Have you been tasked to develop a 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 possible. 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 Costs
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
A clinical trial 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.
Download Clinical Trial Budget Template
2. Site costs
a. Site 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 a sponsor to pay anywhere between $3500 – $7500+ in site start-up fees.
b. Ethics Committee (EC)/ Institutional Review Board (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 a 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, in recent years, this cost has become a more common line item in the study budget.
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 the 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 of 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 the 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 the market.
b. Data Safety Monitoring Board (DSMB)
DSMB is sometimes known as 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 the trial enrollment phase. In some cases, DSMB meetings occur until 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 the 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 core lab 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 core lab 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 core lab 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 core lab data to regulatory agencies, it is important that adequate and accurate budget is allocated for independent core lab analysis.
e. Medical product cost
Once you are ready to enroll patients in the clinical trial, you’ll need to ship the medical product to the sites. Most sites will expect to receive the medical product for free. The only exception is when conducting post-approval trials for commercially available medical product.
Medical device and biologics manufacturers may conduct a trial for clinical indication expansion. For example, a stent company may conduct a trial to get their heart stent approved for use in different anatomy. For such expansion trials, sponsors may need to provide commercially available medical product to sites at no cost.
Whether or not you want to provide the medical product at no cost is a business decision. When investigational medical product is provided at no cost, sites can enroll faster and have a much stronger, collaborative relationship with the Sponsor.
Download 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 the 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. Clinical 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 an electronic data capture system or paper case report forms needed to collect trial data.
d. Clinical Research 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 plays the role of the scientist.
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.
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 a pre-study visit, also known 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 pre-study visit, the sponsor will need to pay for travel and CRA labor costs.
c. Monitoring – Remote, Virtual, In-person
Once patients are enrolled in the study, it is critical to collect data in 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 the push for a reduction in clinical trial costs, several sponsors have started to monitor remotely rather than conducting an in-person monitoring trip.
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.
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.
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 a 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 Clinical Trial Budget Template
7. Other Clinical Trial Cost 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. The 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, an annual review of exchange rates is advised. Adjust clinical trial cost projections based on exchange rates.
c. Trial enrollment delays
Enrolling in trials is a 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.
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 amounts 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 laboratory 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.
28 Thoughts on "The Ultimate Guide to Clinical Trial Costs"
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Tidor MorganFebruary 1, 2017
Kunal, thanks for summarising this so concisely…. a really useful read and reference point for future discussion.
KunalFebruary 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.
ChrisMarch 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.
KunalMarch 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.
EhsanJanuary 19, 2019
Thank you for writing the article and sharing the excel file. These are great!
Kunal SampatJanuary 23, 2019
Thanks Ehsan! Let me know if you have any follow-up questions. Happy to help!
Kunal SampatApril 21, 2019
Thank you, Ehsan!
Colin CookFebruary 5, 2019
Hi Kunal, what a tremendous resource you’ve provided here, thank you! I’m looking for someone to consult on a budget for a medical device trial. Do you know anyone offering these services?
LauraMarch 30, 2019
Excellent, thank you.
Kunal SampatApril 21, 2019
Thank you, Laura. Glad to hear your feedback.
Kunal SampatJune 4, 2019
Thank you, Laura
Vladimir ShnaydmanApril 19, 2019
1. How budgeting is coordinated with site selection?
2. How did you included risk in budgeting process?
3. What are major cost drivers for a clinical trial budget?
Kunal SampatApril 21, 2019
1. budgeting in most cases would not be coordinated with site selection
2. many of the clinical trial costs are tried to patient recruitment. patient recruitment is a dynamic process. you will likely need to re-forecast your budget on a regular basis depending on how fast or slow you enroll
3. Major cost drives are generally patient grant costs, labor costs, and monitoring. Every study is different and there may be other high ticket items.
Ivy ShakaApril 20, 2019
This post should be renamed Clinical Trial Budgeting for dummies, as it gives an informative yet easy to understand breakdown of the whole process. Thank you Kunal.
Kunal SampatApril 21, 2019
Hi Ivy, Thank you 🙂
UriAugust 8, 2019
Thanks Kunal , this is helpful. I may also add that it might also be required to include the product’s manufacturing costs in a study budget, especially in budgets of small Biotech companies.
Kunal SampatAugust 8, 2019
Hi Uri, Yes, I agree. Product manufacturing costs should be part of the study budget. I’ve mentioned “device costs” in this article. Will update it to include “biologics costs” as well. Thanks for the input.
Francis AkenamiSeptember 25, 2019
Hi Kunal – thank you for the comprehensive presentation. Where do you include costs for Medical Writing Services such content development for Protocols, Clinical Study Reports, Clinical Evaluation Reports, New Drug Applications and publications in peer-reviewed journals? Can they be added to the overall cost of Clinical Trials? I should think so since a Clinical Trial cannot be considered complete if those are missing.
Gerard AbateSeptember 14, 2020
What is the average cost per patient for a CRO for an interventional trial?
Kunal SampatSeptember 28, 2020
It depends on the study design.
KarthikNovember 16, 2020
Really got a good understanding of the basics especially when I am in a project involving a major player in the clinical trials domain. Thanks a lot!
Kenneth QuintanaApril 19, 2021
What is the average time a cro spends on final data analysis?
Kunal SampatApril 24, 2021
This average time a CRO spends time on data analysis can vary based on study design (ex: how complex are your statistics), quality of the data collected (ex: lot of missing data = more time needed), and resources (ex: do you have a team to do the work). I would say plan for 3-months but it can take more or less time based on the above factors
raveena aherMay 19, 2022
thank you for sharing your blogs