Majority of Life Sciences Companies Establish Milestone Payments in Clinical Investigator Contracts to Motivate Physicians

RESEARCH TRIANGLE PARK, NC--(Marketwired - January 15, 2015) - With the long timelines that accompany clinical trials, pharmaceutical companies strive to expedite investigator contracts and facilitate pass-through costs. According to business intelligence firm Cutting Edge Information, certain payment structures may help motivate investigators while others could actively hinder trial progress.

Companies may choose to use compensation limits, per patient visits or even hourly payments when structuring investigator contracts. Some companies withhold a portion of overall payments until the study is complete, but this method may deny physicians the funds needed to conduct the trial. Conversely, other payment tactics can be employed that both motivate investigators and help pay the fees required for the trial.

According to Clinical Investigator FMV and Compensation Benchmarks: Structuring Contracts and Planning Investigator Meetings, a new report by Cutting Edge Information, the majority (57%) of surveyed companies establish milestone payments in the investigator contract. Ryan McGuire, report author and Head of Research at Cutting Edge Information, explains that milestone payments simplify trial cost management. Further, these payments encourage investigators to conduct the clinical trial at a steady pace. "By establishing milestone payments," McGuire said, "the sponsor company is able to lay out the key moments of the trial and encourage investigators to progress through the study at a reasonable rate."

Clinical Investigator FMV and Compensation Benchmarks is available at http://www.cuttingedgeinfo.com/research/clinical-development/investigator-compensation/ and explores physician payment processes and structures, including common milestones outlined in investigator contracts and the percentage of compensation companies withhold until trial completion. It also examines methods companies use to determine fair market value when compensating physicians. The research analyzes the ranges and averages of direct costs that clinical sites pass through to sponsors for each clinical trial stage.

With insights from this report, clinical development executives will be prepared to structure investigator payments according to the latest practices and FMV requirements. Executives can also use this report to:

• Prepare for clinical trial site pass-through/direct costs
• Determine factors contributing to fair market value compensation
• Develop comprehensive clinical trial budgets
• Build budgets and prepare for investigator meetings
• Shape investigator contracts

For more information about Cutting Edge Information's pharmaceutical clinical investigator research, visit www.cuttingedgeinfo.com.