Refutable Rates

Perhaps few issues elicit more interest in clinical trial agreements (clinical grants) than the overhead portion of the contract. Clinical trial agreements typically have three parts: procedures, nonprocedures, and overhead.

Procedures are those medical activities directly related to the protocol that may range from a blood draw to something far more complex. Nonprocedures include an equally broad range of activities, such as study coordinator time, facility charges, patient reimbursement, and meals.

Overheads are indirect institutional costs allocated to individual departments and their programs. These indirect costs can include such illustrative items as costs of the institution's general management, building maintenance, general administration, and in some cases, general marketing efforts.

Here we report U.S. overhead rates. Few pharmaceutical companies are willing to pay overhead costs to office-based investigators. However, most clinical trial agreements with institutions include an overhead figure.

Clinical grant data in GrantPlan from companies conducting 76% of all clinical studies demonstrate that, in general, overheads at academic medical centers are slightly higher than at other institutions.

Instiutions vs Actual Agreements in U.S.-Based Overhead Figures

Particularly noteworthy though is the significant difference between the overhead rate reported by the institution, frequently used as the starting point in negotiations, and the actual amount accepted in the contract by the institution.—TTC (For more information, please contact help@ttc-llc.com.)