become sport to sit back and point out the efficiencies of other parties in the process.  All the while, inefficiencies probably abound within your own organization.

Consider just a few causes of delays that come to mind:

  • Poorly conceived protocols that result in amendments
  • Non-core procedures and data that increase the time required to complete subject visits and to enter and evaluate data
  • Ineffective recruitment processes that delay study accrual
  • Slow response to queries
  • Slow response to email and other communications
  • Conflicting policies
  • Delays in IRB approvals that stall enrollment
  • Redundant processes

Obviously not an exhaustive list, you can probably think of many more causes of delays.

A few examples amplify the opportunity to save time in conducting clinical research studies.  First, a study conducted in 2012 by the Tufts Center for the Study of Drug Development found that an average of 22.3% of all clinical trial procedures are considered to be non-core[i].  Certainly there is justification for performing some of these procedures, but collection of purely extraneous data only adds to the time and cost to complete clinical trials.

Second, although social media is routinely used successfully by many Sites, many study Sponsors will only reimburse sites for out-of-pocket costs for traditional advertising.  In one study [ii] the authors found use of social media to be 12 time more effective than recruitment using traditional sources.  Recruitment via social media requires staff time, so there is a direct cost to Sites.  It appears that time can be saved by adopting new and evolving recruitment methodologies, which should be supported by Sponsors.

In a third study evaluating the cause of queries for a multi-national study[iii]

  • 15% were due to missing baseline or event ECGs
  • 23.1% were due to missing dates or signature
  • 14.7% were due to erroneous or inconsistent Subject Identifiers

Mistakes happen, but the above demonstrates that just a little additional care by sites in collecting and reporting data could decrease the time required by both Monitors and Site staff and reduce study delays.

No one, whether Sponsor, CRO, Site, or IRB, own the whole problem, but we all have a stake in creating solutions.

So, what can you do today to minimize delays over which you exercise some control?




[i] Extraneous Data Collected in Clinical Trials Cost Drug Developers $4 Billion to $6 Billion Annually,

[ii]Shere M, Zhao XY, Koren G (2014) The Role of Social Media in Recruiting for Clinical Trials in Pregnancy. PLoS ONE 9(3): e92744. doi:10.1371/journal.pone.0092744

[iii] Elizabeth P Tolmie, Eleanor M Dinnett, […], and Allan Gaw (2011) Clinical Trials: Minimising source data queries to streamline endpoint adjudication in a large multi-national trial


Who should bear the cost of not-for-cause audits?

We often hear that the cost to support a not-for-cause audit is “a site’s cost of doing business,”(overhead) and, therefore , a Sponsor will not reimburse for such costs. That would imply that not-for cause audits occur simply because a site is in the business of conducting clinical trials, not because of the site’s conduct of a specific clinical trial.

“Not-for-cause” vs. “for cause” audit

Before addressing who should bear the cost, it is important to distinguish between a “not-for-cause” audit and a “for cause” audit.

A for cause audit occurs when a regulatory body suspects that something is awry with a site, whether generally or because of a specific event. A for cause audit occurs when some form of wrongdoing is suspected. A for cause audit is clearly out of the control of the Sponsor, so a site selected for a for cause audit should expect to pay the full cost of preparation and support of the audit.

Contrast that with a not-for-cause audit, which generally is triggered because a) a site is a high enroller in a specific study or b) it is selected at random based on statistical criteria established by the regulatory body. Regardless of why or how a site is selected for a not-for-cause audit, not every site will be audited that conducts a particular study. As subtle as that difference may be, it establishes whether the cost should be included in overhead or whether it is specific to the conduct of a particular study, and should be supported by the Sponsor.

What constitutes Overhead?[i] defines overhead as “ . . . all ongoing business expenses not including or related to direct labor, direct materials or third-party expenses that are billed directly to customers. Overhead must be paid for on an ongoing basis, regardless of whether a company is doing a high or low volume of business.” Note the phrase “regardless of whether a company is doing a high or low volume of business.”

Since conducting a particular study relates to the volume of a site’s activities and is not fixed, the cost associated with a not-for-cause audit is a variable cost associated with the specific study for which the site is audited. Even if every site that conducts the same study will be audited, because of the random nature of the cost and its variability, this cost should not be included in overhead.


Since only a subset of sites that conduct a specific study will incur the cost of a not-for-cause audit, sites that are audited should be directly compensated for the additional cost.




Commitment to Training as a Predictor of Performance

What is it, really, that can be used to predict the performance of clinical research sites? Certainly past performance provides a clue to possible future performance. Of itself though, past performance does not guarantee future performance. Many sponsors have been frustrated after selecting a site because it had performed well on a prior study, only to fail on a current study. Why does that happen?

It is necessary to look deeper; to look at what made the site a top performer to begin with, and then to determine if the same conditions exist today.

Ultimately, a clinical research site is a team working in unison to conduct a series of clinical research studies. Like any team, there are leaders and followers. Intended or not, a culture exists that affects the team’s performance – for good or bad.

In organizations that sustain a high level of performance over long periods, the culture emanates from the core leadership’s beliefs and deep-seated values. These may be embodied in a mission statement or may simply come to be understood over time, but they form the basis for a culture of integrity; a drive to succeed; a commitment to do things well, every time.

As Dr. Connie R. Curran, President of Curran Associates, a healthcare consulting company stated, “These organizations have rejected the myth of the single, isolated, superhero.” 1 Instead, they recognize that long-term, sustainable performance depends on having a broad range of well-trained professionals who consistently follow effective, efficient processes in pursuit of achieving the best possible outcomes. They “start the race with the finish line in sight”2, envisioning and planning for what they want to be and to be known for, and then build each of the elements necessary to allow them to achieve those goals.

Processes and People

At the core of consistency are processes. When effective processes are created and implemented, you can expect to begin to see consistent results. We are all familiar with standard operating procedures (SOP’s), which in clinical research become the site’s operating equivalent to the Bible, but what I am speaking of goes even further. It is more than simply who does what, and when. It gets down to the level of attitude and sets expectations right down to how people are greeted in the lobby or on the phone. Many notable organizations come to mind when you think of companies that have achieved this level of consistency and success. Among them are Southwest Airlines and Nordstrom.

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