Clinical Trial Budgeting Challenges and Service Catalog in Contract Research Organization.


Budgeting of a clinical trial project requires an assessment of all possible risks and a clear understanding of the project plan. It’s almost impossible to estimate the true effort required to complete a project without analysis of potential risks, which in turn determines the workload for the project and thus the final budget.

Despite the development of modern IT technologies, we see that the process of clinical study budgeting in most CROs and sponsor organizations has not undergone significant changes. Many companies continue to use sophisticated and comprehensive excel-templates for calculating the costs of their projects. These templates and calculations are represented in the form of separate files, and at most can show only «how much», but not the «why». This historical approach, for example, doesn’t make important links between cost estimations and possible risks (risk mitigation activities) for a particular project.

There is no standard approach to structuring budgets in the industry. Clinical trial sponsors create their own template, and then all potential contractors have to convert their cost estimations into the required sponsor format. This process takes significant time, not to mention potential transcription errors and the risk of misunderstandings.

Cost estimation for a clinical trial is a task that requires experienced people who can evaluate the risks in their mind or organize brainstorming with colleagues to determine such potential risks. This is a creative process that takes substantial time and resources, and this process has to be repeated every time a potential contractor receives an RFP. The experience of customization and optimization of the project budget often remains undocumented since it exists only in the mind of the employee, who takes full responsibility for the accuracy of the proposal and estimations. If this employee leaves the company for any reason, the new employee who replaces him/her will have to re-accumulate experience in customizing and optimizing these budgeting processes.

Today, existing technologies for budgeting of clinical trials projects use undocumented algorithms for associating risks to project costs and scenarios; there is no accumulation of systematized and detailed information on budgeting based on risk assessment. The overview and analysis of this information is impossible or requires enormous efforts for systematization; much valuable information, therefore, remains only in the minds of individual employees, which builds-up their know-how instead of building-up essential corporate knowledge.

On the other hand, clinical trials are a very heavy regulated area of human activities, so the general structure of the clinical trial plan and budget doesn’t vary much from one CRO to another. We always see the same list of services, included within the project plan, described in different words and with more or less detailed. What this means, therefore, is that this structure can be transformed into a “Service Catalog” containing all options and scenarios and can be used by proposal managers for more consistent trial cost estimation. Furthermore, this structure can be universal, which opens the way to seamless service integration between different outsourced CROs and other providers, involved in the same project.

ITIL and Contract Research Organizations

Reflecting on these challenges, we started to search for a solution outside of the pharmaceutical CRO industry and found our inspiration in the Information Technology Infrastructure Library (ITIL), a popular framework, and the most common approach for managing IT services. Based on its success, ITIL has become synonymous with the “best practice” in IT service management. It assumes a consistent, reproducible, and measurable service delivery process aimed at achieving business goals within the constraints of the resources allocated to it. Despite being applied to IT, the principles of ITIL can be easily introduced to manage services in any other service-oriented business, including that of the CRO industry, because they are so universal. Rethinking the principles of ITIL, we discovered that the model of service catalog management can help us to resolve most of the challenges we face with budgeting and planning.

The introduction of service catalog management in a CRO can bring about many positive changes. It allows us to identify and describe work scenarios to meet requirements and mitigate existing risks, effectively manage cost optimization, and gain independence from organizational changes within the company. Employees will not only be able to approach the work from the perspective of working on individual tasks, but they should also now see the broader, ultimate goals and what for the client is actually paying for.

By ITIL definitions, a service catalog is a database or a structured document with information about all used services (live services), including additional services that are available for deployment. A typical service catalog includes information about suppliers, prices, contact points, as well as the required support processes.

If we want to adopt the ITIL approach, it’s necessary first to determine what benefits the client (sponsor) expects to receive using the CRO’s service catalog and what objectives should be achieved (i.e., “user request view”). Next, it’s necessary to identify the main processes that lead to the achievement of these goals (i.e., “business view”).

The last step includes a description of all details of the services that are involved in the main processes and systemized in the catalog by its structure (i.e., “technical view”).

From the sponsor’s perspective, the value of clinical research is the scientifically-based conclusion about the potential effectiveness and safety of the drug, which is necessary for its introduction to the market (or for new indications) to generate sales revenue. In addition to the scientifically-based conclusion, the sponsor wants to receive documentation, which reflects all stages of the study and which confirms strict adherence to the rules, standards, and good practices in clinical research. In some cases, the sponsor may purchase limited “packages” of services and related documentation. Each such “package” of services corresponds to a process that manages the services included in it.

ITIL states: “A «service» is a means of delivering value to customers by facilitating outcomes customers want to achieve but without the ownership of specific costs and risks.” Thus, to describe the service, it is necessary to understand what the customer wants to acquire and to pay for”.

So what services do we sell according to this definition? None of the numerous clinical trials budget templates that we have seen answer this question. For example, a budget position can say “monitoring visit.” What is the value of a single monitoring visit regarding creating value for the research sponsor? A single visit has no value from the service definition point of view. The monitoring visit is a part of the clinical trial monitoring service, the final result of which is the clinical data collected on time and in accordance with GCP, the protocol and other guidelines regulations and practices; with comprehensive documentation, which reflects all the activities of the project team on this matter. Proceeding from this, in reality, the sponsor pays not for a single visit (although the sponsor often talks about it), but for the guarantee that the trial will be performed at clinical sites on time and with an acceptable level of quality.

For this reason, to estimate the monitoring volume, we should not proceed with an abstract number of visits (“like we always do”). We have to consider monitoring scenarios that would allow us to guarantee quality in spite of the risks that may arise from the specific project: the complexity of the protocol, logistics, the use of new technologies, etc. In other words, we have to describe the dependence between project risks and efforts that we put into service performance, also taking into account the cost-drivers and timelines of the processes.

So what have we done?

Using the ITIL approach, we have successfully built a Service Catalog. We reviewed the clinical trial budget template used for cost estimation and transformed its rows and sections into a comprehensive list of services. Each service is described with a set of attributes like deliverable, relation to functional departments, service owner, link to QMS documents, behavior in a time schedule, etc. Next, we designed service levels for each service. In fact, the word “level” comes from ITIL and mostly describes the quality of service. In a clinical trial, the quality is binary, it only can be acceptable or unacceptable, and in this case, “service level” refers to the risk-mitigating service scenario, required in a particular project. In the projects with complicated protocols, we have to put more efforts to prevent and mitigate risks rather than in projects with less complexity. Site monitoring, for example, will include more tasks and actions, data management requires more data validation procedures, etc. So, we described efforts and their dependence on project cost-drivers and risk factors for each service level that any company provides in different projects.

We have launched a new Service Catalog, and in combination with a cloud-based solution Risk Based Budgeting Tool (RBBTool, provided by AIE Solutions s.r.o) manage services and create budgets and project plans for new projects based on risk assessment. We fully utilize our corporate knowledge and can show our clients the best way to conduct a trial, managing all potential risks. We also use our service catalog as a knowledge database, which gives us a clear view of our pricing principles and rules. Using the RBBTool, we can find the best solution for our clients, even when working with our foreign partners because the platform also serves as a service integrator for multiple CRO and service providers.

We will continue to look to the future. Service integration has become a common trend over the past years, and we can see how IT technologies allow small and medium businesses to unite and be successful in the face of competition with the big market players. Service integration via a standard Service Catalog structure is a way to provide clinical trial services across the world by local CROs, who are generally faster, less expensive, more flexible and know the local market and regulatory requirements as well as any of the global service providers.

Ekaterina Kholodkova, DM Head at Synergy Research Group (