Strategies for Maximizing the Benefits of Outsourced Site Contract Negotiation

Who Cares About Site Contracts?

It is worth asking, why should we even care about site contracts? Admittedly, in the clinical operations space there are many issues that seem infinitely more important and exciting than sending a document back and forth a few times and then hunting busy, important people down to sign it. However, the terms of a carefully drafted clinical trial agreement provide critical protection for sponsors around matters like subject injury, indemnification, confidentiality, and intellectual property. Without these protections, sponsors would not be able to capitalize on the massive financial investments they make in research and development.

The other, more operational reason site contracts command our attention is that a fully executed clinical trial agreement is an absolute prerequisite for site activation—there can be no activation, no enrollment and, thus, no data unless and until the site executes a contract. Moreover, while site contracts are not the only prerequisite for site activation, they are routinely identified (rightly or wrongly) as a if not the primary rate limiter for site activation. The implications of this extend beyond poor metrics for cycle times or missed study milestones. It has been estimated that every day a clinical trial extends over schedule can cost the sponsor anywhere from $600,000 to $8 million per day. This should bring into focus that not only are site contracts unavoidable, but that we must find ways to execute them as efficiently as possible, all while maintaining the integrity and accuracy of the contract itself and ensuring we are appropriately limiting the sponsor’s exposure to risk. So how do we accomplish this feat?

Why Do Sponsors Outsource Site Contract Negotiation?

Sponsors of all sizes routinely turn to outsourced models to execute their clinical trials, and this invariably includes the contract negotiation function. Why do sponsors choose to outsource? First, outsourcing provides a high degree of flexibility in resourcing that aligns with the natural ebb and flow of a pipeline and its resultant varied resourcing needs. A clinical research organization (CRO) or similar functional service provider can easily shift resources around across various sponsors as needs change. This spares the sponsor’s in-house contracts team or legal department from having to accommodate sudden changes in the volume of work with a team whose size must remain relatively stable. Partnering with a CRO that can provide a team of local negotiators “fit for size” for the study should arguably enable the finalization of a greater volume of contracts in a shorter period of time.

Additionally, outsourcing contract negotiation allows a sponsor to leverage the CRO’s expertise gained from executing thousands of contracts. Not only do individual team members get exposure to different phases, therapeutic areas, templates, and regional or country preferences, but also, ideally, the team is capturing and centrally storing this type of information so that it can be retrieved by any team member and used to the sponsor’s benefit. No matter the size of the sponsor, an in-house contracts team will simply never compile this same volume of experience-based knowledge. If leveraged effectively, expertise around things like regional cycle times or solutions for common contracting obstacles can go a long way in expediting contract execution and preventing site contracts from becoming a rate limiter for site activation.

The key to making outsourcing work in this space to increase the efficiency and effectiveness of the site negotiation process is the implementation of certain strategies which work to maximize the benefits of the outsourcing model.

Oversight Tools

The first, and in some ways most important, strategy is the administration of appropriate oversight. All outsourcing models are wholly dependent upon the establishment of oversight processes and reporting mechanisms and outsourced site contract negotiation is no exception. One of the most important reporting mechanisms in site contracting is the much maligned contracts tracker. This is an Excel based report, often derived from a CTMS system, which shows a snapshot in time of the status of all contracts for a given study at a given time. This type of tracker, when maintained regularly, is a sponsor’s key mechanism for being able to both get a general sense of the progress of contract negotiation and know the status of a particular contract, thereby providing visibility into what is happening during study startup. That said, the utility of the tracker is highly dependent upon both the types of information it reports and the frequency and consistency with which it is updated.

The types of information presented in a tracker that make it useful can be very sponsor specific. What is essential, therefore, is that a CRO demonstrates a willingness to customize these reports. Additionally, the information captured in a tracker must be decipherable to the sponsor. This relates both to issues of disparate nomenclature (e.g. what is meant by start date?) and to what I call “cursory comments.” The comments section of a tracker provides front line negotiators with the opportunity to tie all of the metrics into a narrative that the sponsor can easily understand; unfortunately, it is an opportunity that is too often squandered. Compare the following examples:

Comment: 4/1: Local neg followed up with site via email—site reviewing second round of revisions since 3/15, mostly minor except issue with Inventions language

Comment: F/U with site

I encounter both types of comments on a regular basis, but it takes little analysis to see that one actually tells me where a contract is along the continuum of start to execution and provides some insight into how much longer the negotiation is likely to take; the other is a “cursory comment”—it tells me that the local negotiator wants me to know he or she gave this particular contract its due five minutes of attention for the week. A box has been ticked. But the point of the contracts tracker as an oversight tool is not to provide oversight of the local negotiator, per se, but to provide oversight of and insight into the negotiation process. That is why complete, detailed comments are so crucial.

A common complaint by CROs is that sponsors get too heavily involved and oversight quickly segues into micromanagement. There is a delicate balance to be reached here, one that requires both the sponsor to trust in the experience and expertise of the CRO and the CRO to consistently deliver high quality reporting. The CRO must ensure it is providing the information necessary to give the sponsor confidence it is safe to trust that what should be going on behind the scenes is going on behind the scenes. A sponsor’s ability to trust also requires a consistent level of responsiveness by the CRO. Nothing makes a sponsor more uneasy than finding out-of-date information in the tracker, reaching out for an update from the CRO, and not hearing a response for several days. Unresponsiveness begs the Sponsor to request more detail, more reporting, and more reassurance overall that study startup is progressing as it should. This translates into more work for everyone with little upside with respect to actual contract negotiation.

Setting Expectations

Another important strategy for maximizing the value of the outsourced model is proactive setting of expectations. In addition to expectations around reports, it is critical to similarly set expectations around other aspects of the sponsor-CRO relationship. This includes things like communication style, study priority (e.g. is the study high visibility and, thus, one should expect a lot of different actors to want key updates), and how informed the sponsor contracts manager wants to be from the perspective of both frequency and level of detail.

Additionally, specific to site contracts, it is critical to set expectations around escalations, not just the process or pathway, but the actual format of escalations. One of the most unnecessary delays in the site negotiation process is when an escalation must be returned by the sponsor to the CRO because it is insufficient or unclear. Too often, whether due to a lack of empowerment or support, inability to put one’s self in the shoes of someone who has not been handling the negotiation directly, or simply being pressed for time, the contract negotiator escalates an issue that either does not require sponsor review because it is addressed by existing fallback or the contract negotiator does not provide adequate information around what revision the site is requesting or why. When I work with a new team at a CRO to set expectations around escalations, I always share with them—when you escalate to me, read the email back and ask yourself, using just the information presented here, would I be able to make a decision to approve or reject this escalation? If the answer is no, you have more work to do before sending along this escalation. Escalations must clearly highlight the what and why of a site’s request. It is also important for the CRO to be able to articulate to the sponsor what is behind a site’s concerns. Many times there is a misunderstanding around the true meaning of contract language and if the practical implications of the language were better understood by the site, revisions would be unnecessary.

Beyond clearly communicating the site’s perspective, escalations should leverage the CRO’s breadth of experience and expertise by including information like: (1) have you worked with this site before? (2) do they routinely make this request; (3) do other sponsor’s routinely approve it; and (4) is this request site specific or have you noticed a trend across sites in this region? In the absence of this contextual supporting information, invariably the sponsor must return the escalation with a request for additional information and, in turn, the CRO negotiator must revisit the escalation, possibly reaching back out to the site for information. All of this additional communication causes unnecessary delays and represents a missed opportunity for the CRO to deliver the expertise they bring to the partnership. In this way, it is critical that detailed expectations are set around escalations from the beginning. The take away here is to make each and every escalation count!

Limitations on Outsourcing Models

The next strategy is less a strategy and more a reminder to bear in mind the inherent limitations of the outsourced site contract negotiation model. While I fully support and embrace the team mentality between the sponsor and CRO, I find it equally important to come into the partnership with realistic expectations. To start, rarely are local negotiators dedicated solely to your studies. This means their focus and commitment is potentially spread across various studies of different phases, therapeutic areas, and complexity and that they are, therefore, mentally juggling different budgets, contract templates, and negotiating parameters. As compared to in-house counsel (or an in-house contracts team that resides within the Sponsor’s clinical operations unit) that is intimately involved with a study on a regular basis, the CRO team members cannot always have at the forefront of their mind all the background of a particular study. Therefore, it is essential for the Sponsor to communicate this type of information to the CRO early and often. This includes information like why certain countries need to be activated by a certain date, or why it is so important that a particular KOL be activated first in a country. This relates to setting expectations but this time in the form of helping the CRO team set priorities, providing frequent reminders of those priorities, and keeping the team informed if those priorities shift.

The Collaborative Team Environment

The last strategy ties everything together, and that is to continually work at creating and maintaining a collaborative team environment. This starts with completely dismissing the principal-agent mentality that many Sponsors adopt. To optimize the relationship, the Sponsor must view the CRO team as part of the team, rather than just an external service provider. I have seen firsthand on too many occasions a Sponsor belittling their CRO counterpart or taking the position of “this is your problem—fix it.” This approach is hard to understand from the perspective of meeting study objectives, as it has no likelihood of leading to sustained success. When local negotiators are juggling multiple studies for multiple Sponsors, they will, understandably, quickly adopt the habit of avoiding those contracts for which they are not offered the necessary support to carry out their role.

Site contracts exist in a space where deadlines are constantly hanging heavy in the air, and this is admittedly a difficult environment in which to feel comfortable taking precious time to build relationships; but relationship building in this setting is critical. It cannot be the case, as it is all too often, that communication between Sponsor and the CRO occurs only in the face of an issue or problem that requires immediate attention. Initial introductions between the Sponsor and CRO team members should occur in person, if possible. This can be accomplished by way of attendance at the Study Kick-Off meeting. It is so important and valuable in the long term for team members to be able to put a face with a name and get a better handle on individuals’ demeanor. It can provide a window into interpreting illusive email tone or silence on a weekly update call. I have personally had the experience, as I would guess most of us have, where someone develops a reputation for being curt or rude, but because I know the person in real life I am able to contextualize an undesirable email communication style.

Beyond a commitment to only rely on less personal forms of communication after establishing a relationship with the CRO team, I also encourage Sponsor’s to be generous with compliments of the CRO and strategic with criticism. When a local negotiator sends a perfect escalation, I let them know it. When a local negotiator is on point and extremely prepared on a study update call, I let them know it. I might even let their manager know it. In contrast, when someone is missing the mark, perhaps sending through inadequate updates in a tracker, I make mental note of it, but give them the benefit of the doubt and refrain from taking immediate action. Everyone is entitled to have an off day or week. Only after it becomes a pattern do I address it, but not to chastise. Instead, I share my perspective—why I am not able to do or evaluate something I need to because I have been provided with inadequate information and how we can work together so that I may accomplish what I need to accomplish.

This brings us to the final point that I find is so important, not just in the outsourced model relationship but also during the actual contract negotiation, and that is to remember we are all working toward the same ultimate goal, which is to execute a contract—quickly. The Sponsor wants to help the CRO in any way that helps them to negotiate the contract quickly. The CRO wants to negotiate the contract quickly, if for no other reason than to move it off their plate and move on to the next. The site wants to negotiate the contract quickly to enable site activation so that they may begin enrolling patients into the trial. The more all parties are reminded of this common objective and provided a collaborative space within which to achieve it, the greater the likelihood of successful and expeditious site contract negotiation.

Bringing it All Together

Clinical trial agreements matter whether we like it or not. The main benefits of outsourcing the negotiation of these required contracts are increased flexibility in resourcing and access to expertise. But these benefits can only be realized through appropriate oversight, proactive expectation setting, maintaining awareness of the inherent weaknesses of the outsourcing model, and carefully curating a collaborative working environment. Through the use of these strategies, Sponsors and CROs can work together to efficiently execute site contracts that successfully limit the Sponsor’s exposure to risk and conform to budget parameters. Happy negotiating!