Budgeting for Clinical Trials Carolyn Strickland, RN, BSN, CCRC Research Billing Services Consultant Office of Contracts Management My Biosketch Basic overview of budget negotiation Informal, Interactive, ask questions Review budget development, review examples Available after session for off topic questions

Objectives Review basics of a clinical trial budget Review “PriceChecker” on Starbrite Provide tips on the most common mistakes we see in OCM Just review don’t discuss

Lack of knowledge re use of CRC space & fees Most Common Budget Mistakes With Budgets for Industry-Initiated Projects Missing IDS fees Missing IRB fees Lack of knowledge re use of CRC space & fees Accounting for full staff effort VUMC indirect costs Start-up Fee Reimbursement for protocol procedures Annual cost increase for budget items Archive fees

Purpose of a Budget Understand the cost Identify who will pay for what Documentation of cost Informed decision How much will the study cost? Who will pay for each procedure and staff effort? Insurance, the sponsor, Good documentation assists with negotiation and decreases delays Should you open this trial?

Getting Started Carefully review protocol Input from investigator, coordinator, sponsor Know institutional requirements- finance, compliance Price quotes Feasible? Staff- Need additional staff? Training? Reasonable? Will patients with memory loss have to complete a daily electronic diary entry? Are blood draws daily over several hours for many days? Is the pt NPO for an extended period? Is the data due within 24 hrs of visit? Compatible? Conflict with other studies- compete? Is it in line with work department is already doing? Some dept have a committee to review research studies Do you see these pts in your clinic? Competitive enrollment Get price quotes and estimate cost of staff Dept of Hospital Finance Billing Compliance - researchratesrus

Developing Budget List study events and staff time Identify hidden costs Account for institutional indirect -industry sponsored 29% Identify standard of care (Routine Care) and research costs Events should mimic x-page Reconcile x-page with protocol, lab manual, CRFs

Routine Care Principle investigator and coordinator must carefully identify usual and customary care procedures vs. research specific procedures Usual and customary care procedures would probably be performed if the patient were not on the study Routine care tests and results may be used for research Usual and customary or SOC is unique to the institution. Ask the question- would I perform this procedure/service if the subject were not on a study? Is it reimbursable? Physician must assist and agree- physician word most important during an audit or court case. Medicare- is trial eligible? Is item eligible? LMRP site- Star panel- “Inf resources” CPT & ICD-9 check compliance- Third party payor

Research Costs Research specific procedures would probably not be performed if the patient were not on a study Can not bill insurance for any item that is reimbursed by sponsor

Schedule of Events example   Screening -14-- 0 Day Initiation Day 1 +/-3Days MO 1 2 3 4 5 6 +/-3Days or ET* Unsched. visit Visit 1 Visit 2 Visit 3 Visit 4 Visit 5 Visit 6 Visit 7 Visit 8 XXXX-STUDY Assessments Clinical Exam √ Prednisone use HX MM MMT QMG MG-ADL SF-36 IgA IgG AchR Pregnancy test BUN Creatinine PT/PTT CBC/Diff LFT Examinaton of XXXX site √ (Teach) √ (Refresher Course) AE Con Meds STUDY VISIT FLOW CHART *ET=Early Termination

Start-up Costs Protocol review Staff training Budget preparation Site selection/initiation visit Investigator meetings Development of study tools Administration (budget) Regulatory Also known as the site initiation costs/fee- incurred before the first patient is enrolled Tools- data collection and patient education Staff time for meetings File set up and internal paperwork

Start-up Costs Nonrefundable Up front Average start-up fee $10,000 National Conference range- $5,000- $15,000 Local fee standard $7500

Fixed Costs IRB fees- Institutional charge for IRB review, amendments, annual review Archive fees Pharmacy review; set-up fee, annual fee, close-out fee External audit fee Radiology set-up fee Lab set-up Close out activities Pass through fees Line item Don’t forget to add 29% indirect May be a one time fee

Personnel costs Screening Outreach Conference calls and email Patient visits Study documentation Regulatory Data management SAEs Monitoring visits Shipping Meetings Staff effort

Study Subject Costs Assessments- medical history, physical exam, adverse events Medical procedures- radiology, cardiology Professional fees Office visits/facility fees Lab work Medical and/or lab supplies Hospital bed VICTR/Clinical Research Center Screen Failures Research discounts Many procedures have professional fees- EKG, CXR, Cat scan

Administrative Costs Office supplies Telephone or fax charges Pager Voicemail Computer Postage/Shipping Department overhead not covered in the 29% indirect Get Sponsor billing number for shipping

Payment terms Critical Negotiated by the department Advance payment Payment trigger Payment schedule One time expenses Designed to assist with cash flow. Advance should be paid upon contract execution; pt advance is credited towards future payment. 20% or 2 pts Trigger- CRF completion? Monitor visit and pulled data? Quarterly or less Milestones may be ok if payment still made quarterly and prorated for pts enrolled One time- remittance within 30 days or with next quarterly payment

Payment terms Prorated payment Annual cost adjustment Payment adjustments Holdback -Per institution policy holdback can not exceed 20% Annual cost adjustment- 5-10% Ask for more money if needed

Sponsor Budget

Sponsor Budget Exhibit B – Clinical Study Financial Terms $5000 Investigator Fee $3750 IRB Fee $5000 Lab Fee $700 Per patient Fee (estimate 150 patients) estimate $1,050,000 $118,750 Estimated Total (based on 150 patients) $17,812.50 15 % payable upon IRB Approval (Institution will invoice Sponsor) $12,963.75 Per month for six months after first patient enrolled. Total $77,782.50 $23,155.00 At close out based on 150 patients Institution will invoice Sponsor in writing Any patients over 150 forecasted billed at $700 /per patient Any patients under 150 deducted at $700/per patient IRB amendments and continuing reviews will be an invoiceable pass-through cost at $500 each amendment, $750 each continuing review. All payments made pursuant to this Agreement shall be made payable to Vanderbilt University Medical Center and directed to the following address: Attn: Stephen Todd Associate Director Department of Finance Academic and Research Enterprise Vanderbilt University Medical Center Dept AT 40303 Atlanta, GA 31192-0303 Each payment voucher should reflect IMI’s name, Protocol Number, and the Principal Investigator’s name. Institution’s Federal Tax Identification Number is____62-0476822_______.

Negotiation Budget process requires negotiation Documentation Confidence Ideal vs. bottom line Compromise Mutual agreement

Example of Price Checker Screen – Basic Instructions

Example of Price Checker Screen – Discounts/Rates

Example of Price Checker Screen

Most Common Budget Mistakes With Budgets for Industry-Initiated Projects Missing IDS fees – 4 fees including: Initial submission - ~$2000-$3000; Annual fee - ~$1650 (varies); Close-out - ~$650; Dispensation of drug – varies. Always get an IDS quote. Missing IRB fees – 3 fees including: Initial submission - $2250; Amendments each $500; Continuing Review - $750. Lack of knowledge re use of CRC space & fees Accounting for full staff effort A misunderstanding or lack of knowledge re VUMC indirect costs (continued next slide)

Most Common Budget Mistakes With Budgets for Industry-Initiated Projects (continued) Failure to obtain Start-up Fee Inadequate or no reimbursement for protocol procedures; use tools such as Price-Checker; i.e. pathology fees for tissue samples Failure to build in annual cost increase for budget items Archive fees

Questions?

Contact for Budget Assistance Carolyn Strickland, RN, BSN Research Billing Services Consultant Office of Contracts Management 936-6691 carolyn.strickland@vanderbilt.edu