Transcript Situation 1

Clinical Trial Contracting
Negotiations to Compliance
NCURA WESTERN REGIONAL MEETING
Presenters:
Erik Lium, Ph.D.
Director, Industry Contracts
University of California San Francisco
Lewis Barbieri
Director, Office of Research
and Contract Analysis
University of Arizona, Tucson, AZ
Overview
P R I M E R
F O C U S O N I N D U S T R Y F U N D E D C L I N I C A L T R I A L S
INDUSTRY-SPONSORED
 INVESTIGATOR-AUTHORED
 NOT FOCUSING ON DEVICE TRIALS
A D D ’ L F O C U S O N C O M P L I A N C E
I N T E R A C T I V E S E S S I O N

The Basics
REGULATORY BODIES
PARTIES AND FUNCTIONS
TYPICAL CONTRACTING SITUATIONS
Regulatory Bodies
•W H I C H B O D I E S G O V E R N C L I N I C A L T R I A L R E S E A R C H ?
•W H I C H R U L E S A N D R E G U L A T I O N S C O N T R O L S A I D
RESEARCH?
•H O W A R E T H E S E R E Q U I R E M E N T S I M P L E M E N T E D A N D
ENFORCED?
Clinical Trial Phases
After promising treatments are explored in animal and/or laboratory studies, researchers perform clinical
trials. Once the drug, device or procedure enters the clinical trials process, it must go through several phases:
•Phase I
•Phase II
•Phase III
•Phase IV
trials determine the safety of a new treatment
trials determine efficacy and dosing for a new treatment
trials study whether a new treatment is better than standard treatment
trials find more information about a new treatment that has been already approved for
use in patients
Institution Review Board – “IRB”
 An Institutional Review Board is a group that has been formally
designated to approve, monitor, and review research involving
humans with an aim of protecting the rights and welfare of the
subjects.
 FDA Regulations state the requirements for Institutional Review
Boards
 These requirements are stated in the Code of Federal Regulations:

21 CFR Part 56, subparts A-D
 At any time, the FDA can audit/inspect an Institutional Review Board
for compliance with said regulations and issue findings on the audit
Health Insurance Portability and
Accountability Act – “HIPAA”
 HIPAA establishes regulations for the use and disclosure of Protected
Health Information (PHI).

PHI is any information about health status, provision of health care, or
payment for health care that can be linked to an individual. This is interpreted
rather broadly and includes any part of a patient’s medical record or payment
history.
 Entities must disclose PHI to the individual patient within 30 days upon
request. They also must disclose PHI when required to do so by law, such
as reporting suspected abuse to state child welfare agencies.
 Entities may also disclose PHI to facilitate treatment, payment, or health
care operations or if the covered entity has obtained authorization from
the individual.

When a covered entity discloses any PHI, it must make a reasonable effort to
disclose only the minimum necessary information required to achieve its
purpose.
FDA Investigator Financial Disclosure
 This disclosure requires that the Principal Investigator certifies that s/he does not
have a significant financial holding in the company with which he wishes to
contract.
 This helps to avoid conflict of interest situations in which the Investigator’s data
may be called into question because of financial interest in the company.
 Financial Arrangements that require disclosure include:
 Compensation made to the investigator in which the value of compensation could be affected by
study outcome.
 A proprietary interest in the tested product, including, but not limited to, a patent, trademark,
copyright or licensing agreement.
 Any equity interest in the sponsor of a covered study, i.e., any ownership interest, stock options, or
other financial interest whose value cannot be readily determined through reference to public
prices.
 Any equity interest in a publicly held company that exceeds $50,000 in value.
 Significant payments of other sorts, which are payments that have a cumulative monetary value of
$25,000 or more made by the sponsor of a covered study to the investigator or the investigators'
institution to support activities of the investigator exclusive of the costs of conducting the clinical
study or other clinical studies, (e.g., a grant to fund ongoing research, compensation in the form of
equipment or retainers for ongoing consultation or honoraria) during the time the clinical
investigator is carrying out the study and for 1 year following completion of the study.
Clinical Trial Contracting
•W H O A R E T H E P A R T I E S T O A C L I N I C A L T R I A L ?
•W H A T T H E P A R T I E S N E E D T O N E G O T I A T E ?
•W H A T I S T H E A P P R O V A L P R O C E S S F O R T H E F I N A L
DOCUMENT?
Clinical Trial Overview
Sponsor
CRO
University
• Develops Protocol
• Provides Contractual and Budgetary guidelines to Contract Research Organization (CRO)
• Negotiates Investigator Budget with University
• Negotiates Clinical Trial Terms and Conditions with University
• Pays University through funding supplied by Sponsor
• Monitors study sites for source document comparison and Case Report Form Retrieval
• Sends invoices to CRO
• Sends final data to Sponsor or CRO Designee
• Indemnified by Sponsor (usually through a Letter of Indemnification)
Common “sticking points” between Sponsors/CROs and
Universities in Contract Negotiation
Confidentiality
• Protection of
Sponsor
Confidential
Information
• Maintenance of
Patient Records
Intellectual
Property
• Sponsor Protocol
• University Idea
• Who should own it?
Publication
Indemnification
• When can results be
published?
• Why can
publication be
delayed?
• What about multicenter publications?
• Some Universities
cannot reciprocate
Sponsor
indemnification,
even for University
employee’s
misconduct.
Contract Process: Clinical Trial Agreements (“CTAs”)
SPS/ORCA Interaction
Routing the Draft
Agreement
Tracking the Agreement
Negotiating the Agreement
• Sponsored Programs logs
agreement into University
database as a draft
• Contract Office contacts
Sponsor for purpose of
negotiating terms of CDAs and
CTAs
Negotiating the Agreement
Pending Finalization
Signing the Agreement
•
•
•
•
•
• Sponsored Programs receives
internal routing documents and
fully approved budget
• Upon receipt of routing
documents, Contracting Office
executes the agreement, and
forwards copies to Investigator
and Study Coordinator
• Agreement comes to
Investigator or Contract Office
• Investigator forwards
agreement to Contract Office
Works as needed with:
Investigator
Office of Technology Transfer
Office of General Counsel
Risk Management
Typical CTA Contracting
Situations
•W H O W R I T E S T H E P R O T O C O L ?
•W H O P R O V I D E S I N D E M N I T Y ?
•H O W A R E T H E P A R T I E S B O U N D T O T H E A G R E E M E N T
TERMS?
Situation 1
Traditional Sponsored Clinical Trial Agreement
UA and Pharmaceutical
Company enter into a
contractual agreement
Pharma Co writes the
Protocol
Pharma Co offers UA
full indemnification
Indemnity
Pharma
Company
Protocol
University
of Arizona
Contract
Situation 2
Traditional Investigator-Initiated Clinical Trial
UA and Pharmaceutical
Company enter into a
contractual agreement
University PI writes the
Protocol
Pharma Company
indemnifies UA: limited
to manufacturing
defects in the drug and
use of the Study results
Indemnity
Pharma
Company
University
of Arizona
Contract
Protocol
Situation 3
Incoming IIR Subcontract through Coordinating
Institution
UA and Coordinating
Institution enter into a
contractual agreement
(Subcontract)
Pharma
Company
Coordinating Institution
has an agreement with the
Pharma Company (Prime
Award): Terms flow down
to the Subcontract (IP,
Publication,
Confidentiality)
Coordinating Institution PI
writes the Protocol
Each Institution is
responsible for its own acts
and omissions
Pharma Co indemnifies UA
for manufacturing defects
in the drug and use of the
Study results
Coordinating
Institution
Protocol
Contract
(Subcontract)
Responsibility
University of
Arizona
Situation 4
Incoming IIR Contract: Other Institution’s Protocol
UA and Pharmaceutical
Company enter into a
contractual agreement
Pharma
Company
Coordinating Institution
has an agreement with
the Pharma Company
Coordinating Institution
PI writes the Protocol
Each Institution is
responsible for its own
acts and omissions as
agreed in a letter of
responsibility
Pharma Co indemnifies
UA for manufacturing
defects in the drug and
use of the Study results
Coordinating
Institution
Protocol
University of
Arizona
Letter of Responsibility
Situation 5
Outgoing IIR Subcontract through UA
UA and Pharmaceutical
Company enter into a
contractual agreement
(Prime Award): Terms
flow down to the
Subcontract (IP,
Publication,
Confidentiality)
University
of Arizona
Protocol
UA has an agreement
with the Other Institution
(Subcontract)
University PI writes the
Protocol
Each Institution is
responsible for its own
acts and omissions
Pharma Co indemnifies
UA for manufacturing
defects in the drug and
use of the Study results
Other
Institution
Pharma
Company
Compliance Overview…
•
•
•
FEDERAL ANTI-KICKBACK STATUTE
FEDERAL FALSE CLAIMS ACT
REGISTRATION OF CLINICAL TRIALS
Federal Anti-Kickback Statute …
 Purpose:

To protect patients and federal health care programs from fraud and abuse
 Summary:

Prohibits the solicitation, receipt, offer or payment of remuneration “in return
for” or “to induce” the referral of program related business, arranging for, or
recommending, the purchase, lease, or ordering of any item or service
reimbursed by a federal healthcare program
 Penalties:


Civil:
 Fines up to $50,000
 Exclusion from federal health care programs
Criminal:
 Felony
 Up to five years in prison
 Fines up to $25,000
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Anti-Kickback: Trial Risks …
 Direct payments to investigators
 Incentives for investigators (i.e. exotic meeting locations)
 Unbudgeted payments
 Financial COI
 Study biases (i.e. site selection, prescribing…)
 Excess funds
 Study merit
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Anti-Kickback: Trial Risks & Solutions…
 Direct payments to investigators

Institutional financial management
 Incentives for investigators (i.e. exotic meeting locations)

Institutional contracting
 Unbudgeted payments

Institutional financial management
 Financial COI

Published and enforced COI policies
 Study biases (i.e. site selection, prescribing, …)

IRB and training
 Excess funds


Fair market value pricing
Published policies on the disposition of excess funds
 Study merit

IRB review and approval
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Federal False Claims Act …
 Purpose:

To counteract fraudulent billing of the federal government
 Summary:



Implicates anyone who knowingly submit claims … in order to obtain payment
of a false or fraudulent claim by the federal government
Intent to defraud is not required
Qui Tam / Whistleblower Law
 Penalties:


Civil:
 Treble damages per false claim, plus
 Civil penalties of $5,500 to $11,000 per false claim
Criminal penalties:
 Predicated on willful violations
23
False Claims: Risks …
 Centers for Medicare and Medicaid Services (CMS):





Medicare basics
Routine clinical services vs. investigational clinical services
Qualified clinical trials
Double billing or billing for items covered by the Sponsor
Secondary Payor (MSP)
24
False Claims: Medicare Basics …
 Centers for Medicare and Medicaid Services (CMS):

Medicare general coverage:
 Items and services that are reasonable and necessary for the diagnosis
or treatment of illness or injury

Clinical Trial National Coverage Determination (NCD)

Coverage:
 Items or services provided pursuant to trials if the items or services
would otherwise be covered outside of a trial
 Routine clinical services of qualified clinical trials
 “Standard of Care” is not a defined term
 Exceptions apply
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False Claims: Routine Services…

Routine clinical services (covered):





Items and services covered outside of a trial
Items and services used for direct patient management in a trial
Items or services required solely for the provision of the investigational
item or service (i.e. infusion of experimental chemotherapeutic)
Items or services required for the prevention, diagnosis, or treatment of
complications related to an investigational item or service
Investigational clinical services (not covered):

Items and services being investigated as a trial objective
26
False Claims: Qualifying Clinical Trials …
 Qualifying Clinical Trials (QCT):

Two-part test:
 Part 1: (all three criteria are required)
 Trial must investigate an item or service for which Medicare pays
 Trial must enroll patients with diagnosed disease
 Trial must have therapeutic intent
 Part 2: (1 out of 5 criteria required)
a. Trial funded by AHRQ, CMS, CDC, DOD, NIH or VA
b. Trials supported by cooperatives supported by the agencies listed in “a”
c. Trials conducted under an IND
d. Trials conducted under an IND exemption
e. Trials conducted under the Coverage with Evidence Development
process (rare)
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False Claims: Non-QCT …
 Non-Qualifying Clinical Trials





Nutraceuticals / Vitamins
Preventative care studies
Phase I drug studies
Studies funded by non-qualifying government agencies
Some investigator-initiated studies
 Routine Clinical Care under non-qualifying studies

Not covered when conducted under a NQT
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False Claims: Secondary Payor …

Medicare Secondary Payor (MSP)


Under MSP, a Medicare payment "may not be made . . . with respect to
any item or service to the extent that payment has been made or can
reasonably be expected to be made" under a primary plan.
Example contract language:
 Unacceptable: “In the event Site is not reimbursed for routine
clinical services contemplated in the Protocol, Site may remit an
invoice to Sponsor.“
 Acceptable: “Sponsor will be charged for items and services pursuant
to the study that are not routine clinical services.
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False Claims: Solution …



Determine whether a trial is a “Qualified Clinical Trial”
Convert trial protocol into a series of events
Perform a coverage analysis to identify




Identify coverage exceptions
Align the informed consent, budget, contract and planned billing
practices



Routine clinical services
Investigational clinical services
Eliminate double billing, and billing for items covered by sponsor
Eliminate contract language implicating MSP
Coordinate with charge capture / billing
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False Claims: Cases …
 Rush University Medical Center Settlement: Improper Medicare
Billing in Clinical Trials Under September 2000 NCD
On December 8, 2005, the United States Attorney’s Office for the Northern District
of Illinois reached a settlement with Rush University Medical Center in Chicago,
under which Rush agreed to repay approximately $1 million to the federal and state
governments for inappropriate clinical trials charges submitted to Medicare and
Medicaid. According … these charges relate to services and items provided … to
patients enrolled in oncology clinical trials. …voluntary disclosure by Rush to federal
authorities.
 University Of Alabama-birmingham will Pay U.S. $3.39 Million to
Resolve False Billing Allegations
WASHINGTON, D.C. - The University of Alabama at Birmingham and two related
entities will pay the United States $3.39 million to settle allegations that they
violated the False Claims Act with respect to claims submitted in connection with
the school's health science research activities.
31
Registration of Trials: FDA …
 FDA Amendments Act (Public Law 110-05)





Definition of clinical trial:
 Biologics: controlled, clinical investigations, other than Phase I
investigations, of a product subject to FDA regulations
 Devices: controlled trials with health outcomes, other than small feasibility
studies, and pediatric post-market surveillance
When must registration be completed:
 Within 21 days of 1st subject being enrolled
When must a registration be updated:
 Annually or within 30 days of any change in recruitment status or the
completion of the study
Penalties:
 Civil monetary penalties
 Loss of federal funding
More information:
 http://grants.nih.gov/grants/guide/notice-files/NOT-OD-08-014.html
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Registration of Trials: ICMJE …
 Int’l Council of Medical Journal Editors (ICMJE)





Definition of clinical trail:
 Any … study that prospectively assigns human participants … to one or
more health-related interventions to evaluate … health outcomes.
Interventions include drugs, surgical procedures, devices, behavioral
treatments, process-of-care changes, and the like.
When must registration be completed:
 Prior to enrolling the 1st subject
When must a registration be updated:
 Every 6 months
Penalties:
 Publication of research results may be blocked by affiliate journals (NJM,
JAMA, Lancet, …)
More information:
 http://www.icmje.org/index.html#clin_trials
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