Negotiating Study Budgets: Site and Sponsor Perspectives

April Schultz
December 14th, 2017

Sites and sponsors are often at odds when negotiating study budgets because they believe the other party is making unreasonable requests. It’s easy to assume each stakeholder has conflicting motivations and that negotiating a fair budget is a losing battle. In reality, sites and sponsors need one another to conduct successful research and it’s critical for the two stakeholders to come to mutual agreement.

At this year’s MAGI West Clinical Research Conference in San Francisco, CA, two presenters tackled this challenge head on in their session “Debate: Are Site Budgets Fair?” Together, Pavel Kruchek of the University of Utah and Vianey Swann of Roche Molecular Systems, Inc. shared their different perspectives on common challenges and potential solutions for both sites and sponsors.

Fair market value (FMV)

One of the first challenges addressed was the disconnect between a site’s and sponsor’s assessments of fair market value (FMV). It was evident that this disconnect is particularly frustrating for both parties, and rightly so. The consequences of not reaching a consensus on the amount that should reasonably be paid for conducting a clinical trial can have huge impacts.

Pavel noted that without sufficient reimbursement, the site can’t function at full capacity and is at risk for non-compliance and/or poor data quality. This, in turn, affects the sponsor’s trial results, and can ultimately hinder the relationship between the two parties.

Pavel asked the mixed audience of sites, sponsors and other industry stakeholders to raise their hands if a sponsor has ever told them their budget “is the highest among all of our sites.” A large group of hands raised in response.

Vianey asserted it’s important to understand a sponsor’s intent is not malicious. From her perspective, sponsors are looking at industry standards and attempt to be consistent yet flexible with their negotiations across sites.

“You always need to be willing to give me your sales pitch.” Vianey said to sites in the room. “Many times, [sponsors] are willing to pay if you give us a solid business case.”

Principal investigator (PI) and study coordinator time

Another hot-button issue addressed during the presentation was how sites are compensated for PI and study coordinator time. The disconnect here arises when these individuals are spending more time performing and/or overseeing study-related tasks than the budget covers.

Pavel noted that PI and coordinator time is often underestimated in the budget and a lack of compensation for this time can lead to lost revenue for the site. However, it’s often difficult to make an accurate estimate of the amount of time that will be spent performing tasks, such as pre-screening, data entry, etc.

Both presenters explained that this is where past performance data can be a key asset when negotiating trial budgets. Vianey said knowledge of past performance will show you where your site excels and where you need more time and resources. Giving sponsors solid reasoning and evidence is an irrefutable way to show them you need to be compensated for additional efforts. Vianey also suggests writing down the additional time spent and associated expenses so you have a comprehensive list to present to the sponsor. Tools such as a clinical trial management system (CTMS) can also help sites track staff effort and house budget-related data to build a successful business case.

Want more answers?

By the end of the discussion, it became clear that understanding both sides of the situation can lead to more effective negotiations. Even during one short hour shared in a conference room, the audience seemed to develop a better understanding of how communication can influence site-sponsor relationships.

To further explore how sites and sponsors can work together to develop better communication, reach mutual agreement and improve clinical research processes, download your copy of our free eBook, “Improving Site-Sponsor Relationships: Proactive Strategies for Transparent Clinical Trials.”