Budget Strategies

Here’s expert’s advice to develop a solid budget

Watch for discrepancies

Budgeting is a complicated process, but you can make it work well by following thorough and well-organized, step-by-step strategies.

A first step could be to invest in a clinical management system, says Don McCall, RN, CCRC, research manager at Piedmont Hematology Oncology Associates of Winston-Salem, NC.

"The CTMS helps keep you from spending a lot of time doing budgeting," McCall says. "And it’s good to be standardized."

McCall, who has spoken about clinical trial budgets at national conferences, says that his personal experience working in all facets of research helped immensely when he began writing study budgets.

"I’ve worked in every area of the department: data management, regulatory, coordinator, everything that could be done in a research trial, so I understand how much time it all takes, and that helps us do well," McCall says.

McCall offers this advice on how to improve a trial site’s budgeting:

• Closely examine the protocol when developing budget.

"First look at the table of events in the protocol," McCall says. "Most sponsors give you a spreadsheet."

The key is to review and compare the protocol and study budget.

"It takes me almost a day to look at a good oncology study budget," he adds. "I have two widescreen monitors in front of me, and I have a protocol on one and a budget on another."

The budget template should look like the table of events in the protocol, so it’s important to compare the two, looking for discrepancies.

"Sometimes you’ll find something that’s not in the budget, but it’s in the table of events," McCall says. "The sponsor might leave something out that maybe is nothing, but it also could be something that costs you money, so you should look for it and scrutinize both the budget and table of events."

The most costly errors can occur when sites and sponsors underestimate how long a study will take.

"The study could go on for two years while your budget went on for three months," McCall says. "Make sure the wording is appropriate in the budget."

• Involve the research site’s billing office.

Billing office staff can be helpful in analyzing costs and preparing the budget.

For example, when a research manager determines the cost of a specific procedure, it helps to know what the billing office charges an insurer for the same procedure. The billing office also can help with calculating the research office’s overhead costs, which could range from 20% to 40%, although sponsors will pay at the lower end, McCall says.

Set procedure costs should be updated on a regular basis, as should drug and other item costs.

"Exam costs might change yearly, but some things like drugs could change quarterly," McCall says.

McCall checks on prices twice a year. He emails or calls the billing department as he updates the costs.

• Physician investigators review the protocol.

After McCall takes a look at the protocol, he sends it to the research site’s physicians to see if it meets their scientific criteria.

"I just look at the structure of the protocol to see if this is something our center can find patients to enroll," he says. "Physicians check the protocol to see if this is something they’d want to give to their patients."

They check to see if the study is asking appropriate questions and whether the questions are relevant. They see whether the endpoints are important for the patient population, McCall says.

• Assess study’s enrollment potential.

Research sites like Piedmont Hematology Oncology Associates have electronic medical records that could be accessed to determine the patient population for any particular study. This provides a good baseline for determining any particular study’s potential to succeed in enrollment.

But there are other considerations, as well.

"Our screen failure rate has doubled over the last two years," McCall notes. "The inclusion/exclusion criteria these days are very targeted with specific issues, including interactions with other drugs."

In oncology, many new drugs could cause blood clots, so patients who already have blood clots typically are excluded from oncology trials, he says.

Also, many patients have cardiac arrhythmias, and investigational drugs often could cause problems for these patients, so they also are excluded from clinical trials, he adds.

"Patients who have had any other type of cancer, such as men who have a history of prostate or lung cancer, and women with cervical or breast cancer, also can be excluded," McCall says.

So it’s crucial to carefully examine the inclusion/exclusion criteria and estimate based on these how narrow or broad the potential recruitment pool might be.

"If you don’t enroll, you lose money, so you have to enroll," he says. "You realize every site has the same issues, so the sponsor has to expect low recruitment numbers, and I’ll open a trial if I think I can enroll even three subjects."

On rare occasions, the research site might even take a trial in which only one patient could be enrolled, he adds.

• Learn to handle the negotiators.

McCall recommends returning the sponsor’s budget with changes highlighted in red, letting them know that the site manager is happy to discuss the changes. It’s important to return budget changes in a professional manner, using an Excel spreadsheet so the sponsor will see that the site manager knows what he or she is doing.

"They can tell whether you have been doing this a long time by the way you return the budget," McCall says.

Sponsors sometimes contract with clinical research organizations (CROs) to negotiate contracts and budgets. Research site managers might assume that the CRO has financial incentives to negotiate low budgets, so they should understand how to handle these negotiations, McCall says.

"The CRO always will tell you, The sponsor’s limit is this amount,’" he says. "And I say, What I need you to do is submit the budget as I wrote it to the sponsor because when I submitted this budget it was conservative, and it’s my bottom line.’"

Typically, things will work out once the site’s budget is sent to the sponsor, he adds.

"You have to be willing to speak directly and not be nervous about it," McCall advises. "This is a business deal, just like buying a car; you tell them what you need, and you don’t get emotional; just be polite and professional."

Sponsors and CROs sometimes try to appeal to a researcher’s benevolence, asking the clinical trial site to take on a study that might cost more than its budget for the sake of helping their patients. This is an erroneous assumption because no clinical trial can guarantee a personal benefit to subjects, McCall says.

Occasionally, McCall finds that a CRO or sponsor negotiator is taking the process too personally and is upset that McCall rejects the initial study budget. When this occurs, McCall finds someone else to deal with.

"I will send an email, saying, I can’t work with this person; they’re too emotional and are taking it too personally,’" he says. "So I’ll request a different person, or I’ll ask the person to stop that line of reasoning that this study is for the patient’s benefit."

The key is to think of the clinical trial as a partnership between sponsors, CROs, and research sites. Each party wants to achieve the same objective: successful trials with robust data.

"Both sides understand they need to look out for one another," McCall says. "If I gouge the sponsor they won’t come back to me with more studies, and if I’m losing money on the study than I won’t be able to do research much longer."

• Walk away from the study when the numbers do not work.

"My goal is to not walk away from a study, but I will walk away," McCall says. "I don’t want any bad feelings, and I won’t get personal with budgets; these are business and nothing else."

Sometimes contract negotiations reach an impasse, and the research site has to decide whether there are any positive factors that make it worth taking on a trial that will lose money. For instance, is this a case where it will create good will with a new sponsor partner, and the long-term relationship could prove more financially profitable? Or perhaps this is an investigational product that patients, who have exhausted existing treatments, have been asking about.

But if there are no compelling reasons why the site should take on a study that will lose money, then the site manager should just say, No thanks,’ and walk away, McCall suggests.

"Pharmaceutical companies have been making profits for years and years, and research centers have not," he says. "But in order for us to do good research, we need to make a profit, and we need to compensate our staff well for their taking on the kind of stress they have in doing clinical research."