Finalization of the budgetary part of a clinical trial agreement is very often more complicated and more time consuming than finalization of the legal language. Many sites even prioritise negotiation of ‘numbers’ over negotiation of ‘words’. Luckily, in some countries those ‘numbers and words’ are standard and recognised at country, region and site levels as being non-negotiable. But, when it comes to those site that do not have their standard, all the fun begins.

There are a few systems and databases used to define country-level fair market value (FMV) of clinical trial procedures and visits. These systems help a lot to build up a site budget that is used as a starting point for negotiation. But is that fair market value really fair?

We see at times that the final site budget can significantly vary from the initial FMV-based template. Does it mean that the template was not good – or ‘fair’ – enough or there are some other reasons behind? Let’s try to figure out and review some factors:

• Overhead (OH). OH deserves a separate discussion as the concept of OH may be understood differently from country to country or even from site to site: for some sites OH is a part of budget that goes to the institution to cover some utility costs, for some others – it is just a percentage used to increase the budget up to desired level. In the context of FMV, OH can vary from 5% to 60%, depending on the site’s policies. Thus, the higher is the OH, the higher is per-visit fee. Surely, the negotiator should obtain the documentation from the site proving the requested OH level.

• Experience from other trials. Let’s say FMV for MRI procedure is budgeted as EUR 1,000.00 per procedure. This is fair and corresponds to the average market price. But the site pushes back asking for EUR 1,500.00 stating that they are paid with this amount for the same procedure in another clinical trial. Bluntly speaking, some other trial ‘spoiled’ the site, so solving this problem is more ethical question. Best way is to reason the site to come back to FMV price or ask for their official price list proving the higher fee. In emerging states, the higher fee is treated as a guarantee that a study subject will receive the procedure within timelines required by the protocol, instead of waiting in a queue that can last weeks or months – in such cases applicability of the higher fee is far more than ethical question, and the negotiator should be very cautious about it.

• Site claims their fees are not negotiable. Isn’t it our favourite? 🙂 Some tips how to act in this case are covered in one of our previous articles.

Thus, answering question “Is fair market value really fair?” it is fair enough to say “More Yes, than No”, however, the exact answer will always depend on the particular situation.