Managing Clinical Trials & Outsourcing

Clinical trials are costly, complicated, and time consuming. The costs are well documented — anything from $897 million, according to the Tufts Center for the Study of Drug Development, to $1.7 billion, according to Bain & Co. — to bring a drug to market, with a large chunk of that money being tied up in clinical trials (see "New Drug Costs Sky-High: $1.7B," Jan. 2004 Bio·IT World, page 1). As hurtful to companies are the time constraints. Today, according to Tufts, the clinical and approval time for new biopharmaceuticals takes 7.8 years, a sizeable increase from 4.7 years in the 1980s.

Then there's the complicated nature of clinical research, exacerbated by the numerous parties involved in the process — from the sponsor, to the contract research organizations and site management organizations to which companies very often outsource trial management, to investigators and the patients.

To date, pharmaceutical companies have not done a good job of streamlining the operating procedures required to manage outsourced clinical trials. Instead of managing the process and relationship, the focus has been on managing specific tasks.

If the pharmaceutical sponsor is to minimize challenges involved in managing outsourced clinical trials, it must learn to establish the relationships with the right partners, and manage the project and process tightly.

Key to managing the relationship is knowing which partner to select. A company might choose to work with one provider for all outsource components to ensure transparency across functions, clear accountability, and fewer oversight complications.

But a downside to such a strategy is that one contract research organization (CRO), for example, is unlikely to have in-depth expertise across all functions. Furthermore, large vendors that offer a wide array of services are likely to be more focused on their top pharma clients, and may well not be an appropriate partner for smaller biotechs and pharmas.

Alternatively, companies may select several outsource partners. Deep expertise and greater flexibility are two clear advantages when deciding to work with multiple providers. However, the sponsor will then have to manage many different interactions and cope with a lack of accountability and finger-pointing between the vendors.

A further option might be to outsource some functions with a provider, while keeping other activities in-house. Deciding which aspects of the clinical trial process to outsource will depend on the core competencies of both the vendor and sponsor.


Be Careful What You Outsource
Outsourcing components where a company lacks business expertise makes sense, whereas a sponsor may be giving up critical efficiencies if it outsources an element that might offer a competitive advantage. For example, a sponsor may have systems and processes that support immediate payment of investigators upon completion of trial milestones. If this enhances investigator relationships and, consequently, study conduct, it would be unwise to outsource such a function.

The value of strong investigator relationships cannot be overemphasized. Slow reimbursement or a failure to meet milestone payments will hinder the clinical trial, preventing follow-on studies from getting under way or forcing cutbacks to high-recruiting studies. This in turn creates further delays to drug development.

A 2002 McKinsey Quarterly report, entitled "A Cure for Clinical Trials," noted that delays can cost a pharmaceutical company at least $800,000 a day in lost sales for a niche medication, and as much as $5.4 million a day for a blockbuster.


Watch That Vendor Audit
Good communication is critical for the success of any project. Early discussions should center on what's important to both parties, and should include a review of standard operating procedures (SOPs) and product deliverables, as well as future expectations.

Getting to a point where expectations are clear requires many discussions with multiple parties. As a project moves through its milestones, key personnel may change, just as the dynamics of the clinical study itself mean constantly evolving deliverables.

At an early stage, for example, the key people will be the managers involved in formulating the contract. Further down the line, participants in discussions between the sponsor and vendor will include personnel in clinical supplies, in monitoring, and in trial management. Decisions that are made by each group need to be communicated and shared internally and with external partners. Similarly, as patient recruitment, market conditions, or results affect deliverables, communication within and between organizations will be critical.

Sponsors and vendors have the opportunity to plan for these known cycles and to build a communication plan that will facilitate management of these transitions. The plan should include communication protocols and frequent contact (as well as multiple points of contact) between the sponsor and the vendor. Also helpful is formal training on company processes for both sets of staff.

The sponsor should also play close attention to a vendor's audit. CROs and other organizations involved in clinical trial outsourcing are required to undergo an independent regulatory compliance audit to ensure that their procedures, systems, documentation, and controls comply with regulatory guidelines and standards. The audit will provide the sponsor with important information about the vendor.

First, the audit enables the pharma or biotech to fulfill its due-diligence obligation to regulatory bodies such as the FDA, proving that it is conducting clinical trials in compliance with regulations.

Second, and perhaps more importantly in terms of relationship building, the audit enables the sponsor to identify specific commonalities and differences with the vendor.

The audit will expose vendor SOPs, enabling comparisons with sponsor SOPs. In the context of the audit, sponsors can drill down with questions and specific examples to better understand the SOPs' usage, and uncover those practices that mesh with the pharma's own practices and those that can be tolerated or adapted.


Want Lower Costs? Integrate!
The uses of technology, including methods for data capture and tracking clinical trials, and how the sponsor and vendor share information will be critical to building and maintaining the relationship.

Information collection currently is highly dispersed, to the detriment of both the sponsor and the outsource service organization. Sponsors are hit by higher costs and longer development times, while their CRO and SMO clients are hurt by slow reimbursement and, without access to all critical data, struggle to manage the trial efficiently.

Therefore, it is in the interests of both parties to work toward system integration, taking it one step at a time.

To begin with, the sponsor and the vendor should develop a small-scale integration plan, perhaps focusing on processes used for data entry. Since project teams that are entering data from multiple sources often do this manually, there is a huge propensity for error. A central system for data entry could dramatically reduce error reporting.

A longer-term integration goal might be to put in place a data-warehousing tool or clinical trial management system (CTMS) to collate data from a variety of systems, such as central lab systems or clinical database management systems, and then linking those systems to the operational data necessary for managing a clinical trial. These include the collation of such information as clinical grants and budgets, contract management and investigator payment, and accounts payable systems.

By integrating information necessary to manage clinical trials in a central repository, or CTMS, the drug-development teams from the pharmaceutical sponsor as well as the project teams on the vendor side are brought into the loop on all aspects of the trial. To cut the time and costs involved in developing a CTMS, companies should adopt commercially available systems.

By managing the relationship from the outset and putting in place at least some level of systems integration, the pharma sponsor will not only be able to more easily gain access to, collect, store, and report data vital to clinical trial management, but it will also be able to ensure that its protocol requirements are reconciled with the SOPs of its outsource partners.