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 AnalysisUniversity of Arizona, Tucson, AZ

Clinical Trial ContractingNegotiations to Compliance

PRIMER FOCUS ON INDUSTRY FUNDED CLINICAL TRIALS

INDUSTRY-SPONSORED INVESTIGATOR-AUTHORED NOT FOCUSING ON DEVICE TRIALS

ADD’L FOCUS ON COMPLIANCEINTERACTIVE SESSION

Overview

REGULATORY BODIESPARTIES AND FUNCTIONS

TYPICAL CONTRACTING SITUATIONS

The Basics

•WHICH BODIES GOVERN CLINICAL TRIAL RESEARCH?•WHICH RULES AND REGULATIONS CONTROL SAID RESEARCH?•HOW ARE THESE REQUIREMENTS IMPLEMENTED AND ENFORCED?

Regulatory Bodies

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 trials determine the safety of a new treatment •Phase II trials determine efficacy and dosing for a new treatment •Phase III trials study whether a new treatment is better than standard treatment •Phase IV trials find more information about a new treatment that has been already approved for use in patients                                                        

Clinical Trial Phases

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.

•WHO ARE THE PARTIES TO A CLINICAL TRIAL?•WHAT THE PARTIES NEED TO NEGOTIATE?•WHAT IS THE APPROVAL PROCESS FOR THE FINAL DOCUMENT?

Clinical Trial Contracting

Clinical Trial Overview

Common “sticking points” between Sponsors/CROs and Universities in Contract Negotiation

Contract Process: Clinical Trial Agreements (“CTAs”)

SPS/ORCA Interaction

•WHO WRITES THE PROTOCOL?•WHO PROVIDES INDEMNITY?•HOW ARE THE PARTIES BOUND TO THE AGREEMENT TERMS?

Typical CTA Contracting Situations

Situation 1UA and Pharmaceutical Company enter into a contractual agreement

Pharma Co writes the Protocol

Pharma Co offers UA full indemnification

Protocol

Traditional Sponsored Clinical Trial Agreement

Situation 2UA 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

Traditional Investigator-Initiated Clinical Trial

Protocol

Situation 3UA and Coordinating Institution enter into a contractual agreement (Subcontract)

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

Incoming IIR Subcontract through Coordinating Institution

Indemnity

Protocol

Situation 4UA and Pharmaceutical Company enter into a contractual agreement

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

Indemnity

Incoming IIR Contract: Other Institution’s Protocol

Protocol

Situation 5UA and Pharmaceutical Company enter into a contractual agreement (Prime Award): Terms flow down to the Subcontract (IP, Publication, Confidentiality)

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

Indemnity

Protocol

Outgoing IIR Subcontract through UA

• FEDERAL ANTI-KICKBACK STATUTE• FEDERAL FALSE CLAIMS ACT• REGISTRATION OF CLINICAL TRIALS

Compliance Overview…

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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

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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)

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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

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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 VAb. Trials supported by cooperatives supported by the agencies

listed in “a”c. Trials conducted under an INDd. Trials conducted under an IND exemptione. 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

Routine clinical services Investigational clinical services

Identify coverage exceptions Align the informed consent, budget, contract and planned

billing practices 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 NCDOn 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 AllegationsWASHINGTON, 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.

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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