Sponsors are not only dissatisfied with the efficiency of their outsourcing relationships, but are also increasingly dissatisfied with their outcomes. The percentage of sponsors that is satisfied with the performance of their clinical service providers declined steadily from 71% in 2008 to 62% in 2010, and only 42% of sponsors are satisfied with the value they receive from their providers.The Avoca Group, 2010

It may be the deepest paradox of clinical outsourcing. Could companies hired to unburden the sponsor community be adding to the load of clinical trial work? Could the sponsor community's ambivalence about relying on other organizations be undermining those relationships?

More to the point: If sponsors are merely invoking the rhetoric of alliances, but working randomly with an endless array of esteemed contract research organization (CRO) "partners," can real efficiencies arise?

The quandary is familiar to Denise Calaprice-Whitty of The Avoca Group. The Princeton, New Jersey consulting firm surveys sponsors and CROs. Avoca studies those relationships and monitors how both types of organizations are performing. Calaprice-Whitty is diplomatic. But her company's research suggests room for improvement in clinical trials and the associated outsourcing.

Sponsor-CRO Dynamics

The crux of much of the firm's research boils down to the difference between sponsors that are committed to working with the same CRO repeatedly—and those that burn through many CROs quickly and without much satisfaction. There's no question that the former types of relationships, which she terms strategic, are more efficient. Sponsors with long-term ties to CROs spend less.

image

The catch? There is an up-front learning process that takes time and dollars. In some dysfunctional sponsor-CRO relationships, sponsors replicate CRO work to be utterly, definitively certain it gets done right. Those practices may violate any abstract MBA-program definition of efficiency. Those practices may make senior executives at Intel or GE laugh. But they also guarantee the science and the data are not mishandled.

In some respects, organizational efficiency is quietly sacrificed on the altar of personal job security. Here's how it works. John Smith, one of 20,000 employees at Megapharma, is very aware the same task is being done twice. But he knows that his own job will not be in jeopardy if the trial is conducted correctly.

For years, many industry-run trials had enough latitude—time latitude, financial latitude, competitive latitude—to allow for padding. Sloppiness. It was acceptable to have uncertainty around what the trial would cost and when it would be done. Getting to the finish line was hard enough. The route? Not so important.

But that's changing. Pressures on sponsors are brutal, both for publicly and privately owned firms. Calaprice-Whitty has done the surveys long enough to have a weary view of sponsors that wake up to exclaim that they need a "better fit" with a new CRO. Naturally, every twosome has unique dynamics. But Calaprice-Whitty might surmise that such sponsors never set up the relationship with the previous CRO so that the outsourcing firm understood the trial's needs in detail.

"There are a lot of sponsors that want to introduce penalties," she says. "How can we make them perform? The stronger we want to become, the better fit we have to have. The feeling is that CROs have burned them and they have to stand up and be more punitive."

Information, Please

Two hallmarks of healthy sponsor-CRO relationships, she says, are communication and visibility into exactly what the CRO is doing. Technology can augment the human connections in those situations. Some sponsors are using software to extract the latest information about where a trial stands in all respects—on its budget, time line and general progress.

Once that information is in hand, Calaprice-Whitty says, the sponsor tends to relax, and not neurotically duplicate what the CRO was supposed to do. "The transparency needs to be there," Calaprice-Whitty says. "They are trying to care less about exactly how many hours it took for monitoring visits, and more about the overall output for the budget."

But at some companies, alas, there is no technology to show the day-by-day progress of a trial, or no inclination on the CRO's part to reveal that information. Says Calaprice-Whitty: "That kind of technology is very important in these relationships. It goes back to clear expectations and alignment of expectations—and the ability to measure against those expectations."

Perennial Dissatisfaction

Sometimes, if a wonderful but nebulous term like "quality" is not defined at the start of the project, the search for a "better fit" between a sponsor and a CRO is a never-ending quest. Says Calaprice-Whitty: "When the CRO doesn't meet their expectations, they say 'Aha! I don't have a good enough fit.' Those sponsors never get what they want. They have not looked at themselves and said, 'What do I want and what is the best way of getting it?' "

Another area of difficulty: metrics. "There is a low hit rate for satisfaction with metrics," she says. "But the ones that are hitting it are more satisfied in every aspect of clinical trial outsourcing."

She adds that technology can help distribute metrics data, which in turn helps to cement the human aspects of the sponsor-CRO bond. Seeing the metrics is one thing. "You also need to be able to discuss the metrics," Calaprice-Whitty says. "If you don't have accurate data that is current, you don't have anything to discuss. Good data facilitate a fruitful discussion."

As an example of a problematic metric, Calaprice-Whitty cites tracking whether a trial enrolled its subjects on time. Needless to say, there's nothing inherently wrong with knowing that. It's a standard in the industry.

Proactive Metrics

But by the time the metric is in hand, it is too late to take remedial action. A better approach, she says, is to be forward-looking. "If [companies] can focus on the leading metrics," says Calaprice-Whitty, "they have the ability to focus on the objectives as they go along. Where am I as a percentage of where I should be?"

The tolerance for poor performance in the sponsor world isn't high. If a trial doesn't work, Calaprice-Whitty says, the CRO may just get fired. Longer-term efficiencies never have a chance to blossom. At a sponsor where trials are bid and conducted one at a time, efficiency is just a pleasant, businessy word in a Powerpoint presentation.

The good news? With longer-term relationships, when sponsors pledge to work with CROs on multiple trials, the cost of research services tends to drop as trust levels rise.

"There is a big reason for pursuing more of a long term model," says Calaprice-Whitty. "As a sponsor promises a book of work over a long period of time, contingent on the CRO learning their processes, the CRO reduces their prices. The sponsors save quite a bit of money."

No Fad

Sometimes, Calaprice-Whitty notes, the senior management of a sponsor may believe itself ready for a comprehensive, global reliance on a single CRO. But lower-level teams at the same sponsor may not be prepared to cede their authority to some new organization. So it behooves sponsors to assess their own organization's comfort levels within various departments.

There isn't a one-size-fits-all model. "We never take the approach that there is one model that has been successful, you should do it, too," she says. "It's hard for one sponsor to look at a particular example of something out there and say 'I'm going to do that and do it right now.' Their organization may or may not be suited for that. Each company has to think through where it wants to be."

For sponsors that can get comfortable with outsourcing, and do have long-term partners, Calaprice-Whitty says the survey data suggest much more satisfactory results: "Sponsors that implement certain kinds of relationships and ways of managing those relationships are indeed enjoying much greater efficiencies in their outsourcing."d9A2t49mkex

While there is still plenty of usage of CROs for inefficient onesie and twosie projects, Calaprice-Whitty says the industry is getting serious about formal, long-term relationships. "The idea of strategic relationships is a good one. We see it as a model that will be increasingly adopted in the future," she says. "There are some things the industry tried that didn't work out. But this one is working out the way companies hoped, at least in a certain percentage of cases."

This is the first article in a series on high performance trials. The second article, on Abbott's efficiency ideas, can be found here. The third article describes a top trial budgeting and optimization system.

d9A2t49mkex