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MANAGING CLINICAL TRIAL

BUDGETS & CONTRACTS

JoAnn Pfeiffer, DrSC, rAC, CCrA

MArilyn WinDSChiegl, JD

Preface

I was handed my first clinical trial budget and agreement to review many years ago. My

instructions were to determine if they were acceptable for the site. What should I do? I

had no concept of terms of the CTA. My experience up to this point was managing

federally funded studies and grants with the support of a grants and contracts office. I

was familiar with budgets for NIH grants. Though there were similarities these industry-

sponsored trials requiring a CTA were far different. I reviewed the documents as best I

could, passed them on to the director to sign, and returned them to the sponsor or CRO.

During the process, I thought to myself, “Surely the Sponsor/CRO knows more than me and weren’t these documents all pretty much the same?” As long as the proposed budget covered the site’s expenses, we were good to go. Little did I know or understand the legal ramifications of these documents or the intricacies involved in clinical trial

budgets. Luckily due to the quality of research at the sites I worked at or perhaps sheer

luck, I never experienced any legal issues.

From that day forward I set out to learn as much as I could about clinical trial

agreements and budgets. The process was frustrating as I found very few resources

and help in this area. That was many years ago, and thankfully I have learned much

through experience, colleagues, research, seminars, and reading. Knowing what I do

today, it terrifies me that I was ever allowed to manage a budget or contract with so little

experience. Unfortunately, I still believe this happens today. I have talked with many

individuals in the research industry who are or were in the same place I was when I

looked at my first budget and agreement. Although there are professional organizations,

model agreements, and articles available on both budgets and contracts, it is still a

matter of piecing the information together. Budget and contracts go hand-in-hand, and I

have still not found a comprehensive resource that covers both. This book was created

with the idea to address this gap.

This book is a step-by-step guide geared to clinical trial sites on the management of

budgets and contracts. I wanted others who found themselves in my earlier situation to

have a resource to guide them through the process. The authors do not provide legal

advice, but provide recommendations based on our combined experience, research in

the area, and the gathering of stories and information from many colleagues over the

years. With the help of my colleague, Marilyn Windschiegl, J.D., Director of Contracts

and Compliance, PFS Clinical, this book is now a reality.

If you are new to budgets and contracts we hope that this book will assist you in

understanding, properly reviewing, negotiating and managing clinical trial budgets and

agreements. If you have been working with budgets and contracts for quite some time

perhaps it will provide additional knowledge and new perspectives.

This book is based on the current regulations and guidelines of 2016.

JoAnn Pfeiffer, DrSC

TABLE OF CONTENTS

Acronyms ........................................................................................................................................ 1 Chapter One: Budget Preparation ................................................................................................ 3 What Is This Chapter About? .............................................................................................. 3 Study Protocol ..................................................................................................................... 3 Informed Consent ................................................................................................................ 5 Clinical Trial Agreement (CTA) ........................................................................................... 5 Lab and Pharmacy Manuals ............................................................................................... 7 Charge Master or Fee Schedule ......................................................................................... 7 Sponsor Budget .................................................................................................................. 7 Chapter Review ................................................................................................................... 8 Apply Your Knowledge ................................................................................................. 8 Chapter Review Questions ........................................................................................... 8 Chapter Two: Building the Site Budget ..................................................................................... 11 What Is This Chapter About? ............................................................................................ 11 Creating the Site Budget ................................................................................................... 11 Budget Sections ................................................................................................................ 11 Study Start-up Costs .................................................................................................. 11 Study Visits ................................................................................................................. 11 Subject Compensation ............................................................................................... 12 Equipment ................................................................................................................... 12 Recruitment ................................................................................................................ 12 Monitor Visits .............................................................................................................. 12 Extra Visits .................................................................................................................. 13 Serious Adverse Events (SAEs) ................................................................................. 13 Study Close-Out ......................................................................................................... 13 Subcontractors ........................................................................................................... 13 Invoiced Items............................................................................................................. 13 Additional Staff ........................................................................................................... 14 Travel .......................................................................................................................... 14 Overhead (Indirect Costs) .......................................................................................... 14 Creating the Study Budget ................................................................................................ 14 Budget Assumptions ................................................................................................... 14 Staff Costs ............................................................................................................ 14 Overhead ............................................................................................................. 15 Study Visits .......................................................................................................... 15 Building the Budget ........................................................................................................... 16 Visit Costs ................................................................................................................... 16 Recruitment ................................................................................................................ 21 Study Close-Out ......................................................................................................... 21 Subcontractors ........................................................................................................... 22 Invoiced Items............................................................................................................. 22 Travel .......................................................................................................................... 23 Additional Staff ........................................................................................................... 23 Internal Budget .................................................................................................................. 24 Populating the Sponsor Budget Template ........................................................................ 27 Chapter Review ................................................................................................................. 28 Apply Your Knowledge ............................................................................................... 28 Chapter Questions ...................................................................................................... 29

Chapter Three: Coverage Analysis ............................................................................................ 31 What Is This Chapter About? ............................................................................................ 31 The 2000 Clinical Trial Policy and The Affordable Health Care Act ................................. 31 Qualifying Clinical Trials .................................................................................................... 31 Coverage Analysis ...................................................................................................... 33 Assigning Costs to Appropriate Party ......................................................................... 34 Coverage Analysis Steps ........................................................................................... 34 Billing ............................................................................................................................. 36 Chapter Review ................................................................................................................. 37 Apply Your Knowledge ............................................................................................... 37 Chapter Review Questions ......................................................................................... 37 References ........................................................................................................................ 38 Chapter Four: Payment Plans ..................................................................................................... 39 What Is This Chapter About? ............................................................................................ 39 Payment Types ................................................................................................................. 39 Milestones ......................................................................................................................... 40 Study Visits ....................................................................................................................... 40 Invoices ............................................................................................................................. 40 Payment Triggers .............................................................................................................. 41 Billing ............................................................................................................................. 42 Tracking Payments ........................................................................................................... 43 Chapter Review ................................................................................................................. 44 Apply Your Knowledge ............................................................................................... 44 Chapter Review Questions ......................................................................................... 45 References ........................................................................................................................ 45 Chapter Five: Negotiating the Sponsor’s Budget ..................................................................... 47 What Is This Chapter About? ............................................................................................ 47 Preparation ........................................................................................................................ 47 Communication ................................................................................................................. 48 Practice ............................................................................................................................. 49 Items to Consider for Negotiation ..................................................................................... 50 Study Start-up Fee ..................................................................................................... 50 Screen Failures .......................................................................................................... 50 Sponsor Holdback ...................................................................................................... 51 Serious Adverse Event (SAE) Adjudication ................................................................ 51 Submission of Institutional Review Board (IRB) Continuing Review Reports ............ 51 Review of MedWatch/SUSAR Reports by the Investigator ........................................ 51 Record Storage .......................................................................................................... 52 Destruction of Study Records ..................................................................................... 52 Destruction or Return of Investigational Product ........................................................ 52 Shipping and Handling of Specimens ........................................................................ 53 Special Storage Requirements ................................................................................... 53 Cost of Living .............................................................................................................. 53 Reporting of Physician Payments .............................................................................. 53 Chapter Review ................................................................................................................. 54 Apply Your Knowledge ............................................................................................... 54 Chapter Review Questions ......................................................................................... 54 References ........................................................................................................................ 55 Chapter Six: Clinical Trial Agreements- The Preliminaries ..................................................... 57 What Is This Chapter About? ............................................................................................ 57 First Steps ......................................................................................................................... 57 The Parties ........................................................................................................................ 58 The Recitals ...................................................................................................................... 59

The Definitions .................................................................................................................. 60 Chapter Review ................................................................................................................. 61 Apply Your Knowledge ............................................................................................... 61 Chapter Review Questions ......................................................................................... 62 Chapter Seven: Responsibilities and Compliance ................................................................... 63 What Is This Chapter About? ............................................................................................ 63 Compliance with Laws ...................................................................................................... 63 Institutional Review Board Oversight ................................................................................ 65 Adverse Events ................................................................................................................. 66 Filings and Registrations ................................................................................................... 66 Debarment, Disqualification and Exclusion....................................................................... 67 FINANCIAL DISCLOSURE ............................................................................................... 69 Conflicts of Interest ........................................................................................................... 69 Meetings ............................................................................................................................ 70 Chapter Review ................................................................................................................. 70 Apply Your Knowledge ............................................................................................... 70 Chapter Review Questions ......................................................................................... 70 Chapter Eight: Finance ................................................................................................................ 73 What Is This Chapter About? ............................................................................................ 73 Payment ............................................................................................................................ 73 Subject Injuries .................................................................................................................. 75 Indemnification .................................................................................................................. 78 Insurance .......................................................................................................................... 83 Chapter Review ................................................................................................................. 84 Apply Your Knowledge ............................................................................................... 84 Chapter Review Questions ......................................................................................... 84 Chapter Nine: Ownership & Recordkeeping: Data, Intellectual Property & Publications .... 87 What Is This Chapter About? ............................................................................................ 87 Confidential Information .................................................................................................... 87 Recordkeeping .................................................................................................................. 90 Intellectual Property, Patents and Licensing ..................................................................... 90 Publishing and Publicity .................................................................................................... 93 Chapter Review ................................................................................................................. 95 Apply Your Knowledge ............................................................................................... 95 Chapter Questions ...................................................................................................... 95 Chapter Ten: Termination and Miscellaneous Matters ............................................................ 97 What Is This Chapter About? ............................................................................................ 97 Term and Termination ....................................................................................................... 97 Survival ............................................................................................................................. 99 Notices and Notification .................................................................................................... 99 Governing Law and Alternative Dispute Resolution ......................................................... 99 Counterparts ................................................................................................................... 100 Assignment ..................................................................................................................... 100 Relationships of the Parties ............................................................................................ 101 Force Majeure ................................................................................................................. 101 Chapter Review ............................................................................................................... 101 Apply Your Knowledge ............................................................................................. 101 Chapter Review Questions ....................................................................................... 102 Apply Your Knowledge Key………………………………………………………………………….103 Chapter 1: Budget Preparation ....................................................................................... 103 Chapter 2: Building the Site Budget ................................................................................ 103

Chapter 3: Coverage Analysis ........................................................................................ 104 Chapter 4: Payment Plans .............................................................................................. 104 Chapter 5: Negotiating the Sponsor’s Budget ................................................................ 105 Chapter 6: Clinical Trial Agreement – The Preliminaries ................................................ 106 Chapter 7: Clinical Trial Agreement – Responsibilities & Compliance ........................... 108 Chapter 8: Clinical Trial Agreement – Finance ............................................................... 110 Chapter 9: Clinical Trial Agreement – Ownership & Recordkeeping .............................. 112 Chapter10: Clinical Trial Agreement – Termination & Miscellaneous ............................ 115

Acronyms List

ACA Affordable Care Act

ADR Alternative Dispute Resolution

AE Adverse Event

AHRQ Agency for Research Quality

CDC Centers for Disease Control

CED Coverage with Evidence Development

CFR Code of Federal Regulations

CMS Centers for Medicare and Medicaid

CPT Common Procedural Terminology

CRF Case Report Form

CTA Clinical Trial Agreement

CTP Clinical Trial Policy

COL Cost of Living

CV Curriculum Vitae

DOD Department of Defense

EDC Electronic Data Capture

FDA Food and Drug Administration

GCP Good Clinical Practice

HEAT Health Care Fraud Prevention and Enforcement Action Team

HIPAA Health Insurance Portability and Accountability Act

ICF Informed Consent Form

IND Investigational New Drug

IRB Institutional Review Board

LCD Local Coverage Determination

LOI Letter of Indemnification

NCD National Coverage Determination

NIH National Institutes of Health

OHRP Office of Human Research Protection

QOL Quality of Life

SE Schedule of Events

SAE Serious Adverse Event

VA Veteran's Administration

Chapter One Budget Preparation

What Is This Chapter About?

In this chapter we cover the first steps to creating an adequate and compliant budget for the study site. The starting point for the site is to identify and gather all of the study documents that contain research-related costs. Once the costs have been identified the site will be able to ensure that the sponsor’s proposed budget compensates the site adequately.

Development of a study budget serves three purposes:

1. To ensure that the site is appropriately reimbursed for all services rendered in the conduct of the trial.

2. To determine whether it is financially feasible for the site to conduct the study. 3. To assign the appropriate party for reimbursement of the various research costs.

Documents that need to be reviewed to identify study costs include:

 Study Protocol  Informed Consent  The Clinical Trial Agreement  Laboratory and Pharmacy Manuals  Charge Master/Schedule of Procedure Fees  CMS Fee Schedule for trials covered under the Affordable Health Care Act of

2010

 Sponsor Budget

Tip 1

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In the following sections we review each of these documents, identify what research costs are found in each document, and where to locate the research costs in the document. As you review these documents it is also important to compare the various documents for consistency.

Study Protocol

The study protocol defines the conduct of the study. It must be approved by an appropriate institutional review board (IRB) before the study can be conducted. The protocol includes the study procedures and services that will be performed during the duration of the study. The Schedule of Events in the protocol is a table that outlines the study visits, from screening to the final visit. Under each visit is a list of procedures that need to be conducted during the visit. (See Figure 1 for an example of a schedule of events.)

GATHER STUDY DOCUMENTS, SUCH AS THE PROTOCOL AND THE INFORMED

CONSENT THAT CONTAIN STUDY RELATED COSTS.

Tip 1

     

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Tip 1

First Steps

Figure 1 Schedule of Events

Procedure Screen Visit 1 Day 1

Visit 2 1

month

Visit 3 3

months

Visit 4 6

months

Visit 5 12

months Consent X Height X Weight X X X X X X Vitals X X X X X X Medical History X Physical X X X X Blood Draw X X X X X X Urine Pregnancy X X X X X X EKG X X Chest X-ray X X QOL Survey X X X X X Dispense/Collect Drug

X X X X X

Randomization X Concomitant Meds X X X X X X Adverse Events X X X X X

From the schedule of events you identify the procedures for the study. To determine cost to the site, list each procedure, determine cost of the procedure. Total cost of the procedure will includes the cost of the test/procedure and staff time to conduct the procedure. Multiply the total cost for each procedure by the number of times it is performed during the study. For example, the Quality of Life (QOL) survey is administered five (5) times during the study. If the cost is $50 per time administered, the total cost to the site for each subject for this procedure is $250.

The schedule of events provides general information about the required procedures and services that occur at each visit. You must also review the protocol for descriptions and details of each procedure to determine the specifics of the tests/procedures. For example in the table above, what does the physical include? The protocol may require that the physical be conducted by a physician as opposed to a nurse. The protocol will describe in detail what the physical includes. Whether it is a full physical or a general physical, and what procedures or tests need to be included as part of the physical. These details are important when figuring the cost of the event to the research site. Examples of other procedures and things to look for are shown below:

 What is included in the blood draw and how many tubes need to be collected?  What type of X-ray and EKG is required?  How does the site need to process the blood for shipping and what lab tests

(e.g., urine pregnancy) are processed on site?

The answers to these types of questions can be found in the body of the protocol under the descriptions of study procedures.

It is also important to read the footnotes. Footnotes may contain additional information related to procedure costs. For example, if a lab result comes back out of range, what is the process for handling this? The protocol may allow the subject to be rescreened which would be an additional cost to the site. It may require a follow-up visit and additional tests. Perhaps a protocol requires a biopsy. What other services need to be included for the biopsy? Do you need an anesthesiologist, a surgery center, a recovery room and staff? These are all things to consider when building the study budget. This type of information may be found in a footnote.

Some investigational products and specimens require special handling or storage. The protocol will provide specific instructions on how these specimens or products must be handled, stored and shipped. (This information might also be found in the lab or pharmacy manual.) For example, products that contain biohazard material, recombinant RNA, DNA, etc., generally require special handling and storage (some products require a -40 or -80 freezer). If the site does not have this equipment and the sponsor is not willing to cover the cost, then this study may not be financially feasible for the site.

Informed Consent

The informed consent includes information on subject compensation which is generally included in the sponsor’s budget. The sponsor compensates the site and the site pays the subject. Subjects may be compensated for travel and time. If study visits are lengthy (over 4 hours) compensation may include providing meals or refreshments for the subject. This cost would also need to be included in the budget.

The complexity and length of the informed consent will help determine how much staff time will be needed for the consent process. Complex and lengthy consents take more time to explain and to answer subject questions. In pediatric studies, children 8 years and older are often provided an assent, which is a condensed version of the consent written in terms the child will understand. Consenting would then include both the parents and the child which increases the time. In pediatric studies the parents or guardians generally ask many questions. Conducting the consent process in pediatric studies is generally more time consuming than in adult studies. The consent process may also take more time in studies that include vulnerable populations.

Clinical Trial Agreement (CTA)

The CTA is covered in detail in Chapters 6 – 10. This chapter covers the cost items you need to look for in the CTA to create the study budget. These items include:

 Study-specific training: staff training that is directly related to the protocol.

IN ADDITION TO REVIEWING THE SCHEDULE OF EVENTS, CHECK FOR

FOOTNOTES THAT MIGHT INCLUDE ADDITIONAL COSTS AND REVIEW THE

PROCEDURE DESCRIPTIONS FOR DETAILS.

Tip 2

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IN ADDITION TO REVIEWING THE SCHEDULE OF EVENTS, CHECK FOR

FOOTNOTES THAT MIGHT INCLUDE ADDITIONAL COSTS AND REVIEW THE

PROCEDURE DESCRIPTIONS FOR DETAILS.

Tip 2

Clinical Trial Agreement (CTA)

The CTA is covered in detail in Chapters 6 – 10. This chapter covers the cost items you need to look for in the CTA to create the study budget. These items include:

 Study-specific training: staff training that is directly related to the protocol.

Tip 2

willing to cover the cost, then this study may not be financially feasible for the site.

Informed Consent



Tip 2

 IRB Submissions, amendments, and continuing reviews: the cost of these may or may not be covered by the sponsor. Each of these takes staff time to prepare and submit. If the site is responsible the cost of staff time should be included in the site budget.

 Sponsor monitor visits and audit expectations of the site: The monitor plan should provide the details of what is expected by the sponsor for each visit, including staff time expected during each monitor visit. The plan should describe what the monitor will review while at the site so that the site is prepared when the monitor arrives. This information will provide the site with an idea of staff time needed in preparation for and during the visit. Sponsors may not have details as monitoring may be based on site performance. In this case, based on site history of similar studies, the site should be able to determine a general cost to the site for monitor visits. CTAs typically do not provide the details of the monitor visit provided here. It might be to the site’s advantage to request an additional document that includes these details.

 Specific pharmacy or lab set-ups: If there are special requirements for setting up the pharmacy or lab these should be included in the budget and the CTA. Often, if the study site uses a hospital or clinic pharmacy there is a charge assessed to the site and the site will want to include this in the budget.

 Recruitment and advertising: Generally the sponsor develops and provides the recruitment materials to the site. In multi-site studies, if using a central institutional review board (IRB), the sponsor typically gets approval for these materials. However, if your site is required to submit to a local IRB, the site will need to obtain approval for these materials from that IRB in addition to the central IRB. Additional recruitment such as radio and television ads should be discussed in the CTA and the amount available to the site for these recruitment activities should be in the sponsor’s proposed budget.

 Screen Failures: The CTA should define the number of screen failures for which the sponsor will compensate the site. If not covered in the content of the CTA, this may be found in the budget exhibit.

 Recruitment goal for the site: The CTA will sometimes identify the number of subjects the site is expected to enroll in the study. It also describes if the recruitment is competitive or if each site is allowed a set number of subjects to recruit. It is important to keep these details in mind as they may impact the site’s recruitment. For example, if the recruitment is competitive a site that is able to recruit quickly may be allowed to over enroll. In this situation sites with slower enrollment may find that enrollment is completed before they reach their proposed recruitment goal.

 Study supplies and equipment: The CTA outlines what the sponsor will provide to the site, including the investigational product and the placebo or the approved product that the sponsor is using for comparison to their investigational product. Study supplies such as subject binders, blood draw supplies, dedicated study computers, electronic data capture (EDC) systems, IV pumps, etc. should be listed in the CTA.

 Record storage requirements: The CTA will dictate how long the sponsor expects the site to store the study records.

All of these items are costs to conduct the study and need to be included in the site’s budget.

Lab and Pharmacy Manuals

Special handling or processing of labs or investigational product will be covered in these manuals. For example, if the investigational product is administered intravenously it might be a combination of products that need to be mixed prior to administering to the subject. This would require additional staff for mixing and also administration of the drug. The lab manual will describe what types of labs need to be processed at the site (for example a urine pregnancy test) and how to process and ship the specimens that are to be sent to a central lab. If these are not provided to the site they should be requested.

Charge Master or Fee Schedule

The charge master is a list of thousands of medical procedures, the codes, and cost of each. This document will be used to determine the cost of the procedure or test by the site. If the study qualifies under the Affordable Health Care Act, National Coverage Determination (NCD) for Routine Costs in Clinical Trials (310.1) will be used to determine the cost of the procedures that qualify for Medicare reimbursement. These can be found at the Medicare and Medicaid website, (http://www.cms.gov/Medicare/Coverage/Coverage-with-Evidence- Development/index.html).

Sponsor Budget

The study sponsor provides a budget template for each site proposing how they will reimburse the site for conducting the study. This is referred to by many as the external budget and will be the template that is used when working with the sponsor. However, only by identifying all of the study costs can you determine if the sponsor’s proposed budget provides fair compensation to the study site that includes payment of all research costs and meets the revenue goals set by the site. Breaking down the costs for the study and creating an internal site budget with cost details is key to determining if it is financially feasible for the site to conduct the study.

Budgets may be formatted in several ways.

 The budget may be a set reimbursement fee per subject for the study.  It might be a set fee per visit per subject.  It could be broken down by procedure.  It might be a set of conditions that need to occur for payment.

By carefully reviewing the study documents that include possible study costs and identifying all costs to the site, the site is able to determine if the sponsor’s proposed budget compensates the site adequately for the conduct of the study.

http://www.cms.gov/Medicare/Coverage/Coverage-with-Evidence-Development/index.html

Chapter Review

This chapter covered the study documents that need to be gathered and carefully reviewed to identify all research costs for a study and to build a budget that will compensate the site for all study costs, as well as meet the revenue goals of the site. Identifying all cost assists the site in determining if the sponsor’s proposed budget will compensates the site for all research costs or if the site needs to negotiate a more equitable budget with the sponsor. Reviewing the documents outlined in this chapter to identify study costs will provide the information needed to determine whether or not the study is financially feasible for the site to conduct. During the review of documents it is also important to identify any inconsistencies between the documents. This chapter addressed the first steps in preparing a study budget.

Apply Your Knowledge

Scenario

As a site manager, it is your responsibility to develop a study budget and recommend that the site either accept the sponsor budget as proposed, negotiate a more equitable study budget, or choose not to accept the study because it is not feasible for your site. You have reviewed the schedule of events in the protocol and compared the visit procedures and tests to the sponsor’s budget. The sponsor’s budget provides compensation for each of the listed procedures and tests in the schedule of events. It also covers:

 Subject compensation,  Recruitment fees,  Payment for monitoring visits,  Lab and pharmacy start-up fee, and  Compensation for staff training on the study protocol.

Do you have enough information to make a recommendation to the site?

Chapter Review Questions

1. Preparing a site study budget includes collecting the following documents for review:

a. Study Protocol b. Clinical Trial Agreement

c. Informed Consent

d. All of the above

2. Which of the following cost items is not found in the study protocol?

a. Study procedures

b. Subject compensation

c. Staff required to perform the procedure

d. None of the above

3. The Clinical Trial Agreement will provide information on the following cost(s):

a. Investigator fee

b. Consent fee

c. Payment for screen failures

d. None of the above

4. The Charge Master is a list of medical procedure costs and codes.

a. True

b. False

5. The Sponsor’s budget can be used as a review tool to determine if it adequately compensates the site for conducting the study.

a. True

b. False

6. A site budget should include fair compensation to the site for research costs

including meeting the revenue goals of the site.

a. True

b. False

Chapter Two Building the Site Budget

section. The time allowed to complete each event should be reasonable and cover the time spent by staff. In this section, the procedure cost, staff and staff time are determined for each event. By breaking the visits down by event the site will be able to determine whether the sponsor’s proposed reimbursement for each visit or for each subject will cover the site’s expenses.

Subject Compensation

Generally the subject is compensated for time and travel for each visit. This may be a one-time payment at the end of the study or for each study visit. Subject compensation may also include parking and for lengthy visits meals and/or refreshments.

Equipment

If the study requires special equipment it would be included in this section. Typically the sponsor will provide any specialized equipment to the site for the duration of the study. If special equipment is not included in the sponsor’s proposed budget it should be added to the site budget.

However, the site is expected to provide general study equipment needed to conduct studies. This equipment would include freezers, refrigerators, and medical equipment such as EKG machines, exam tables, gowns, and blood pressure cuffs. If the site needs additional equipment to meet the needs of the proposed study this would be a business expense. Business expenses are covered through the site’s overhead that is applied to the study budget.

Recruitment

The sponsor generally provides IRB approved recruitment and marketing materials to the site. In addition, the sponsor generally includes a set amount in the budget for subject recruitment. Based on the type of study the site will need to determine what type of recruitment will be required to enroll subjects in the study. The site might be affiliated with a health care practice or clinic that has access to the study population. Or the site may need to recruit via mail, media outlets, or social networks. This might require more time and effort and additional recruitment materials. In addition, for complex studies that have a lengthy list or strict criteria, it may be more difficult to recruit subjects. Based on these types of factors, the site will need to determine if the proposed sum for recruitment is reasonable.

Monitor Visits

During the study the sponsor is required to monitor the study to ensure that the site is compliant with applicable regulations, is following good clinical practices (GCPs), and is compliant with the protocol. The CTA should include a monitoring plan. Typically the plan in the CTA is not specific. If possible the site should request a plan that provides details regarding their expectations of the site during monitoring visits. These expectations will provide information to assist the site in determining the staff that will be needed to prepare for and be involved in the visit and an idea of staff time required. With this information the site should be able to identify a reasonable cost to the site for monitor visits.

Extra Visits

Occasionally extra visits are required in a study. These may be unexpected visits from a subject or a follow-up visit needed resolve an adverse event. While it is not possible to determine if these visits will occur, or what procedures will be required at the visits, they should be addressed in the budget. These visits would be included as items to be invoiced to the sponsor by the site. The sponsor’s budget should include these under invoiced items that will be covered by the sponsor upon invoice from the study site.

Serious Adverse Events (SAEs)

Adjudication of SAEs is another cost item that should be included in a budget. The site and the sponsor need to determine how the site will be compensated. The two options are for the site to:

 Invoice the sponsor for the actual costs (man hours, copying records, etc.) to resolve the SAE.

 Invoice the sponsor based on a set fee for each SAE that occurs.

The cost of SAEs would therefore be included in the invoice section of the budget.

Study Close-Out

Closing out the study involves activities that require staff time. These include:

 Investigation product inventory and accountability, packaging the product for shipment to the sponsor.

 If using paper case report forms, packing, labeling and providing secure storage.  Packing and storing other paper study documents such as MedWatch Reports,

Protocols, regulatory binders, lab manuals, investigational product distribution records and logs, and other study reports.

 Close-out meeting which includes study staff time required during the close-out visit.

Subcontractors

If the study requires the use of other health care professionals outside of the study site, these would be subcontracted by the site. This might include the need for X-ray technologists, surgeons for biopsies, etc.

Invoiced Items

These include all items that need to be invoiced by the site. These are generally one- time items or items that may or may not occur during the study. As discussed previously these might be costs such as shipping and handling of subject specimens, adjudication of SAEs, extra visits, etc.

Additional Staff

The site may need additional staff to support the various activities of the study. Support staff might include a recruitment coordinator, an accountant for billing and receipt of payments, legal counsel to review the contract, a person to prescreen and/or screen potential subjects, etc.

Travel

Investigator meetings are generally paid for by the sponsor including travel and meals. However, travel requires time away from the office and the staff traveling are still being paid. Often, an investigator’s time at a meeting means the loss of income from his/her clinical practice. While these are not specific travel costs they are related to the time required for travel to the meeting. While sponsors are hesitant to pay for time during the training, it is an item that might be negotiated.

Overhead (Indirect Costs)

Site overhead or indirect costs are to pay for the expense of facilities and administrative support. These cover space, utilities, phones, administrative staff such as receptionists, and office equipment. Depending on the organization and the type of study overhead costs generally range from 25 – 35% for industry-sponsored trials. Overhead can be added to each item, each budget section, or to the total budget. In this budget, it is added to each section.

Creating the Study Budget

An internal budget includes the detailed costs of conducting a study, while the external budget (sponsor budget) usually does not include as much detail. As mentioned, the external budget generally provides payment per visit or per subject. A detailed internal budget allows the site to determine the specific costs to determine whether the sponsor’s proposed budget will cover the site’s costs to conduct the study. A detailed budget can also provide the site with break-even point to determine revenue projections and help to minimize the chance of missing expenses.

To simplify the creation of the study budget it has been broken into steps. Each section of the budget is created separately. The data from each section is then used to populate the final internal study budget.

Budget Assumptions

The budget presented here may not include all of the cost items for a study you are conducting. Each study has its own nuances and will be a bit different. This budget presents typical costs associated with many clinical research studies and is based on a simple study. To create the budget the following assumptions were made:

Staff Costs

 To determine an hourly rate for staff, salaries were divided by 2,080 hours (40 hour work week times 52 weeks).

 Staff benefits are figured at 35% and are added to the salary for a total cost per hour.

 Staff pay rates (per hour) used for this budget are as follows: o Investigator $150 o Research manager $85 o Study nurse $65 o Coordinator $45 o Research assistant $22 o Lab tech $18 o Data entry $15

To determine total staff cost per hour an additional 35% for benefits and employment taxes is added to the hourly rates. The total hourly cost for the various staff roles is shown in Table 2.1.

Table 2.1 Budget - Hourly Employee Rates Staff Role Total Hourly Rate

Coordinator $60.75

Data Entry Coordinator $20.25

Investigator $202.50

Lab Technician $24.30

Research Assistant $29.20

Research Manager $114.75

Study Nurse $87.75

Overhead

 Site overhead is applied at 30%.

Study Visits

 Include only the procedures listed in the schedule of events.

Building the Budget

Table 2.2 Budget - Study Start-up Costs Activity Staff Per Hour # Units Total Document Review Investigator

$202.50/hr.

6 hrs.

$1,215.00

Protocol Training Coordinator Research Assistant

Data Entry Study Nurse

Lab Tech

$60.75/hr. $29.70/hr. $20.25/hr. $87.75/hr. $24.30/hr.

1.5 hrs. 1.5 hrs. 1.5 hrs. 1.5 hrs. 1.5 hrs.

$91.13 $44.55 $30.38

$131.63 $36.45

EDC Training Investigator Coordinator

Research Assistant Study Nurse

Data Entry

$202.50/hr. $60.75/hr. $29.70/hr. $87.75/hr. $20.25/hr.

1.0 hrs. 1.0 hrs. 1.0 hrs. 1.0 hrs. 4.0 hrs.

$202.50 $60.75 $29.70 $87.75 $81.00

Lab Set-up $150.00 1 $150.00 Pharmacy Set-up $300.00 1 $300.00 Chart Reviews to identify potential subjects

Coordinator (initial review)

Investigator review

$60.75/hr.

$202.50/hr.

10 hrs.

4 hrs.

$607.50

$810.00 Budget and Contract Review & Negotiation

Research Manager Investigator

$114.75/hr. $202.50/hr.

20 hrs. 5 hrs.

$2,295.00 $1,012.50

Subtotal $7,185.75 Overhead 30% $2,155.84

Start-up Total $9,341.59

Visit Costs

This section of the budget includes the procedures and services that occur at each visit and the staff time to complete the events. Table 2.3 is a list of the procedures taken from the schedule of events that occur during each study visit.

To determine the cost of each procedure the following were included:

 The staff required for the task and the amount of time for each staff role to complete the task. For procedures such as the EKG and X-ray costs can be found in the charge master if applicable. For example, if the study requires an EKG the cost of the EKG (taken from the charge master – Table 2.4) is $225.

TO DETERMINE STAFF TIME NEEDED TO PROPERLY CONDUCT THE VARIOUS

STUDY TASKS HAVE STAFF MEMBERS TRACK THEIR TIME WHEN COMPLETING

THE STUDY PROCEDURES AND TASKS.

Tip 1

The coordinator and research assistant are trained and qualified to perform the EKG and their time would be added to this line item.

 The chest X-ray might be contracted out. Again the cost would be found in the charge master. However, when contracting services from a vendor or another provider, make sure that you verify the cost of the procedure with the contractor before including it in the budget.

Table 2.3 Budget - Visit Procedures Procedure Staff Hourly

Pay Rate

Benefits (35%)

Total Hourly Rate

Time Total Cost

Consent SC PI

$45 $150

$15.75 $52.50

$60.75 $202.50

1.5 .50

$91.13 $101.25

Height RA $22 $7.70 $29.70 .25 $7.43 Weight RA $22 $7.70 $29.70 .25 $7.43

Vitals RA $22 $7.70 $29.70 .50 $14.85

Medical History N $65 $22.75 $87.75 1.0 $87.75 Physical PI $150 $52.50 $202.50 1.0 $202.50 Limited Physical N $65 $22.75 $87.75 .5 $42.38 Blood Draw SC

L $45 $18

$15.75 $6.30

$60.75 $24.30

.50

.50 $30.38 $12.15

Urine Pregnancy L $18 $6.30 $24.30 .50 $12.15 Dispense/Collect Drug

SC $45 $15.75 $60.75 .50 $30.38

Randomization SC $45 $15.75 $60.75 .50 $30.38

Concomitant Meds

SC $45 $15.75 $60.75 .50 $30.38

Adverse Events SC $45 $15.75 $60.75 .50 $30.38

Data Entry DE $15 $5.25 $20.25 1.0 $20.25 Legend: SC = Study Coordinator PI – Investigator N = Nurse L = Lab Tech M = Research Manager RA = Research Assistant DE = Data Entry

Table 2.4 is a simple example of information found on a charge master or schedule of fees. Charge masters are much more complex and contain thousands of fees and codes for procedures, hospital services, medical equipment, supplies, drugs, and diagnostic procedures. Each item listed may have multiple entries for the service or procedure. For example there are many types of chest X-rays, multiple diagnostic blood tests, an array of EKGs, and so on. When using a charge master to determine the cost of a procedure, make sure that you select the correct procedure. The information in the Table 2.4 is not intended to reflect actual cost data, but are typical of the industry. The procedure costs in Table 2.4 are used to populate the costs of the procedures in the visit schedule (Table 2.6).

Table 2.4 Budget – Charge Master (Fee Schedule) Procedure Service Code Charge Urinalysis, without microscopy 81003 $45.00

Collection Venous Blood Venipuncture 80010 $270.00

Complete Blood Count 85027 $280.00 Basic Metabolic Panel 80048 $370.00

Comprehensive Metabolic Panel 80053 $344.00 Lipid Panel 80061 $341.00 X-ray Exam Chest 2 views 92071 $526.00 Electrocardiogram, routine 93000 $225.00 Ambulatory Blood Pressure 99103 $49.50 Medical History & Exam (15 minute) 99213 $268.00 Detailed Medical History & Exam 99214 $464.00

Table 2.5 shows the Schedule of Events (SE) for each study visit. Adding the costs for all events at each visit will provide the cost per visit. Adding the costs of all visits will provide the base cost per patient for the trial. Table 2.5 Budget - Schedule of Events Procedure Screen Visit 1

Day 1 Visit 2

1 month

Visit 3 3

months

Visit 4 6

months

Visit 5 12

months Consent X

Height X Weight X X X X X X Vitals X X X X X X Medical History X Physical X X

Limited Physical X X X X Blood Draw X X X X X X Urine Pregnancy X X X X X X Dispense/Collect Drug

X X X X X

Randomization X Concomitant Meds X X X X X X Adverse Events X X X X X

The information in Tables 2.1, 2.3 and 2.4 are used to populate the cost of each study visit. The total cost for each study visit is determined by adding the costs the study events. For example, the total cost of the screening visit includes the following events in Table 2.6.

Table 2.6 Budget - Screening Visit Costs Event Cost

Consent $192.38

Height $7.43

Weight $7.43

Vitals $14.85

Medical History $87.75

Physical $202.50

Limited Physical $42.38

Blood Draw $42.53

Urine Pregnancy $12.15

Concomitant Medications $30.38

Data Entry $20.25

Subtotal $617.50

Overhead (30%) $185.25

Total $802.75

Visits can be broken down into individual event costs if preferred. Simply take the cost of the event and add the overhead to cost to determine the total cost for the event. For example:

 Adding an overhead of 30% to the informed consent ($192.38) brings the total to $250.94.

 The blood draw cost is $42.53 plus $12.76 (30% overhead) for a total cost of $52.29.

Table 2.7 includes the cost for each of the study visits (screening through visit 5).

Table 2.7 Budget - Study Visit Costs Study Visits Screen* $802.75 Visit 1* $341.01 Visit 2* $310.63 Visit 3* $310.63 Visit 4* $310.63 Visit 5* $390.80 Total $2,466.45

The cost to the site per subject for the study visits is $2,466.45. Assuming the recruitment goal for the site is ten (10) subjects, total subject visit cost would be $24,664.50. Subject compensation must be added to the cost per subject for a total per subject cost.

 Subject compensation is $25 per visit.  For five (5) visits for a total compensation of $125 per subject.

Total subject cost (including visit procedures, compensation, and overhead) is shown in Table 2.7. The overhead cost is added at the end of the section to determine total cost per subject as well as for the number the site is expected to recruit to the study. Table 2.7 Budget - Total Subject Cost Visit Costs Total $2,466.45

(per subject) Subject Compensation

$25/visit $125.00

Cost/Subject $2,591.45 Overhead (30%) $777.43 Cost per subject $3,368.88 10 Subjects $33,688.80

Thus far the costs for the study start-up section and the subject costs section have been determined. The next step in building the budget is to determine the additional costs of the study.

MANY BUDGET COSTS ARE THE SAME FROM ONE STUDY TO ANOTHER. KEEP A

LIST OF THE COSTS FOR TYPICAL ITEMS SUCH AS CONSENTING, COLLECTING

AND REVIEWING CONCOMITANT MEDICATIONS AND ADVERSE EVENTS. USE

THESE FIGURES TO POPULATE FUTURE BUDGETS FOR SIMILAR STUDIES.

Tip 2

Recruitment

The sponsor generally supplies recruitment materials and a set amount in the proposed budget for recruitment activities. To determine if the cost of recruitment provided by the sponsor will cover the site’s cost you must determine recruitment activities that will be used. These might include: mailings, media, social media, community events, and chart review. Many sponsors request a recruitment plan from the site. This includes the type of recruitment activities the site plans to do, a timeline, and the cost of each activity. Your site may use one or multiple avenues to recruit subjects. Costs can be estimated by looking at previous similar studies at your site and the recruitment for those studies. For the purpose of this budget recruitment activities will include chart reviews, attendance at a community health fair, and three television ads. Table 2.8 details the recruitment costs. Table 2.8 Budget - Recruitment Costs Recruitment Activity Cost Description Cost

Review Patient Charts PI (10 hrs. @ 202.50 per hr.) ($2,025.00) $2025.00

Community Health Fair 2 SCs @ $60.75 per hr. X 12 hrs. (6 hrs. each) $729.00

Television Ads 3 ads X $6,500 per ad $19,500.00

Sub-Total $22,254.00

Overhead (30%) $6,676.20

Total $28,930.20

Study Close-Out

In a multi-site study, the study officially closes when the last site has completed the last visit for their last subject, all data queries have been completed, and the sponsor has done the data lock. At this point, the sponsor should schedule a close-out visit with each study site. The close-out visit includes:

 An accounting of all investigational product. Packing and shipping the remaining product back to the sponsor.

 Review record retention requirements and ensure records will be stored in a safe and secure environment.

 Ensure all paper study documents and records are collected and filed for storage with applicable labeling for easy location.

 Return of any study-specific equipment the sponsor provided to the site.  Determine any outstanding items that need to be addressed.

Staff time to conduct the close-out visit should be included in the budget, as well as shipping materials and shipping costs. For most sites the close-out visit takes one day.

The study coordinator typically needs to be available the entire close-out visit. Other staff may also be involved including the investigator, pharmacy staff, or regulatory staff. Discuss the close-out visit with the sponsor at site evaluation to determine their expectations so you are able to apply appropriate costs for the close-out in the study budget. For this budget study close-out includes the following:

 Eight (8) hours of coordinator time at $60.75 per hour for a total of $486.00. With the addition of 30% overhead ($145.80) the total cost for the close-out is $631.90.

 Shipping materials and costs to ship will be an invoiced item.

Subcontractors

Subcontractors are usually off-site vendors used to perform procedures that cannot be done at the site or by the site personnel. If the site is hospital-based, these vendors may be on site, but in a different department. Examples of subcontractors might be: radiologists, surgeons, physician specialist (e.g., Ob/Gyn, Rheumatologist, Internist, etc.), and accountants. Cost for these services will be provided by the vendor. When reviewing procedures that require outside contractors make sure that you read the details of the protocol and the procedure to determine what is required for the procedure or service. For example: if the procedure is an x-ray does this only include a radiology technician or does the x-ray need to be read? For a biopsy you might have the costs of the surgeon, the surgery center, anesthesiologist, and other support staff. Read the protocol details to make sure that you include all costs of the procedure or service. In our study, the only subcontractor is for X-rays. The cost of $526 includes the X-ray and the reading of the X-ray. To simplify the budget process here, we included this as part of the visit costs. If the procedure is required for all subjects, then it should be included in the visit costs. However, in some studies not all subjects receive the procedure. In this case, this would be budget as a separate item in the contract/vendor section of the budget. Invoiced Items

Invoiced items are those procedures and tasks that do not occur on a regular basis or may or may not occur. One such items would be the shipping and handling of specimens to a central lab. Shipping may have special requirements such as the need for dry ice or special containers. This information is usually found in the lab manual, but may also be included in the protocol. Other invoiced items would include things such as:

 Submission of protocol amendments  IRB continuing review reports  Adjudication of SAEs  Unscheduled visits  Subject re-consent  Follow-up visits and procedures  Screen Failures (figured at the cost of the screening visit)  Sharps container  Biologic Waste Disposal

 Record Storage

The budget should identify the cost of these if possible. Some items are not possible to cost-out. For example, if a subject experiences an unexpected or adverse event that requires additional procedures, these cannot be predetermined as each event and subject is different. The budget should specify that these costs will be covered at fair market value by the sponsor upon submission of an invoice from the site. Items for which the cost can be pre-determined should be agreed upon and included in the budget such as an agreed upon set rate for SAE adjudication. Travel

Sponsors generally cover the lodging and meals for investigator meetings. The sponsor may have a travel department to take care of these arrangements. In this case, travel would not be included in the site’s budget. If the site is responsible for making the travel arrangements then the site would submit invoices to the sponsor for the costs. In addition to lodging and meals the staff time at the meeting should be compensated by the sponsor. While attending the meeting staff are being paid by the site. This would not be considered a business cost as it is study-specific and the travel and attendance would not be required otherwise. Generally an investigator meeting includes the attendance of the investigator and the coordinator. Most investigator meetings are 1 – 2 days in length. For this budget the cost of staff time is figured at 16 hours for the investigator and the coordinator. (Eight hours per day for a two day meeting.) Some meetings may be via phone conference or web. While there is no travel involved, the time involved should be compensated. Sponsors can provide information about meetings and time expectations. Additional Staff

Any additional support staff required to properly conduct the study should be included in the budget. This could include recruitment staff, scheduling staff, and a receptionist. In addition there may be accounting and billing costs. These staff are generally assigned to multiple studies, with a percentage of their time charged to each study. For example a receptionist may be compensated at 10% of their salary by your study. The site would need to determine any additional staff and the percentage of their time needed for the study. In this budget the following additional staff are included:

 Recruitment coordinator at 30% time for 6 months,  Receptionist at 10% for 18 months (this is who will handle the scheduling and

check-in of subjects).  Accounting/billing at a flat rate cost of $400 per month for 18 months.

Table 2.9 shows the costs for additional staff.

Table 2.9 Budget - Additional Staff Staff Salary Benefits

(35%) Percent Effort Length Cost

Receptionist $32,000.00 $11,200.00 10% ($4,320 per yr.)

18 months

$6,480.00

Recruiter $48,000.00 $16,800 50% ($32,400 per yr.)

6 months $16,200.00

Subtotal $22,680.00

Billing $400/month 18 months

$7,200.00

Subtotal $29,880.00

Overhead 30% $8,964.00

Total $38,852.00

Internal Budget The internal budget is the itemized list of all costs to the site to conduct the study. This budget is not typically shared with a sponsor, however the figures in the internal budget will be used to populate the various sections of the sponsor budget template. By detailing to this depth the site is able to determine the financial feasibility of conducting the study and use the figures as justification when negotiating the budget with the sponsor.

At this point the various sections of the budget have been created. The next step in building the budget is to use the figures from each section to populate a complete study total budget for the site. (Table 2.10) shows a different budget model. The same costs are used throughout the budget, however the overhead is figured at the end of the budget, not for each section. Invoice items agreed upon costs are included at the end of the budget, however not included in the budget total costs.

Table 2.10 - Internal Site Budget Start-up Costs Description of

Cost Per Unit/Hr. # Units Total

Document Review Investigator

$202.50/hr.

$1,215.00

Protocol Training Coordinator Research Assistant

Data Entry Study Nurse

Lab Tech

$60.75/hr. $29.70/hr. $20.25/hr. $87.75/hr. $24.30/hr.

1.5 1.5 1.5 1.5 1.5

$91.13 $44.55 $30.38

$131.63 $36.45

EDC Training Investigator Coordinator

$202.50/hr. $60.75/hr.

1.0 1.0

$202.50 $60.75

Research Assistant

Study Nurse Data Entry

$29.70/hr. $87.75/hr. $20.25/hr.

1.0 1.0 4.0

$29.70 $87.75 $81.00

Lab Set-up $150.00 1 $150.00 Pharmacy Set-up $300.00 1 $300.00 Chart Review Coordinator (initial

review) Investigator review

$60.75/hr.

$202.50/hr.

$607.50

$810.00 Budget and Contract Review & Negotiation

Research Director Investigator

$114.75/hr. $202.50/hr.

20 5

$2,295.00 $1,012.50

Subtotal $7,185.75 Overhead $2,155.84 Start-up Total $9,341.59 Study Visits Screen $802.75 Visit 1 $341.01 Visit 2 $310.63 Visit 3 $310.63 Visit 4 $310.63 Visit 5 $390.80 Total $2,591.45

(per subject) Subject Compensation

$25/visit $125.00

Cost/Subject Subtotal $2,591.45 Overhead $777.43 Per Subject Total $3,368.88

10 Subjects Total $33,688.80 Study Equipment Dedicated Fax & Line

Fax machine provided by Sponsor

Fax Line $69/mo.

24 months $1,656.00

Dedicated Computer & EDC System

Provided by sponsor

N/A

Overhead $496.80 Total $2,152.80

Study Close-out (return shipping of extra study drugs and supplies provided by sponsor)

Coordinator 8 hours 631.90

Overhead $189.57 Total $821.47 Subject Recruitment

Recruitment Costs $22,254.00 Overhead $6,676.20 Total $28,930.20 Additional Staff Recruiter $16,200.00 Receptionist $6,480.00 Accountant $7,200.00 Subtotal $29,880.00 Overhead $8,960.00 Total $38,844.00 Travel Investigator Meeting

 PI  SC

Meeting, meals, lodging, travel covered by sponsor

16 hours 16 hours

$3,240.00 $1,112.00

Subtotal $4,352.00 Overhead $1,305.60 Total $5,657.60 Total Budget Cost $119,436.46 Invoice Items To be paid upon invoice of service or procedure IRB Continuing Review Reports

Coordinator 1 hr. @$60.75

$78.98/rept.

Protocol Amendments

Research Manager ($114.75/hr.)

1.5 hr. @ $114.75

$223.77/ amendment

Subject Re-consent Coordinator .5 hr $30.38/ subject (10 subjects)

$394.94

Screen Failures 10 Total $21,819.33 SAE Adjudication Coordinator 10 hrs @

$60.75 $877.50/

SAE Review of MedWatch Reports in excess of 200

Investigator $50 per review up to 200 after initial 150

200 $13,000

Monitor Visits Coordinator Investigator

12 hours 1 hours

$723.00 $202.50

$1203.15

Unscheduled Visits Based on procedures performed

Sharps Containers $15 each 4 total $78.00 Biologics/Waste Disposal

$59/qtr. 8 total $613.60

Record Storage Paper Records $150/mo. 36 mos. $7,020.00

Note: Invoice fees include a 30% overhead cost.

Populating the Sponsor Budget Template Costs from the internal budget will be transferred to the budget template provided by the sponsor. The itemized costs in the internal budget will need to be grouped to fit into the appropriate line items and sections of the sponsor’s budget. Table 2.11 shows line items that might be included in the sponsor’s budget.

Table 2.11 - Sponsor Budget Template Start-up Costs Cost per

Unit # Units Total Cost

Investigator Protocol Review $150 4 $600.00 Site Set-up/preparation $8,000.00 Pharmacy Set-up $300.00 Investigator Meeting – PI $150 8 $1,200.00 Investigator Meeting – Coordinator

$50

$400.00

IRB Submission $1,200.00 Total

Fixed Study Budget Site Initiation Visit $700.00

Study Close-out $600.00 Monitoring Visit $200/day SAE Reporting & Submission $500/SAE

after 1st 3

IRB Continuing Review $300/

Protocol Amendment Submission $750/ Screen Failures (up to 10) $900/ Record Storage $30/yr. per

box

Total Per Subject Budget Informed consent $150 1 $150.00 Inclusion/Exclusion $50 1 $150.00 Medical History $50 1 $50.00 Physical Examination $250 1 $250.00 Brief Physical $50 5 visits $250.00

Lab Specimen $75 6 visits $450.00

Urine Pregnancy Test $50 6 visits $300.00

Vital Signs $30 6 visits $180.00

AEs $50 6 visits $300.00

Concomitant Medications $50 6 visits $300.00

Investigator Fee $150 6 visits $900.00

Research Nurse Fee $100 6 visits $600.00 Coordinator Fee $250 6 visits $1,500.00 Patient Reimbursement $25/visit 6 visits $150.00

Total Cost Per Subject $5,530.00

Using the figures from the detailed site budget, populate the sponsor’s budget. For simplicity it is probably best to group costs into sponsor line items when possible rather than to request multiple additions to the budget. For example:

 Site set-up/preparation would include the costs for the study start-up including protocol training, lab set-up, chart review, and budget and contract review and negotiation. You could include the costs of the coordinator’s review time as well as the overhead.

 The site initiation visit would include the training costs for the EDC system and protocol as well as overhead.

 For internal budget items that cannot be incorporated into one of the sponsor categories, the site can add these costs to the template and negotiate with the sponsor.

Once all costs identified by the site in the internal budget have been transferred to the sponsor’s budget template compare the two budgets to ensure that the sponsor’s budget covers all site costs.

Note that in the sponsor budget payments for various costs will be different than what is in the internal budget. Some may be higher and some may be lower. The key is to determine whether the total budget presented by the sponsor covers the site costs. If it does not, then it is time to negotiate. Budget negotiation in covered in Chapter 4.

Chapter Review

In this chapter we learned how to build an internal budget that covers the costs to the site to conduct a study. We identified the various costs of procedures, services and other costs including benefits and overhead. Sponsor budgets generally differ from an internal budget and the site costs must be transferred into the sponsor’s budget template. Once all items have been transferred, the internal budget and the sponsor’s proposed budget are compared to determine if the proposed budget adequately compensates the site. The key to creating budgets is to implement processes that are well-organized.

Apply Your Knowledge

Scenario:

Site “Clinical Trials ‘R’ Us” has been approached by Pharma, Inc. (sponsor) to conduct a clinical trial. The site has created an internal budget. Based on a review of the appropriate study documents and overhead cost, the site has determined that the cost per subject to the site is $4,500.00. This cost includes the cost of the procedures, services, staff time, subject compensation, and overhead. The sponsor’s proposed fee

is $5,000.00 per subject. This includes the cost for visit procedures, coordinator and investigator timed, recruitment of the subject, and data entry. Comparing the two costs would the sponsor’s proposed fee of $5,000.00 cover the costs to the site? Explain.

Chapter Questions

1. The sponsor’s budget is final and the site must accept it as is. a. True b. False

2. Personnel compensation should include benefits and required employment taxes. a. True b. False

3. Study start-up costs should be nonrefundable, regardless of whether the site enrolls subjects or not. a. True b. False

4. Invoiced items are those costs that may or may not occur during the conduct of the study. a. True B. False

5. The cost of “Doing Business” includes overhead costs. a. True b. False

and medical insurance companies are required to cover standard of care costs regardless of whether these are performed at the health care provider’s office or as part of a clinical trial. Medicare may also cover some research costs if the clinical trial qualifies under the 2000 Clinical Trial Policy. If the sponsor has agreed to pay for all costs of the clinical trial, then the site does not need to perform a coverage analysis.

The 2000 Clinical Trial Policy and The Affordable Health Care Act

In June 2000, the President of the United States directed the Secretary of Health and Human Services to authorize payment for routine patient care costs associated with participation in clinical trials. The Centers for Medicare & Medicaid Services (CMS) responded with the clinical trial policy national coverage determination (NCD) issued on September 19, 2000, now labeled the 2000 Clinical Trial Policy (CTP). In July 2007, revisions were made to the CTP to add coverage with evidence development (CED). CED is determined through the NCD process. (CMS, 2007) The revised NCD is found in section 310.1, of Pub. 100-03, of the NCD Manual. CMS decides after a formal review of medical literature whether to cover an item or service in the context of an approved study. (CMS, 2014) In addition, The Affordable Care Act (2010) requires insurers to cover the costs of routine care for patients enrolled in a qualifying clinical trial. These two policies necessitate performing coverage analysis for clinical trials that are covered under Medicare to determine the payer of the procedure or service. Standard of care procedures for subjects who are insured through Medicare may be billed to Medicare.

It is critical to determine the paying party to ensure compliant billing. Confusion can result in double billing where both the sponsor and the insurance company or the sponsor and Medicare are charged for the same item. Double billing and noncompliant billing practices can lead to fines, criminal action, cost to the site for government audits, and the possibility of the site not being eligible for government funding.

Coverage analysis is the process of carefully reviewing the protocol and the budget to determine what costs are covered under the CTP and assigning the costs to the appropriate party. The site’s payment plan should include tags to clearly identify the party to be billed. Many sites bill clinical trial costs through a central billing department. Using tags to identify and training the billing staff on the tag system helps to eliminate double billing.

Qualifying Clinical Trials

To qualify for Medicare coverage the clinical trial must meet the following three requirements: (CMS, 2007)

 The subject or purpose of the trial must be the evaluation of an item that falls within a Medicare benefit category (e.g., physician’s service, durable medical

The 2000 Clinical Trial Policy and The Affordable Health Care Act

Qualifying Clinical Trials

To qualify for Medicare coverage the clinical trial must meet the following three requirements: (CMS, 2007)

 The subject or purpose of the trial must be the evaluation of an item that falls within a Medicare benefit category (e.g., physician’s service, durable medical

In this chapter we review coverage analysis to determine the parties who are responsible for payment of various study costs. In addition to the clinical trial sponsor there are other parties that might be responsible for reimbursing research costs. Under the Affordable Health Care Act (2010) health and medical insurance companies are required to cover standard of care costs regardless of whether these are performed at the health care provider’s ofice or as part of a clinical trial. Medicare may also cover some research costs if the clinical trial qualiies under the 2000 Clinical Trial Policy. If the sponsor has agreed to pay for all costs of the clinical trial, then the site does not need to perform a coverage analysis.

Chapter 3 Coverage Analysis



What Is This Chapter About?

equipment, diagnostic tests) and is not statutorily excluded from coverage (e.g. cosmetic surgery, hearing aids).

 The trial must not be designed exclusively to test toxicity or disease pathology. It must have a therapeutic intent.

 Trials of therapeutic interventions must enroll patients with diagnosed illnesses/ conditions rather than healthy volunteers. Trials of diagnostic interventions may enroll healthy patients in order to have a proper control group.

In addition to these three requirements the clinical trial should have the following desirable characteristics:

1. The principal purpose of the trial is to test whether the intervention potentially improves the participants’ health outcomes;

2. The trial is well-supported by available scientific and medical information or it is intended to clarify or establish the health outcomes of interventions already in common clinical use;

3. The trial does not unjustifiably duplicate existing studies; 4. The trial design is appropriate to answer the research question being asked in

the trial; 5. The trial is sponsored by a credible organization or individual capable of

executing the proposed trial successfully; 6. The trial is in compliance with Federal regulations relating to the protection of

human subjects; and 7. All aspects of the trial are conducted according to the appropriate standards of

scientific integrity.

Some clinical trials automatically qualify for Medicare coverage of routine costs. These include:

1. Trials funded by the National Institutes of Health (NIH), the Centers for Disease Control (CDC), the CMS, the Department of Defense (DOD), and the Veteran’s Administration (VA);

2. Trials supported by centers or cooperative groups that are funded by the NIH, CDC, Agency for Healthcare Research Quality (AHRQ), CMS, DOD, and VA;

3. Trials conducted under an investigational new drug application (IND) reviewed by the FDA; and

4. Drug trials that are exempt from having an IND under 21 CFR 312.2(b)(1) will be deemed automatically qualified until the qualifying criteria are developed and the certification process is in place. At that time the principal investigator of these trials must certify that the trials meet the qualifying criteria in order to maintain Medicare coverage of routine costs. This certification process will only affect the future status of the trial and will not be used to retroactively change the earlier deemed status.

Routine costs covered in clinical trials include:

 Items or services that are typically provided absent the clinical trial (.e.g., conventional care).

 Items or services required for the provision of the investigational product (e.g., intravenous infusion of the investigational drug).

 Items or services needed for reasonable and necessary care arising from the provision of an investigational item or service—in particular, for the diagnosis or treatment of complications.

Items or services not covered include:

 Items and services provided solely to satisfy data collection and analysis needs that are not used in the direct clinical management of the patient (e.g., monthly CT scans for a condition usually requiring only one scan, depression and quality of life surveys); and

 Items and services customarily provided by the research sponsors free of charge for any enrolled in the trial.

Coverage Analysis

The first step in coverage analysis is to determine if the trial qualifies under the CMS requirements. Once this is established the site needs to determine who pays for what items and services. Review the sponsor’s budget to determine what items the sponsor has agreed to pay. These items should be identified based on the site’s coding system. For example research costs may simply be marked with an “R.”

Once the research costs have been identified, review the list of remaining items to determine the appropriate payer. To determine whether the item or service is covered ask the following questions:

1. Is the item or service conventional care? 2. Is the item or service required for the provision of the investigational item?

For participants covered by Medicare, routine costs will be billed to Medicare. Routine items for subjects covered under various commercial insurance policies will be billed to the appropriate insurer. Routine costs are those items or services that the subject is entitled to through Medicare or their insurance for conventional care. For example, a patient with type 2 diabetes would be eligible for diabetic care to include HA1C tests, routine visits, and foot care. If these items are included as part of a clinical trial they would be billed to the insurer. However, if the items or services are performed more often than what is covered in conventional care the additional procedures would be billed to the sponsor. For example, the subject’s insurance company covers two HA1C tests per year. If the study required this test quarterly for the period of one year, the sponsor would be billed for two of the tests and those would be included in the budget as research costs.

Current Procedural Terminology (CPT) codes are used in relation to National Coverage Determination (NCD) and Local Coverage Determination (LCD). These codes will be

used for billing purposes for Medicare and the insurance companies. Codes can be found by searching the CMS Database on the cms.gov website. The Medicare Coverage Database contains the National Coverage Determination (NCDs) and Local Coverage Determination (LCD) codes. Billing items and services requires the use of modifiers for the codes. The two modifiers used in qualifying clinical trials are:

 Q1 – Routine clinical service provided in a clinical research study that is in an approved clinical research study.

 Q0 – Investigational service provided in a clinical research study that is in an approved clinical research study.

Items to be billed to insurance or Medicare should be marked according to site policy. Previously we discussed marking items covered by the sponsor as “R.” In the same manner, the site might use the letter “I” to indicate the item is to be billed to insurance or Medicare.

Assigning Costs to Appropriate Party

In this section we provide an example of applying coverage analysis to a clinical trial.

Study Title: Phase III Multi-center Study of RA-123 in Combination with Methotrexate

For Treatment of Rheumatoid Arthritis.

Sponsor: JPMW Pharmaceuticals

Drug IND: 212-387

Principal Investigator: J.P. Investigator, M.D.

Investigational Item: RA-123

Study Phase: III

Coverage Analysis Steps:

Step One: Review the study protocol to determine if it qualifies under the Medicare CTP. Does this study qualify the Medicare Clinical Trial Policy? This study meets the requirements as well as the desired characteristics as shown in the Table 3.1 Medicare Qualifications below.

Figure 3.1 Medicare Qualifications

Requirements

The subject or purpose of the trial must be the evaluation of an item that falls within a Medicare benefit category.



It must have a therapeutic intent.  Must enroll patients with diagnosed rather than healthy volunteers.  Desirable Characteristics The principal purpose of the trial is to test whether the intervention potentially improves the participants’ health outcomes;



Does not unjustifiably duplicate existing studies;  The trial design is appropriate to answer the research question being asked in the trial;



The trial is sponsored by a credible organization or individual capable of executing the proposed trial successfully;



The trial is in compliance with Federal regulations relating to the protection of human subjects;



The trial is well-supported by available scientific and medical information or it is intended to clarify or establish the health outcomes of interventions already in common clinical use;



All aspects of the trial are conducted according to the appropriate standards of scientific integrity.



Step Two: Identify the items and services in the study that are routine costs and the number of times each is performed. Review the schedule of events and mark those that qualify as routine or conventional care. See Table 3.2 Schedule of Events example below.

Figure 3.2 Schedule of Events

Item or Service V1 V2 V3 V4 V5 V6 Lipid Panel  RA Factor    Physical   EKG  Joint Assessment       Vitals       X-rays – hands    Adverse Event       Concomitant Medications       Medication via Intravenous Infusion       Quality of Life Survey       Joint Pain Assessment      

Conventional care items for the treatment of rheumatoid arthritis (RA) are highlighted in yellow. Assume that conventional care for RA includes the following items and services:

 RA Factor – annually  Physical – annually  Joint Assessment – annually  Pain Assessment - annually  Vitals – at annual physical and infusion of medication  X-rays – annually  IV Medication – 4 times per year

Step 3: Assign payer codes to the items and services. Based on the conventional care for RA, Table 3.3 below indicates the items or services covered by insurance or Medicare. These items are marked with an “I.” The subject’s insurance company or Medicare will be billed for the items marked “I.” Note that only four of the infusions are covered by insurance as routine care allows only four per year. The remaining are billed to the sponsor and should be included in the budget. Vitals are covered at Visit 1 and an additional four times when the subject receives the IV. The remaining items and services are research costs and can be marked as such. For the purposes of this coverage analysis research costs are marked “R.”

Figures 3.3 Covered Research Costs

Item or Service V1 V2 V3 V4 V5 V6 Lipid Panel R RA Factor I R R Physical I R EKG R Joint Assessment I R R R R R Vitals I I R I R I X-rays – hands I R R Adverse Event R R R R R R Concomitant Medications R R R R R R Medication via Intravenous Infusion I R I R I I Quality of Life Survey R R R R R R Joint Pain Assessment R R R R R R

Billing

Once the payer for each item or service has been identified a payment plan reflecting the party to be billed should be created. If a billing department is used, as discussed earlier in this chapter, it is important to train the billing staff on how the items and services for clinical trials will be tagged and who is to be billed to ensure compliant billing practices. It is critical not to double bill on any item as this is considered fraud and may results in fines and imprisonment.

Chapter Review

In this chapter we reviewed how to determine whether a clinical trial is covered under the Clinical Trial Policy for Medicare Reimbursement. We reviewed the steps to perform coverage analysis to determine the party responsible for payment of the various items and services. Routine medical care costs can be billed to the insurer or Medicare for clinical trials under the Medicare Clinical Trial Policy. Conducting a thorough coverage analysis is important to ensure compliant billing practices.

Apply Your Knowledge

Scenario

Review the hypothetical study described below. Which items and services could be billed to the insurer or Medicare and why?

Study Title: A Phase III Randomized, Multicenter Study to Compare the Efficacy and Safety of BP-5000 to Simvistatin® in the Reduction of Total Cholesterol in Male and Female Adults 18 – 75 Years of Age Who Have Been Diagnosed with Chronic Hyperlipidemia.

Conventional Care: Annual physical, lipid panel blood screen every 6 months.

Item/Service V1 V2 V3 V4 V5 Weight      Vitals      Medical History  Physical   Lipid Panel      12-lead EKG  Distribute Medication     

Chapter Review Questions

1. If a person is covered by Medicare insurance all of the costs for procedures and services in a qualified clinical trial will be covered by Medicare.

a. True b. False

2. Physician services, durable medical equipment, and diagnostic tests fall under the Medicare Benefit Category.

a. True b. False

3. The Centers for Medicare and Medicaid Services provides oversight for the 2000 Clinical Trial Policy.

a. True b. False

4. Clinical trials funded by the National Institutes of Health are automatically qualified for Medicare Coverage.

a. True b. False

5. One of the requirements to qualify for Medicare Coverage is that the trial must enroll pediatric subjects.

a. True b. False

References

Center for Medicaid & Medicare Services. (2007). CMS Manual. Pub 100-03 Medicare National Coverage Determinations.

Center for Medicaid & Medicare Service. (2014). Guidance for the Public, Industry, and CMS Staff Coverage with Evidence Development.

Chapter 4 – Payment Plans

What Is This Chapter About?

In a survey by Pfeiffer in 2013, investigators reported that the most common issues they

experience with sponsors are with budget and payment. (Pfeiffer, 2014). Over 50% of

respondents to the survey reported at least one issue related to budget and/or payment

from the sponsor. Properly preparing and understanding the payment plan described in

the clinical trial agreement (CTA) may prevent or reduce these types of issues.

   

  

TIP 1

In this chapter we discuss payment plans including types of payment, triggers for payment, and

billing. We also review how the different types of payments and triggers impact study site. In a survey

by Pfeiffer in 2013, investigators reported that the most common issues they experience with spon-

sors are with budget and payment. (Pfeiffer, 2014). Over 50% of respondents to the survey reported

at least one issue related to budget and/or payment from the sponsor. Properly preparing and un-

derstanding the payment plan described in the clinical trial agreement (CTA) may prevent or reduce

these types of issues.

   

  

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The payment plan should be included in the CTA. Details of the payment plan should

include the following information:

 Payment type  Payment triggers  Requirements for payment  Payment schedule

PAYMENT TYPES

Sponsors generally set up payments to sites in one of three ways:

 By milestone  By visit  By invoice

Sponsors may also use a combination of these types of payment. For example, as

discussed in previous chapters, some clinical trial costs may or may not occur. When

this type of event or item occurs, the site would submit and invoice to the sponsor for

payment. (Examples include: shipping and handling; an unscheduled visit and

procedures needed to resolve an adverse event.) Most budgets are a combination of

either milestone or visit and invoiced costs.

TIP 1

THE MONEY IS IN THE DETAILS. REVIEW THE CTA TO UNDERSTAND HOW

PAYMENTS WILL BE MADE, THE TRIGGERS FOR PAYMENT, ANY SPECIAL

REQUIREMENTS FOR RECEIPT OF PAYMENT AND HOW OFTEN PAYMENTS OCCUR.

MAKE SURE THE PLAN IS ACCEPTABLE AND IS REASONABLE BASED ON THE SITE’S

FINANCIAL NEEDS.

MILESTONES Milestones in clinical research are the scheduled events or tasks that are the expected deliverables from the site. The sponsor might use milestones for payment of these deliverables. The sponsor will identify specific milestones a subject must complete before the site is reimbursed. This could also include meeting multiple milestones. Examples of milestones might be:

 The site will receive payment for screen failures when it has accrued five (5) screen failures.

 The site will be reimbursed for subjects at completion of Visit 3, Visit 6 and Visit 9.

 The site will be paid when 5 subjects have been enrolled in the study, and when those 5 subjects have completed visit 3, visit 6 and so on.

It is important to read and understand the milestones proposed by the sponsor to determine if the payment structure works for the site. If a site has multiple studies and revenue coming in on a regular basis a payment that is based on multiple subjects meeting milestones or subjects completing multiple visits this type of payment may be acceptable. However, for smaller sites that do not have a strong financial base and payroll needs are reliant on payment from the sponsor this may not be acceptable as payments may not occur for months.

STUDY VISITS

Reimbursement for study visits is by individual subject. The sponsor might propose

payment at the completion of each visit or by a set number of visits. Examples of payments by study visit are:

 The sponsor will reimburse the site for each subject when the subject has successfully completed three visits.

 The sponsor will reimburse the site for each visit completed by each subject. (This is the ideal payment for sites as they are reimbursed upon completion of work.)

INVOICES

As mentioned in Chapter 2, invoices are used for payment of items that may occur on

an irregular basis, may or may not occur during the trial, for example shipping and

handling of subject samples or the cost the cost of dry ice to ship lab samples.

Sponsors may have a set payment schedule where they will pay all invoices received at

the end of each month. Or a sponsor may pay upon receipt of invoice in a set number of

days.

The budget should clearly identify items to be invoiced. Similar to understanding

payments triggers (presented below), the site must review how invoices must be

submitted and when they will be paid. Check for the following details:

 What details does the invoice need to include?  To what department or person should they be submitted?  How are payments reimbursed? By electronic deposit or check?  How often or what is the timeframe for payment? Is payment sent 15 days or 30

days after receipt of invoice? Does the sponsor send out payments at set times

such as monthly or quarterly?

PAYMENT TRIGGERS

It is important to understand what triggers payments for subject visits/procedures to

determine if it is acceptable and workable for the site. Payment triggers may include:

 Submission of completed subject case report forms (CRFs) for visits through the electronic data capture (EDC) system.

 Submission and approval by monitor of completed subject CRFs for visits through the EDC.

 Submission, approval by monitor, and resolution of any queries of completed subject CRFs for visits through the EDC.

 Submission of an invoice by the site for reimbursement.  Monthly payments by the sponsor based on completed work based on entry into

the EDC system.

 Quarterly payments by the sponsor based on completed work based on entry into the EDC system.

The examples shown are a few of the payment triggers a sponsor might choose. Issues

related to timely reimbursement by the sponsor could arise for payments based on

monitor approval or resolution of queries. For example, if monitor visits are scheduled

quarterly or infrequently and the monitor must sign off on each of the case report forms

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CAREFULLY REVIEW THE PAYMENT PLAN AND UNDERSTAND WHAT

TRIGGERS PAYMENTS TO THE SITE FOR WORK COMPLETED. IF THE

TRIGGERS WILL NOT MEET THE FINANCIAL NEEDS OF THE SITE, REQUEST

CHANGES.

   

days after receipt of invoice? Does the sponsor send out payments at set times

such as monthly or quarterly?



 



TIP 2

   



 



TIP 2

CAREFULLY REVIEW THE PAYMENT PLAN AND UNDERSTAND WHAT

TRIGGERS PAYMENTS TO THE SITE FOR WORK COMPLETED. IF THE

TRIGGERS WILL NOT MEET THE FINANCIAL NEEDS OF THE SITE, REQUEST

CHANGES.

(CRFs), the site may not be reimbursed for their work until months after it has been

completed. Another example, if payment is based on resolution of queries, again this is dependent on monitor’s schedule, and

 How quickly the monitor provides the site with the queries,  How quickly the site responds to the queries, and  A final review and sign off by the monitor.

This process could take days, weeks, or months and it could be many months before the site receives payment.

Payment triggers should not interfere with the site’s financial ability to conduct the study. Slow payments impact the budget and for smaller sites that do not have large budgets

to cover costs such as payroll, this can be a serious problem. Carefully review the proposed payment triggers and request changes if these are not acceptable to the site.

BILLING

Billing for study site expenses may require billing multiple parties. For example, if the

study qualifies under Medicare, some procedures may be billed to Medicare. Under the

Affordable Health Care Act insurance companies may be billed for standard of care

items. If the sponsor is not reimbursing the site for all research costs, then the site must

conduct a coverage analysis, which was covered in Chapter 3, to determine the parties to be billed for the various procedures.

When a sponsor covers all research costs, then billing is relatively simple as all costs

are billed to the sponsor. As mentioned above, the site must be familiar with payment triggers to determine what the site must do to receive payment for work done.

Determine if the sponsor’s billing and payment schedules are appropriate for the site to conduct the trial and meet site financial responsibilities. After review, if there are

questions discuss these with the appropriate sponsor representative. Make sure that your questions are answered to your comfort prior to agreeing to the plan.

When research costs are covered by multiple parties, billing is much more complex. The

site must be careful not to double bill for a procedure or service. Double billing is

charging more than one party for the same cost, for example charging both Medicare

and the subject’s insurance company. Double billing is a serious issue and is considered fraud under Medicare rules. Whether intentional or not it may result in financial and criminal penalties.

The 2012 Affordable Care Act (ACA) includes tools and enhanced authority to fight against fraud. Additions to the ACA include:

 Increased sentencing guidelines.

 Identification of providers and suppliers who pose a higher risk to undergo a higher level of scrutiny.

 Fosters better coordinator among states, Center for Medicare and Medicaid Services (CMS), and the Department of Justice (DOJ).

 Provides additional funding to ramp up anti-fraud efforts. (CMS, 2012)

In addition, the Health Care Fraud Prevention and Enforcement Action Team (HEAT)

was created. In May 2012, HEAT coordinated a takedown involving more than $452

million and 107 individuals. (CMS, 2012)

When multiple parties are to be billed, it is important to develop a system that clearly

marks the party to be charged. Many sites, for example those affiliated with hospitals,

use a central billing office for research billing. In this case it is critical to train the billing

staff on the system. Whatever system the site uses to mark the party to be paid, it

should be clearly visible to help eliminate chances of double billing. In addition, an SOP

for billing should be developed by the site and a copy given to billing staff. Site staff as

well as billing staff who are involved in billing for study expenses should be required to review and sign off on the SOP.

TRACKING PAYMENTS

Properly tracking payments sent and received is important to determine that the site has

been properly compensated for all work completed. There are multiple accounting

software programs available, an accountant may be used, or the site may simply use

the Excel® program for tracking of payments. Choice of tracking programs will depend

on the site’s needs and preferences. Regardless of what is chosen the site must be able to track all costs and payments received.

Poorly tracked expenses billed and receipt of payment can lead to site’s not being fully compensated for their work. For simplicity the site might consider creating tracking

sheets for each study. For sites that conduct multiple studies, tracking expenses and

payments for all studies on one tracking sheet may become confusing, lengthy and hard to review and verify.

An example of a simple tracking sheet created in Excel® is shown in Figure 4.1 Excel Expense and Payment.

TIP 3

WHEN BILLING TO MULTIPLE PARTIES FOR STUDY COSTS, IMPLEMENT A SYSTEM THAT CLEARLY IDENTIFIES THE PARTY TO BE BILLED TO PREVENT DOUBLE BILLING.

Figure 4.1 AJAX Trial Expense & Payment

Invoice

Date

Invoice

# Item

Amount

Due Total Paid

Date

Received

Outstanding

Balance

1/12/2016 1

Visit 1, 2 & 3 for

subject 001LLL $3,600.00 $3,600.00 2/5/2016 0

1/30/2016 2

Screening subject

002JPP $1,800.00 0 $1,800.00

2/5/2016 3

2 Screen Failures

(0003LKP and

0004STL) $3,600.00 $1,800.00 2/28/2016 $1,800.00

2/15/2016 4 Shipping Labs (Jan) $187.36 $187.36 2/28/2016 0

Total Due $3,600.00

CHAPTER REVIEW

In this chapter we reviewed what should be included in a billing plan. We briefly covered

possible issues a site might encounter with payments and the importance of ensuring

that the sponsor’s payment plan meets the site’s needs. We discussed that double billing constitutes fraud and the importance of coding payment parties to eliminate this possibility. We also briefly reviewed the need for a proper payment tracking system.

APPLY YOUR KNOWLEDGE

The site has received the sponsor’s proposed budget for a clinical trial. They have also reviewed the payment plan. The sponsor will pay for all subject costs unless the subject

is covered under Medicare. The study is for individuals 45 – 70 years of age, so it is likely that the study will enroll individuals who are covered by Medicare. The study site

is affiliated with a hospital and billing of research costs is done through the hospital’s central billing department. What type of plan or process would you put in place to ensure that the appropriate party is billed and to prevent double billing?

CHAPTER QUESTIONS

1. The Affordable Care Act of 2012 included adding higher scrutiny for all Medicare providers and suppliers.

a. True b. False

2. Payment triggers should be clearly described in the payment plan. a. True b. False

3. The site should always accept the payment terms proposed by the sponsor. a. True b. False

4. Double billing is defined as billing a sponsor twice for the same procedure or service.

a. True b. False

5. Implementing a system to track billing and payments assists the site in being fully compensated for work performed.

a. True b. False

References

Pfeiffer, J.P. (2014). Managing and Negotiating Clinical Trial Agreements. Scholars

Press. Germany.

Center for Medicare and Medicaid Services, Affordable Health Care Act. (2012)

Retrieved from www.cms.gov

Chapter 5

Negotiating the Sponsor’s Budget

Negotiation is a business process and sometimes an art that requires the active participation of all parties. It is not necessarily a win-win, but reaching a mutual agreement that the parties are comfortable with. Two of the key strategies for successful negotiation are Preparation and Practice. These two strategies go a long way in creating an environment that is conducive to successful negotiations. Most people are not born negotiators and often prefer to avoid conflict. Being prepared and practicing helps to develop good negotiation skills and increases comfort level.

The negotiation process usually requires multiple sessions with the parties. Parties must utilize open and respectful communication tactics and be willing to consider the other party’s points.

In this chapter we will review the various strategies needed for successful negotiation between parties, items to consider during the negotiation process, and how to prepare for the negotiation.

Preparation

The first step by the site to prepare for negotiation with a sponsor is to review relevant documents and information. These include the budget, the clinical trial agreement (CTA), the organization’s charge master or fee schedule, costs from previous studies, and the protocol. As mentioned in Chapters 1 – 3, this is similar to budget preparation and is covered in those chapters. Assuming at this point that the site has created a budget, throughout that process budget needs and deficiencies in the sponsor’s proposed budget have been identified.

Create a list of the site’s budget needs. This list would be a “needs list.” In other words, what budget items need to be negotiated to properly compensate the site for the costs of conducting the study? These are items the site absolutely must have to conduct the study.

TIP 1

COLLECT AND PREPARE DATA AND INFORMATION BASED ON SIMILAR STUDIES

PREVIOUSLY CONDUCTED BY THE SITE THAT SHOW SITE QUALITY AND SUCCESS.

PROVIDE CHARGE MASTERS OR OTHER FEE SCHEDULES DETAILING THE COSTS

OF STUDY PROCEDURES.

The negotiation process usually requires multiple sessions with the parties. Parties must utilize open and respectful communication tactics and be willing to consider the other party’s points.

In this chapter we will review the various strategies needed for successful negotiation between parties, items to consider during the negotiation process, and how to prepare for the negotiation.

Preparation

TIP 1

COLLECT AND PREPARE DATA AND INFORMATION BASED ON SIMILAR STUDIES

PREVIOUSLY CONDUCTED BY THE SITE THAT SHOW SITE QUALITY AND SUCCESS.

PROVIDE CHARGE MASTERS OR OTHER FEE SCHEDULES DETAILING THE COSTS

OF STUDY PROCEDURES.

What Is This Chapter About?

In this chapter we review key strategies for negotiation, the importance of communication between

parties, justiication for requests, and share items a site might consider when negotiating with the sponsor. Negotiation is a business process and sometimes an art that requires the active participation of all parties. It is not necessarily a win-win, but reaching a mutual agreement that the

parties are comfortable with. Two of the key strategies for successful negotiation are Preparation

and Practice. These two strategies go a long way in creating an environment that is conducive to successful negotiations. Most people are not born negotiators and often prefer to avoid conlict. Being prepared and practicing helps to develop good negotiation skills and increases comfort level.

Create a second list of “wants.” These are items that the site would like, but does not necessarily require to conduct the study. For this second list, prioritize the “want” items in terms of importance to the site.

Collect data and documents that justify and support both the needs and wants identified on the lists. These might include:

 Costs from previous similar studies.  Costs for procedures and services in your location.  Site history showing meeting or exceeding recruitment quotas, on time

completion of study tasks and deadlines, low deviation and violation rates, and accurate and complete documentation.

Address each of the items on both lists and include appropriate documentation to justify each request. Being prepared with documentation and reasons to justify your requests demonstrates that the site is organized and has thoroughly reviewed the study to determine that it is feasible and they are interested in conducting the study. Site history as discussed above shows that the site that has proven that it has high standards and is capable of conducting the study with minimal issues. A sponsor is likely to be more open to negotiating with this type of site.

Communication

Good communication skills include knowing when to close one’s mouth and listen. It is through listening that one is able to understand where the other party is coming from, their perceptions of the study, the financial needs to conduct the study, and areas where they might be willing to compromise. Listening and watching can provide insight into the other party’s negotiation skills and strategies. As with the site, the sponsor has needs and wants. Together, through communication the parties will usually be able to reach an acceptable agreement. However, even in the best of situations, the parties may not be able to reach an agreement. This should not be viewed as a failure. It may be the best solution for both parties.

The budget is often one of the most contentious issues between the site and sponsor (Pfeiffer, 2014). It does not need to be contentious. Parties to a contract can negotiate fairly and in good faith by being respectful of the other party and clearly communicating

TIP 2

KEEP IN MIND THAT IF AN ITEM IS NOT FULLY COVERED BY A SPONSOR THERE

MAY BE OTHER ITEMS IN THE BUDGET REIMBURSED THAT ARE ABOVE THE COST

TO THE SITE. LOOK AT THE COSTS OVERALL WHEN DETERMINING YOUR NEEDS.

their requests for revisions to the budget. Communication is a two-way street. It requires give-and-take. It is important to enter the negotiation process with the attitude that there will be compromises. The “needs” and “wants” lists are simply tools that can be valuable during the negotiation process.

Do not go into the negotiation with your bottom line figures. Chances are the other party will counter with a lower figure. Requested figures should leave room for negotiation. However, inflating a requested cost extremely high may result in the other party not addressing the request and simply denying it. This is where the art comes into negotiation – determining a reasonable cost that leaves room to negotiate and ultimately, at minimum meet the site’s bottom line need.

An important aspect of successful communication in negotiations is responding to the other party in a timely manner. Delaying responses can impact the ability of the sponsor and the site to initiate the study. Delaying the start of the study can be costly to the sponsor. Sponsors understand the importance of a site that efficient, performs quality work that reduces study delays.

Practice

Preparing for the negotiation is a start. Practicing will improve your negotiation skills, assist in revising or developing good strategies, and increase your comfort level. Practice includes the following:

 Review your supporting documents until you are comfortable with the content of each and can explain your reasoning confidently.

 It may be helpful to conduct a mock negotiation session with someone who has been involved in similar negotiations.

 Practice in front of a mirror.  Contact sources at other sites and discuss the negotiation process. What has

and has not worked for them. Inquire if they have had experience with the sponsor.

 Come up with questions the sponsor may have of the site based on previous negotiations you have been involved in. Prepare your answers.

These strategies will assist whether you are a new or experienced negotiator. If it is your first time negotiating a contract, concentrate on the “needs” list. Once you have negotiated your needs select your top one or two priorities from your “wants” list. Don’t become overwhelmed by trying to negotiate each and every item. Build on your successes.

Items to Consider for Negotiation

There are multiple items that might be addressed when negotiating a budget with a sponsor. Some of these may seem obvious, others are not so obvious and are sometimes referred to as “hidden costs.” Whether obvious or hidden, these are costs incurred by the site in the conduct of the study. The following items are not a complete list of all costs, but are some of the key costs to consider when building and negotiating a study budget.

Study Start-up Fee

The site incurs costs to set-up for the study and to prepare study staff to conduct the study according to the protocol. These costs might include:

 Staff preparation time including the investigator’s time to review the protocol and investigator brochure.

 In addition, it may include investigator and/or staff time to review of patient records to identify potential study subjects.

 Review of the clinical trial agreement and budget.  Set-up fees for pharmacy and labs.  Staff training on the study protocol.  Staff training on the electronic data capture system.

The study start-up fee should be negotiated as a one-time non-refundable fee provided to the site prior to initiating the study. The fee should be nonrefundable regardless of the sites study results. Whether a site is able to enroll subjects or not, the site incurs these start-up costs and should be compensated for them.

Screen Failures

In any study, no matter how much effort is put into the recruitment and prescreening of potential subjects, there will always be screen failures - those subjects who do not meet the study criteria. Complex studies and studies with narrow eligibility and ineligibility criteria, generally increase the number of screen failures. These are factors to consider when estimating the potential number of screen failures for the site. In addition, reviewing the number of screen failures in previous similar studies will help in determining the site’s estimate.

It is a common practice for sponsors to the limit the number of screen failures that they are willing to reimburse the site for in their proposed budget. However, the site conducts

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PREPARATION, PRACTICE AND COMMUNICATION ARE THE KEYS TO

SUCCESSFUL NEGOTIATION.

all of the services and procedures in the screening visit for each of the screen failures. These costs should be reimbursed by the sponsor. A sponsor may not agree to reimburse for all screen failures. In this situation, the site should ask for an increase in the number proposed based on the number of screen failures the site has estimated based on experience with similar studies.

Sponsor Holdback

The sponsor may include a percent or set amount of the total study budget as a holdback until completion of the study. The site should attempt to negotiate for a holdback that will not negatively impact the site’s ability to meet its financial responsibilities for the study, such as meeting payroll, paying subcontractors and other services required for the study. Usually a 10% holdback is reasonable. Smaller sites may not be able to manage even a 10% holdback.

Serious Adverse Event (SAE) Adjudication

When a SAE occurs in a study it involves follow-up by the study coordinator and investigator that may takes months and sometimes even years. Follow-up activities include obtaining medical records from various sources (for example, hospitals, primary care physicians, vital records, rehabilitation facilities, etc.) depending on the SAE, and conducting follow-up visits and tests. Collecting all of the records related to the SAE takes time and may include copy costs. Multiple phone calls or visits to the record holders may be required. Following the subject to resolution of the SAE, which might include death, involves active follow-up of the subject, collecting ongoing records, and even bringing the subject in for follow-up visits.

It is not possible to determine the exact cost to the site of adjudicating each SAE. The might request that this be a cost that is invoiced to the sponsor based on the actual costs to the site. Another option is to request a flat fee for each SAE. To determine an appropriate fee the site should review previous SAEs to determine average time and cost to adjudicate these SAEs. This flat fee would be included in the budget as an invoiced cost (for example, $500 per SAE) since it may or may not occur.

Submission of Institutional Review Board (IRB) Continuing Review Reports

The IRB that approves the study and provides oversight will request that the site submit continuing review reports on a regular basis. This may be every 6 months or on an annual basis. The study coordinator is generally responsible for completing and submitting the continuing review reports and responding to any questions the IRB may have. The study coordinator’s time should be a cost that is reimbursed by the sponsor.

The site might negotiate this payment to be an invoiced cost based on the coordinator’s time to prepare and submit each report. Another option, as seen with SAE adjudication would be to include a flat fee for this task in the budget. Again, a reasonable fee could be determined based on past experience.

Review of MedWatch/SUSAR Reports by the Investigator

It is the responsibility of the investigator to protect the safety and welfare of the study subjects. To do this, the investigator must be familiar with adverse events occurring at

all study sites in order to inform subjects of new risks and to understand overall risks of the trial. This includes reviewing reports for SAEs in investigational drug trials, which are reported on a MedWatch form and unexpected adverse events in investigational device trials, reported on a Suspected Unexpected Serious Adverse Reaction (SUSAR) report. As an investigator’s responsibility this might be considered a “cost of doing business.” This is reasonable up to a certain extent. However, in multi-site studies there could be more hundreds of sites conducting the study. The investigator might need to review thousands of reports related to the study. The complexity and type of study will impact the number of events reported.

While it is reasonable to expect the investigator to review these reports, being inundated with hundreds of reports that require a great deal of the investigator’s time to review at no additional fee may not be acceptable. Investigators’ have a general idea of what is an average number of these reports to expect in a study, for example 250. The site might negotiate for compensation for the investigator’s time for review of MedWatch or SUSAR reports above that number. This would be an item invoiced to the sponsor either based on the time it took the investigator’s to review the reports or based upon an agreed upon set fee.

Record Storage

This may become less of an issue as sites and sponsors resort to all electronic records. However, many sites still utilize paper case report forms (CRFs) to collect subject data at study visits. The costs to the site to store these records for the two years post product approval, as required by FDA regulations, should be compensated by the sponsor. While electronic records do not require the physical space of a secure storage area, they must be stored and maintained on a secure computer or device. There are costs associated with staff including time to manage and access these records upon request by the sponsor. In addition with ever-changing technology, computers and software are changed and/or updated regularly. This may require moving the data and ensuring secure and complete transfer of data. Some sponsors request that the site retain the records past the two years. These are costs that should be included in the budget or open for negotiation if not included in the sponsor’s proposed budget.

Destruction of Study Records

When the date has passed for required record storage the site should destroy the study records. This is usually done through the use of a professional data management company that shreds confidential documents. The cost of destroying the study records should be covered by the sponsor and should be included in the budget as an invoiced expense. It should be noted in the budget, that this expense will occur after study closure and contract termination, but the sponsor is still liable for payment.

Destruction or Return of Investigational Product

At the end of the study the sponsor will schedule a close-out visit. During a close-out visit the sponsor’s monitor will perform the following activities:

 Ensure that all records have been packaged and securely stored. They will request name, address, and phone number of storage facility.

 Perform an inventory of the remaining investigational and control product. After the inventory, destruction of the drug may occur in one of several ways.

o The monitor may package the remaining product and prepare it to be shipped back to the sponsor, who will then be responsible for destruction of the product.

o The monitor may ask the site to package and send the remaining product to the sponsor. If this way is used, the site should invoice the sponsor for the cost of packing and shipping of the product.

o The sponsor may provide instructions for the site detailing how the remaining product is to be destroyed. In this case, the site should bill the sponsor for staff time for destruction of the product.

If the site is responsible for destroying remaining product, the site should require written instructions for destruction of the product from the sponsor.

Shipping and Handling of Specimens

During the study, specimens are generally processed at the study site and then shipped to a central lab for analysis. Shipping and handling of specimens should be covered by the sponsor. Shipping and handling of specimens requires special shipping containers, often requiring the use of dry ice, and biohazard stickers. These should be included in the budget under invoiced items.

Special Storage Requirements

Some investigational products require special storage. This could be storage in a -40˚ freezer or in a refrigerator kept at a certain temperature. Storage of these products requires logging the freezer or refrigerator’s temperature on a daily basis, sometimes more often. If the site is not equipped with the required storage units, this may be provided by the sponsor at their expense. However, if a study site plans to conduct studies on an ongoing basis, the site should invest in the appropriate refrigerators and freezers required for the studies the site conducts.

Cost of Living

Cost of living (COL) is one of those hidden costs that are often not addressed in a budget. When a study is long term, lasting multiple years, COL should be built into the budget. Staff salaries, procedure fees, and facility expenses increase on a regular basis. Reviewing COL increases in the study site’s geographic area for the past 3 – 5 years should provide a reasonable estimate of this cost.

Reporting of Physician Payments

The Physician Payment Sunshine Act requires that manufacturers of drugs, medical devices, biological and medical supplies who participate in U.S. federal health care programs track financial relationships with physicians. Manufacturers are required to report all physician payments or transfers ≥ to $10 monetary value to the Centers for Medicare and Medicaid Services (CMS). (CMS, ND). Sponsors often require the assistance of the investigator in tracking these transactions. This can be a time- consuming task. The sponsor and the investigator should agree to a set hourly fee for

the investigator’s time or an accountant (if used) to provide this information. This would be included in the invoiced items in the budget.

Chapter Review

In this chapter we reviewed strategies for successful negotiation of site budgets with sponsors. Key elements include, preparation, practice, and effective communication. We also reviewed some of the cost items that might be addressed during the negotiation process with the sponsor.

Apply Your Knowledge

Scenario

You are preparing to negotiate the study budget for your site. Based on the site budget you created after reviewing the appropriate study documents, conducting a feasibility study and a coverage analysis, there are several items the site has put on their “needs” list that are not included in the sponsor’s proposed budget or the proposed reimbursement does not cover the site’s cost. These items include:

 Study start-up costs (Does not cover costs estimated by the site)  Procedure fees for x-rays (The sponsor’s proposed budget includes

the X-ray but not the time for the technician.)  Consenting the subject (This is a complex study that the site has

determined, based on experience, it requires more time with the subject during the consenting process than in other types of studies. The cost proposed is less that what it will cost the site.)

What data and information would you collect and provide to the sponsor to justify that they cover the fee or that the fee be increase to the fee you are requesting? Why?

You also realize that the site’s reputation and ability to conduct efficient and compliant studies may be a factor when negotiating with the sponsor. What things would you want the sponsor to know about your study site?

Chapter Questions

1. Under the Physicians Payment Sunshine Act the investigator is required to report financial transactions with medical product manufactures to the Centers for Medicare and Medicaid Services. a) True b) False

2. Study start-up costs should be included as an invoiced item in the study budget.

a) True b) False

3. Two strategies to help prepare for negotiations and to improve negotiation skills are preparation and patience.

a) True b) False

4. Invoiced items are those costs that may or may not occur or occur on occur on

an irregular basis. a) True b) False

5. A successful negotiator knows his/her bottom line cost and goes into the

negotiation and requests this fee from the start. a) True b) False

References

Centers for Medicare and Medicaid Services (CMS). (ND). Fact Sheet for Physicians

Open Payment Sunshine Act. Accessed from www.cms.gov/Regulations-and-

Guidance/Legisation/National-Physicians-Payment-Transparency-Program/

Pfeiffer, J. (2014). Clinical Trial Agreements: Negotiation and Management. Scholar’s

Press. ISBN: 978-3-639-71262-9.

http://www.cms.gov/Regulations-and-

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Chapter 6

CLINICAL TRIAL AGREEMENTS - THE PRELIMINARIES

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FAMILIARIZE YOURSELF WITH THE UNDERLYING STUDY MATERIALS SUCH AS

THE PROTOCOL AND THE INFORMED CONSENT DOCUMENT BEFORE

REVIEWING THE CONTRACT.

What Is This Chapter About?

First Steps

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There are a few preliminary items to review when you are evaluating a contract for

services on behalf of a study site in a clinical trial agreement (CTA), regardless of how

large and complex or small and research-focused your particular organization is. This

chapter will guide you through the steps to take in the contract review process.

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study subjects, and the stage of development of the study drug or device. These

facts will help you to include the necessary protections for your study site, based on

the amount of risk that your site is willing to accept for the study.

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TIP 1 If you are working on all of the study preparations such as coverage analysis,

budgets and contracts simultaneously, you may have already read the background

information about the study in the protocol and the informed consent document. If

not, these are good places to begin. Familiarize yourself with the available study

materials to determine how long the study will likely run, the potential risks to the

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After you have a basic understanding of the study itself, review the CTA template.

 Who will your site be working with to perform this study?  Are there deadlines for enrollment that will affect your contract review and

negotiation timelines?

 Is there a contract review organization (CRO) involved to handle the administrative duties on behalf of the pharmaceutical sponsor, or will you be

working with the sponsor directly?

 Are there any provisions that immediately raise questions or concerns regarding the ability to perform the study? Make a note of those items so that you can ask

your questions of the CRO or sponsor or review in greater detail as you review

the CTA.

Generally speaking, the CRO or the sponsor will provide your study site with a template

contract that it intends to use for all sites participating in the study. Naturally, the CRO

or sponsor would prefer that you not make any changes to the contract, but immediately

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accept it (and sign it) as written. Typically, study sites should add preferred language and provisions to protect the site and its research subjects.

As you review the CTA, make changes that you wish to see in the document using

“redlined edits” to the sponsor’s original template. The sponsor will respond to your requested edits with further redlines by striking out, modifying or accepting your

requests. This process continues until you reach agreement on all of the contract provisions.

The “redlines” are created in a Word document by turning on the “track changes” function. Usually, this is turned on before you receive the contact from the CRO or the

sponsor. If it is not turned on, you can (and probably should) turn it on yourself. The tracking function appears under the Review menu tab.

Now you are ready to begin reviewing and editing the contract in earnest.

The Parties

Check whether all parties to the contract are identified. If so, is your correct legal entity

name and address listed? If not, strike out the incorrect information and replace it with

the corrected name and address. Have all of the parties been listed? For example, if

you wish the principal investigator to be a party to the contract, be sure he or she is listed in the preamble of the contract as a party.

Each party is directly responsible (and directly liable for performance) to the other party

or parties. Some study sites contract with a principal investigator to perform the study,

and some sites directly employ the principal investigator. As a rule, if a study site

employs the principal investigator, the site’s signature also binds the principal investigator. Does your study site have sufficient control over a contracted principal

investigator to take responsibility for his or her compliance with the agreement? Think

about whether the principal investigator will be insured for his or her services by you or

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SAVE THE ORIGINAL CONTRACT TEMPLATE A“ I“ FOR FUTURE REFERENCE. IMMEDIATELY SAVE THE DOCUMENT A SECOND TIME WITH AN UPDATED

NAME. IF YOU DO NOT HAVE A PREFERRED NAMING CONVENTION, YOU

COULD USE THIS ONE: CTA_STUDY NAME_YOUR INITIALS_DATE.

EACH TIME YOU RECEIVE AN UPDATED DRAFT WITH NEW EDITS, RENAME IT SO

THAT YOU CAN EASILY FIND THE LATEST VERSION.

through his or her own insurance provider? These are all factors to consider when

deciding who should be a party to the contract.

If you are not certain, check with your legal advisor for assistance.

Finally, before moving to the next step, you should also check the signature page at the

end of the contract. Are the parties listed there the same as in the preamble? The

parties should match! Note that if your study site does not want the principal

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Example 1 Naming the Parties to the Contract

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The Recitals

The recitals typically appear after the preamble of the contract. This is where you will

find additional background information about the parties, the study itself, and the

reasons the parties want to work together.

Your primary goal when reviewing this section is to be certain that you are comfortable

with the representations about your study site. There may also be wording about the

mutual promises and payments (“consideration”) being adequate for the services being

rendered. For example, if it applies, you may want to add that you are government-

affiliated, an academic center, or a non-profit entity. When reviewing the recitals, if you

believe any of the information is wrong or missing, revise or add it.

RECITALS SHOULD NOT INCLUDE CONTRACT TERMS OR WHAT ANY OF THE

PARTIES ARE EXPECTED TO DO. IF TERMS APPEAR HERE, MOVE THEM TO THE

APPROPRIATE PLACE IN THE BODY OF THE CONTRACT.

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Example 1 Naming the Parties to the Contract

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Example 1 Naming the Parties to the Contract Sponsor and Institution each may be referred to individually as a “Party” and

collectively as the “Parties.”

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IF THE PARTIES ARE NOT IDENTIFIED IN THE PREAMBLE, ADD THAT CLARIFICATION

AND CONFIRM THAT “PARTY” AND “PARTIES” IS CAPITALIZED THROUGHOUT.

REFERENCES TO ANY THIRD PARTY SHOULD NOT BE CAPITALIZED TO

DIFFERENTIATE IT FROM REQUIREMENTS UPON THE PARTIES.

investigator to be a party to the contract, he or she will likely still need to sign the

signature page, stating that he or she has read the document and understands the

requirements for a principal investigator in this study, and will abide by those

requirements.

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Example 1 Naming the Parties to the Contract

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The Definitions

Definitions can be handled in multiple ways, but whichever way is selected, it should be

consistent throughout the entire contract. The two most frequent ways are either to

have a section at the beginning of the agreement with all of the definitions used in the

contract listed in alphabetical order, or to define each term when it first appears in the

document. If a term is defined within the contract, it must be capitalized to signify its importance.

The definitions section should include any key terms and words that are used in a

unique way in the contract. The definition may not be familiar or what you would use in

that situation. For that reason, contract definitions are important and should be scrutinized to make sure that you can agree to that use.

Check to be sure that the contract includes a specific definition of the effective date.

Often this is found in the preamble or the definitions section, but too frequently there is

no explicit effective date from which you are held accountable for performing your

contracted duties. If there is no effective date given, choose a date that you can begin,

or if you prefer, the effective date can be the date that the agreement is fully executed by all of the parties.

Example 2 Recitals

WHEREAS, the performance of the Study is consistent, compatible and beneficial to the

role and mission of the Institution; and WHEREAS, the Institution is qualified to provide

the esea h e ui ed u de this o t a t….

Example 3 (Definitions Section)

Clinical Investigator Brochure: A brochure provided by the Sponsor, which contains

summary information of all studies, carried out during the development of the Product.

FDA: The Food and Drug Administration of the United States Department of Health and

Human Services.

Example 4 (Embedded Definitions)

The Institution and the Principal Investigator may be subject to monitoring and audits

by the Sponsor and its representative(s) as well as inspections by the United States

Food a d D ug Ad i ist atio FDA a d egulatory agencies of other countries and regions.

Chapter Review

In this chapter, you have learned that there are a few preliminary items to review before

you begin evaluating a contract for services on behalf of a study site in a clinical trial

agreement. You must read the study protocol and the informed consent document in

order to ensure that you understand the critical information about the study, such as the

procedures required, duration of the study, risk levels and whether you are competing

for enrollees. If the final informed consent document is not available when you begin

marking up the CTA, recheck it when it is final to ensure that you understand the risks.

With this information, you can include the necessary protections for your study site, based on the amount of risk that your site is willing to accept for the study.

Review the preamble, the definitions and the description of the parties to the

agreement to be sure that the information was prepopulated correctly by the CRO or the

sponsor, and correct any errors or wording that concerns you either due to accuracy or risks to your study site.

Apply Your Knowledge

Chapter 6 Practice Contract Editing

CLINICAL TRIAL AGREEMENT

This Clinical Trial Agreement ("Agreement") is effective on] [INSERT DATE], 6 Effective Date y a d among [SPONSOR NAME], a corporation located at [SPONSOR ADDRESS] ("Sponsor"), and [ ] having a business

address at [ ] "Research Institution").

WHEREAS, Sponsor has retained [CRO NAME] to provide study management and select oversight services for

the aforementioned protocol on their behalf. Throughout this Agreement, reference to SPONSOR may include

its agent, representative and/or designee, as applicable. Such reference can or may refer to [CRO NAME], a

Contract Research Organization engaged in the design, implementation and management of clinical trials of

medical devices and pharmaceutical agents.

WHEREAS, the Parties desire to conduct a clinical trial ("Trial") to gather information regarding the performance

of “po so ’s p op ieta y STUDY DEVICE NAME ("Device") according to the clinical protocol, entitled PROTOCOL NAME the Protocol . The T ial is of utual i te est a d e efit to the pa ties e ause it

furthers instructional and research objectives and may benefit patient care.

WHEREAS, Sponsor desires to enlist the assistance of Research Institution and its employed physician DOCTOR

NAME, M.D. as the Principal Investigator PI to conduct the Trial, using the Protocol which may be amended

from time to time, and is attached herein as Exhibit A, and

WHEREAS, the Trial is of mutual interest and benefit to Research Institution and Sponsor, and will further the

instructional and research objectives of Research Institution in a manner consistent with its status as a nonprofit

educational and health care institution.

NOW THEREFORE, the Pa ties ag ee …

Chapter Review Questions

1. Why should you review the study documents before reviewing and redlining the

template study agreement?

(a) to see how many procedures the principal investigator must perform

(b) to find out if there are any dangers to the study subjects from the procedures

(d) all of the above

2. Should the requirements upon the parties appear in the recitals section?

(a) Yes

(b) No

3. Does it matter where the contract effective date is located?

(a) Yes

(b) No

4. What should you do if you see wrong information about your research site in the

contract template?

(a) Leave the sponsor’s or CRO’s template alone, they do not like it if you change things.

(b) Correct errors about the study and the site if you see that information is wrong.

5. What should you do if you think a party to the contract is missing (for example, you

would like the principal investigator to be a party but he or she is not listed).

(a) Make the correction in the CTA using redlined edits (“track changes” function) (b) Ask the CRO or Sponsor to make the change and send it back to you.

(c) Make changes at the site to match the CTA as sent by the Sponsor or CRO. (d) Make changes to the Protocol to reflect the appropriate parties to the CTA.

Chapter Seven Responsibilities and Compliance

What Is This Chapter About?

There are a number of different sections of a CTA that deal with the legal

responsibilities of the parties, including compliance responsibilities. These are often

divided up throughout the CTA. For example, there may be a section describing the

obligations of the study site, and possibly one for the obligations of the principal

investigator. Occasionally, there will be a section to address the responsibilities of the

sponsor and/or the CRO. Many times, there will be portions of these responsibilities

described toward the end of the CTA in a miscellaneous section. Each of the sections

described in this chapter have legal and operational significance to your site and even if

dispersed throughout the CTA should be very carefully evaluated. This chapter will

guide you through what to look for in the responsibilities and compliance sections of the contract.

As with the other sections of the CTA, carefully read the wording of the CTA to be

certain that you understand and can perform the responsibilities as described and

can comply with the requirements noted. If the CTA includes obligations that are not

applicable or are too onerous for your study site, suggest reasonable modifications

that will allow you to perform the study without unduly modifying your operations or

incurring substantial extra costs. Focus first on the study site’s primary needs to ensure that those are addressed. Then, suggest changes for the lesser needs of the site with changes that protect your site.

Compliance with Laws

When reviewing the CTA, there will be a section or possibly multiple sections that

identify the laws that the study site and the principal investigator are expected to follow.

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IF YOU ARE MAKING CHANGES TO THE CTA IN RESPONSE TO THE INTERNAL

POLICIES OF THE SITE, INCLUDED A COMMENT BUBBLE EXPLAINING THE REASONING. THE SPONSOR IS LESS LIKELY TO PUSH BACK IF IT UNDERSTANDS

THAT THE EDIT WAS TO COMPLY WITH YOUR SITE POLICY REQUIRMENTS. BE

PREPARED TO PROVIDE A WRITTEN STATEMENT OF THAT POLICY ON YOUR SITE

LETTERHEAD TO BACK UP YOUR REQUEST.

Sometimes these are defined to be the “applicable laws.” Be certain to scrutinize the laws that are identified to be sure that you know what is required and that you are

subject to those laws. You should expect to follow the portions of the U.S. Food and

Drug Administration (FDA) laws, regulations and guidelines that are applicable to a

study site and/or investigator. There may also be requirements referred to as Good

Clinical Practices, and/or to the International Conference on Harmonisation (ICH) of

Technical Requirements for Registration of Pharmaceuticals for Human Use. These

guidelines are ethical and scientific quality standards for trials with human subjects and

are internationally recognized as appropriate and protective of the rights and safety for

trial subjects. Use of these standards facilitate the acceptance of clinical data by regulatory authorities in the European Union, Japan and the United States.

Another law that is commonly addressed in a CTA is the Health Insurance Portability

and Accountability Act of 1996 (HIPAA). HIPAA imposes requirements relating to the

collection, use, and disclosure of data and biological samples that may be gathered

during a study, and is the source of requirements associated with the use of an

informed consent (ICF) form and/or an authorization form (often incorporated into the

ICF). Sponsors and CROs vary in the language addressing HIPAA. There may also be

a Data Use Agreement incorporated into the CTA describing how the portions of data

governed by HIPAA will be used. Input from your site’s HIPAA Privacy Officer or if you do not have one, your compliance advisor would be very helpful in determining whether

the uses and disclosures listed by the sponsor/CRO are acceptable to your site. In

some instances, sponsors/CROs will specify that the data collected will be transferred

overseas and no longer be subject to protections required by the United States for such

data. Many Privacy Officers will not allow such language in a CTA. Other sponsors will

describe plans for unlimited future uses and disclosures of the data following the study.

In general, your site should limit the release of data to the sponsor/CRO to the minimum

amount that is necessary to actually conduct the study, and to uses that are approved in

writing by the study subject in either the ICF or the HIPAA authorization form. In all

cases, the CTA and the ICF/authorization form should be consistent as to the permitted uses and further disclosures of the subject’s information.

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IF THE SPONSOR/CRO REFER“ ONLY TO ALL APPLICABLE LAWS AND REGULATION“ YOU MAY ACCEPT THIS WORDING OR REQUEST MORE SPECIFICITY BASED ON YOUR “ITE’“ PREFERENCE. IF OTHER LAWS ARE REFERENCED, BE SURE YOU KNOW WHETHER SUCH LAWS ACTUALLY DO APPLY

TO YOUR SITE AND THAT THEY ARE REASONABLY RELATED TO YOUR

PERFORMANCE ON THE STUDY.

If the sponsor is an international company, there may be laws listed that you are

unfamiliar with or with which you cannot comply. Strike out the international laws, such

as European privacy or data protection standards that you cannot meet so that you are

not inadvertently in breach of the CTA.

Less commonly, there will be language in the CTA in which the Sponsor or CRO

identifies the laws with which it will comply. Depending on the policies and preferences

of your site, you should review it to be certain that your site agrees with – or at least has

no concerns with – the compliance promised by the sponsor and/or CRO. Some sites

will insert mutual compliance promises for all of the parties (to the extent applicable to

each party). Many sponsors are willing to assert compliance in this fashion, if asked.

Institutional Review Board Oversight

In many CTAs, there will be a requirement for the site to obtain and maintain oversight

by an Institutional Review Board (IRB) throughout the course of the study. This must

occur before any study subjects are entered into the study, and, depending on the site’s

and the IRB’s operating procedures, may additionally be subject to periodic review.

These ongoing reviews may be at specified prearranged times (e.g., quarterly,

annually), or they may be specific to a particular study depending on the complexity of

the study. In these instances, the IRB’s official approval letter will identify when the next

review must take place. Sponsors will generally impose a requirement on the site to

maintain IRB approval at all times during the study. Without ongoing IRB approval, the

data gathered during the study will not be accepted by the regulators, and the sponsor’s

success in developing a marketable product will be jeopardized.

In the alternative, a sponsor may elect to use a centralized IRB for the entire study,

relieving the site of responsibility for maintaining ongoing IRB approval. If a centralized

IRB (or other service such as a lab or photographer) should be clearly identified in the

CTA. Correspondingly, the site’s protection from liability for the actions of the

centralized service(s) should be very clear. In this case, the individual site generally

needs to submit a site-specific ICF to the central IRB with the site’s information (e.g.,

address, investigator, phone number).

SITES MAY WISH TO EXPLICITLY WRITE INTO THE CTA A REQUIREMENT FOR THE

SPONSOR TO RECEIVE FDA APPROVAL BEFORE RUNNING THE STUDY AND

SUPPLYING THE STUDY DRUG TO SUBJECTS. IF SPECIAL STORAGE, DELIVERY, OR

SHIPPING CONDITIONS ARE REQUIRED FOR THE STUDY DRUG, THE SITE MAY

WISH TO SPECIFY THESE IN THE CTA TO PROTECT ITSELF FROM LIABILITY FOR

INJURY TO STUDY SUBJECTS IF THE CONDITIONS ARE NOT MET.

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In the alternative, a sponsor may elect to use a centralized IRB for the entire study, reliev-

ing the site of responsibility for maintaining ongoing IRB approval. If a centralized IRB (or

other service such as a lab or photographer) is used, it should be clearly identiied in the CTA. Correspondingly, the site’s protection from liability for the actions of the centralized

service(s) should be very clear. In this case, the individual site generally needs to submit

a site-speciic ICF to the central IRB with the site’s information (e.g., address, investigator, phone number).

Adverse Events

Typically, the CTA will specify that the site and/or the principal investigator must report

all adverse events (AEs) and serious adverse events (SAEs). Sponsors generally have

a format established for reporting such events. Sometimes the reports are captured on

a Case Report Form (CRF) and otherwise a special document for such reporting is

required. Look for clarity in the CTA as to how (e.g., fax, phone, in an email, etc.) and

when (e.g., 24 hours after the event, 24 business hours after learning of the event) such

reports will be required. If the CTA indicates that the specifics for AEs and SAEs is in

the Protocol, be sure that the Protocol is very specific about timing, content and format

for when the reports are required. If the site or the principal investigator has questions

or concerns about this important reporting requirement, ask for clarification and capture

the information in the CTA. Similarly, if the CTA requires reporting that would be difficult

to complete on a timely basis, or that would divert from attending to the subject’s

medical situation, request a reasonable alteration that will allow the subject’s well-being

to be attended to as the priority. Also bear in mind that if the reporting timing is not

negotiable, the study budget may need to increase to permit another person to be

reasonably available to meet the timing requirement.

Filings and Registrations

There are usually multiple sections of the CTA that address a variety of filing

requirements and study registration. For the purposes of this chapter that addresses

compliance with laws, sites should watch for and remove CTA language in any section

that will prohibit use of study-related information by the site, the principal investigator, or

other study team members, if needed to meet any of the site’s regulatory reporting,

conflict of interest reporting, or grant requirements from non-commercial funding

sources.

Filings that are related to obtaining a patent as a result of participating in the study will

be addressed in the Finance chapter, [CHAPTER 8].

With regard to registration of the clinical trial, the site should determine which party is

responsible for registering the study with clinicaltrials.gov or any similar site. If this

obligation isn’t clearly assigned to one party or the other, the site must clarify whether it

has that responsibility. Pursuant to 42 USC §282 the sponsor is required to register the

clinical trial on the clinicaltrials.gov website. In some form, the responsibility must be

clearly identified in the CTA.

Filings that are related to obtaining a patent as a result of participating in the study will be addressed in the Finance chapter, CHAPTER 8.

Debarment, Disqualification and Exclusion

Virtually all CTAs will require that the study site unequivocally state that neither it nor

the principal investigator (if not already a separate party) nor any of the study team has

been debarred, excluded or otherwise rendered ineligible to participate in a clinical trial,

and that the site will notify the sponsor and/or CRO immediately if such a debarment,

exclusion, or ineligibility occurs. This is a significant concern of the sponsor due to the

impact on future approvals of the study drug or device if data gathered under the study

has been “tainted” by the site’s use of a currently debarred investigator. The CTA may

specifically reference the Generic Drug Enforcement Act of 1992, or it may instead

reference other laws and regulations applicable to the study.

Sites should be wary of CTAs that demand debarment reporting for persons that are

outside of the site itself and the team working directly on that sponsor’s study. If the site

is using another site or lab as part of the study, the site may not know the debarment

status of the other entities and should not represent otherwise. If the site is unable to so

limit this requirement to the study staff, it may be forced to obtain similar representations

from the other entities used for the study. If that happens, be sure to keep copies of the

other entities’ certifications of non-debarment/exclusion or other ineligibility to participate

in the study to protect your site during an audit of the study by the sponsor, CRO or

government agency. Some sponsors want the site to report ANY individual working on

ANY study or in ANY other capacity at the site. This is of concern to the site, as it may

violate its confidentiality obligations by reporting non-study related staff. Such requests

should be approved by the site’s human resources and compliance advisors before

agreeing to include in the CTA. In addition, the site may not be aware of the

debarment, exclusion or other ineligibility status of non-study team members. For that

reason, a site may want to include language such as, “to the best of its knowledge” or

Example 1 –Registering the Study

Registration and Related Information. Prior to the initiation of enrollment, Sponsor shall

have the right to register and provide any information that is: (i) required to be registered

by Sponsor pursuant to and in accordance with the Food and Drug Administration

Amendments Act (42 U.S.C. § 282) or any other applicable laws and regulations; (ii)

required by the ICMJE for studies intended to be published in the international peer-

reviewed literature (http://www.icmje.org); or (iii) from company sponsored trials of both

investigational and marketed medicines and products that are adequately-designed and

well-controlled (21 CFR 314.126), whether or not required by (i) or (ii) of this section

above. Study Site is not required to perform any registration of the Study.

Example 1 Registering the Study

“to the best of its knowledge after due inquiry” when attesting that there are no

debarments, exclusions or other ineligibility

A site should consider whether to agree to report, if asked for, “in progress” investigations and other actions. Many sponsors agree to remove such language if sites explain that such actions (e.g., investigations, hearings) do not necessarily result in debarment and/or exclusion actions and that the site wants to avoid having its employees experience repercussions of such allegations which may be deemed baseless upon further investigation during due process proceedings. In some instances it may be necessary to include language that limits the reporting to those in progress actions which are likely to lead to actual debarment, exclusion or disqualification, and that do not violate the site’s other confidentiality obligations (e.g., if the investigation is related to a different study sponsor and revealing information about the investigation would violate a contractual agreement to protect the other study sponsor’s information).

Depending on the site’s staff history, it may be necessary to strike out language that

represents that the site and/or any of the study team has never been sanctioned. For

example, if the site, IRB or principal investigator has received a warning letter from a

governing agency, this is a sanction but does not rise to the level of being debarred,

excluded or otherwise made ineligible to participate in studies. This is an example of

making sure that the CTA is accurately reflecting the site’s status with regard to

debarment, etc.

Following are two examples of debarment language for use by a site.

Example 2 - Debarment

No debarment or conviction under the Federal Food, Drug and Cosmetic Act. No Party to

this Agreement has been or will knowingly employ, contract with or retain any officer,

employee, or agent directly or indirectly involved with the Study who is or has been: (a)

debarred by FDA under 21 U.S.C. 335a, or (b) excluded from participation in the Medicare

program or any federally-funded health care program pursuant. Each Party will notify the

other Parties of any debarment or exclusion.

To the best of its/his/her knowledge after due inquiry, Site’s and Principal Investigator’s

employees or any other person retained by it/him/her to perform the Services pursuant to

this Agreement (i) is not presently debarred pursuant to the Generic Drug Enforcement Act of

1992, as amended (21 U.S.C. §301 et. seq.) or any other laws and regulations applicable to the

Study; (ii) does not have a revoked or suspended medical license or applicable certification,

and (iii) has not engaged in any conduct or activity which could lead to any of the above

mentioned debarment, disqualification, revocation or suspension actions.

Example 3 - Debarment

A site should consider whether to agree to report, if asked for “in progress”

Example 2 Debarment

Example 3 Debarment

FINANCIAL DISCLOSURE

Due to the Physician’s Payment Sunshine Act, some sponsors and CROs are including

language obligating the site to maintain records and provide periodic reports to the

sponsor regarding payments made that are related to the study. These records are to

aid the sponsor in meeting its reporting requirements. Sites should be aware that the

reporting obligations are the sponsor’s legal responsibility, not the site’s or the principal

investigator’s. Some sponsors want the site to provide reports on unique spreadsheets

or other systems that are extra work for a site to maintain. It is not convenient or

reasonable for a site to have to log all of the payment information differently depending

on the sponsor. If the sponsor cannot or will not accept the site’s standard reporting

format, the sponsor should be willing to pay the site to convert the data into the desired

format. Sites therefore do not have to provide free assistance to the sponsor to meet

such requirements.

Conflicts of Interest

At times, CTAs will request that a site’s investigators that are involved in a study sign a

financial disclosure document, and keep each disclosure updated if the information

should change. The disclosure document certifies that the investigator and his or her

immediate family does not have a financial interest in the sponsor’s company.

Sponsors usually ask that the disclosures be kept current for a full year after the study

ends. If a sponsor requests that the document be updated after a year that is longer

than required by the Code of Federal Regulations (21 CFR 712).

Example 4 – Sunshine Act Reporting

Site shall keep detailed records regarding Payments paid to, and on behalf of, each Health

Care Provider for services rendered pursuant to this Agreement, at Sponsor’s expense. Site

shall provide such Payment data to CRO and/or Sponsor at intervals and in a format defined

by Site [or it could say “in a format defined by CRO/Sponsor, at Sponsor’s expense], to satisfy

its business needs and current and future reporting requirements under local, state and

federal laws, rules and regulations, including, but not limited to the Physician Payment

Sunshine Act, 42 U.S.C. §1320a-7h. Sponsor and/or CRO shall be entitled to review Site’s

relevant records in relation to this study, with reasonable advance notice and during normal

business hours, to (i) confirm the accuracy of invoices issued by Site hereunder (including

subcontractors, if any); (ii) audit the required data reporting requirements set forth in

Section (i.e., the Sunshine Act).

ends. If a sponsor requests that the document be updated after a year, that is longer

Example 4 Sunshine Act Reporting

Site shall keep detailed records regarding Payments paid to, and on behalf of, each Health

Care Provider for services rendered pursuant to this Agreement, at Sponsor’s expense. Site

shall provide such Payment data to CRO and/or Sponsor at intervals and in a format deined by Site [or it could say “in a format deined by CRO/Sponsor”, at Sponsor’s expense], to satisfy its business needs and current and future reporting requirements under local, state and federal

laws, rules and regulations, including, but not limited to the Physician Payment Sunshine Act,

42 U.S.C. §1320a-7h. Sponsor and/or CRO shall be entitled to review Site’s relevant records

in relation to this study, with reasonable advance notice and during normal business hours, to

(i) conirm the accuracy of invoices issues by Site hereunder (including subcontractors, if any); (ii) audit the required data reporting requirements set forth in Section (i.e., the Sunshine Act).

Meetings

If a sponsor requests that the investigator or any other of the site’s study team attend a

training meeting, such meetings should be handled at the sponsor’s expense. Some

sponsors will not also pay for the investigator’s or study team’s time in addition to all

travel expenses related to the meeting, but this is based on a sponsor’s travel policies.

If your site requires the salary be paid for the time away from the site, be sure to include

it in your study budget.

Chapter Review

In this chapter, you have learned about the legal and regulatory compliance obligations

that are usually incorporated into a CTA, such as oversight, necessary disclosures,

reporting and confirmation that the study staff is not prohibited from performing the

study.

Apply Your Knowledge

Chapter Review Questions

1. If the study site does not use its own IRB, does it need to include language about

obtaining IRB approval of the study prior to proceeding with subject enrollment:

a. Yes

b. No

Chapter 7 Practice Redlining

The Site represents and certifies, neither Site nor Principal Investigator nor any person employed by or under contract to Site or Principal Investigator, including (but not limited to) any research performed hereunder has been (i) convicted of an offense related to any Federal or State healthcare program, including (but not limited to) those within the scope of 42 U.S.C. § 1320a-7(a); (ii) excluded, suspended or is otherwise ineligible for Federal or State healthcare program participation, including (but not limited to) persons identified on the General Services Administration’s List of Parties Excluded from Federal Programs or the HHS/OIG List of Excluded Individuals/Entities; or is otherwise ineligible for Federal or State healthcare program participation or (iii) debarred from or under any Federal or State healthcare program (including, but not limited to debarment under Section 306 of the Federal Food, Drug and Cosmetic Act (21 USC 335a). Site further represents and warrant that no person employed by or under contract to Site in connection with the performance of the Agreement is listed in the FDA’s Clinical Investigator Disqualification Proceedings database. Site certifies that if, at any time after execution of this Agreement, it becomes aware that it has or any person who participated, or is participating, in the performance of any service or any other work for Sponsor has, become or is in the process of being charged, convicted, debarred, excluded, suspended or otherwise rendered ineligible, it will notify Sponsor in writing at: [Sponsor’s address] within two (2) days of its becoming aware of this fact.

sponsors will not pay for the investigator’s or study team’s time in addition to all

Chapter 7 Practice Redlining

2. If a sponsor will not pay for my principal investigator’s time to attend a required meeting, does the site have to absorb the loss of that investigator’s time?

a. Yes, unless the sponsor will agree to increase its allowance for other costs in

order to reduce the impact of the loss of the investigator’s time to attend the meeting.

b. No, not if after initially refusing to pay, the sponsor agrees to pay an amount

that was reduced from the initial requested payment amount.

c. Both of the above.

3. The sponsor is asking for immediate reporting for adverse events (AEs) and

serious adverse events (SAEs). Is this reasonable and should it be accepted?

a. If a site is staffed such that it can make immediate reports of AEs and SAEs

without impacting the health and wellbeing of the study subject that is

experiencing the event, then the site can agree to the timing the sponsor has

requested.

b. If a site would have to add staff or increase “on call” duties to timely submit such reports, the site may reasonably request an extension by changing

“immediately” in the CTA to “promptly” or “within 2 days of learning of the event.”

c. If a site has a documented policy that it will always report AEs and SAEs

within 2 business days, the site should provide the policy on its letterhead and

ask sponsor to approve the timing so that an exception in operational process

is not needed.

d. All of the above, as applicable.

Chapter 8 - Finance

What Is This Chapter About?

In this chapter, you will learn about several financial-related considerations that are

addressed in a CTA. These are of particular interest to a site because such provisions

will protect the site from negative financial impacts that could arise during a study, as

well as address, at a high level, budget related matters that are further detailed in the

budget exhibit to the CTA. The information indicated in these sections of the CTA

should not contradict anything in your budget exhibit.

Payment

In most CTAs, the payment terms and the budget are explicitly documented in a budget

exhibit, so there is often not much stated in this section. When reviewing this part of the

CTA, check it for consistency with the content of the budget to ensure that the terms are

not contradictory. If not included already addressed, add language in the payments

section to clarify that should be a protocol deviation occur due to a study subject’s

medical emergency, the sponsor will not refuse to pay the site.

The payments section might include a requirement that the site submit all case report

forms (CRFs) within a certain timeframe in order to be paid. If the sponsor is requiring

the site to submit the forms in less than five days, consider whether the due date can

reasonably be met, and if needed ask for more time. A turnaround time of three to five

business days is generally reasonable, depending on the staffing at the site. If the

sponsor wants a quicker turnaround time, a rapid-document turnaround fee may be

requested. This will need to cover the cost of the coordinator’s time dedicated to meet

the short deadline. It is important to ask for the time listed to be in business days so that

a coordinator doesn’t have to be brought in on the weekend or a holiday, possibly at

overtime pay rates, to meet the deadline.

Example 1 –Submission of Case Report Forms

Institution will make reasonable efforts to enter data within [site should select the number of days 7/10/14] business days after subject visits and within 5 business days after the last Subject’s last visit. Sponsor will make best efforts to submit only legitimate data queries

to Institution. Institution will make reasonable efforts to respond within [3/5/10] business

days to Sponsor’s queries. If Institution is unable to resolve a query within this timeframe,

it will instead respond with an explanation and expected date of resolution.

Institution will make reasonable efforts to enter data within [site should select the number

of days 7/10/14] business days after subject visits and within 5 business days after last

Subject’s last visit. Sponsor will make best efforts to submit only legitimate data queries to

Institution. Institution will make reasonable efforts to respond within [3/5/10] business days

to Sponsor’s queries. If Institution is unable to resolve a query within this timeframe, it will

instead respond with an explanation and expected date of resolution.

Example 1 Submission of Case Report Forms

Payment frequency might be listed in the CTA as monthly, quarterly, or other frequency.

The ideal is to set up monthly payments to ensure that the site has adequate cash flow.

Quarterly payments are acceptable, and sites are advised to challenge less frequent

payments. Payments may be triggered by CRF completion or completion of queries.

Payments based on CRF completion are better for the site because the site has control

over the completion process. If the payments are triggered by completion of queries

and the sponsor will not allow a change to this requirement, the site should cap the time

to review the queries to a maximum of 10 business days so that payment is not delayed

for reasons outside of the site’s control. In addition, some sponsors pay CROs by the query, which encourages excessive numbers of unnecessary queries, and adds to the

site’s workload and costs. If the sponsor indicates that payments will be released after data is “entered and monitored,” the site should try to remove “monitored.” There can be significant delays for the site to wait for a monitor to arrive and approve the data so

that payment can be released. Once the monitor has verified that the payment is

triggered, if it is monitored early in the quarter, the site might have to wait until the next

quarter for that payment to go out, meaning that it could be 4-5 months before the site is

paid for a visit. If “monitored” is removed, contractually the sponsor should have to pay once the data is entered.

Another payment term a site may want to include is a record archiving fee. If this is

sufficiently addressed in the budget, it is not necessary to add to the payment terms in

the CTA. If it is not expressed in the budget, it will allow the site to request

reimbursement for its costs to retain sponsor’s records related to the study. CTAs almost always establish that a sponsor owns the study records, so sites should not have to pay to store sponsor’s records beyond the site’s normal retention period.

On occasion, the CTA payment section will reference “advance payments,” which is a refundable amount that the sponsor provides the site on a one-per-patient basis. The

site may want to consider the pros and cons of accepting such a payment, and decline it

TIP 1

SOME SPONSORS PAY PER VISIT, SOME PAY PER MILESTONE, AND RARELY SOME

PAY PER PROCEDURE. THE IDEAL ARRANGEMENT IS TO BE PAID PER VISIT OR PER

PROCEDURE SO THAT THE SITE RECOUPS COSTS AS THEY ARE INCURRED. TRY TO

AVOID MILESTONE PAYMENTS. IF THE SITE IS PAID PER MILESTONE AND A STUDY

SUBJECT DOES NOT HIT THE NEXT MILESTONE, THE SITE WILL LOSE MONEY ON THE

VISITS THAT HAPPENED BETWEEN THE TWO MILESTONES. IF THE SPONSOR

REQUIRES MILESTONE PAYMENTS, MAKE SURE TO ADD LANGUAGE THAT ENSURES

THE INSTITUTION WILL BE PAID EVEN IF THE SUBJECT DOES NOT MAKE IT TO A

CERTAIN MILESTONE. SITES NEED TO BE PAID FOR THE WORK PERFORMED AT

EACH VISIT.

if it is not necessary. The site must pay the sponsor the money back if it doesn’t enroll the number of subjects for which an advanced payment is made, or use up the amount

of the advance payment. For example, the sponsor might offer an advance payment of

the total amount payable for one study subject, or the offer might be for a flat dollar

amount that is less than the total for one subject. Typically, the site will not receive any

additional payment from the sponsor until the advance payment has been offset. The

advance payment may be helpful; however, if the sponsor is paying on a quarterly basis and the site needs the advance payment to get the study up and running.

The payment section may refer to a “holdback” amount, which is a portion of the per- patient payment that is retained by the sponsor until all site activities are completed and

the sponsor has approved all of the case report forms and other documentation. This is

an incentive for the site to get all of its data and queries completed, return all of the

study materials, and have the site closeout visit. The holdback payment is then

released to the site as a final payment. The ideal holdback amount is ten percent or

less. A holdback of twenty percent or more is unreasonable and a reduction should be requested.

Sites should check to be certain that there will be sufficient time to resolve any final

payment discrepancies before the study is closed. Usually 90 days after study completion will be enough to complete this process.

Subject Injuries

Although not a lengthy section, the subject injury provision in a contract is one of the

most important protections for the site and its enrolled subjects. If a subject should

happen to be injured because he or she participated in a clinical trial, the subject’s care to recover from the injury should be paid by the sponsor. This provision can be one of

the most contentious provisions in the entire CTA, so it is important to know what the

very minimum subject injury protection the site will accept. Ideally, the site will be able

to obtain sufficient subject injury coverage without having to accept the absolute minimum that can be tolerated.

TIP 2

REMOVE LANGUAGE THAT PROHIBITS THIRD PARTY BENEFICIARIES TO THE

AGREEMENT; SUBJECTS WHO ARE INJURED (OR THEIR FAMILY MEMBERS WHO SUE

ON BEHALF OF THE SUBJECT) ARE INTENDED TO BE THIRD PARTY BENEFICIARIES

UNDER THIS SECTION. IF SUCH LANGUAGE IS PRESENT, INSERT THE SUBJECT INJURY

CLAUSE AS AN EXCEPTION.

When reviewing a subject injury clause, look for and add if needed, a description of

what is covered under the provision. It is best to include illness, injury and death to

Subject Injury. Sponsor will reimburse Site at actual cost for reasonable and necessary

medical expenses incurred by a Subject for medical care in the treatment of adverse

reactions arising directly from the Study Device used in compliance with the Protocol and

this Agreement, provided, however, that such adverse reactions are not attributable to the

negligence, recklessness, or willful misconduct of any employee or agent of Site or Study

Personnel, or their failure to follow any applicable federal, state or local laws, regulations, or

guidelines, or to conform to reasonable prudent clinical practices, including GCPs as

applicable to clinical device studies. The Sponsor shall not be obligated under this Section to

provide compensation for: (a) illness-or-injury-related costs that are not related to medical

care (such as lost wages), (b) medical expenses that are paid for by a third party (provided

that neither the Institution nor the subject shall be obligated to seek reimbursement from

third party insurers), (c) medical expenses for any injury or illness attributable to any

underlying subject illness, (d) medical expenses caused by treatment that would have

occurred absent the Study, or (e) medical expenses caused by the Subject’s failure to follow

the instructions, to the extent Subject is capable of following such instructions, provided

within the Protocol and listed in the Informed Consent.

Subject Injury. For purposes of this Agreement, the term “Subject Injury” means an injury,

illness or death that, in the opinion of the Principal Investigator was caused by Study Drug

or Study procedures required by the Protocol that the Study subject would not have

received if the Subject had not participated in the Study. Sponsor will assume

responsibility and submit payment to Site for the reasonable and necessary costs of the

diagnosis and medical treatment of any Subject Injury experienced by a Subject enrolled

in the Study except for such costs caused by: (i) failure to adhere to the terms of the

Protocol by Site or Principal Investigator, except for medically necessary deviations to

protect the health and wellbeing of the Subject in an emergency situation, or (ii) negligence

or willful misconduct on the part of the Site. Sponsor acknowledges and agrees that a

Study subject may choose to obtain treatment for Subject injuries from another medical

provider unrelated to the Site, which shall not void this Subject Injury provision. Site agrees

to provide or arrange for prompt diagnosis and medical treatment of any Subject Injury

experienced by a Study subject. Site further agrees to promptly notify Sponsor of any

Subject Injury.

Example 3: Subject Injury Drug

Example 2: Subject Injury Device

Example 2 Subject Injury Device

Example 3 Subject Injury Device

cover the potential mental, emotional and physical ramifications of an adverse reaction

to the study drug or device. More limited coverage is given if the sponsor will approve

only “bodily injury” or “physical injury.” Look also for a description of the causal

relationship between the study drug and the injury, such as “believed to have been

caused by,” “reasonably related to,” or “may have been caused by.” Terms such as,

“known to be caused by,” or “known to be related to,” or “sustained as a direct result of,”

will limit the subject injury protection.

A good subject injury provision will identify who determines that there was a subject

injury. It is best for a site to have that determination made by the principal investigator,

who knows the subject’s medical condition because he or she has actually been treating

the subject. A sponsor should not be permitted to make the sole determination as to the

cause of the injury, as it will not want to admit that the study drug caused an injury or

illness or even death. In some cases, the sponsor will prefer a joint determination that

an injury has occurred, but this is less preferred.

The next point of consideration is to review the exceptions from payment for a subject

injury. Frequently, the sponsor will not want to pay for a subject injury caused by the

negligence of the principal investigator or site, or for violations of the protocol or written

instructions from the sponsor or CRO. These are reasonable and acceptable

exceptions. The sponsor may also include exceptions for legal violations by the site, or

failure to follow good clinical procedures; these are also generally reasonable for a site

to accept. One other exception that is frequently requested by a sponsor is for injuries

attributable to the subject’s underlying disease. This exception can be tricky because

the injury might be an exacerbation of the disease caused by the study drug, so if

possible, sites should remove this exception.

Be wary if a sponsor wants to exclude payment for subject injuries that are paid for by

the subject’s insurance coverage. This may get the site into trouble with Medicare as a

violation of Medicare Secondary Payer law for subjects with Medicare Insurance. Seek

guidance from legal counsel before agreeing to accept such wording. While not illegal

to accept such language for subjects with private (not government program) insurance

coverage, it does create an administrative burden for sites to ensure that they are not

incorrectly billing, depending on the subject’s insurance coverage. Watch for references

to how uninsured subjects who are injured will be compensated. Will the site’s

uninsured subjects have to pay for care out of pocket, possibly causing the site to

absorb those costs? In addition, it creates unfairness for the subjects with private

coverage, because those patients will have to pay any applicable deductibles,

copayments and coinsurances which can sometimes amount to tens of thousands of

dollars. Many sites simply insist that all injured subjects be treated the same by the

sponsor, regardless of the availability or lack of insurance coverage.

The subject injury provision should include a description of how much of the injury will

be paid, and who will receive the money. Ideally, the sponsor and the study subject will

work directly together to submit bills and receive payment. This is ideal because it

permit

takes the site out of the middle; however, some sponsors prefer not to have direct

contact with the subjects and will work with the site to provide subject injury payments.

This is also acceptable and the most commonly used arrangement. In this situation, the

site will pay for the subject’s injury care, and the sponsor will reimburse the site for

invoices submitted. The site should avoid having to obtain sponsor’s preauthorization of

such care because there tends to be a lot of back-and-forth regarding the approved

costs, leaving the site holding a lot of unpaid expenses until the sponsor grants the

preauthorization.

Indemnification

Sites want to have an indemnification provision that promises that if the site is sued for

a reason related to the study, that the sponsor (or more rarely, the CRO) will indemnify

the site. The indemnification provision describes how the site will be protected from the

costs or losses due to a lawsuit or other action started by a third party, not the sponsor

or CRO that has signed the CTA. If a site is at risk for a claim held by a subject, the risk

is then switched to the sponsor because the sponsor agreed to indemnify the site in the

contract. If the sponsor is not a party to the CTA, ask the CRO to provide the sponsor’s

Letter of Indemnification or “LOI” template agreement. That LOI is signed by the site’s

representative and the sponsor and is a separate contract between the two parties

establishing the terms of the indemnification protection.

The details of the indemnification provision are usually quite heavily negotiated, as the

broader the protection, the better for the site, but the more expensive for the sponsor. A

site will want to identify its top priorities for which it wants protection, , e.g., subject injury

payments or indemnification of contractors as well as employees working on the study,

and focus on obtaining those priorities. Unfortunately, the reality is that the remainder

of the protections may have to be used as negotiating chips to obtain the protections

identified as the most necessary.

Example 4 – Subject Injury (Payable Amounts)

Sponsor will pay for all reasonable and customary fees for the diagnosis and treatment of

subject injuries…

…except to the extent such costs are covered by the Study Subject’s insurance or other third

party coverage…

Example 5 – Subject Injury (Potential Compliance Issues)

Example 4 Subject Injury (Payable Amounts)

Example 5 Subject Injury (Potential Compliance Issues)

n, , e.g., subject injury

working on the study,

Sites will also need to determine whether to reciprocate the indemnification offered by a

sponsor. Some sponsors will not require it, others will insist on it. Mutual

indemnification is usually acceptable in this situation, although some sponsors will

require greater indemnification from the site than it offers. The site must be prepared to

see such CTAs and know whether to invest the time and money into reviewing a CTA,

coverage analysis and budget for studies that do not offer the enough protection.

The Party or Parties seeking indemnification under this Article shall (i) give prompt written

notice to the indemnifying Party after (1) receiving any Claim or (2) learning of any potential

Claim; (ii) permit the indemnifying Party to assume the defense and/or disposition of any such

Claim or related litigation, provided that the counsel selected by such indemnifying Party is

reasonably acceptable to the Party or Parties seeking indemnification; and (iii) cooperate with

the indemnifying Party in all reasonable respects with regard to the defense of such Claim, with

reasonable out-of-pocket costs of the Party or Parties seeking indemnification to be

reimbursed by the indemnifying Party. The indemnifying Party under this Article shall not enter

into any settlement agreement with a claimant without the prior written permission of the

Party or Parties seeking indemnification, which permission shall not be unreasonably withheld.

Example 6 – Indemnification (Simple Mutual Provision)

Example 7 – Indemnification (Comprehensive Mutual Provision)

Sponsor Indemnification. Sponsor shall indemnify, defend and hold harmless the Site, its trustees, directors, officers, agents, representatives, contractors, and employees (collectively

“Site Indemnitees”) from any liability, loss, costs (including reasonable attorney’s fees), or

damages (collectively, “Liabilities”) arising out of any claim, action, lawsuit, or other proceeding

(each a “Claim”) resulting from: (i) an injury, illness, or death to the Subject that, in the

judgment of the Principal Investigator was caused by the Study drug or Study procedure(s)

during the course of the Study; (ii) failure by the Sponsor, its trustees, officers, directors, agents,

representatives, contractors, or employees to comply with any applicable FDA or other

governmental regulations; (iii) any negligence, recklessness or willful misconduct by Sponsor,

its trustees, officers, agents, representatives, contractors or employees; (iv) any breach of

Sponsor’s, its trustees’, officers’, directors’, agents’, representatives’, contractors’, or

employees’, representations, warranties or obligations set forth in this Agreement or the

Protocol; (v) Sponsor’s use of Study data or results; provided, however, the Sponsor will not be

responsible for any Liabilities to the extent that the Claim arises from (a) the negligence or

willful misconduct of any Site Indemnitee; (b) research activities conducted by a Site

Indemnitee that are contrary to or outside the scope of the Protocol or the Agreement; (c) any

actions by a Site Indemnitee in material violation of applicable laws, regulations, ICH/GCP

guidelines, or in violation of this Agreement or any written instructions from the Sponsor

relative to the conduct of this Study; (d) any unauthorized warranties by any Site Indemnitee

relating to the Study Drug or the Study.

Example 6 Indemniication (Simple Mutual Provision)

Example 7 Indemniication (Comprehensive Mutual Provision)

Depending on the expectations a site establishes with regard to indemnification, sites

may want the sponsor to both indemnify the site and to defend it during the legal

process leading up to the eventual court decision or case settlement. The term “hold

harmless” and “defend” are sometimes used interchangeably, but are not always

interpreted the same in every jurisdiction so ideally, all three of these terms will be

included in the indemnification provision.

The site must identify which individuals and entities are to be protected by the

indemnification provision. If a sponsor offers indemnification at all, it virtually always

Example 7 Continued– Indemnification (Comprehensive Provision)

Site Indemnification. Site shall indemnify, defend and hold harmless, to extent allowed by

applicable law, the Sponsor, its officers, agents, contractors and employees (collectively

“Sponsor Indemnitees”) from any Liabilities arising out of any Claim to the extent resulting

directly from: (i) the negligence or willful misconduct of any Site Indemnitee; (ii) research

activities conducted by an Site Indemnitee that are contrary to or outside the scope of the

Protocol or the Agreement; (iii) any actions by an Site Indemnitee in violation of applicable

laws, regulations, ICH/GCP guidelines, or in violation of this Agreement or any written

instructions from the Sponsor relative to the conduct of this Study; (iv) any unauthorized

warranties by any Site Indemnitee relating to the Study Drug or the Study; (v) a material breach

of this Agreement or the Protocol by any Site Indemnitee, provided, however, the Site will not

be responsible for any Liabilities to the extent that the Claim arises from (a) the negligence or

willful misconduct of any Sponsor Indemnitee; (b) any actions by a Sponsor Indemnitee in

violation of applicable laws or regulations; (c) any breach of the representations, warranties,

or obligations set forth in this Agreement or the Protocol by any Sponsor Indemnitee.

Conditions of Indemnification. Each Party’s agreement to indemnify, defend, and hold

harmless the other Party and its respective Indemnitees is conditioned on the indemnified

Party (i) promptly after receipt of notice of a Claim, notify the other Party thereof in writing of

all the particulars known to the indemnified Party and shall enclose a copy of all papers served,

provided, however, that failure to give such notice shall not excuse the Indemnifying Party’s

obligation to indemnify, except to the extent that it has suffered damage or prejudice by any

indemnitee’s failure to give notice or delay in giving such notice; (ii) permit the Indemnifying

Party to assume full responsibility to investigate, prepare for and defend against any Claim

(including, without limitation, selecting defense counsel and rendering decisions relative to

litigation, appeal, and proposed settlement); (iii) assist the Indemnifying Party, at the

Indemnifying Party’s reasonable expense, in the investigation of, preparation for and defense

of any Claim; (iv) not compromising or settling such Claim without the Indemnifying Party’s

written consent. The Indemnifying Party shall not settle a Claim in any manner that admits fault

on behalf of the Indemnified Party or imposes injunctive relief on the Indemnified Party

without such Party’s prior written consent, which shall not be unreasonably withheld.”

Example 7 Continued Indemniication (Comprehensive Provision)

indemnifies the site itself and the principal investigation. In addition, most sites also want the study team working directly on study-related activities to be protected.

Most sites also want to include the directors, trustees, officers, employees, agents,

representatives, contractors, medical affiliates or similar sister companies, and the IRB,

depending on the site’s structure and who assists in performing study tasks. If you have included any of these individuals in a definition of the study team, it will shorten the

indemnification provision. When determining which of these to include in the

indemnification provision, be mindful of which are the top priority and insist on those.

Others might need to be removed during the negotiation process, but it is generally wise

to ask the sponsor to explain why it will not agree to protect that individual or entity. Sometimes that is sufficient to retain indemnification protection.

Next, evaluate what types of costs or expense will be indemnified. Typical inclusions

are “liabilities, losses, costs, damages and expenses, including reasonable attorney’s fees.” There may be other items included, but ideally the site will have protection for each of these. Note that “fees” and “costs” are different, and so should be listed individually. For example, an attorney’s fees are the wages you pay the attorney to work on the site’s case. In addition to the attorney’s wages, the attorney will have to pay the court to file a case, hire a court reporter for witness depositions, and so forth.

The court costs and other costs are separate from the attorney’s wages. Make sure that attorney’s fees are included; these add up quickly! To avoid having to relist this repeatedly, give the full list a name such as “Losses” or “Liabilities.” Then, nothing gets left out by mistake.

Also, be aware of what sorts of events can lead to the costs described in the paragraph

above. Will the site only be protected if it is sued? Many indemnification provisions

include protection for “any claim, action, lawsuit or proceeding,” and some also include investigations or other types of events. As always, the site must know for which risks it

will require indemnification and be sure those are listed. As with the types of cost or

expense, it is helpful to insert a short name for such events, such as “Claim” for further reference in the CTA.

Sites must next check to see what “triggers” the indemnification. The CTA should include a list of what might reasonably cause the sponsor’s indemnity to activate.

TIP 3

CHECK THE DEFINITIONS SECTION OF THE CTA, IF THERE IS ONE. IT MAY BE

NECESSARY TO INSERT A STUDY TEAM DEFINTION. IF IT IS ALREADY THERE, IT IS

HELPFUL TO ADD THE INDIVIDUALS AND ENTITIES WHO ARE WORKING DIRECTLY ON

THE STUDY TO THE DEFINITION OF THE STUDY TEAM. THEN, BY ADDING THE STUDY

TEAM AS AN INDEMNITEE, THE SITE HAS INCLUDED ALL NECESSARY PERSONNEL

WITHOUT HAVING TO INCLUDE A LONG LISTING IN THAT SECTION.

Although this list is substantially similar to the list found in the Subject Injury provision of

the CTA, the protection provided for this list in the indemnification provision is effective

only when there is a lawsuit or other action brought against the site. In the Subject Injury section, no lawsuit is required to activate the subject injury payments.

Typical indemnification provisions will include a Claim (i.e., the short name that you

have chosen for the event) arising out of a subject’s injury, illness or death that is related to the study drug or device, or procedures required by the protocol. The site will

also usually be able to obtain indemnification for any “bad acts” by the sponsor or its representatives, such as negligence, willful malfeasance, violation of law or breach of

representations or warranties in the CTA. Depending on the site’s view of the risk, it may also want to be indemnified for the sponsor’s use of the study data gathered at its site since it will not have control over what happens to the data once out of the site’s possession.

Generally, the indemnification provision will carve out exceptions under which the

sponsor will not have to pay, such as “bad acts” (e.g., negligent acts or omissions, and malfeasance) by the site, or refusal to follow the sponsor’s instructions. These exceptions should be reviewed to be sure they are reasonable.

The site should avoid losing its indemnification for actions that are unrelated to the

study and not under the site’s control as a public-facing health facility. For example, a public hospital cannot prevent sick people from coming through the door for care; if a

visitor to a patient happens to cause damage that affects the study subject, some

sponsors will want to automatically cancel the indemnification provision, giving the

rationale that the sponsor can’t control who is allowed to be on the site’s property. It might be that after the court reviews such circumstances the sponsor will not be held to

have caused the injury, but this would be a court determination, not the sponsor’s unilateral decision. If such conditions are found in the CTA, they should be removed.

Likewise, the site should not lose its indemnification for a failure to notify the CRO or

sponsor of a trigger event that would activate indemnification protection, by including

language that requires the protection to be activated to the extent that the sponsor/CRO has been prejudiced in its defense of the site.

If the CTA requires indemnification of the CRO, sites are advised to ensure that the

indemnification is mutual; that is, that the CRO protects the site with the same conditions as the site protects the CRO.

Sites should not feel obligated to offer indemnification to the CRO or to the sponsor

unless it is demanded. Bear in mind that for industry-sponsored studies, the site’s relationship with the sponsor and CRO is not symmetrical, therefore, indemnification

does not need to be symmetrical. The sponsor authors the protocol, the investigator

brochure, has substantially greater financial reward, and has authority over the conduct

of the study by the investigative personnel. If the site is required to provide some

indemnification but does not wish to provide substantial coverage the following may be

more acceptable to the site than the examples provided heretofore.

Insurance

Each site must determine the levels of coverage that it will request from the

sponsor/CRO, appropriate to its clinical specialty and location and any unique risks. As

a rule, all parties to the CTA should keep insurance coverage beyond the end of the

study to be sure anything that is identified after the study ends is covered. General

liability insurance should have a clinical trial participation rider/coverage; otherwise, the

general liability insurance may provide no protection. The site is advised to check with

its insurance carrier for confirmation of coverage parameters.

Sponsors should carry general liability, product or study liability, and/or self-insurance in

amounts appropriate to the amount of the risk inherent to that type of study. Many sites

prefer to be listed as a named covered entity on the sponsor’s policy. If a sponsor says

it is self-insured, a Memorandum of Insurance is usually still available to identify the

coverage the site can rely upon. For example, higher amounts of insurance are

appropriate for studies using implantable devices or significantly invasive procedures

such as ablations, brain surgery, and so forth. In contrast, low risk studies would

include observational, data collection, and retroactive review types of studies and a

lower amount of insurance coverage may be acceptable.

Sites are typically expected to carry general liability insurance, property coverage, and

professional liability (malpractice) insurance to protect the sponsor. Investigators, if not

employed by the site, will be expected to have professional liability/malpractice

insurance, which should specifically include clinical research.

Sites can determine whether to require specific amounts of insurance for each study, or

whether to accept more general wording that requires “sufficient coverage” for the

purposes of the study. The more specific the wording, the less likely that there will be a

misunderstanding about whether there truly is “sufficient” coverage. It is within the site’s

discretion to confirm that the coverage is sufficient by requesting the sponsor’s

Certificate of Insurance. Sites may also choose to ask the sponsor to obtain additional

coverage as a condition of participating in the study.

Sites that are working with a CRO should include the desired insurance language in the

LOI obtained from the sponsor, as an added measure of protection.

Example 8 – Indemnification (Site’s Statement)

Site and Investigator are responsible for the acts and omissions of the Study Team with

respect to an alleged failure to adhere to the terms of the Protocol, applicable regulations

and this Agreement. This shall not be construed as a contractual or other obligation to

defend, indemnify or hold harmless Sponsor or any third party.

Example 8 Indemniication (Site’s Statement)

Chapter Review

In this chapter, you have learned about several financial provisions that are of key

interest to a site, including payment terms, compensation for subject injuries, and

indemnification. These provisions could become contentious as there is potentially

significant money on the table when these issues are in negotiation. Sites wish to

ensure that subjects’ finances are protected if injured, and that the sponsor will defend

the site if it is sued by a third party. Sponsors want to reduce impact on the bottom line

in the event of an injury or lawsuit. As always, sites are advised to know what risks are

acceptable and to be prepared to walk away if the necessary protections are not

provided.

Apply Your Knowledge

Chapter Review Questions

1. Should the site accept a payment term that states that payments will be made

following monthly monitoring visits by the sponsor?

a. Yes, this is reasonable based on the information available in this question.

b. No, that is not reasonable; the site should counter with more frequent

payment requirement.

Chapter 8 Practice Redlining

Subject Injury. Sponsor will reimburse Site at actual cost for reasonable and necessary medical expenses incurred

by a Study Subject for medical care in the treatment of unanticipated adverse reactions arising directly from the

Device and used in compliance with the Protocol and this Agreement, provided, however, that such adverse

reactions are not attributable to the negligence, recklessness, or willful misconduct of any employee or agent of

Institution or Study Staff, or their failure to follow any applicable federal, state or local laws, regulations, or

guidelines, or to conform to reasonable prudent clinical practices, including GCPs as applicable to clinical studies

for the Device. The Sponsor shall not be obligated under this Section to provide compensation for: (a) illness-or-

injury-related costs that are not related to medical care (such as lost wages), (b) medical expenses that are paid

for by a third party (provided that neither the Institution nor the subject shall be obligated to seek reimbursement

from third party insurers), (c) medical expenses for any injury or illness attributable to any underlying subject

illness, (d) medical expenses caused by treatment that would have occurred absent the Trial, or (e) medical

expenses caused by the subject’s failure to follow the instructions provided within the Protocol and listed in the

Informed Consent.

Chapter Review Questions

1. Should the site accept a payment term that states that payments will be made

following monthly monitoring visits by the sponsor?

a. Yes, this is reasonable based on the information available in this question.

b. No, that is not reasonable; the site should counter with more frequent

payment requirement.

Subject Injury. Sponsor will reimburse Site at actual cost for reasonable and necessary medical expenses

incurred by a Study Subject for medical care in the treatment of unanticipated adverse reactions arising

directly from the Device and used in compliance with the Protocol and this Agreement, provided, however,

that such adverse reactions are not attributable to the negligence, recklessness, or willful misconduct of any

employee or agent of Institution or Study Staff, or thier failure to follow any applicable federal, state or local

laws, regulations, or guidelines, or to conform to reasonable prudent clinical practices, including GCPs as

applicable to clinical studies for the Device. The Sponsor shall not be obligated under this Section to provide

compensation for: (a) illness-or-injury-related costs that are not related to medical care (such as lost wages),

(b) medical expenses that are paid for by a third party (provided that neither the Institution nor the subject

shall be obligated to seek reimbursement from third party insurers), (c) medical expenses for any injury or

illness attributable to any underlying subject illness, (d) medical expenses caused by treatment that would

have occured absent the Trial, or (e) medical expenses caused by the subject’s failure to follow the

instructions provided within the Protocol listed in the Informed Consent.

2. If the site tries to obtain stronger subject injury protection in the contract, will that

cause the sponsor to “walk away” from the site?

a. It might, but it is worth it to protect the site’s and study subject’s risk of financial loss because if the site has to pay for the injured subject’s case, it is too expensive for the site.

b. It might, but the site can determine which studies are the riskiest ones and

focus on the subject injury language in those studies, while accepting the

sponsor’s language on the less risky studies even if the language is less preferred.

c. It might, but my site probably doesn’t want to work with sponsors that don’t provide adequate subject injury protection.

d. All of the above are possible considerations for the site.

3. Is there any potential problem caused if a site agrees to require a subject’s insurance to pay for injury costs prior to the sponsor paying?

a. No, there is no concern; this is a normal process for sponsors to expect.

b. There is no legal concern unless I have subjects with government payer

coverage such as Medicare or Medicaid; however, it does cause my study

subjects to be treated differently depending on whether they have private

coverage, government coverage, or no insurance coverage at all. My

subjects with private coverage must pay deductibles, coinsurance and

copayments before the sponsor pays, and if the subject’s insurance requires a $10,000 deductible to be paid, my subject is financially disadvantaged

compared to the other subjects who are participating in the study.

4. Is it important for a site to add an offer to indemnify the sponsor if the sponsor

didn’t request it in its template agreement?

a. Yes.

b. No

5. What is the purpose of a Letter of Indemnification (LOI) from a sponsor?

a. If the contract is with the sponsor, no LOI is needed.

b. If the contract is with a CRO and the sponsor has not authorized the CRO to

bind it to the terms of the contract, there will be no indemnification from the

sponsor without a LOI. c. Both of the above.

Chapter 9 – Ownership & Recordkeeping: Data, Intellectual

Property & Publications

What Is This Chapter About?

In this chapter, the CTA sections that deal with the ownership, confidentiality and

recordkeeping of study data will be addressed. Sites must be aware of these provisions

as each impose certain obligations and timelines that could create operational issues or

inadvertent breaches unless the site is prepared to perform according to the identified

requirements. Also, a site will want to be sure that its own property interests are

protected. Although the CTA sections discussed in this chapter may appear in different

locations of the CTA depending on the sponsor’s or CRO’s template, the site will be

able to identify the topics and review for potential concerns.

Confidential Information

The CTA should strike a reasonable balance between the sponsor’s desire to protect

the confidentiality of the study design, the drug or device information and the study

results with the site’s obligation to protect its subjects’ patient information, and any

unique qualities about the site’s operational information.

The Confidentiality or Confidential Information section of the CTA is a shorthand term

used to collectively refer to the study-related data, records, materials, samples and so

forth. The CTA must include a definition of what the sponsor considers confidential.

Some sponsors use vague language that doesn’t list out what is included; this can be a

concern to the site because usually sponsors consider such confidential information to

be the sponsor’s property. Sites will want to be aware of what it must protect on behalf

of the sponsor and what must be returned to the sponsor at the end of the study. The

site will want to be certain that the sponsor isn’t encroaching into the site’s own property

and confidential information in the process, such as the subjects’ medical records and

other similar source documents.

Example 1 –Definition of Confidential Information

Confidential Information is all Study-related information (including verbal, written, and

electronically stored or transmitted information), materials (including the Study

Medication), and documents (including the Protocol, Investigator Brochure, this

Agreement and Budget) provided to the Site by or on behalf of Sponsor in connection

with the Study, including preclinical data and case report forms, and all information, data,

reports and knowledge developed by Site as a result of work in connection with the Study.

For the avoidance of doubt, medical records are not the property of the Sponsor and are

not considered Confidential Information.

Example 1 Deinition of Conidential Information

must be

site will want to be certain that the sponsor isn’t encroaching into the site’s own intellectual property and conidential information in the process, such as the subject’s medical records and other similar source documents.

Common items included in the definition of confidential information are the protocol,

study data, biological samples, the CTA and its exhibits including the budget, and

virtually anything related to the study drug or device. Sponsors may include other items

in the definition; if so, these should be reviewed for reasonableness and edited if needed.

Confidential Information should also include a list of exceptions. If no exceptions are listed, the following are usually acceptable to most sponsors:

 Information that was disclosed to the site by a third party without violation of law or any obligation of confidentiality

 Information that was already known to the site at the time of disclosure  Information that was independently developed by the site without the use of

Confidential Information, as shown by site’s prior written records  Information that was or becomes publicly available through no fault of the site  Information that is required by applicable law to be disclosed to federal, state, or

local authorities

Sponsors may impose additional limitations on the release of information for legal

reasons, such as prior notice so that the sponsor can attempt to obtain a protective

order governing the release, or perhaps to block it entirely. Sites can determine if the

additional limitations make sense and do not impose an unreasonable operational

burden. Caveats can be negotiated by the site to protect from such burdens. For

example, prior notice requirements should give sufficient number of days. Sites should

not be required to provide prior notice if it is prohibited by law. Sponsors may ask that

the disclosure be limited to the minimum information required, or that the site continue

to protect the confidentiality of the information for all other purposes besides the legal disclosure.

Sites should attempt to obtain sponsors’ permission to share confidential information with as many as possible of the following, in order to simplify operational processes (i.e., not having to first obtain permission from the sponsor):

 IRB  Site’s legal counsel  Study team (including contractors, agents and representatives) on a “need

to know” basis in order to carry out the study  Third party payer to the extent necessary to determine subjects’ insurance

coverage

TIP 1

IF “UBJECT“’ MEDICAL RECORD“ ARE DEFINED EL“EWHERE IN THE CTA TO BELONG TO THE SITE, THAT IS ACCEPTABLE.

 The Subject, to answer reasonable questions during the informed consent process

 Third party providers of service for medical treatment or counseling of subjects or other persons exposed to a study drug

Sponsors will upon occasion say that certain exceptions are not explicitly needed

because such activities are included as part of the study; sites can confirm that there is

nothing in the CTA that would appear to limit such uses for study operational purposes.

During the term of this Agreement and for 3 years thereafter, Site will use Confidential

Information only for the purposes set forth in this Agreement. Site will protect

Confidential Information with at least the same care as they protect its own Confidential

Information of a comparable nature, and in no event will it use less than reasonable care.

Site will disclose Confidential Information only to its Study Personnel, who are bound by

a similar obligation of confidentiality, on a need-to-know basis, and have been informed

of their obligations, and only to authorized third parties.

TIP 2

A SITE MAY WANT TO CONSIDER INCLUDING ITS OWN ADDITIONAL DEFINITION OF

CONFIDENTIAL INFORMATION, AND REQUIRE THE SPONSOR TO PROTECT IT.

Example 3 –Site’s Confidential Information

All information provided or disclosed to Sponsor and/or its representatives by Site,

Principal Investigator or any Study Personnel, or that is accessed or observed by

Sponsor and/or its representatives, that relates to Site and/or Principal Investigator, and

which is not directly and solely related to the Study, shall be the sole and exclusive

property of Site and will be kept in strict confidence by Sponsor and not used for any

purpose not expressly provided for in this Agreement. Sponsor shall be responsible for

ensuring that its employees and representatives agree to these same terms of

confidentiality and non-use. The provisions in this section shall survive the termination

or expiration of this Agreement.

Example 2 – Protection of Confidential Information

Example 2 Protection of Conidential Information

Example 3 Site’s Conidential Information

Recordkeeping

The recordkeeping requirements in a CTA usually deal with how the Parties’ confidential

information is to be protected and maintained.

When a CTA is in negotiation for drugs and devices that are under development, the

sponsor may not yet know how long confidential information will need to be kept.

Nevertheless, sponsors should not require a site to retain such information for an

unreasonably long time period. This adds expense and compliance risk (e.g., protection

from breaches and record integrity to name two) for the site and should be limited to the

shortest time reasonably necessary. CTAs might include a requirement for the site to

maintain study documentation for between three to fifteen years, with five to seven

years as the most common and reasonable timeframe.

Based on the site’s size and operational capabilities, as well as any unique local

regulatory requirements, a site may need to include language in the CTA allowing it to

return all study records and other materials to the sponsor for storage and destruction.

Some sites have considerable cost burden or environmental regulations governing such

storage and destruction; these should be known by the site so that costs can be

recovered if the sponsor will not agree to accept the records or samples for storage

and/or destruction. Sponsors should also pay for the cost to return or destroy such

study materials and data at the end of the retention period, and for significantly long

retention periods (e.g. over 15 years) for records kept at the study site.

Intellectual Property, Patents and Licensing

One of a study sponsor’s main objectives in operating a study is to ensure that it

protects its intellectual property interests that are related to the development of a new

study drug or device, or new use for an existing drug or device. For this reason,

sponsors will have rigorous requirements in the CTA related to the protection of such

rights. A site’s contribution to the development of the intellectual property does not

necessarily translate into having some right to the intellectual property created during

the study. To the extent that sharing in the intellectual property rights is an objective of

the site, this shared ownership language will need to be inserted into most CTAs, and

Upon the termination or expiration of this Agreement, or at any other time upon the

written request of the Sponsor, the Site shall promptly return to Sponsor or at Sponsor’s

request, destroy all Confidential Information in Site’s possession or control, at the

Sponsor’s expense.

Example 4 – Record Return or Destruction

Example 4 Record Return or Destruction

will likely be heavily negotiated, unless the sponsor is unwilling to negotiate such rights.

The site should be prepared for such requests to be “deal-breakers” for certain

sponsors.

A CTA will virtually always include a broad definition of what the sponsor considers to

be its intellectual property rights. If a site is willing to defer to sponsor’s desire to own all

intellectual property created during a study, the definitions should be reviewed primarily

for reasonableness; for example, that the invention or process improvement arises from

the study, incorporates or uses the sponsor’s intellectual property, or is directly related

to the study drug or device or material that the sponsor has provided.

A site should not sacrifice its own intellectual property to the sponsor due to the study. If

there is no provision stating that each party continues to own what it brings to the table,

or what it independently develops, the site can add it.

Sites (including all of the staff working on the study) will be expected to report any

inventions or discoveries made to the sponsor, and to assist the sponsor with filing for

patents or other paperwork to protect the invention. All site staff will be expected to

assign all rights to any inventions to the site, which in turn must assign such rights to the

inventions to the sponsor. All such activities should be performed at the sponsor’s

expense. These activities take time away from other studies and/or patient care and

are to the direct benefit of the sponsor. The site should not be expected to lose the

value of the time that its investigators spend on such work.

Sponsors are frequently willing to grant the site a non-exclusive license to continue to

use any invention made at the site for its own internal, noncommercial research

purposes. If this is not of interest to the site, there is no need to add it if it is not already

in the CTA.

Tip 3

IT IS ACCEPTABLE (AND CUSTOMARY) NOT TO GIVE A TIME FRAME FOR REPORTING

INVENTIONS MADE AT THE SITE TO THE SPONSOR. IT IS REASONABLE TO AGREE TO

REPORT SUCH INVENTIONS “PROMPTLY.”

It is agreed that none of Sponsor, Principal Investigator, or Site transfers to any other

by operation of this Agreement any patent right, copyright, trademark right, or other

proprietary right of Sponsor, Principal Investigator, or Site, except as expressly set

forth herein.

Example 5 – Pre-Existing Intellectual Property Ownership

Upon the request and at the sole expense and exclusive control of Sponsor, Site shall, and

shall cause the Principal Investigator and the Site Staff to execute any instruments or testify

as Sponsor reasonably deems necessary for Sponsor to obtain patents or otherwise to

protect Sponsor’s interest in Sponsor Intellectual Property.

Example 6 – Assistance with Filing for Patents

Example 5 Pre-Existing Intellectual Property Ownership

Example 6 Assistance with Filing for Patents

Site shall have a royalty-free, non-exclusive license, with no right to sublicense, to use

Inventions for internal research, educational or patient care purposes.

If a site wants to own a portion of the Inventions, it can offer Sponsor language such as

the following; this might lead to a compromise.

Example 8 – Sponsor’s Option to License Institution’s Inventions

Example 7 –Shared Ownership of Intellectual Property

Inventorship for all inventions, discoveries, technical, scientific and other know-how and

information resulting from this Agreement, including improvements to pre-existing

technology, shall be determined in accordance with U.S. patent laws for determining

inventorship. Each Invention made, conceived or reduced to practice resulting from the Study

and during the course of this Agreement shall be owned as follows: title to all new Inventions

that are invented solely by Site (or Principal Investigator) under this Agreement shall reside in

Site; title to all new Inventions that are invented solely by the Sponsor under this Agreement

shall reside in the Sponsor; and title to all new Inventions that are invented jointly by Site (or

Principal Investigator) and the Sponsor under this Agreement shall reside jointly in Site and the

Sponsor. In the event that Site, Principal Investigator or Sponsor make a new Invention under

this Agreement, such Party shall promptly notify the other Parties in writing of such new

Invention. Such notice and all related information and documentation shall be kept strictly

confidential and not otherwise used or disclosed.

Site hereby grants Sponsor an exclusive option for a period of 180 days from the date of such

notice to obtain an exclusive, worldwide commercial license, with right to grant sublicense(s),

to any new Invention, related technology and know-how that is derived from the Protocol,

provided however, the terms, financial milestones and insurance conditions of said exclusive

license to Sponsor will be negotiated in good faith by Sponsor and Site on competitive terms

as in an arm’s length transaction with a non-sponsor third party licensee.

Example 7 Shared Ownership of Intellectual Property

Example 8 Sponsor’s Option to License Institution’s Inventions

Publishing and Publicity

Sites should review the CTA requirements associated with publishing study results in

light of the site’s own interest in such activities. Many sites are willing to defer to the

sponsor’s preference to take the lead in all publishing; however, larger research centers

Example 9 – Filing Patents For Joint Ownership Intellectual Property

Sponsor shall have the sole right to control the filing, prosecution and maintenance of patents

for each new Invention that is made solely by Sponsor. Site shall have the sole right to control

the filing, prosecution and maintenance of patents for each new Invention that is made solely

by Site or jointly by Site and Sponsor; provided however, that Site shall consult with Sponsor

regarding the filing, prosecution and maintenance of any such patent applications to the

extent such applications relate to a new Invention licensed to Sponsor previously or

hereunder. If Sponsor obtains an exclusive license to a new Invention pursuant to the terms

and conditions of this Agreement that is the subject of such patent application, then Sponsor

shall reimburse Site, within thirty (30) days of receipt of the billing invoices, or otherwise be

responsible for all expenses related to the filing of such patent applications, including

attorney's fees, for domestic and foreign patent applications relating to such licensed new

Invention. Site agrees to provide Sponsor with copies of any such patent applications, as well

as copies of any documents related to the prosecution of said patent applications.

Notwithstanding the above, Site may at its discretion and upon written notification choose to

allow Sponsor to direct all patent prosecution, in which case Sponsor shall directly pay all

patent related costs and consult with Site and provide copies of all correspondence related to

any new Invention. If the Sponsor informs the Site, upon a 90 day advanced written notice,

that Sponsor no longer wishes to pay patent prosecution and maintenance fees and expenses

on any aspect of a new Invention, then Site shall be free to either abandon such patent

applications or patents or to continue such prosecution and maintenance at the Site’s sole

expense, all solely in the name of Site, and Sponsor shall have no further interest or rights in

said patents and applications.

TIP 3

SITES SHOULD EXPECT THAT ANY TISSUE SAMPLES, BLOOD OR SERUM SAMPLES,

URINE SAMPLES, OR OTHER GENETIC MATERIALS GATHERED BY THE SITE IN THE

COURSE OF THE STUDY PURSUANT TO THE PROTOCOL ARE OWNED BY THE SPONSOR.

REPORTS AND INFORMATION ABOUT THE STUDY AND ITS PROGRESS, WHETHER

GENERATED BY, FOR, OR AT THE SITE, ARE ALSO THE PROPERTY OF THE SPONSOR.

Example 9 Filing Patents For Joint Ownership Intellectual Property

and major universities consider publishing a high priority, as the investigators have an

obligation to publish as a job responsibility. These larger research facilities must

negotiate rights for publication into the CTA.

As a rule, for most industry-sponsored studies, the Sponsor will expect the first right of

publication for any study, especially those conducted at multiple centers. The sponsor

will want to coordinate the data at all of the sites, and ensure that nothing is leaked

about the study or its results before all centers have submitted the data and it can be

analyzed.

Any publications, presentations or other dissemination of the site’s results will therefore

need to be submitted for review to the sponsor, following the timing established in the

CTA. The sponsor will confirm the timing of the publication and will check for possible

improper use by the site of confidential information or patentable inventions. The

sponsor will identify and request removal of such information that a site is not permitted

to include. The sponsor may also try to provide editorial comments, but the site should

remove language from the CTA that gives a sponsor such editorial rights.

Sites should check the CTA for timelines associated with publication. The sponsor’s

right to pre-review the proposed publication should not extend beyond 60 days, unless

such timelines are unimportant to the site. If the sponsor identifies patentable

information in the publication, it can ask the site to hold up the publication to give it time

to file patent paperwork, but generally 90 days is a sufficient delay to accomplish this

purpose.

Sites may also wish to add language that require the parties to work in good faith to

resolve any differences of opinion or interpretation of data that is presented in the

article.

If, for some reason, the sponsor does not pursue its first right to publish the study

results after the study is completed at all study sites, the CTA should indicate how much

time a site has to wait before it has the right to publish or present the study results as

the first publication. Usually, for multi-center sites, the wait is no more than 12-18

months following the end of the study at all study sites. The sponsor will still expect to

review the publication before it is submitted to a journal or presented at a conference,

for example.

The CTA should include a description of the permitted uses of a party’s name by the

other party. In most cases, neither party should use the other party’s name without prior

written permission, unless it is required by law, such as for regulatory filings and for

Example 10 – Publications

Sponsor may review for unprotected Inventions and may also provide comments on content.

Site will consider any such comments in good faith but is under no obligation to incorporate

Sponsor suggestions.

Example 10 Publications

complying with applicable law. Some reasonable exceptions might be listed, such as

using information that is already publicly disclosed on e.g., clinicaltrials.gov, in the

principal investigator’s curriculum vitae (C.V.), or in the site’s internal corporate

documentation and other financial reports; however, publicity disclosures should always

be subject to prior approval by the party whose name is being used.

Chapter Review

In this chapter, you have learned how to review contract provisions governing the data

and intellectual property owned by a party to the CTA or created during the conduct of

the study. This chapter also considers the site’s right to publish study results.

Depending on the site’s objectives for participating in a study, these provisions can be

reviewed for reasonability and accepted accordingly, or can be modified to grant the site

certain ownership rights.

Apply Your Knowledge

Chapter Questions

1. What is a site’s objective in reviewing the sponsor’s description of ownership of

data?

a. To make sure that the sponsor is not going to claim ownership of the site’s

proprietary data, such as patient records.

Example 11 – Publicity and Use of Names

No Party will use the other Party’s name or trademarks in any advertising or other form of publicity

without prior written consent of the other Party, except as required by law.

Practice Redlining

Prior to publishing or otherwise publicly presenting Site Results, the Site and the Investigator

shall provide SPONSOR with a copy of any such proposed publication, presentation or public

disclosure for review and comment at least thirty (30) days prior to submission to a publisher

of such publication or the making of such presentation or other public disclosure. SPONSOR

may request that any Confidential Information or intellectual property contained therein be

removed, redacted, or modified. If the Site and the Investigator do not agree to such deletion

or modification, they shall so notify SPONSOR in writing, and they shall agree to postpone such

submission, presentation or public disclosure for an additional sixty (60) days to allow

SPONSOR to file appropriate applications or seek protective remedies.

Example 11 Publicity and Use of Names

b. To make sure that the site clearly understands what it must protect during the

study and then return to the sponsor after the study is completed.

c. Neither of the above.

d. Both of the above.

2. Having clearly written exceptions for a site’s use or disclosure of confidential information will allow a study site to operate the study efficiently, because it can

use the information as needed and as clearly permitted in the agreement, without

having to first wait for a sponsor’s review and written approval.

a. True

b. False.

3. Some study sponsors will ask a site to retain study records until 20 years have

passed. This is not a reason for a site to be concerned.

a. True

b. False

4. If one of a site’s significant objectives is participating in studies is to jointly own inventions that it helps to develop, it can insert such language into an agreement.

a. True

b. False

5. When developing publishable materials such as articles, presentations and

similar materials, sites have the freedom to publish without the sponsor’s editorial control.

a. True b. False

Chapter 10 – Termination and Miscellaneous Matters

What Is This Chapter About?

In this final chapter, the CTA sections governing termination of the Agreement and a

number of miscellaneous matters will be considered. Most of these provisions are

found in the concluding pages of the contract, and although appearing at the end, each

should be read and if needed, edited to ensure that the site is not disadvantaged.

Term and Termination

If not described elsewhere, such as with the effective date of the CTA, the term of the

CTA will be included with the termination provision. The “term of the agreement” is the

time period during which the site is obligated to following the requirements of the CTA.

It begins at the effective date, and concludes at the termination date. If the term of the

agreement is not explicitly stated, it should be added for the site’s protection from

ongoing requests from the sponsor well after the study activities have concluded.

The termination provision should be carefully reviewed and edited as needed to ensure

it contains necessary important protections for the site. Some elements of the

termination provision can be significant enough to be deal-breakers for the site,

depending on the site’s identified priorities, so a watchful eye is important. Sites usually

want the CTA to term at the time that the study activities at the site itself are completed.

That way, the site can finish up its responsibilities and move forward with its next study.

Some sponsors attempt to extend the site’s obligations for a lengthy period of time,

such as 20 years, after the study activities conclude, so the site should be aware of the

potential ramifications of such extensions. For example, will the sponsor have the right

to continue to audit the site during that extended time period? The site should insist on

reasonable durations and compensation for the activities required under such extended

terms.

Sites are advised to remove wording that requires return of payments previously made

by the sponsor. It is acceptable to leave wording that “unearned payments” will be

returned, but not funds that the site has rightfully earned.

TIP 1

INSERT TERMINATION PROVISIONS THAT PROTECT THE SITE FROM CONTINUING

IN A STUDY IF THE SPONSOR DOES NOT MEET ITS RESPONSIBILITIES.

Sponsor shall reimburse Site for any reasonable, non-cancellable expenses properly

incurred (i) prior to the date of written notice of termination and (ii) incurred after the

date of termination but reasonably necessary to ensure the safety of enrolled Study

Subjects

Example 1 – Payment of Site for Services Prior to Notice of Termination

Example 1 Payment of Site for Services Prior to Notice of Termination

The termination provision will always include a series of events that will allow the

sponsor/CRO to terminate the agreement, sometimes with a termination of payment as

well. Sites should remove or soften language that would permit a sponsor to stop

paying for services that were rendered prior to the notice to the site of termination.

Sites should insist that notice of termination be provided in writing, and under most

circumstances with at least 30 to 45 days advance notice. Sites need sufficient time to

safely transition subjects off of the study, and this can be cited as a reason for needing

additional notice time. “Immediate termination” can be accepted, if site’s immediate

obligation is to stop new enrollments, while it appropriately transitions existing subjects

off of the study or to a different study site.

Sites may want to reserve the right to terminate the CTA for some or all of the following

reasons:

 The responsible IRB terminates approval to continue the study  The site or principal investigator determines that it is unsafe for the subjects to

continue

 The sponsor or any of its representatives materially breach the CTA  The sponsor or any of its representatives is excluded by the FDA, OHRP, or

other federal program, or is otherwise prohibited from performing studies (to

avoid such government action also tainting the site’s reputation)

 The sponsor files for bankruptcy protection or becomes insolvent, which may leave the site unpaid after having performed the study

If Sponsor terminates this Agreement before completion of the Study, except to protect the

safety and welfare of the Subjects, Sponsor will, free of charge, if requested by Site and

permitted by law and regulations, provide materials and support to ensure Subjects can exit

the Study in a medically safe manner as specified in the Protocol.

Bankruptcy or Insolvency. If Sponsor or its designee, including each of its respective

trustees, officers, representatives, agents or contractors has filed for protection under

any bankruptcy laws, has been declared insolvent, ceases or threatens to cease to carry

on all or part of its business, fails to pay its bills when they become due, makes

assignment for the benefit of its creditors, an administrator or receiver has been

appointed over all or part of its assets, or Sponsor or its designee takes advantage of any

debtor relief proceedings under any present or future law, immediate written notice to

Site is mandatory, to permit Site to take appropriate action(s) consistent with Sponsor’s notice. Appropriate action(s) may include, but is not limited to, immediate termination of

this Agreement.

Example 2 – Payment to Site for Ongoing Services for Subjects Following Termination

Example 3 – Payment of Site for Services Prior to Notice of Terminations

Example 3 Payment of Site for Services Prior to Notice of Terminations

Example 2 Payment to Site for Ongoing Services for Subjects Following Termination

Survival

The CTA will likely specify certain sections will continue to apply even after the term

date of the agreement. Sites should confirm the desirability and reasonableness of

continuing survival of each listed section, and also consider the duration of the survival

and its potential operational impacts to the site. Typically included are the

confidentiality provision, indemnification, intellectual property, subject injury, notices,

and publication requirements.

Notices and Notification

In this provision, the parties establish the means for providing official notification to each

other. Notices not following the prescribed process risk not be considered valid under

the CTA. Notice addresses should be kept updated throughout the entire term of the

CTA. Sites are advised to require that all notices be provided to it in writing so that

there is documentation of any change in processes, instructions or other requirements

Governing Law and Alternative Dispute Resolution

Sites should watch for a couple of things in the governing law and alternative dispute

resolution sections. Sponsors generally write the CTA to state that if it is involved in a

lawsuit with the site, the suit will take place at a court convenient to the sponsor. Sites

are usually able to change this location to one nearer to its own location, or to state that

the parties have agreed to “remain silent” on this point. If the parties remain silent, then

the location of the site will be determined by the standard legal processes. Sponsors

may also try to include separate provisions for venue (the location of the court) and the

governing law (which state’s law will apply). Sites are advised to use the location of the

site for both, or to remain silent for both if the site’s state is not acceptable to the

sponsor.

The laws of the state in which the Site is located shall govern the validity, performance,

and construction of the Agreement.

Example 4 – Governing Law (Site’s Location)

TIP 2

FOR ITS OWN PROTECTION, IN THE RARE INSTANCE THAT A SPONSOR

WILL NOT AGREE TO WRITTEN NOTIFICATIONS IN ALL INSTANCES, THE

SITE SHOULD SPECIFY IN THE CTA THAT THE NOTICE PROCESS IS

COMPLETE ONLY WHEN THE SITE CONFIRMS IN WRITING TO THE

SPONSOR RECEIPT OF THE NEW INSTRUCTION, PROCESS, ETC.

Example 4 Governing Law (Site’s Location)

The site should determine whether it is willing to accept alternative dispute resolution

(“ADR”) in addition to or instead of litigation. Some sites like ADR and others prefer to

go to court if there is an issue. When reviewing the governing law and ADR provisions,

watch for language that puts the sponsor on better footing than the site in terms of legal

review; e.g. waiving the right to a jury trial (because juries are less sympathetic to big,

international, multibillion dollar corporations).

Counterparts

If present in the CTA, this provision allows the parties to execute the agreement on

multiple separate documents, which, when combined together constitute one fully

executed and binding agreement. Sponsors generally determine based on internal

policy controls whether counterparts are acceptable, or whether a single scanned

document, or one document with original (“wet”) signatures will be required.

Counterpart signatures can be a way to expedite the signature process rather than

circulating one document for signature by multiple entities in separate locations.

Assignment

Generally speaking, sponsors will not agree to the assignment of a CTA by the site to

any other entity without prior written approval. Sponsors reason that the site was

selected for a study based on its particular features and qualifications, and it does not

want to switch the chosen site for another one without a chance to approve it first. In

contrast, sponsors often reserve the right to assign its rights to any of its affiliates or

possible future owners without any prior knowledge or approval by the site.

Sites might consider adding to the CTA that if the sponsor assigns its duties under the

CTA, that it remains responsible to the site for the proper performance of its assignee.

Example 5 – Governing Law – (Remain Silent)

The Parties prefer to remain silent regarding governing law.

TIP 3

UNDER NO CIRCUMSTANCES SHOULD THE SITE ACCEPT ANOTHER

COUNTRY AS THE CHOICE OF LAW.

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Example 5 Governing Law (Remain Silent)

Relationships of the Parties

This section establishes that no party is an employee or joint venture with the other

party, and that the relationship is strictly contractual. This protects the parties from

possible claims by the other party based on any other relationship; for example, that the

sponsor owes employment taxes for the site staff working on the study.

Force Majeure

This section protects a party from accusations of breach by the other party if the party is

unable to perform its obligations due to reasons beyond its control (usually due to forces

of nature or acts of the government such as a war). The non-performing party is

expected to resume its activities as quickly as possible after the event has ended.

Chapter Review

In this chapter, you have learned about a number of miscellaneous sections such as

termination, notices, relationships of the parties, and so forth that typically appear in the

concluding pages of the agreement. These are often referred to as the “boilerplate”

language but should still be carefully reviewed to be sure that something objectionable

to the site was not inserted.

Apply Your Knowledge

Example 6 – Assignment of Sponsor’s Duties

“If Sponsor assigns, delegates, or subcontracts any duties under this Agreement, Sponsor

remains responsible to Site for performance of those duties”

Chapter 10 Practice Contract Editing

This Agreement shall be construed in accordance with the laws of the State of [ ], United States of America,

without regard to its conflict of laws provisions. Any action, suit or other legal proceeding which either party

may commence to resolve any matter arising under or relating to any provision of this Agreement shall be

commenced only in the state or federal courts located in the State of [ ], United States of America, and the

parties hereby consent to the jurisdiction of such court with respect to any such action, suit or proceeding.

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Example 6 Assignment of Sponsor’s Duties

“If Sponsor assigns, delegates, or subcontracts any duties under this Agreement, Sponsor

remains responsible to Site for performance of those duties.”

Chapter Review Questions

1. If the site wants the right to terminate the CTA “without cause” following 30 days’ written notice, but the sponsor will not allow it, what should the site do?

a. Identify the risks to the site that would cause it to want to extract itself from

the study (e.g., the sponsor is not timely in paying the site’s invoices, or the sponsor is excluded by the FDA), and write those risks in as an escape

clause.

b. Offer mutual rights to terminate without cause (if sponsor has not already

included that in its termination rights).

c. Offer the sponsor something it had previously conceded to the site as a

reward for approving site’s right to terminate without cause. d. Explore whether the sponsor would agree to this provision if the notice period

was extended to 90 days or 120 days.

e. Walk away from the study since the sponsor will not agree to this requirement

and it has been determined to be a “deal-breaker priority” for the site. f. Any or all of the above.

2. There is little reason to double check the “Survival” section of the CTA. a. True b. False

3. Is the “Counterpart” copy section a meaningless provision? a. Yes b. No

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Apply Your Knowledge Key

Chapter 1: Budget Preparation

Scenario Feedback:

The schedule of events provides an outline of the procedures and tests that occur during the study visit. You must also review the body of the protocol for an explanation of each of the tests and procedures for each visit to identify all costs. In addition, there may be footnotes that relate to other costs tied to visit procedures and tests. The information in the protocol will identify who is required to perform the various procedures and tests. Specifics will help determine the amount of time and staff required for each procedures. The protocol will also define any special shipping, handling or storage requirements for the investigational product or study specimens. In addition you need to review the CTA to determine the specifics of the monitor visits, record storage, and screen failures. You would want to compare all documents to make sure they are consistent. For example is the subject honorarium in the sponsor’s budget consistent with what is listed in the informed consent?

Chapter Review Questions – Answers

1 – A, 2 – B, 3 – C, 4 – A, 5 – A, 6 - A

Chapter 2: Building the Site Budget

Scenario Feedback:

Data entry and recruitment of subject costs are not figured into the site’s per subject cost of $4,500. To determine if the additional $500 being offered for reimbursement per

subject you would need to looks at the recruitment costs and the cost of data entry staff.

Then take the total cost of these items and divide by the number of subjects. If this

amount comes out to $500 or less per subject then it would cover the costs. If it is above $500 then it would not. Let’s look at an example:

Site Costs for recruitment are $8,000.

Data entry staff are budgeted at $18,000.

Site Cost per subject is $4,500.

Budget is based on 10 subjects.

$8,000 (recruitment) + $18,000 (data entry) = $26,000.

$26,000 ÷10 (number of subjects) = $2,600.00

103

The additional $500 that the sponsor included in the subject cost does not cover the

site’s costs. The site would be losing $2,100.00 per subject based on the sponsor’s proposed reimbursement of $5,000 per subject inclusive of recruitment and data entry.

Chapter Review Questions – Answers

1 – B, 2 – A, 3 – A, 4 – A, 5 – B

Chapter Three: Coverage Analysis

Scenario Feedback

Conventional or standard of care include the physical and blood screen two times per

year. The study requires blood work at each visit for a total of five (5) times and a

physical at the screening visit and final visit (2 times). The two physicals could be

covered by insurance or Medicare. Two (2) of the five (5) blood tests could be billed to

Medicare or an insurance company. The additional three (3) would be covered by the

sponsor and included in the budget. These are the only routine costs that are covered by the Clinical Trial Policy.

Chapter Review Questions – Answers

1 – B, 2 – A, 3 – A, 4 – A, 5 –B

Chapter Four: Payment Plans

Scenario Feedback

The study site should develop a system that clearly identifies who is to be billed for

research costs. The system should clearly identify costs to be billed to Medicare. It

might be the use of a bright sticker, or the cost being highlighted on the statement. The

billing staff who will be handling the research billing should be trained on the system

and provided an SOP or process for billing research expenses. In addition, the site

might add a checks and balance system (where the bills are reviewed by a member of the study team prior to being sent) to prevent billing an inappropriate party.

Chapter Review Questions – Answers

A – B, 2 – A, 3 – B, 4 – B, 5 - A

104

Chapter 5: Negotiating the Sponsor’s Budget

Scenario Feedback

 Study Start-up: Sponsor’s look at average costs when determining study start-up (such as staff costs). Your staff costs may vary due to area that you live in,

qualifications, and experience of your staff. You require staff time for the

investigator to review the appropriate documents. The coordinator would need to

review the protocol, consent, etc. Included in the staff costs would be the staff

that need to be trained on the protocol and the EDC system, for example data

entry and management, lab and pharmacy staff, etc. Bring the staff cost figures

based on your site to the negotiation table. In addition, perhaps you and/or the

investigator have reviewed patient charts and have already identified potential

subjects for the trial and the sponsor did not take this into consideration in their

start-up costs. Having done this, the site is ready to screen their first patient as

soon as the site is initiated. Another cost may be lab or pharmacy set up,

especially if there are special requirements for the investigational product. The

sponsor may not have included this in the start-up budget.

 X-ray: The sponsor’s proposed reimbursement fee in the budget is based on the Medicare rate and only covers the X-ray. The site contracts with the hospital X-

ray department and their fee is higher than the Medicare rate as well as includes

the cost of the technician. A fee schedule for the hospital X-ray department would

be appropriate as well as fair market value fees for the area.

 Consent: This is where site experience comes into the equation. Based on the study criteria and the complexity of the study the proposed fees do not cover the

cost. Bring metrics from previous similar studies that show the staff and time

required to conduct the consenting process.

 Site Information: Provide site metrics that show that your site is efficient and effective. These might include:

o The number of similar studies you have done, how many subjects you

were able to recruit for the study and the time it took to recruit.

o Qualifications and experience of staff. They are highly qualified, have

successfully conducted many trials within the set time frames.

o The site has a great reputation for accurate and complete documentation

of study data. Compared to industry standards the site has few data

queries, protocol deviations, and violations.

o The site has met recruitment goals for similar studies and is often a top

enroller.

o The site has had multiple FDA inspections and has received no observations or warnings.

Chapter Review Questions

1 – B, 2 – B, 3 – B, 4 – A, 5 – B

105

Chapter 6: Clinical Trial Agreement – The Preliminaries

Chapter Review Questions – Responses

1. Why should you review the study documents before reviewing and redlining the

template study agreement?

DISCUSSION: For example, if the protocol and informed consent document

describe a risky, invasive study while the contract references an observational,

data collection study, you can raise questions about which is the more accurate

description of the study. Based on the answers you receive from the sponsor or

CLINICAL TRIAL AGREEMENT

This Clinical Trial Agreement ("Agreement") is effective on] [INSERT DATE], 6 Effective Date and among [SPONSOR NAME], a corporation located at [SPONSOR ADDRESS] ("Sponsor"), and [SITE

NAME] having a business address at [SITE ADDRESS] "Research Institution").

WHEREAS, Sponsor has retained [CRO NAME] to provide study management and select oversight

services for the aforementioned protocol on their behalf. Throughout this Agreement, reference to

SPONSOR may include its agent, representative and/or designee, as applicable. Such reference can or

may refer to [CRO NAME], a Contract Research Organization engaged in the design, implementation

and management of clinical trials of medical devices and pharmaceutical agents.

WHEREAS, the Parties desire to conduct a clinical trial ("Trial") to gather information regarding the

pe fo a e of “po so ’s p op ieta STUDY DEVICE NAME ("Device") according to the clinical p oto ol, e titled PROTOCOL NAME the Protocol . The T ial is of utual i te est a d e efit to the parties because it furthers instructional and research objectives and may benefit patient care.

WHEREAS, Sponsor desires to enlist the assistance of Research Institution and its employed physician

DOCTOR NAME, M.D. as the P i ipal I estigato PI to o du t the T ial, usi g the P oto ol hi h may be amended from time to time, and is attached herein as Exhibit A, and

WHEREAS, the Trial is of mutual interest and benefit to Research Institution and Sponsor, and will

further the instructional and research objectives of Research Institution in a manner consistent with

its status as a nonprofit educational and health care institution.

NOW THEREFORE, the Pa ties ag ee …

Chapter 6: Practice Contract Editing

106

CRO, you can edit the contract to ensure that all of the documents reflect the same level of risk and protection.

2. Should the requirements upon the parties appear in the recitals section?

DISCUSSION: No, it is best to move actual obligations upon any party from the

recitals (background and reasons to work together) to a section of the agreement

that describes similar obligations.

3. Does it matter where the contract effective date is located?

DISCUSSION; No, it doesn’t matter where in the contract the effective date appears, although it is often in the preamble or in the definitions section. It is

also appropriate for it to be placed in the termination section or as an addition to

the miscellaneous section.

4. What should you do if you see wrong information about your study site in the

contract template?

You should correct any erroneous information that you find in the contract,

including if the information is about your study site.

5. What should you do if you think a party to the contract is missing (for example,

you would like the principal investigator to be a party but he or she is not listed).

DISCUSSION: If there is a party to the contract (such as the principal

investigator) that is either missing or is listed inappropriately, you can remove or

add that party as long as you are consistent throughout the entire agreement.

That means that if you add or remove a party, you should also add/remove the

corresponding signature block at the end. In order to prevent questions or

concerns later, you might consider reaching out to the CRO or sponsor to be

sure that it will accept the change in party(ies) to the contract. Generally, the

CRO or sponsor will not require a study site to add an undesired party; however,

there may be a different template that the CRO or sponsor would prefer the site

to use. This will save hours of editing later if the preferred template is used from

the beginning.

107

Chapter 7: Clinical Trial Agreement – Responsibilities & Compliance

Chapter Review Questions - Responses

1. If the study site does not use its own IRB, does it need to include language about

obtaining IRB approval of the study prior to proceeding with subject enrollment:

Yes

Correct Answer = Yes

DISCUSSION: Even if the study site will be using a central IRB, it should obtain

written confirmation that it is approved to perform the study and that the site is using

the approved protocol, informed consent document, and other study-related

documentation.

2. If a sponsor will not pay for my principal investigator’s time to attend a required meeting, does the site have to absorb the loss of that investigator’s time?

The Site represents and certifies agrees that to the best of its knowledge upon diligent research and

inquiry, neither Site nor Principal Investigator nor any person employed by or under contract to Site or

Principal Investigator in connection with the performance of this Agreement, including (but not

limited to) any research performed hereunder has been (i) convicted of an offense related to any

Federal or State healthcare program, including (but not limited to) those within the scope of 42 U.S.C.

§ 1320a-7(a); (ii) excluded, suspended or is otherwise ineligible for Federal or State healthcare program

parti ipatio , i ludi g ut ot li ited to pe so s ide tified o the Ge e al “e i es Ad i ist atio ’s List of Parties Excluded from Federal Programs or the HHS/OIG List of Excluded Individuals/Entities; or

is otherwise ineligible for Federal or State healthcare program participation or (iii) debarred from or

under any Federal or State healthcare program (including, but not limited to debarment under Section

306 of the Federal Food, Drug and Cosmetic Act (21 USC 335a). Site further represents and warrant

that no person employed by or under contract to Site in connection with the performance of the

Ag ee e t is listed i the FDA’s Cli i al I estigato Dis ualifi atio P o eedi gs data ase. “ite certifies agrees that if, at any time after execution of this Agreement, it becomes aware that it has or

any person who participated, or is participating, in the performance of any service or any other work

for Sponsor has, become or is in the process of being charged, convicted, debarred, excluded,

suspended or otherwise e de ed i eligi le, it ill otif “po so i iti g at: [“po so ’s add ess] within two (2) business days of its becoming aware of this fact.

Chapter 7: Practice Redlining

108

(a) Yes, unless the sponsor will agree to increase its allowance for other costs in

order to reduce the impact of the loss of the investigator’s time to attend the meeting.

(b) No, not if after initially refusing to pay, the sponsor agrees to pay an amount that was reduced from the initial requested payment amount.

Correct Answer = c) Both of the above

DISCUSSION: The negotiation process can be used to identify and recoup some, if

not all, of the investigator’s lost time with study subjects in order to attend sponsor- mandated meetings.

3. The sponsor is asking for immediate reporting for adverse events (AEs) and serious adverse events (SAEs). Is this reasonable and should it be accepted?

(a) If a site is staffed such that it can make immediate reports of AEs and SAEs

without impacting the health and wellbeing of the study subject that is

experiencing the event, then the site can agree to the timing the sponsor has requested.

(b) If a site would have to add staff or increase “on call” duties to timely submit such reports, the site may reasonably request an extension by changing “immediately” in the CTA to “promptly” or “within 2 days of learning of the event.”

business days, the site should provide the policy on its letterhead and ask

sponsor to approve the timing so that an exception in operational process is not needed.

(d) All of the above, as applicable.

Answer = d) All of the above, as applicable

DISCUSSION: This question demonstrates how a site can evaluate the request

based on its needs and operational policies and procedures and ask that the sponsor work with it to accommodate its reasonable requests.

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Chapter 8: Clinical Trial Agreement – Review Questions – Responses

Chapter Review Questions – Responses

1. Should the site accept a payment term that states that payments will be made

following monthly monitoring visits by the sponsor?

(a) Yes, this is reasonable based on the information available in this question

(b) No, that is not reasonable; the site should counter with more frequent payment requirement.

Answer = a)

DISCUSSION: Although it is not generally desirable for a site to have to wait for the

sponsor to appear onsite to monitor the study documentation before releasing

payment, if the sponsor is promising in the contract to monitor every month, that

would allow more frequent payments and better cash flow than a quarterly payment

that does not require a monitoring visit or documentation approval.

Subject Injury. Sponsor will reimburse Site at actual cost for reasonable and necessary medical

expenses incurred by a Study Subject for medical care in the treatment of unanticipated adverse

reactions arising directly from the Device and used in compliance with the Protocol and this Agreement,

provided, however, that such adverse reactions are not attributable to the negligence, recklessness, or

willful misconduct of any employee or agent of Institution or Study Staff, or their failure to follow any

applicable federal, state or local laws, regulations, or guidelines, or to conform to reasonable prudent

clinical practices, including GCPs as applicable to clinical studies for the Device. The Sponsor shall not

be obligated under this Section to provide compensation for: (a) illness-or-injury-related costs that are

not related to medical care (such as lost wages), (b) medical expenses that are paid for by a third party

(provided that neither the Institution nor the subject shall be obligated to seek reimbursement from

third party insurers), (c) medical expenses for any injury or illness attributable to any underlying subject

illness unless exacerbated by the Study Device or procedures, (d) medical expenses caused by

t eat e t that ould ha e o u ed a se t the T ial, o e edi al e pe ses aused the su je t’s failure to follow to the best of his or her ability the instructions provided within the Protocol and listed

in the Informed Consent.

Chapter 8: Practice Redlining

110

2. If the site tries to obtain stronger subject injury protection in the contract, will that

cause the sponsor to “walk away” from the site?

(a) It might, but it is worth it to protect the site’s and study subject’s risk of financial loss because if the site has to pay for the injured subject’s case, it is too expensive for the site.

(b) It might, but the site can determine which studies are the riskiest ones and

focus on the subject injury language in those studies, while accepting the

sponsor’s language on the less risky studies even if the language is less preferred.

(c) It might, but my site probably doesn’t want to work with sponsors that don’t provide adequate subject injury protection.

(d) All of the above are possible considerations for the site.

Answer = d)

DISCUSSION: This question shows several possible positions that a site can adopt

with regard to subject injury protection. For some sites, all of the statements will be

true.

3. Is there any potential problem caused if a site agrees to require a subject’s insurance to pay for injury costs prior to the sponsor paying?

(a) No, there is no concern; this is a normal process for sponsors to expect.

(b) There is no legal concern unless I have subjects with government payer

coverage such as Medicare or Medicaid; however, it does cause my study

subjects to be treated differently depending on whether they have private

coverage, government coverage, or no insurance coverage at all. My

subjects with private coverage must pay deductibles, coinsurance and

copayments before the sponsor pays, and if the subject’s insurance requires a $10,000 deductible to be paid, my subject is financially

disadvantaged compared to the other subjects who are participating in the study.

Answer = b)

DISCUSSION: CMS issued a letter on April 13, 2004 to Holley Thames Lutz, Esq.

of the Washington D.C. law firm Gardner, Carton and Douglas, LLP, in response to a

question she had submitted on this topic, indicating it considers the sponsor to be

acting as a “plan or policy of insurance” if the sponsor has agreed to pay for any trial participant’s “medically necessary services related to injuries” that arise as a result of participating in the trial. Medicare stated in the letter that, “Any agreement by a trial sponsor to ‘pay for medically necessary services related to injuries…receive[d] as a result of…participation in this trial…’ constitutes a demonstration of primary payment responsibility.” CMS further stated that it will not pay for services if it is

111

aware that this situation has arisen, because the “Medicare statute precludes payment when ‘payment has been made or can reasonably be expected to be made under a liability insurance policy or plan (including a self-insured plan…)….”

4. Is it important for a site to add an offer to indemnify the sponsor if the sponsor

didn’t request it in its template agreement? (a) Yes. (b) No

Answer = b) No

DISCUSSION: A site does not need to add this potential expense if it is not

requested by the sponsor. Some sites may even wish to delete or limit a sponsor’s request for indemnification from the site if it appears in the template language.

5. What is the purpose of a Letter of Indemnification (LOI) from a sponsor?

(a) If the contract is with the sponsor, no LOI is needed.

(b) If the contract is with a CRO and the sponsor has not authorized the CRO

to bind it to the terms of the contract, there will be no indemnification from the

sponsor without a LOI.

Answer = c) Both of the above.

Chapter 9: Clinical Trial Agreement – Ownership & Recordkeeping

Practice Redlining

Prior to publishing or otherwise publicly presenting Site Results, the Site and the Investigator

shall provide SPONSOR with a copy of any such proposed publication, presentation or public

disclosure for review and comment at least thirty (30) days prior to submission to a publisher

of such publication or the making of such presentation or other public disclosure. SPONSOR

may request that any Confidential Information or intellectual property contained therein be

removed, redacted, or modified, to the extent such deletion does not preclude the complete

and accurate presentation and interpretation of the Study results. SPONSOR shall not

exercise editorial control over the proposed publication. If the Site and the Investigator do

not agree to such deletion or modification, they shall so notify SPONSOR in writing, and they

shall agree to postpone such submission, presentation or public disclosure for an additional

sixty (60) days to allow SPONSOR to file appropriate applications or seek protective remedies.

Chapter 9: Practice Redlining

112

Chapter Review Questions – Responses

6. What is a site’s objective in reviewing the sponsor’s description of ownership of data?

(a) To make sure that the sponsor is not going to claim ownership of the site’s proprietary data, such as patient records.

(b) To make sure that the site clearly understands what it must protect during

the study and then return to the sponsor after the study is completed.

(d) Both of the above.

Answer = d) Both of the above

DISCUSSION: Both (a) and (b) are true, and a site may have additional reasons

to scrutinize such language based on its prior experience.

7. Having clearly written exceptions for a site’s use or disclosure of confidential information will allow a study site to operate the study efficiently, because it can

use the information as needed and as clearly permitted in the agreement, without

having to first wait for a sponsor’s review and written approval. (a) True (b) False

Answer = a) True

DISCUSSION: The time invested in getting clearly defined approved uses is worth

the effort because if the site knows that it will need it for a specific use or disclosure,

it will save having to wait for the sponsor to approve it later, or worse, if the site has

assumed that it is a reasonable use of the sponsor’s confidential information but the sponsor finds out and alleges the agreement was breached, the site might have the

study revoked.

8. Some study sponsors will ask a site to retain study records until 20 years have

passed. This is not a reason for a site to be concerned.

(a) True.

(b) False

Answer = b) False

DISCUSSION: Sites are responsible for protecting the records from prying eyes,

from unauthorized access or modification, and for keeping the media accessible

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throughout the retention period. Sites will incur expenses if required to maintain

study records for twenty years. Such expenses should be avoided if at all possible,

or should be compensated by the sponsor. Since these records are owned by the

sponsor, the responsibility for their maintenance and upkeep are not a reasonable

“cost of doing business” for the site.

9. If one of a site’s significant objectives is participating in studies is to jointly own inventions that it helps to develop, it can insert such language into an agreement.

(a) True

(b) False

Answer = a) True

DISCUSSION: Not all sponsors will agree to such language, and some are willing to

grant more limited rights to ownership than joint ownership. To the extent that this is

a priority, sites may wish to work with an attorney specializing in intellectual property until becoming comfortable in negotiating such provisions with sponsors.

5. When developing publishable materials such as articles, presentations and

similar materials, sites have the freedom to publish without the sponsor’s editorial control.

(a) True

(b) False

Answer = b) False

DISCUSSION: Although a site should expect to be able to present its findings without

undue editorial influence by the sponsor, sponsors will expect to be able to direct the site

to remove any information the sponsor considers to be its confidential or proprietary

information (hence, it is important for the site to ensure that the sponsor’s definition of what is confidential is clear and reasonable). Some sponsors will want to negotiate with

the site if it disagrees with the site’s conclusions, and may add language that if there is a disagreement about the content of the proposed publication that the parties will engage

in good-faith discussions to resolve the disagreement. If a site is concerned about its

editorial freedom, it could consider adding wording such as this: “Nothing in this Publications Section shall be construed to give Sponsor any right of editorial control over any publication prepared by the Site.

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Chapter 10: Clinical Trial Agreement – Termination & Miscellaneous

This Agreement shall be construed in accordance with the laws of the State of [i sert site’s ho e state], United States of America, without regard to its conflict of laws provisions. Any action, suit

or other legal proceeding which either party may commence to resolve any matter arising under

or relating to any provision of this Agreement shall be commenced only in the state or federal

courts located in the State of [insert site’s ho e state], United States of America, and the parties hereby consent to the jurisdiction of such court with respect to any such action, suit or

proceeding.

Chapter Review Questions – Responses

1. If the site wants the right to terminate the CTA “without cause” following 30 days’ written notice, but the sponsor will not allow it, what should the site do?

(a) Identify the risks to the site that would cause it to want to extract itself from

the study (e.g., the sponsor is not timely in paying the site’s invoices, or the sponsor is excluded by the FDA), and write those risks in as an

escape clause.

(b) Offer mutual rights to terminate without cause (if sponsor has not already

included that in its termination rights).

reward for approving site’s right to terminate without cause. (d) Explore whether the sponsor would agree to this provision if the notice

period was extended to 90 days or 120 days.

(e) Walk away from the study since the sponsor will not agree to this

requirement and it has been determined to be a “deal-breaker priority” for the site.

(f) Any or all of the above

Answer = f) all of the above

DISCUSSION: Sites have many options for negotiating provisions, and may be able

to obtain something akin to the desired language through open-ended discussions

with the sponsor.

2. There is little reason to double check the “Survival” section of the CTA.

(a) True (b) False

Answer = b) False

Chapter 10: Practice Editing

115

DISCUSSION: Actually, it is a good practice to check to see if the CTA sections that

will continue to apply after the study is over and the contract is terminated make

sense and protect the site. For example, you may want to add sections to the

survival section to allow the site to continue to be paid for efforts expended to

support the sponsor’s monitoring activities that take place at the site after the study has ended. This will be possible if the monitoring provision includes language that

says that the monitoring will be “at sponsor’s expense.” 3. Is the “Counterpart” copy section a meaningless provision?

(a) Yes. (b) No.

Answer = b) No

DISCUSSION: Counterparts are quite useful for many sites, especially sites that do

not have access to one or more of the signatories on a handy basis. For example, if

the CTA will be signed by the site’s President, located away from the site, and the investigator who is on site only a few days per week, executing the CTA in

counterparts will allow all signatories to sign separate copies of the CTA at the same

time, creating a valid agreement even though the signatures are on different pages.

The site doesn’t have to wait for a signatory be at the site or to receive a routed copy of the partially executed document, add the signature, and so forth.

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Permission from the copyright holder was granted to LAD Custom Publishing, Inc. for reproduction of this material. In an educational environment it is necessary to operate within the copyright laws. Invasion of the copyright laws is often overlooked by users in an educational environment. Even though producing multiple copies is easy to do, it is still unacceptable according to the standards set by the copyright laws.

All royalties and fees have been paid by LAD Custom Publishing, Inc. The royalties and fees are included in this LADPAC.

Attempting to duplicate this material without obtaining authorization is illegal.

This book is designed for investigators, administrators, research personnel and

students who are involved or interested in the development and management of

clinical trial budgets and contracts. It provides the reader a roadmap to building

budgets and reviewing and managing contracts. It guides the reader through the

steps to create a budget including preparation, building the budget, coverage

analysis, and negotiation with the sponsor. It provides a comprehensive review

of the Clinical Trial Agreement, deinitions and descriptions of contract terms, discussions of contract language, and applicable laws and regulations. The authors

provide tips throughout the book and each chapter concludes with review questions

and scenarios to apply the knowledge gained from the chapter.

MANAGING CLINICAL TRIAL

BUDGETS & CONTRACTS

JoAnn Pfeiffer, DrSC, RAC, CCRA

Dr. Pfeiffer is the Director/Faculty, Clinical Research Management

Program at Arizona State University. She has both a Doctorate and

Masters in Regulatory Science. Her expertise includes directing

clinical trials in both academic and nonacademic environments,

managing and negotiating budgets and contracts, and day-to-day

operations of clinical trials.

JoAnn Pfeiffer, DrSC, RAC, CCRA

Marilyn Windschiegl, JD

Marilyn Windschiegl is the Director of Contracts and Compliance

for PFS Clinical, a company that provides administrative support

to clinical research sites to improve their management of

clinical research programs. Her expertise (among other things)

includes revising and negotiating contracts with clinical research

organizations and pharmaceutical research sponsors.

Marilyn Windschiegl, JD

Just wanted to share my great news. I just recently got a promotion from coordinator to Clinical Research Administra-

tor and I am now in charge of the department. We are starting 4 new studies and I'm in the middle of doing my first

budget negotiation and my boss who normally does them was very impressed with my knowledge of the contracts and

budgets and loved the excel spreadsheet I set up for our site. (Like I created for class.)----- Ginger Rappley

“I found the text very easy to read and comprehend. The examples were relevant to

the material covered and the questions at the end of each chapter provided a good

overview. The budget examples were great and showing the formulas was helpful.”----

Heather S. Friar, BS, MT (ASCP)

Managing Clinical Trials- Budgets & Contracts Pfeiffer Windschiegl Digial ASD0037.pdf

MANAGING CLINICAL TRIAL- BUDGETS & CONTRACTS
Preface
Table of Contents
Acronyms
Chapter One: Budget Preparation

What Is This Chapter About?
Study Protocol
Informed Consent
Clinical Trial Agreement (CTA)
Lab and Pharmacy Manuals
Charge Master or Fee Schedule
Sponsor Budget
Chapter Review

Apply Your Knowledge
Chapter Review Questions

Chapter Two: Building the Site Budget

What Is This Chapter About?
Creating the Site Budget
Budget Sections

Study Start-up Costs
Study Visits
Subject Compensation
Equipment
Recruitment
Monitor Visits
Extra Visits
Serious Adverse Events (SAEs)
Study Close-Out
Subcontractors
Invoiced Items
Additional Staff
Travel
Overhead (Indirect Costs)

Creating the Study Budget

Budget Assumptions

Staff Costs
Overhead
Study Visits

Building the Budget

Visit Costs
Recruitment
Study Close-Out
Subcontractors
Invoiced Items
Travel
Additional Staff

Internal Budget
Populating the Sponsor Budget Template
Chapter Review

Apply Your Knowledge
Chapter Questions

Chapter Three: Coverage Analysis

What Is This Chapter About?
The 2000 Clinical Trial Policy and The Affordable Health Care Act
Qualifying Clinical Trials

Coverage Analysis
Assigning Costs to Appropriate Party
Coverage Analysis Steps

Billing
Chapter Review

Apply Your Knowledge
Chapter Review Questions

References

Chapter Four: Payment Plans

What Is This Chapter About?
Payment Types
Milestones
Study Visits
Invoices
Payment Triggers
Billing
Tracking Payments
Chapter Review

Apply Your Knowledge
Chapter Review Questions

References

Chapter Five: Negotiating the Sponsor’s Budget

What Is This Chapter About?
Preparation
Communication
Practice
Items to Consider for Negotiation

Study Start-up Fee
Screen Failures
Sponsor Holdback
Serious Adverse Event (SAE) Adjudication
Submission of Institutional Review Board (IRB) Continuing Review Reports
Review of MedWatch/SUSAR Reports by the Investigator
Record Storage
Destruction of Study Records
Destruction or Return of Investigational Product
Shipping and Handling of Specimens
Special Storage Requirements
Cost of Living
Reporting of Physician Payments

Chapter Review

Apply Your Knowledge
Chapter Review Questions

References

Chapter Six: Clinical Trial Agreements- The Preliminaries

What Is This Chapter About?
First Steps
The Parties
The Recitals
The Definitions
Chapter Review

Apply Your Knowledge
Chapter Review Questions

Chapter Seven: Responsibilities and Compliance

What Is This Chapter About?
Compliance with Laws
Institutional Review Board Oversight
Adverse Events
Filings and Registrations
Debarment, Disqualification and Exclusion
Financial Disclosure
Conflicts of Interest
Meetings
Chapter Review

Apply Your Knowledge
Chapter Review Questions

Chapter Eight: Finance

What Is This Chapter About?
Payment
Subject Injuries
Indemnification
Insurance
Chapter Review

Apply Your Knowledge
Chapter Review Questions

Chapter Nine: Ownership & Recordkeeping: Data, Intellectual Property & Publications

What Is This Chapter About?
Confidential Information
Recordkeeping
Intellectual Property, Patents and Licensing
Publishing and Publicity
Chapter Review

Apply Your Knowledge
Chapter Questions

Chapter Ten: Termination and Miscellaneous Matters

What Is This Chapter About?
Term and Termination
Survival
Notices and Notification
Governing Law and Alternative Dispute Resolution
Counterparts
Assignment
Relationships of the Parties
Force Majeure
Chapter Review

Apply Your Knowledge
Chapter Review Questions

Apply Your Knowledge Key

Chapter 1: Budget Preparation
Chapter 2: Building the Site Budget
Chapter 3: Coverage Analysis
Chapter 4: Payment Plans
Chapter 5: Negotiating the Sponsor’s Budget
Chapter 6: Clinical Trial Agreement – The Preliminaries
Chapter 7: Clinical Trial Agreement – Responsibilities & Compliance
Chapter 8: Clinical Trial Agreement – Review Questions – Responses
Chapter 9: Clinical Trial Agreement – Ownership & Recordkeeping
Chapter 10: Clinical Trial Agreement – Termination & Miscellaneous