clinical trial costs

 

Have you been tasked to develop clinical trial budget? Well you’re in luck because I’m going to share everything you need to know about clinical trial costs.

Clinical trial budgets are often put together in haste. The focus is on getting the product to market as quickly as possibly. Or revenues and profits.

Developing a clinical trial budget can be a confusing exercise for sponsors and CROs. There are too many cost variables to account for.  

This post covers the key cost drivers for medical device clinical trials. If you are a researcher or financial analyst working in clinical research space or simply curious about clinical trial costs, this post will serve you well.

So let’s get started.

1. Patient Grant

Patient grant costs are broken down into screening, baseline and follow-up visits and medical imaging costs.

a. Screen failures

Clinical trial protocols have inclusion and exclusion criteria to qualify patients. Strict inclusions and exclusion criteria reduce the available patient pool for trial enrollment. Clinical sites spend physician and site coordinator time to screen for potential patients.

During the budgeting process, map out the complete patient screening workflow. Speak with a few clinical sites to understand how many patients they would have to see in order to find one qualified patient. For example, a site may need to screen four patients to find one qualified patient. Understand how many hours the site is spending on screening activities and reimburse accordingly. Therefore it’s not unusual to reimburse sites anywhere between $50 to $250+ per screen failure.

b. Baseline/index procedure and follow-up visits

Depending on the clinical trial design, data is collected at baseline or index procedures and follow-up visits. The site coordinator is generally responsible for entering the data in the case report form. Sites are reimbursed for the time spent to collect clinical trial data.

Based on number and type data fields you are collecting, you’ll want to estimate the site coordinator time needed to collect and input trial data. Then multiply the estimated coordinator time by the hourly bill rate to obtain the fair market value for each patient visit.

In some cases, sponsors may choose to reimburse patients. Reimbursement for patients can include paying for their participation, reimbursement for travel, meals or overnight hotel stays.

c. Non-standard of care tests

Medical device trials may require non-standard of care tests such as medical imaging scans. Insurance companies or medical care agencies generally do not reimburse non-standard of care costs. Therefore you should include them in your clinical trial budget.

d. Procedure costs

Medical payor such as Medicare or private insurance may reimburse clinical trial procedure costs. If procedure reimbursement is available, you don’t need to budget for the procedure cost. In case a brand new procedure where no reimbursement available, budget for the procedure costs.

2. Site costs

a. Start-up fees

Clinical sites spend significant time to initiate a new clinical trial. Sites are responsible for site specific informed consent development, Ethics Committee (EC)/ Investigational Review Board (IRB) submissions, staff training including participation in investigator/ site coordinator meetings and site initiation visits and execute a clinical trial contract. It is typical for sponsor to pay anywhere between $2000 – $5000+ in site start-up fees.

b. EC/IRB fees

EC/IRB fees are in addition to site start-up fees. These fees cover the time spent by EC/IRB to plan and conduct review of the clinical trial protocol and other associated materials. Many EC/IRBs update and publish their rates annually.

c. Close-out fees

Close-out fees include time spent by site staff to reconcile clinical trial data, finances and regulatory documents during study closure. Not all sites require this payment but has started to become a more common practice in recent years.

d. Storage Fees

Government regulations require that clinical trial data be stored after study close-out. The duration for storage can range from 2-years to permanent storage. Thus it’s not uncommon for sites to have boxes of regulatory paperwork that need to be stored once a clinical trial ends. The storage fees vary by country and site.  

Some sponsors make arrangements for site to send trial documents to an offsite storage location. Due to country specific regulations, a site might be unable to move documents outside their country.

e. Administrative overhead

Clinical sites may require as much as 30% administrative overhead in addition to per patient grant amount. This cost covers management and legal resources needed to provide clinical research oversight and legal review of clinical contracts respectively.

f. Site Management Organization (SMO)

In certain countries such as Japan, data entry and collection tasks are outsourced to SMOs. For post approval studies, sites do not research coordinator support. Thus sponsors are expected to hire SMOs to support the site or pay the sites to hire their preferred SMOs.

3. Non-patient costs

a. Clinical Evaluation Committee (CEC)

Adverse event and endpoint data is adjudicated by a non-biased, independent CEC. CEC is generally composed 3 or more physicians. CEC members review adverse events and trial endpoints in a team setting or independently.

A sponsor can hire physicians to serve as the CEC and reimburse them at fair market value rates. It is more cost effective for sponsor to contract with physicians directly. But the sponsor has to assign its own resources to manage the CEC.

The other option is for the sponsor to outsource management and conduct of CEC activities. However this option is more expensive because you are hiring professionals to manage the CEC.

CEC is a very important component of medical device clinical trial. Adjudicated adverse event data is highly regarded by regulatory agencies and the physician community. In many cases, it is a requirement to have adjudicated adverse event data in order to get the product on market.

b. Data Safety Monitoring Board (DSMB)

DSMB is sometimes known as the the Data Monitoring Committee (DMC). According to IMARC research, the purpose of the DMC is to advise the sponsor on continuing safety of the trial subjects and those yet to be recruited and provide continuing validity and scientific merit of the study.

For budgeting purposes, it is important to know that DSMB is required during trial enrollment phase. In some cases DSMB meetings occur till all patients have reached their primary endpoint. The decision of whether or not to conduct DSMB meetings after the primary endpoint is reached, is up to the sponsor.

c. Physician consulting

Physicians are consulted during all phases of a clinical trial. Physician guidance is needed to develop clinical trial strategy, enrollment plan, final data analysis and publication plans.

Physician consulting costs can be anywhere between $150 – $600+ per hour. The billable rate varies based on physician’s medical expertise and geographical location. If a clinical trial is interesting to the physician, he or she may be willing to provide consulting services at little or no cost.

d. Independent corelab analysis

Many medical device trials collect imaging data such as angiograms, CT scans and X-Rays. Since this data comes from multiple sites, variability is expected. An independent corelab standardizes the collection and analysis of imaging data.

Corelab costs can add up quickly. Costs depend upon the number of images analyzed per patient, the time it takes for the corelab to analyze the data, and the duration of the trial.

Corelabs usually hire analysts to collect and calibrate data from different sites. The final analysis is usually done by a physician. Given the complexity of imaging data collection and analysis combined with the importance of corelab data to regulatory agencies, it is important that adequate and accurate budget is allocated for independent corelab analysis.

e. Medical device cost

Once you are ready to enroll patients in the clinical trial, you’ll need to ship medical devices to the sites. Most sites will expect to receive these devices for free. The only exception is when conducting post approval trials for commercially available devices.

Medical device manufacturers conduct trials for indication expansion. For example, a stent company may conduct a trial to get their heart stent approved for use in a different anatomy. For such expansion trials, sponsors may need to provide commercially available devices to sites at no cost.  

Whether or not you want to provide devices at no cost is a business decision.  When investigational medical devices are provided at no cost, sites enroll faster and have a much stronger, collaborative relationship with the sponsor.

Download The Ultimate Clinical Trial Budget Template

4. Labor Costs

In order to conduct a clinical trial, you need to hire people that have expertise in clinical research and clinical trial management. Depending on the size of the trial and the number of trials conducted, resource allocations vary. Therefore amount of labor needed to run a study also varies.

a. Clinical Research Assistants or Associates (CRAs)

CRAs are primarily responsible for monitoring clinical trial data that is collected during the course of the study. They visit clinical research sites to ensure data is collected in a compliant manner.

b. Project Manager (also known as Clinical Trial Manager or Study Manager)

A project manager’s responsibilities can vary from one organization to another. Project managers are like “general contractors.” A project manager is responsible for managing the clinical trial budget, resources and timelines. The core function of a project manager is to resolve or escalate issues that come up during the course of a clinical study.

c. Data Manager

A data manager’s job is to address data discrepancy issues by generating queries to sites. Data managers may also be responsible for implementing electronic data capture system or paper case report forms needed to collect trial data.

d. Scientist

The scientist is primarily responsible for developing the clinical strategy for a trial. Individuals with Ph.D. or M.D. degrees are usually the right fit for this role. In some organizations, the project manager also play the role of the scientist.

e. Biostatistician

A biostatistician is responsible for developing a statistical analysis plan (SAP). The SAP documents on the data will be analyzed during the course of the study. A statistician or statistical programmer is also responsible for programming data tables that are incorporated in the final clinical study reports.

f. Quality

Clinical research is a regulated industry. Quality plays an important role in ensuring sponsors, CROs, and clinical sites are conducting the trial in a compliant manner. Thus a quality associate or manager helps an organization create and implement standard operating procedures (SOPs).

Salaries for these roles can vary by geography and experience. The above list is not comprehensive. However it should give you an idea of the core resources needed to conduct a medical device clinical trial.

5. Site Management

a. Pre-study visits

Prior to inviting any site to participate in a clinical trial, you want to conduct pre-study visit, also know as the site assessment visit. This visit becomes even more important if you don’t have any prior experience working with the site in a clinical or commercial setting.

Although sites don’t charge for this visit, the sponsor will need to pay for travel and CRA labor costs.

b. Site Initiation Visits (SIV)

Once the site has received Institutional Review Board (IRB) or Ethics Committee (EC) approval and the trial contract has been signed, it’s time to activate the site for patient enrollment.

A SIV is conducted when you are ready to activate the site. SIV involves training the site on the clinical protocol and any other study-specific requirements.

Similar to the a pre-study visit, the sponsor will need to pay for travel and CRA labor costs.

c. Monitoring

Once patients are enrolled in the study, it is critical to collect data in a compliance with regulations and the clinical study protocol. This is when monitoring comes into play.

A CRA, sometimes known as the site monitor, visits clinical sites at regular intervals to ensure compliance.

In recent years, due to push for reduction in clinical trial costs, several sponsors have started to monitor remotely rather than conducting an in-person monitoring trip.

d. Close-out

Once all patients at a site have completed their follow-up visits, it’s time to conduct a close-out visit. Any open items related to study conduct are addressed during the close-out visit.

Although it’s always nice to have in-person close-out visits, it’s acceptable to close trials via remote close-out calls.

6. Miscellaneous

a. Investigator Meetings

Investigator Meetings serve to kick-off a new clinical trial. Site investigators and research coordinators are invited to participate in a 1-2 day meeting. These meetings serve to educate site personnel on the clinical trial protocol and any other trial specific requirements.

These meetings can be quite expensive and the sponsor pays for attendee airfare, hotel and meals. 

b. Travel

Plan and budget for ad hoc travel. Clinical research is highly regulated. You’ll need to visit a site to address a compliance issue or help them prepare for an audit. In other cases, you want to visit a site to motivate them to enroll patients. Whatever the case may be, it’s always good to have a bit of money set aside for travel.

c. Document Translations

Document translations cost increase significantly depending on the countries in which the clinical trial is conducted. Sites where English is not the primary language, you may receive request for translation of key documents such as the protocol and site specific informed consent in the local language.

Also if the adverse event source documents from non-English speaking sites are in their native language, additional costs will incur to translate documents into English for event adjudication purposes.

d. Technology solutions

To conduct clinical trials, you need systems such as Clinical Trial Management System (CTMS),  Electronic Data Capture (EDC), Electronic Trial Master File (eTMF), Interactive Voice/Web Response System (IxRS). These systems manage site contact information, collect clinical data and maintain clinical trial records. Budget monthly or annual license fees associated with these systems. Additionally you need staff to manage and maintain these systems.

e. Regulatory filing fees

Don’t overlook regulatory filing fees. These fees can run into thousands of dollars. Depending on the class of medical device, different applications are filed with regulatory agencies, competent authorities and notified bodies.

Download The Ultimate Clinical Trial Budget Template

7. Other Factors:

a. Protocol Amendments

Due to unforeseen circumstances, a clinical protocol amendment may be necessary. A protocol amendment has many downstream effects that can increase the cost of a clinical trial.

A protocol amendment usually leads to additional IRB/EC fees, site costs, regulatory re-submissions and more.

b. Inflation, Value Added Tax (VAT) and Foreign Exchange 

Don’t forget to factor inflation for multi-year clinical trials. Generally speaking, plan for a minimum of 3% inflation rate.

For sites in countries such as Australia and Europe, add VAT for the research services. VAT can be upwards of 12% on all research services.

For trials conducted in multiple countries, pay attention to foreign exchange rates. At a minimum, annual review of exchange rates is advised. Adjust clinical trial cost projections based on exchange rates.

c. Trial enrollment delays

Enrolling in trials is tricky business. It takes longer to complete enrollment and initial projections are overly optimistic. Therefore account for these delays when you develop your clinical trial budget.

clinical trial budget

Conclusion:

We’ve covered a lot of ground in this Ultimate Guide to Clinical Trial Costs. To summarize, you should now have a solid understanding of these factors that impact clinical trial costs:

  • Patient grant amount such as screen failure costs, data entry costs and travel reimbursement
  • Site costs such as site start-up fees, EC/IRB fees, close-out and storage fees
  • Non-patient costs such as core labatory fees, clinical events committee and data safety monitoring board
  • Labor costs such as clinical research employee salaries or contractor payments
  • Site management costs such as pre-study, site initiation, monitoring and close-out visits
  • Miscellaneous costs such as travel, technology solutions and regulatory filing costs
  • Other factors such as value added tax, inflation, protocol amendment and delays in enrollment

What’s your best tip to planning a clinical trial budget? Leave in the comment section below. 

6 Thoughts on "Ultimate Guide To Clinical Trial Costs"

  1. Tidor Morgan
    February 1, 2017

    Kunal, thanks for summarising this so concisely…. a really useful read and reference point for future discussion.

    • Kunal
      February 1, 2017

      Hi Tidor, I’m so glad to hear you found this post useful. This should severe as a useful guide to the clinical community when it comes to planning trial budgets. Thanks again for taking the time to read and comment.

  2. Chris
    March 2, 2017

    Nice summary Kunal. The overview is very concise and you touched on all the important aspects to consider when budgeting for a clinical trial.

    • Kunal
      March 2, 2017

      Hey Chris, Thanks for the positive feedback 🙂 It’s good to hear from industry professionals such as yourself who developed hundreds of budget models and scenarios. If you have any other insights or suggestions, please do let me know.

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