Budgeting trouble? Try a budget template
Research institution works toward best practice
One of the more challenging tasks for investigators and clinical trials offices involves developing an accurate budget that captures all that is needed.
Convinced that this process can be turned into a best practice, staff in the Clinical Trials Office of Thomas Jefferson University of Philadelphia have developed a budget template that is intended to help the office achieve three main goals, says Roseann Talarico, associate director of the Clinical Trials Office.
The three goals are as follows:
1. Implement a systematic budget system.
2. Ensure proper identification of study-related costs.
3. Facilitate the processes involved in negotiating the sponsor’s budget and payment schedule.
"Our budget process was very ad hoc in the past," Talarico says. "Everyone kind of did their own type of budget; or rather, the sponsor presented it, and they just accepted it."
With a systematic budget system, the objective is to negotiate the sponsor’s budget and payment schedule, she adds.
Since developing and implementing the new budgeting process, clinical trials administrators have begun to see a more standardized approach to budgeting among investigators as well as other improvements, Talarico says.
It was introduced in September, so it’s too soon to note any financial improvements, but anecdotal evidence suggests it’s been well received, she adds.
"It’s still not mandatory, but what I’m finding is that people are gravitating to it more and more," Talarico says. "Before we began this process, research staff had no idea about all of the start-up costs, time, and effort that go into the regulatory, administrative, and informed consent processes, and they had no idea they could get reimbursement for their time and work in these areas."
She describes how the institution has created a best practice for creating clinical trials budgets:
- Begin with a pre-study checklist. Talarico began by creating a pre-study checklist that assesses the feasibility of doing a pre-study trial. Here are some of the considerations on the checklist:
— Do we have a previous relationship with the sponsor?
— What is the sponsor’s reputation with colleagues?
— Do we have access to the right population?
— Is the proposed enrollment goal realistic?
— Is the proposed enrollment period realistic?
— Will enrollment compete with other studies seeking the same patients?
— Are vulnerable populations involved, which take more time?
— Do we expect a significant number of adverse events?
— How ill is this population?
— Is the protocol well designed?
— Is the protocol ethical?
— Is the study question itself important?
— Is the protocol in its final form and how many amendments can be suggested?
— Will the sponsor be open to suggestions or modifications if the protocol is not feasible as written?
— Do we have qualified staff available and training available?
— Is the workload manageable?
— Does the principal investigator have the appropriate time to devote to the protocol and are specialists needed?
— Are there adequate clinic and office space available?
— Does the sponsor expect to audit the study?
— Will electronic or remote data systems be used?
— Will the sponsor’s site visits be frequent?
— Is the necessary equipment available to do the study?
— Is the study unusually long in duration?
— Are the case report forms complex?
— Is there a large number of case report forms per subject?
— Are drug eligibility requirements complicated?
"These are hidden costs, and these all fall under the feasibility assessment," Talarico says.
The checklist also would need to assess whether inclusion/exclusion criteria are overly restrictive, resulting in a high screen failure rate, she advises.
- Develop a budget template. Talarico developed a one-page budget template that begins with fixed costs and nonrefundable costs, and includes the feasibility assessment, study initiation, capital equipment costs, special supplies, pharmacy, and other fixed costs, Talarico says.
"The facilities and administration rate of 25% goes on top of that," she says. "That’s the standard rate you’ll find."
Then the template goes into other fixed costs, such as the PI effort, advertising, record storage, monitor visits, post-study coordinator charges, etc., Talarico says.
These costs are refundable, and, again, the facilities and administration rate of 25% is calculated on these costs, she says.
Exempt from the facilities and administrative fee are the $2,000 IRB fee and any other study costs designated by the institution.
The next part of the budget template illustrates the study costs per patient, including the PI effort, clerical effort, coordinator/research nurse effort, pharmacy, radiology, etc., Talarico says.
"On some clinical trials you have to dedicate a clerical person specifically to the trial," she explains.
Finally, the budget template provides a row for the total study budget costs and total study budget per patient costs and a summary of the total fixed costs, study costs, study budget, per-patient cost, direct costs, and facilities and administrative costs.
The budget most be signed by the PI.
- Present new budget process to investigators and staff. One of the reasons the clinical trials office staff began to develop a new budget process was because investigators and clinical trials staff too often failed to designate that certain costs were nonrefundable, and this left the research institution to pay for costs that were incurred before a sponsor decided to cancel a study, Talarico says.
"We were burned so many times because sponsors would say they wanted to cancel the study, and we’d have to return all the money," she explains.
So a new budget process was developed to standardize costs across departments and assist the institution in developing and negotiating successful budgets, Talarico says.
"You have to anticipate the unexpected and know what’s in your protocol," she says. "This is something that I try to get across to researchers and staff initially — that we have to gather information and review the protocol in detail to make a complete list of all required procedures, tests, patient visits, etc., regardless of budget types."
Staff training in the new budget process is essential because so much of the success of the budget template is determined by a researcher’s or research coordinator’s ability to understand what will be required at each patient visit, she says.
"An important indirect cost is actual personnel time and effort extended, and they need a clear understanding of the scope of the study to determine these," Talarico adds.
For instance, there are the PI’s time and effort, document reviews, informed consent, study coordinator’s time, patient screening, shipping of specimens, vital signs, patient visits, and scheduling to consider when reviewing the protocol, she says.
Talarico developed a study coordinator’s time and estimate sheet to help clinical trials staff and researchers determine these staff and procedures.
- Teach investigators and staff to consider hidden costs. Examples of hidden costs include unplanned visits or missed visits with subjects, Talarico says.
Also, copies of radiology scans, X-rays, FDA regulations, clinical and nonclinical supplies, such as catheters, office supplies, fax use, telephone calls, mailings, etc., need to be considered, Talarico says.
"You think you put together a budget, but it’s extremely complex, and you need to consider fringe benefits, verifying prices," she says.
One way to assist clinical trials staff and researchers with determining hidden costs is to post costs for certain standard items on a research institution’s web site, Talarico suggests.
"This way, budget people can extract pricing costs as they are doing their budgets," she says.
Also, researchers and clinical trials coordinators should call various hospitals and university departments to ask about costs of various tasks and services.
One of the most common areas of hidden costs is personnel costs, Talarico reports.
"Even if it’s a six-month, double-blind study, the study staff will spend considerable time with start-up costs and will also consider closeout costs, such as data cleanup and queries," she says. "For the closeout, you need to consider the case report entry and filing."
Other hidden costs involve the subjects, such as paying subjects stipends or reimbursement to cover travel and parking costs, Talarico notes.
"Look closely to see how much the sponsor pays for screen failures, because screening may involve expensive tests," she says.
"Sometimes if sponsors come in and present a budget and say it’s a fixed budget, I always encourage coordinators to go back and renegotiate if the budget seems inadequate," Talarico says. "Look at their track record of success: If the budget truly is inadequate, then you might have to step away from that study."
- Analyze proposed payment schedule and its impact. "Read the proposed payment schedule and understand it and analyze the impact it will have on your study," Talarico says. "If it seems impossible to understand, then start writing your own payment schedule because the sponsor may not understand it either."
She says her philosophy is to ask for an upfront payment payable upon execution of the agreement, which is when both parties sign it.
"This helps you to cover start-up costs, patient recruitment and screening, and to carefully consider the size of upfront payment that you’ll need to keep you afloat until the interim payments are due," Talarico explains. "If you don’t request this then you’re incurring start-up costs before being given reimbursement."
Also, the payment schedule should include details about reimbursement for early termination and interim payments and milestones, she adds.
For example, are payments made when a specific number of subjects are enrolled or when they have been randomized or evaluated, Talarico explains.
"Usually, you have to negotiate these payments to fit the protocol and situation," she says. "About 90% of the work is done in the first few months of a study, and you should be paid accordingly so you have to consider the impact of cash flow."
Also, Talarico stresses to PIs that they should not overestimate their enrollment for the purpose of ensuring successful cash flow because if they overestimate, they will lose credibility with sponsors.
Other tips she offers are to keep document tracking and keep track of records that the study monitor reviews to make sure everything is paid correctly.
"And discuss when the final payment will be triggered because the sponsor may want to withhold a substantial portion of the budget until the case report forms are approved, and this could take months," Talarico says. "There would be less motivation for them to pay promptly, so we want to make sure we have that final payment when we complete case report forms and send them to sponsors."
One of the more challenging tasks for investigators and clinical trials offices involves developing an accurate budget that captures all that is needed.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
- Award-winning Medical Content
- Latest Advances & Development in Medicine
- Unbiased Content