Study Budgets

Whether you are developing your own budget or the sponsor presents you with one, the budget should cover all study-related costs and overhead. If a budget presented by a sponsor is inadequate, you will need sufficient evidence to support your request for additional funds. In addition to identifying costs at your facility, it may be helpful to survey other medical facilities in the area to identify their standard charges. The more data you have in support of reasonable and customary costs in your area, the better your chance of obtaining additional funding.

Besides budget considerations, there are other variables in the study agreement (contract) that could affect the financial viability of a study:

  • Will the sponsor cover IRB and advertisement costs?
  • Will screen failures be paid? If so, how much and when?
  • Will the site receive prorated payment for subjects who are removed from the study, drop out, or are lost to follow-up? If
    so, how much and when?
  • When will study payments occur? What will trigger the payments (e.g., patient enrollment, completed CRFs)?
  • How does the payment cash flow affect your site?

Ask for (you may not always get it, but it doesn’t hurt to ask):

  • Up-front payment (e.g., 10%) to defray the cost of start-up work such as preparing regulatory documents, attending investigator
    meetings, site initiation training, enrollment efforts, etc.
  • Payment based on procedures performed
  • Monthly payments
  • Cancellation fee; either a percentage of budget or a fixed fee

Developing the Budget

  • Identify fixed costs for procedures and tests (e.g., x-ray, CBC)
  • Estimate overhead costs of 15%–25% (sometimes more if working within an academic center)
  • Define fixed vs. hourly charges for study staff time (e.g., MD charge for physical exam is $200/exam vs. $200/hour). Hourly rate = annual salary ÷ 2080. For every hour spent with a subject, estimate 1.5 hours of paper work.
  • Identify your projected profit margin (applies to for profit facilities only) and roll the % into line items. For example, if projected profit margin is 10%, and the charge for a physical exam is $200: $200.00 x 10% = $20.00. $20.00 + $200.00 = $220.00, the cost of procedure with profit margin included.

Consider the following when developing a budget. Study budget line items will vary depending on the nature of the study and the location where subjects will be seen (e.g., private practice vs. academic center).

Location of Subject Visits (hospital, clinic, MD office)

  • Outpatient clinic room charges
  • Inpatient room rates (what does the room rate include—medications, supplies, equipment, etc.?)
  • Niche providers (e.g., free-standing radiology facility)


Consider the many costs that make up overhead, including rent, phone bills, utilities, copies, storage facilities, and support staff salaries. Time spent in negotiations, at investigator meetings, transcribing, and talking to subjects can also be considered as overhead, or included in separate line items with SC and PI time.

Who Will Be Seeing the Subject?

Account for the time of all study personnel involved in the study:

  • Study coordinator/clinical research coordinator
  • Administrative
    • Study accounts receivable and payable
    • Processing subject reimbursements
    • Reconciling sponsor payments with milestone requirements
  • Technical/professional staff
    • Services provided by other groups (blood draws, procedures)
    • Computer programming for devices or special study equipment
  • Investigator and subinvestigators

Subject-related Costs

Study Procedures

Consider all hospital charges associated with procedures, including the technical charges associated with specific clinical procedures (e.g., ECG, chest x-ray, blood draws), as well as supplies, equipment, and medications. There may also be additional professional fees associated with specific clinical procedures such as physical exams and procedures performed by staff.

Consider other incidental such as subject meals (if long study visits are required), parking, or travel.

Laboratory services

  • Phlebotomy fees
  • Lab supplies (e.g., vacutainers, needles, dry ice)
  • Processing or shipping to outside lab
  • In-house lab processing and analysis
  • Biological specimen storage
  • CLIA waiver/license application

Pathology services may charge fees for preparing and reading slides.

Pharmacies may charge initiation fees, per-patient dispensing fees, or randomization and blinding/unblinding fees.

Having procedures done outside of practice (such as radiology) may incur fees for conducting procedures and reading procedure results.

Up-front Charges

  • IRB fees
  • Pre-study and Investigator meetings can create costs in terms of PI/SC preparation and time, travel costs (meals, hotels, airfare, etc. ), and study-specific procedure training (if required)
  • Study-specific equipment (e.g., glucometer, ECG machine)

One-time Charges

  • Potential AE-related charges. If insurance does not cover treatment associated with AEs, will the sponsor pay? Estimate the likelihood and incidence of AEs associated with the use of the investigational product.
  • Subject-specific one-time charges (e.g., pregnancy test, CXR if not done within last year)
  • Records storage: Where and how long?
  • Required FAA certification for shipping of biological products

What Can go Wrong

An inaccurate budget can spell financial disaster. Some common flaws in study budgets include underestimating the time commitment for the SC, failing to include over-head, failing to secure payment for screen failures, lack of money for subject recruitment, and unforeseen protocol revisions changing the amount of work to be done. Be prepared!