An Outsourcing Necessity?

April’s “CRO Selection and Management,” presents and discusses information gathered from a survey conducted by the University of Health Sciences and TTC, llc, which questioned clinical trials professionals on topics of outsourcing management. The following article uncovers respondents’ perceptions and experiences of the use of bid grids in the process of selecting a CRO as a partner.

Use of Bid Grids
Many companies put extensive effort into constructing bid grids that guide them in budgeting and selecting CROs. Bid grids, in various configurations and levels of detail, are the forms sent by pharmaceutical companies to CROs detailing the activities expected of the successful CRO to complete the study being bid. During the budgeting process, a refined bid grid enables a company to establish both the overall outsourcing budget and the expected budget for individual major outsourced studies. The bid grid also enables companies working with preferred providers to project costs for individual projects more easily. A carefully crafted bid grid can also smooth the progress of CRO bidding for competitive projects. By using a common bid grid for all the CRO competitors, the sponsor company enhances its ability to compare the bid costs and assumptions of one CRO with another CRO’s costs and assumptions.

Nearly two-thirds of the survey participants indicated that their company uses a common bid grid across all projects, although few think their bid grid is any better than those other companies use.

While many participants report using a common bid grid, certain types of sponsor companies are especially likely to use one. Ninety (90) percent of the American participants report using a common bid grid, in contrast to just over half, fifty-two (52) percent of locations worldwide. Bid grids are also associated with company size, with eighty-one (81) percent of the participants from the largest pharmaceutical companies reporting its use, compared to half (49%) of the study participants from smaller companies who reported employing a common bid grid. Using bid grids is becoming a standard for many pharmaceutical companies, especially for U.S. operations, although few sponsor companies think their particular bid grids provide much of a competitive advantage.

CROs frequently find sponsor-company bid grids confusing and time consuming. As one CRO business development manager explained: “Some bid grids are very detailed, many are not. And every company has to have their own bid grid. It is one thing for us to have to spend so much time filling out different bid grids for each company. It is another for so many companies to work with incomplete, overlapping, or downright confusing bid grids.”

CROs generally have a negative view of how sponsor companies use bid grids. Less than a third (31%) of CRO respondents find the bid grids clear and useful, with virtually no difference in that assessment based on the CRO’s size or location.

Find an example of an actual bid grid here.

By Harold E. Glass, PhD, Professor of Health Policy, University of the Sciences in Philadelphia and Managing Director, TTC, llc; and Daniel P. Beaudry, MBA, Associate Director, Business Development
TTC, llc