Case Study -
WAYNE STATE UNIVERSITY
Lack of time and expertise to properly manage finances associated with clinical trials:
Internal policies and procedures weren’t designed to accommodate the idiosyncrasies of the clinical trial enterprise
There was a disconnect between clinical trial expenses (which are activity-based) and revenue streams (which are milestone-based)
The school uses a cash basis for accounting, but clinical trials require accounting on an accrual basis
Updating institutional policies and procedures and outsourcing financial management to PFS Clinical, the industry’s only company focused exclusively on financial management of clinical trials
Operational efficiency enhancements for all stakeholders in clinical trials
More time to focus on medical, not business, aspects of clinical trials
Significantly improved planning and reporting capabilities
Recouping hundreds of thousands of dollars in “lost” revenues
Academic Medical Center Improves Financial Management of Clinical Trials
The Wayne State University School of Medicine is the nation’s largest single-campus medical school. Located in the Detroit Medical Center among specialty hospitals and research centers, the School of Medicine offers an ideal venue for both learning and research.
In addition to the school’s own research endeavors, each year it conducts more than 300 clinical trials for 140 pharmaceutical and biotechnology companies. These trials span 17 departments— reflecting the school’s wide range of medical specialties and treatment areas.
While such trials bring significant benefits to patients, clinicians and research sponsors, until recently, they were causing some administrative frustration for School of Medicine leaders. Administrators recognized that clinical trials can and should be an important source of much-needed funding for the institution. But without specialized financial management, they could not maximize the opportunities inherent in the clinical trial enterprise.
Fortunately, the school’s leaders were proactive in analyzing the situation—and then identifying and implementing a successful solution.
Understanding the Challenges
Historically, Wayne State’s School of Medicine placed little institutional focus on the business of clinical trials. It was largely left to individual faculty members to identify and finalize contracts, and their respective departments to manage and track them. In 2004, the Dean of the School of Medicine initiated a task force to research the clinical trial enterprise. The team’s marching orders: to identify barriers preventing optimal execution of clinical trials.
Over its 90-day investigation, the task force identified issues around personnel practice (including a lack of specialized job descriptions related to clinical trials) and contract execution (including the need for a faster, more streamlined process that would meet institutional and sponsor requirements). The other key area creating barriers was program accounting.
“The task force found that while we were good at accounting for our own in-house research programs, our cash-based systems and processes weren’t optimal for sponsored clinical trials,” explains James Barbret, Associate Vice President for Research, Wayne State University. “With clinical trials, expenses and revenue streams are often disjointed. So, in many cases, our teams were earning revenue, but we weren’t recognizing those earnings until the funds were actually received—which was sometimes months later or not at all.”
In short, as Barbret notes, “Using our accounting system for clinical trials was like trying to fit a square peg into a round hole: it just wouldn’t work.”
Thus, the task force recommended that the school address the following:
Institutional policies and procedures, including the school’s policy against charging expenses without funds or a budget, the Sponsored Program Office’s policy of not budgeting clinical trials until funds were received, and the overall policy of recognizing revenue only when funds were received—often months after funds were earned and/or an invoice was issued
Patient records, including the lack of updates reflecting patients’ inclusion in trials and the inability to break out trial costs versus patient accounts
Infrastructure, including the need for a single, centralized approach and system for managing clinical trials
Deploying a Solution
In implementing a standardized approach to clinical trials, the School of Medicine updated operational policies to reflect the idiosyncrasies of these projects. The school also identified the need for a single technology solution that could capture and track activities throughout the clinical trial lifecycle. And with limited time and resources, the school decided to buy—not build.
“After carefully considering the options and potential solutions, we decided to outsource this very important function to PFS Clinical,” Barbret explains. “PFS Clinical is the only company that focuses exclusively on providing financial administrative services for clinical trials.”
PFS Clinical’s Revenue Guard Financial Management services cover all aspects of financial management throughout the clinical-trial lifecycle. “When a study is submitted, PFS Clinical assumes responsibility for entering it into a central database,” Barbret says. “That saves our study coordinators valuable time and, just as important, helps to accelerate pharmacy reviews and approvals.”
As a study progresses, stakeholders can enter and/or view information via PFS Clinical’s secure online portal: “Having a common data set means our financial managers can quickly and easily pull reports on earnings accrued, invoiced and received,” notes Barbret. “It also provides study coordinators with convenient updates on a study’s progress, including how many participants have been recruited.”
PFS Clinical handles all tracking, invoicing and collections—so Barbret and other leaders at the School of Medicine can rest assured that they avoid missing any funds.
Reaping the Rewards
The school launched a pilot program to test PFS Clinical’s financial management service in 2005. Covering 39 internal medicine studies and 28 pediatric studies, the study revealed:
Almost $140,000 in non-refundable fees that should have been (but were not) invoiced
Over $35,000 in non-refundable fees that the school invoiced but had not been paid (sponsors had no record of the invoices and PFS Clinical re-submitted them)
More than $148,000 in patient visits that needed to be invoiced in order to be paid
Nearly $58,000 in advances that had been invoiced and had not been paid
“Based on the success of that program, within two months the program was rolled out to the remainder of the School of Medicine departments. Today, clinical trials throughout the school are managed through PFS Clinical—and all stakeholders continue to enjoy many benefits.
“Without doubt, the most significant advantages of working with PFS Clinical are financial,” Barbret notes. “By partnering with PFS Clinical, we now have accurate accruals, improved collections and better financial controls. Perhaps best of all, our reporting and business intelligence capabilities are outstanding. We can quickly see where we are and where we need to be, and we can address at-risk studies before they become problems.”
Barbret says the PFS Clinical solution has also liberated physicians and other clinicians from the “business” side of clinical trials, and allowed study coordinators to avoid time-consuming and error-prone manual tasks.
Last but not least, the institution now has a stronger position when working with sponsors: “This is an excellent way to answer sponsors’ questions about technology and how you’re using it to further these studies,” Barbret says, adding that collecting data is one thing, but getting it together in a format that you can give back to the sponsor is something else altogether.
“PFS Clinical delivers a very clean, consistent format, and we can tell pharma companies, ‘When you do business with Wayne State, here’s how you’re going to receive information,’” he notes.
Solving your Challenges
To other organizations considering PFS Clinical, Schick offers this advice: “If you need to go from ‘zero to 60’ in a very short period of time, I strongly encourage you to consider PFS Clinical. There is a strong business and operational case for using PFS Clinical. In less than a year, we’ve already realized tremendous impact in finding and collecting revenue.”
Get Started Today
The management of clinical trials will never be simple. By enlisting the support of PFS Clinical, you can finally implement a best-in-class solution — and start enjoying the benefits of our services to help improve and enhance your clinical trial administration. (608) 664-9000 | email@example.com