From The Editor | October 17, 2019

The 6 "Musts" Of Clinical Trial Contracting

Ed Miseta

By Ed Miseta, Chief Editor, Clinical Leader
Follow Me On Twitter @EdClinical


Bella Sessoms has spent most of her career negotiating sponsor-CRO budgets and contracts. Her early career was spent on the CRO side of the house, where she worked on contracts, budgets, and proposals for a large global provider. In her last position with a CRO, she worked on a partnership with one of the largest pharmaceutical companies in the industry. In her current position as director, contracts and outsourcing at Astellas Pharma, she leads a team of outsourcing managers who prepare vendor and site contracts.

“I have seen a little bit of everything over the past 20 years,” says Sessoms. “Although most of my work has been on CRO contracts, many of the tips I can share are applicable to all service providers.”

In any contract negotiation, Sessoms believes several things need to happen to make it a success. First, both sides need to set expectations across the two organizations. That involves being transparent and providing all the necessary details on the deliverables. Both sides then need to deliver on their promises and do so within agreed upon timelines. Finally, the entire effort is always underpinned by honest and accurate communication throughout the engagement.

Below are the six efforts Sessoms believes you must undertake to make your contracting endeavor a success.

1. Plan Early

Bella Sessoms
Sessoms recommends that you start thinking about the contracting timeline early in the planning stage of any project. If you’re selecting a provider that you don’t have an existing relationship with, or that you don’t have a master services agreement in place with, the contracting process is going to take longer. That fact should be factored into your decision about which provider to select and in your overall project timelines.

“As soon as the award letter is sent stating that you selected the provider, you should start setting contracting expectations,” states Sessoms. “Ask your business development contact to connect you with the contract manager you will be working with. It’s important for you to be immediately connected to the right point of contact at the CRO.”

If you don’t have an existing relationship with that CRO, you will need a more complex contract type, such as a master services agreement. Be aware that these types of contracts require significant interaction between legal departments on both sides and take a substantial amount of time and effort to prepare and put in place.

Sessoms recommends addressing any review processes and timelines right up front. This includes the scope of the contract, the contract term, and when you need to have that contract signed.

“Before you start exchanging contract drafts, you should outline any funding or term limitations that you might have,” she adds. “I have seen providers spend hours drafting and reviewing contracts. Then, when they send the draft to the sponsor, they are informed of limitations. Stating any limitations upfront can save a lot of time and frustration. It will also go a long way towards building trusting relationships with your providers.”

2. Don’t Underestimate The Complexity Of The Contracting Process

When thinking about contracting, keep in mind that it is not a straightforward process. Setting realistic timelines for all activities that must take place is critical. Sessoms recommends developing a best-in-class contract development timeline.

A proper timeline should have many steps, but Sessoms stresses the importance of encouraging internal teams and provider partners to determine realistic expectations for every step in the timeline. The first step is scheduling the date of the kickoff meeting and detailing what needs to be done before you sign a contract and hold the initial meeting.

Sessoms recommends retro-planning, which is starting from the end date and working back. She recommends one round of review for every contract review cycle but cautions that two will often be required. Therefore, play it safe and build two rounds of review into the timeline from the beginning of the project. If you are seeing more than two rounds of review, she recommends you stop and examine the reasons for the multiple reviews. “There’s no reason anyone should be going around in circles,” she says.

Sessoms also cautions to build in time for the final review and signatory process. Signature processes vary by company and some require the signature of a senior executive who may be difficult to access. Checking in on the signatory’s availability, especially near the end of the financial quarter, will ensure you notify the signatory (in advance if necessary) of any urgent requests and not delay the contracting process.  

“I also recommend having a conversation up front, both internally and with your providers, about when key individuals are going to be out of the office,” says Sessoms. “Build holidays into your timeline and know when key personnel will be on vacation. Working those dates into your timeline is a simple step but can be very impactful on your end result.”

3. Align on Budget Specifications

Once the contract development timeline is complete and you have properly set your expectations, it’s time to discuss the specifications driving the budget, review the budget, and start building the contract. Those three steps can often be combined into one.  “CROs will spend hours building a budgeting tool and populating a contract with information that turns out to be wrong,” says Sessoms. “It is worth the effort to take whatever time is necessary to discuss and set alignment on the specifications before starting the budgeting review cycles.”

Sessoms recommends that specifications be agreed on before any budget reviews begin. The specification files can be exchanged via email and followed up with a meeting to finalize. 

4. Budget Transparency

Sessoms stresses the importance of transparency in the contracting process. Keep in mind that every sponsor has a different budget format, and every CRO has a different budgeting tool. Individual proprietary tools can create challenges across the Sponsor-CRO relationship.

“My teams often say they’re frustrated because of the lack of transparency from CRO partners,” she says. “I believe our CRO partners are doing the best they can to get us the right details, but there is a disconnect in the tools. I tell my teams to sit down, put themselves in the position of the CRO, and think about what they would need to do their job.”

Often the disconnect originates from a lack of understanding of the specifications. When a CRO does not receive or agree on specifications from the sponsor, the process becomes more difficult. CROs must still think about all the specifications that are underlying the budget and driving the costs. A CRO might want to send meeting tables and details of site visits, even if the sponsor has not asked for them. That can go a long way towards minimizing frustration down the line.

Sessoms believes sponsors should also pay close attention to the level of detail in the budget. Every budget is different, and every contract reviewer has a different level of experience and expertise.

For each budget activity, Sessoms recommends that the budget show the unit type and number of units. Reviewers should review the unit cost as well as the total cost. Sessoms likes to see the hours summarized by role and/or region, not by activity. This enables the CRO to perform the work using their own model and processes, which will vary for each CRO. “I want our providers to be able to do their work in the best possible way,” she says.

5. Build Quality Standards

Quality standards should be built into the review process prior to exchanging budgets and contracts. Sessoms believes stressing quality facilitates trust and collaborative relationships between partners. To achieve that quality standard, create tools such as a quality checklist for the teams on both sides and develop processes that assure the checklists are consistently used.

“When I started my current role, we had different skill sets and knowledge levels,” she says. “For that reason, I felt I needed to set expectations. It’s important to have a quality checklist, but you also need to make sure each person is going to use it. If you don’t enforce the use of it, there is no point in setting the expectations.”

6. Don’t Forget To Communicate

The next tip is something personal for Sessoms: Keep your word and always follow through on your commitments, including timelines. The first part of keeping those timelines is establishing a culture of individual accountability.

“I am very explicit with my team, and I let them know I expect them to meet their timelines,” she states. “I also expect them to proactively communicate with their counterparts if they find they will miss a deadline. This is clinical research, and lots of things happen that will derail timelines. But you need to keep in close communication with your partners and let them know when a situation arises.”

Sessoms expects the same treatment from her CRO partners. If they are going to miss a deadline, she wants to know in advance. Keeping track of your contract deliverables at a portfolio level helps, and she believes you can do this regardless of whether you have 2 or 100 contracts with each provider.

Sessoms relies on a tracker that is used to monitor deliverables. She suggests planning time with each key provider at the beginning of each quarter to review priorities for the upcoming quarter and discuss how you plan to get there.

“Make sure you’re sharing your tracker with your vendors throughout the process, not just the at the end of the quarter,” she says. “This is a tool for both sides to use, and when it is used the right way, it can be really powerful.”

Finally, Sessoms advises that you invest in your professional relationships with your counterparts at provider/sponsor organization. That means creating opportunities for your contracting teams to get to know each other. “You really want these people to make connections and talk to each other.” She adds. “Over the past year we tried to bring the contract managers from our CROs into our office. We discuss challenges and try to build those relationships. Once these individuals get to know each other, they are much more willing to pick up the phone and have conversations. Never underestimate the power of those relationships.”