The Future of Clinical Service Provider-Sponsor Relationships - Pharmaceutical Technology

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The Future of Clinical Service Provider-Sponsor Relationships
The author analyzes the results of a survey that polled pharmaceutical executives and managers about both sides of the outsourcing relationship. Read this and other preferred organization articles in this special issue.

Pharmaceutical Technology
Volume 35, pp. s30-s41

In the clinical service-provider surveys, respondents were presented with the same list presented in the sponsor surveys and asked about their perceptions of what sponsors always expected, sometimes expected, or did not expect of their preferred-provider relationships in the recent past (i.e., 2007–2009) and present or future (i.e., 2010 and beyond). Most providers said that, in the recent past, discounted rates were always expected, but all other items were expected only sometimes. Thirty-one percent of provider respondents felt that formal relationship-management programs were not expected by sponsors at all.

Figure 8: What service providers believe that sponsors expect from their preferred providers in 2010 and beyond.
For 2010 and beyond, providers as a group seemed to recognize sponsors' changing expectations of their preferred relationships (see Figure 8). Most recognized formal performance measurement and management to have become always expected, and the increased importance of formal governance and formal relationship management was also recognized. The percentage of respondents that felt that relationship-management programs were generally not expected declined from 31% to 12%.

Formal relationship-measurement and -management programs. At the time of the survey, 54% of sponsor companies reported that they had formal relationship-management programs in place with at least some of their suppliers, and 66% of providers reported that they had such programs in place with at least some of their clients. Components of relationship-management programs most commonly included performance-metric assessment and review, lessons-learned meetings, issue-handling procedures, and formal governance structures. Less commonly employed were systematic ways of gathering relationship metrics from internal and partner staff.

Of the sponsor respondents that had experience with relationship-management programs, 68% reported that these experiences had been primarily positive, and an additional 30% reported that they had been a mix of positive and negative. Similarly, 60% of provider respondents reported having had primarily positive experiences, and an additional 31% reported a mix of positive and negative. Thus, given the considerable level of exposure to such programs and the largely positive experiences, the increasing demand by sponsors for formal relationship-management programs in the future is not surprising.

Figure 9: Sponsors' satisfaction with the work performed by clinical service providers, by whether or not an adequate set of key performance indicators (KPIs) is employed.
In Avoca's sample of sponsors, formal relationship-management programs were associated with a higher rate of satisfaction and lower rate of dissatisfaction with the work provided by clinical service providers. This relationship was stronger when sponsors were sorted according to whether, as part of their relationship-management programs, they employed an adequate set of key peformance indicators to evaluate the performance of service providers (see Figure 9). Although the numbers were small, sponsors that also employed adequate Key Relationship Indicators appeared to enjoy even greater benefits.

Challenges of change. The fact that a company intends to change its outsourcing strategies or tactics does not necessarily mean that the desired changes will be implemented successfully. One objective of this year's industry survey was to explore how the industry was faring with respect to elements of change management such as internal corporate communications about changes in outsourcing strategy and tactics, and attitudes towards changing role definitions.

With respect to internal communications, slightly more than half of sponsor respondents reported that their companies did a good job of communicating changes to staff, though less than half felt that these communications were supported with good training. Provider respondents felt more positively about communications within their organizations than did sponsor respondents, but again, support with training appeared to be the weakest link.

Implicit in most changes designed to improve outsourcing efficiency is the assumption that internal resources will be spared, which, in principle, entails changes in the daily work of the sponsors' clinical-trial managers or other personnel that oversee CROs. However, when asked whether they saw the role of the sponsor's clinical-trial manager changing in the context of a trusting, strategic outsourcing relationship, only 40% of sponsor respondents and 33% of provider respondents said yes.

A new business model for contract R&D: Quotient Clinical
Responses to the question of whether the role of the sponsor's clinical-trial manager should change in a strategic relationship varied considerably according to the nature of the respondent's position within his or her corporate structure. Among sponsors, while the majority of clinical or operations personnel felt that the role of the clinical-trial manager should not change materially, approximately two-thirds of each of outsourcing and management personnel said that it should change. Similarly, among providers, executive managers were nearly twice as likely as middle managers, and nearly 10 times as likely as project managers, to say that the role of the sponsor's clinical-trial manager should change.


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