Clinical study cost breakdown - what makes a study expensive?

Guest post by Safeer Khan, Lecturer at Department of Pharmaceutical Sciences, Government College University, Lahore, Pakistan

Clinical trials are fundamental for generating the data needed to develop new treatments, ultimately improving patient care and advancing healthcare systems worldwide (you can read more in our recent post about the Importance of Clinical Trials). However, despite their essential role, these trials are often financially burdensome, which can hinder research efforts and limit patient access to innovative therapies. For instance, NIH spends an average of $33.8 million per drug in development, with $13.9 million allocated to Phase 1, $22.2 million to Phase 2, and $12.9 million for Phase 3 trials [1]. Moreover, according to Statista, the median cost per patient in a clinical trial between 2015 and 2017 was around $311,000. For more details clinical trial cost per patient.

The high costs involved in conducting these studies also restrict the number of trials that can be initiated, affecting the progress of medical advancements. Given the rising expenses, understanding how much clinical trial costs and having a clear clinical trial cost analysis is crucial for effective budgeting and planning.

This blog post explores the different costs involved in clinical trials, providing insight into the financial complexities of conducting research and how they can be managed for more efficient trials.

Why are Clinical Studies so Expensive?

The total cost of conducting a clinical trial can be daunting, often raising the question: Why are clinical trials so expensive? The expenses associated with these studies are driven by several key factors, each contributing significantly to the overall budget. Across all study phases, the three primary cost drivers of clinical trial expenditures are clinical procedure costs, administrative staff costs, and site monitoring costs,[2]

Clinical Procedure Costs

Clinical procedure costs play a significant role in clinical trial expenditures, typically accounting for 15% to 22% of the total trial budget.[2] A study within the Spanish National Health System found that medical procedures for patients in clinical trials were 32% more expensive than those for patients receiving standard care.[3]

The costs of clinical procedures also fluctuate significantly based on the therapeutic area. A study commissioned by the U.S. Department of Health and Human Services Examination of Clinical Trial highlights that the pain and anesthesia trials incur the highest average costs, totaling $71.3 million, followed by ophthalmology trials at $49.9 million, and anti-infective trials at $41.3 million.

These costs are more significant in later-phase trials or those involving high-risk interventions, where procedures are both intensive and frequent, escalating clinical trial costs. Similarly, the rise in expenses is particularly noticeable in multi-center and industry-sponsored trials, where patients receive more intensive monitoring and care compared to standard healthcare settings. Furthermore, the involvement of multiple sites across different regions or countries adds complexity to managing patient care, which increases costs due to the logistical challenges of coordinating across various locations. Additionally, the extensive medical procedures required in clinical trials necessitate continuous patient care, further driving up the overall cost of the study. Collectively, these factors make clinical procedure expenses one of the primary contributors to the overall financial burden of clinical trials.

Administrative Costs

How much does a clinical trial cost is also influenced by administrative expenses, typically accounting for 11% to 29% of the total costs.[2] While these costs may vary depending on the size and complexity of the trial, they remain a consistent factor across all clinical studies.

Efficient administration is vital to maintaining the smooth progression of a clinical trial and ensuring it meets regulatory requirements. However, the bureaucratic nature of clinical trials often leads to delays, which contribute to additional expenses. Furthermore, the administrative burden is heightened by the need to oversee logistics for trial sites, including patient recruitment, site coordination, and compliance tracking. Clinical trial overhead costs, such as managing multiple sites, add further financial pressure. As clinical trial designs grow more complex and geographically dispersed, the logistical challenges of coordinating among various locations and ensuring consistent data collection across sites only increase, further escalating costs.

Site Monitoring and Compliance

Third factor in determining how much a clinical trial costs is site monitoring, with associated costs typically representing 9% to 14% of the total trial expenses.[2]

These monitoring costs can vary significantly based on factors such as the trial’s scale, the number of sites involved, and whether the study is conducted domestically or internationally. Monitoring costs are particularly high in multi-center trials, where coordination among various locations can be difficult. For international clinical trials, logistical challenges—such as varying regulatory requirements, language barriers, and inconsistent protocols across regions—often result in higher costs. Similarly, the expenses associated with coordinating site visits, verifying data, and ensuring compliance with regulatory standards can be substantially higher in trials that span multiple countries or involve complex treatment regimens.[4]

Additionally, frequent site visits also contribute to the question of why do clinical trials cost so much. The costs are further influenced by the frequency of these site visits. In some trials, sites are monitored every 4 to 8 weeks,[5] and the cost for each visit can quickly add up, especially in long-term studies. These ongoing visits are essential for ensuring data accuracy and regulatory compliance but can also contribute significantly to the overall financial burden of the trial.

Other Costs to Consider

Impact of Regulatory Compliance

Regulatory compliance costs are often an overlooked aspect of clinical trial budgets, yet they contribute significantly to overall expenses. How much does a clinical trial cost depends not only on direct expenses but also on indirect costs clinical trial budget, which include regulatory compliance, administrative burdens, and patient recruitment efforts.[6]

In multi-center trials, particularly those with international sites, navigating a complex array of regulatory requirements can be challenging. Each country or region may have its own set of compliance rules, which can complicate the process of site approval and trial execution. Managing compliance across multiple sites often results in significant increases in operational costs.[4] These additional expenses include extra monitoring, data collection, and communication efforts to ensure every site meets the required regulations.

The timeframe for compliance also plays a crucial role in determining the overall cost of a clinical trial. Trials that face extended approval timelines, due to additional regulatory hurdles or more comprehensive review processes, lead to increased operational expenses. These delays can escalate costs related to staffing, equipment, and other resources, ultimately increasing the clinical trial cost per patient. As trial duration extends, clinical trial overhead costs can also rise, especially when the study involves a broad scope or large patient population.

Complexity of Trial Design

The design of clinical trials has become more complex as the demand for high-quality, reliable data increases. While these advanced designs are essential for generating dependable results, they often bring significant financial implications.

One such design is the adaptive trial, which allows modifications to the study protocol based on interim results. These modifications can include changes to the sample size, treatment regimes, or other key aspects as more data becomes available. While this flexibility is beneficial, it can significantly increase the average cost of clinical trial per patient. The additional demands for statistical analysis and real-time data collection in these trials can increase the clinical trial cost breakdown, adding costs related to interim analyses and frequent updates to the study protocol.[7] Adaptive trials often require specialized personnel and sophisticated software, further escalating costs.

In addition to adaptive designs, including multiple trial arms for comparative analysis further contributes to rising costs. Multi-arm trials test several treatment options simultaneously, which necessitate more extensive data collection, management, and analysis. Similarly, the inclusion of sophisticated endpoints, such as biomarkers, quality of life assessments, and progression-free survival, further complicates trial designs. These added complexities make clinical trial cost estimates harder to manage and often lead to significant budgetary challenges, especially in multi-center or international studies.[8]

Outcome Assessment and Monitoring

Outcome assessment and monitoring costs can also lead to increased costs, prompting the question: Are clinical trials expensive? The costs associated with monitoring participant outcomes can be particularly high in trials that involve long-term follow-ups or those requiring multiple types of data to be collected. Similarly, the need for multiple follow-up visits and diagnostic testing throughout the trial period can substantially increase expenses, especially in more complex studies like those focused on oncology or chronic diseases.[9].

Moreover, the inclusion of multiple assessment points or exploratory endpoints further drives up costs. For instance, trials that assess quality of life alongside traditional health outcomes often require additional data collection mechanisms which come with their own set of expenses. While these exploratory endpoints provide crucial insights into treatment efficacy, they also contribute significantly to clinical trial costs due to the added layers of data collection, monitoring, and analysis involved.

The Influence of Technology on Costs

Technological advancements have greatly changed the way clinical trials are conducted, optimizing several processes while creating both cost-saving opportunities and new expenses. The use of technologies has improved data collection and participant management.[10] By enabling real-time monitoring, these technologies reduce the need for frequent on-site visits, cutting down on both travel and logistical expenses for patients and clinical teams.

While these technological innovations provide long-term savings, their initial implementation can be costly. The upfront costs for remote monitoring systems and telemedicine platforms can significantly add to the trial’s budget, especially for small-scale or early-phase studies. Therefore, the clinical trial cost breakdown must account for the substantial initial investment needed to integrate these tools effectively.[11] Additionally, the use of novel technologies often introduces extra regulatory compliance requirements. This regulatory scrutiny can lead to delays in trial approval, adding more costs to the overall budget. Incorporating such technologies into clinical trial designs often requires further review by regulatory bodies, leading to additional expenses for obtaining approvals and ensuring compliance with evolving standards.[12]

Strategies to Mitigate Trial Costs

There are several approaches that can help optimize clinical trial cost reduction strategies. However, the three core areas stand out as the most impactful opportunities for reducing overall expenditure.

Robust Protocol Design

A 2016 report from the Tufts Center for the Study of Drug Development (Tufts CSDD), in collaboration with 15 pharmaceutical companies, revealed that 57% of clinical trial protocols included at least one substantial amendment, with 45% of these amendments being avoidable. The median direct cost of implementing a substantial amendment in a Phase III protocol was reported at $535,000. This highlights how a well-designed protocol can significantly reduce unnecessary costs.[13]

Designing a robust trial strategy is the first crucial step in managing a clinical trial within a limited budget. This involves clearly defining the study’s goals, identifying potential risks and challenges, and developing a step-by-step plan to achieve those objectives. Key considerations in this plan should include the projected timeline, overall budget, risk mitigation tactics, and alignment with regulatory requirements.

Patient Identification, Recruitment, and Retention

As highlighted by Basia Coulter in a blog on Globant’s platform, patient recruitment accounts for approximately 1.7% to 2.7% of a clinical trial’s total budget. However, the more significant and often overlooked expense stems from delays caused by not meeting enrollment targets on time. These delays can substantially extend trial timelines and inflate overall costs. Similarly, in 2019, the average patient dropout rate in clinical trials was around 19%. Each patient lost due to dropout or non-compliance must be replaced, leading to additional recruitment, onboarding, and data management costs.

Based on these figures, it can be inferred that improving patient identification, recruitment, and retention significantly reduces the need for repeated recruitment efforts, helping contain costs and preserve timelines. Moreover, retaining participants throughout the study contributes to better data quality, as long-term engagement tends to yield more consistent and reliable outcomes, minimizing the expenses related to data correction or re-collection. High retention also increases the likelihood of trial success, reducing the risk of sunk costs from failed studies.

Using Technology to Optimize Clinical Trial Costs

In today’s fast-paced research landscape, streamlining trial operations through technology is essential not only for cutting costs but also for saving time and enhancing patient participation. The strategic use of technology plays a vital role in reducing and managing clinical trial costs. By integrating innovative digital solutions, researchers can ensure greater transparency, improved data accuracy, and faster decision-making.

One of the most effective advancements in this space is the use of personalized AI solutions to support clinical trial processes. AI-driven platforms bring structure and efficiency to research by digitizing workflows and enabling real-time data management. AI tools can also automate the generation and management of data across the entire trial lifecycle, capturing and organizing patient information in a central, accessible system.

Apart from that, there are AI tools available that can accurately predict the costs associated with proposed protocols, offering greater financial control and foresight in clinical trial planning.[14] By analyzing all cost-related data, advanced clinical trial cost tools such as the Clinical Trial Risk Tool allow sponsors and researchers to manage not only internal budgets but also expenses linked to patients, trial sites, subcontractors, and regulatory fees.

Conclusion

Understanding how much does a clinical trial cost per patient is essential for researchers, sponsors, and policymakers to understand the factors that contribute to the high costs of clinical trials. By analyzing the different cost elements, all involved parties can better navigate the financial complexities of clinical research and make more informed decisions to optimize spending.

References

1. Zhou, E.W., M.J. Jackson, and F.D. Ledley. Spending on phased clinical development of approved drugs by the US National Institutes of Health compared with industry. in JAMA Health Forum. 2023. American Medical Association.

2. Sertkaya, A., et al., Key cost drivers of pharmaceutical clinical trials in the United States. Clinical Trials, 2016. 13(2): p. 117-126.

3. Capdevila, F., et al., Cancer Clinical Trials: Treatment Costs Associated With a Spanish National Health System Institution. Therapeutic Innovation & Regulatory Science, 2019. 53(5): p. 641-647.

4. Snooks, H., et al., Bureaucracy Stifles Medical Research in Britain: A Tale of Three Trials. BMC Medical Research Methodology, 2012. 12(1).

5. Usher, R.W., PhRMA BioResearch Monitoring Committee perspective on acceptable approaches for clinical trial monitoring. Drug Information Journal, 2010. 44(4): p. 477-483.

6. Rosas, S.R., et al., Evaluating Protocol Lifecycle Time Intervals in HIV/AIDS Clinical Trials. Clinical Trials, 2014. 11(5): p. 553-559.

7. DiMasi, J.A., H.G. Grabowski, and R.W. Hansen, Innovation in the Pharmaceutical Industry: New Estimates of R&D Costs. Journal of Health Economics, 2016. 47: p. 20-33.

8. Schlander, M., et al., How Much Does It Cost to Research and Develop a New Drug? A Systematic Review and Assessment. Pharmacoeconomics, 2021. 39(11): p. 1243-1269.

9. Bentley, C., et al., Conducting Clinical Trials—costs, Impacts, and the Value of Clinical Trials Networks: A Scoping Review. Clinical Trials, 2019. 16(2): p. 183-193.

10. Rosa, C., et al., Using digital technologies in clinical trials: current and future applications. Contemporary clinical trials, 2021. 100: p. 106219.

11. Kim, H., et al., Costs of Multidisciplinary Parenteral Nutrition Care Provided at a Distance via Mobile Tablets. Journal of Parenteral and Enteral Nutrition, 2014. 38(2S).

12. Poscia, R., et al., Avoided Costs and Economic Benefits Associated With Sponsored Clinical Trials. Medical Academy Journal, 2022. 1(1): p. 5.

13. Getz, K.A., et al., The Impact of Protocol Amendments on Clinical Trial Performance and Cost. Ther Innov Regul Sci, 2016. 50(4): p. 436-441.

14. Wood, T.A. and D. McNair, Clinical Trial Risk Tool: software application using natural language processing to identify the risk of trial uninformativeness. Gates Open Research, 2023. 7(56): p. 56.