Office of Research, UC Riverside
Sponsored Programs Administration

Clinical Trial Budget Considerations

Generally, industry sponsors are concerned with the total cost of conducting a project rather than the classification of costs.  As a consequence, the structures of most clinical trial budgets differ from those of grant proposal budgets.  Sponsor-provided budget templates are typically separated into up-front costs (e.g., advertising costs associated with patient recruitment, pharmacy set-up, initial IRB review fee, translation service for informed consent, etc.), per patient costs, and items to be invoiced on an as-needed basis (e.g., screen failures).  Other budget issues for consideration are listed below:

Departmental Overhead

When preparing and negotiating the budget for an industry sponsored clinical trial, be sure to cover all costs associated with conducting the trial.  Due to the unique administrative nature of clinical trials and the reduced facilities and administrative rate currently being applied to clinical trials, charging administrative expenses may be appropriate if the sponsor will cover these costs as a direct charge.

Patient Care Costs and Coverage Analysis

To obtain a coverage analysis and current research rates for patient care costs, including Pharmacy services, contact paul.hackman@medsch.ucr.edu.

IRB Fees

The Institutional Review Board (IRB) charges fees for the initial review of clinical trials from for-profit sponsors as well as a subsequent IRB renewal fee should the clinical trial extend beyond the date of the initial IRB approval.

Travel

Costs for travel to Investigator's Meetings or other study-related meetings may be managed in a variety of ways.  Be sure to clarify how such costs should be incorporated into your study budget, if appropriate.  Generally, pharmaceutical sponsors of clinical trials will not allow the budgeting of travel. Some pharmaceutical sponsors may allow travel costs associated with UCR employees traveling to different local area performance sites for conducting the clinical trial.  In addition, some sponsors opt to directly reimburse UCR investigators for travel to meetings associated with conducting the clinical trial for the sponsor.

When using a sponsor's budget form, if travel is anticipated but the form lacks a line item or category for travel, complete the budget form and include travel costs as appropriate for each budget item. If investigator travel will be reimbursed by the sponsor, notify SPA, so that the CTA will reflect this understanding.

Facilities & Administration Fees

As a public-supported institution, UCR must recover the full cost of research conducted for outside sponsors, including all associated operating costs ("indirect" costs). To do otherwise could result in subsidizing for-profit research with public funds.  Indirect costs are facilities and administrative ("F&A") costs incurred in support of the University's research infrastructure. The University pools its indirect costs for ease of accounting because it is difficult to assign these costs with a relative degree of accuracy to a specific project or program. The federal government's Office of Management and Budget establishes the standards for calculating the F&A cost rate, and UCR negotiates its rates with the United States Department of Health and Human Services audit agency on a periodic basis.  UCR derives its F&A rate for clinical studies from applicable components of the federally approved rate.

As an exception to recovery of our federally-negotiated Facilities & Administrative cost rate applicable to research at UCR, costs applicable to research at UCR which meets the definition of a clinical trial (i.e., "the controlled, clinical testing in human subjects of investigational new drugs, devices, treatments or diagnostics, or comparisons of approved drugs, devices, treatments or diagnostics, to assess their safety, efficacy, benefits, costs, adverse reactions, and/or outcomes"), and for which is not funded with federal funds, are subject to a 26% indirect cost rate.  Such 26% indirect cost rate applies to the Total Direct Cost, and no budgeted item is excluded from the application of indirect costs. This rate applies regardless of whether a clinical trial is based on a sponsor-initiated or an investigator-Initiated protocol.

Below are FAQs to ponder when determining whether or not the clinical trial rate of 26% TDC is appropriate for a given study.

 

FAQ - Application of F&A Cost Rates for Clinical Trials

A study meeting the UCR definition of a clinical trial will be conducted as a cooperative group trial under NIH funding. Can the clinical trial facilities and administrative cost rate of 26% TDC be used?

No.  Studies supported in whole or in part with federal funding must apply the applicable Federal research facilities and administrative cost rate.

A study will be funded by an industry sponsor via a subcontract to UCR, with prime funding provided by the Federal government.  Since the funds will be received directly from the industry sponsor, can the clinical trial indirect cost rate of 26% TDC be applied?

No, because Federal flow-through funds are involved; the applicable Federal research F&A cost rate should be applied.

A study fully funded by a for-profit entity will involve testing of an investigational drug or device in animals.  Which facilities and administrative cost rate applies?

The clinical trial indirect rate only applies to clinical testing in human subjects.  Pre-clinical laboratory and animal studies are specifically excluded.  Therefore, the applicable Federally-negotiated research F&A cost rate would apply.

A pharmaceutical company has requested that UCR run specialized tests on samples obtained in a clinical trial.  Would the clinical trial indirect cost rate apply?

No.  The clinical trial indirect cost rate only applies to studies involving the direct clinical testing of investigational products in human subjects.  If UCR's sole involvement is to run tests, the applicable Other Sponsored Activities rate would apply.

An investigator has agreed to analyze data collected in an industry-sponsored clinical trial conducted at both UCR and other sites. Which facilities and administrative cost rate applies?

The applicable Federally-negotiated research rate would apply.

The University has been asked by a for-profit sponsor to recruit and enroll human subjects in order to collect data that will be submitted to a patient registry. Is this considered a clinical trial, and would the clinical trial indirect cost rate apply?

Data collection studies for registry purposes, even if human subjects are involved, are not considered clinical trials. Therefore, the clinical trial indirect cost rate would not apply, and the applicable Other Sponsored Activities facilities and administrative cost rate should be used.