Basics of Sample Clinical Trial Agreements: Key Provisions and Strategies

Introduction to Clinical Trial Agreements

Clinical trial agreements, or CTAs, are legally binding contracts between clinical trial sponsors and participating sites (i.e., hospitals, clinics, and/or physicians). The purpose of a CTA is to outline and govern the formal terms and conditions of the study both parties have agreed to conduct. CTAs are essential to the clinical research process because they define the rights and obligations that will govern the study and memorialize the expectations of each party. For example, CTAs typically address key issues such as patient enrollment and retention responsibilities of the sites; which party will perform various study-related functions and whether there will be any subcontractors involved; budgets, per patient visit estimates , and payment schedules; insurance coverage and indemnification provisions; intellectual property rights; confidentiality obligations and reporting requirements to federal regulatory agencies.
CTAs are usually governed by state law, and when a CTA is the result of a study being conducted under an investigational new drug application ("IND") or investigational device exemption ("IDE"), the written agreement is typically submitted to the Food and Drug Administration ("FDA"), along with the investigational plan, for review and approval. CTAs can be negotiated at any point during the clinical research process, although they are often carefully crafted before or around the time when a clinical trial is presented to the institutional review board ("IRB"). This is so the protocol, informed consent form, and other documents submitted to the IRB can account for and reflect the terms contained in the CTA.

Critical Provisions in a Clinical Trial Agreement

A clinical trial agreement (CTA) is a much more detailed and robust contract than the standard services agreement. Because CTAs are unique to each study, there are no universal provisions that must be in a CTA, but there are certain provisions that are commonly seen across all CTAs:
Study Protocol: CTAs typically include the protocol for the clinical study as an attachment or exhibit and a reference to the protocol in the main body of the contract. The study protocol will typically outline the scientific design of the study, the methodology to be employed, the objectives of the study, the schedule for the study and any controls.
Confidentiality: CTAs typically include provisions that require the parties to keep confidential information obtained from the clinical study confidential. A typical provision provides that neither party will disclose any data from the clinical trial (whether written in final form or otherwise) or other confidential information to a third party without advance written consent, but that each party will have the right to disclose such information to its own employees or agents with a need to know. Many CTAs also include a list of items that are excluded or exempted from confidentiality obligations, such as information already known by the party receiving the information, information that is independently developed, information that becomes generally known or is disclosed by the disclosing party without breach of its obligations under the agreement, or information disclosed to the other party by a third party lawfully having possession of the information.
Indemnification: Because the introduction of a new drug into the market is expensive and time-consuming, an important purpose of a CTA is to allocate risks and liability from potential injuries or damages to the parties’ respective investigator or sponsor organizations. Indemnification clauses in CTAs conceal deeper issues about the overall risk assessment of the study, and compensation mechanisms should be discussed early in the negotiation process. A clinical trial agreement typically includes liability and indemnification provisions that are meant to provide compensation to the injured subject if the investigational medical product under investigation caused the subject’s injury or damages. Indemnity provisions typically require the sponsor to indemnify the investigator, the institution, its employees and agents against any and all damages involving any claim or action arising out of or in connection with the study made by a third party, or an investigator or sponsor’s employee, agent or supplier involved in the study, or by a study subject, which claim arises out of the study drug or the research, or the actions or omissions of the investigator. A limitation of liability provision may cap the maximum amount of damages for which a sponsor will be liable, or may require that the maximum amount will be equal to the amount of funds actually received by the institution from the sponsor.

Sample Clinical Trial Agreement: Breakdown of Terms

Clinical trial agreements may span 20 or more pages in length and can be written in such a way that it is a challenge to read and understand the meaning of each section. The following is a section-by-section analysis of a sample clinical trial agreement:

Precedent and Definitions. In addition to the long list of definitions at the end of most clinical trial agreements, the parties’ obligations are defined in the precedence section. These sections are drafted with the intention of being as clear as possible. Sample language: "Before considering any default, breach or other violation of this Agreement, the provisions of this Section 10 shall apply to resolve any inconsistencies between Agreement documents in the following order of precedence: (a) this Agreement and any exhibits or attachments hereto; (b) the Protocol and all amendments and other documents incorporated into the Protocol by reference; (c) other publications and guidelines referred to in the Protocol, such as ICH guidelines, Good Clinical Practices (GCPs), subject rights brochures, and consent forms; (d) any implementing agreements or schedules."
Abstract. This section is a summary of the study, including the names of the parties, purpose of the study, inclusion/exclusion criteria, and other basic details. No surprises here, but often gives you a good feel for the type of study. Sample language: "This is a randomized, double-blind, double-dummy, parallel-group, active-controlled, multicenter, Phase III study of Z drug and Y drug combination therapy compared with A drug and B drug combination therapy as adjunctive treatment to standard of care in order to establish the safety and efficacy of the Z drug and Y drug combination in Currently Approved Indications."
Amendments to Protocol. This language is important because it lays the groundwork for how the study may be implemented. This section permits the protocol to be amended by the mutual agreement of the parties, and the site may implement amended protocols immediately upon receiving the necessary approvals. To the contrary, if the term "good clinical practice" is used without additional modifiers, then the protocol can only be amended if the amended protocol will not substantially affect the rights of participants in the study, if the amendment is made in compliance with applicable regulations, and if such other conditions as set forth in subsection (d) are satisfied. The idea is that the parties and the site will be required to implement good clinical practice according to the timelines specified in the protocol, and any changes will need to be made in compliance with applicable regulations. However, this may inhibit prompt implementation of some important changes.
Sites and Products Involved. This is a simple list of the sites involved in the study, and identifies if the study is being done under a contract research organization ("CRO") or if the study is being done by the sponsor. Sample language: "The Research is sponsored by Sponsor XXXX (applicable to NDA devices or NDA/PMAs) and is being conducted by CRO ZZZ, where permitted by law and regulation, whom is qualified to undertake the Research at the Sites."
Quality Control Procedures. This section identifies who will be conducting maintenance on the device, if applicable, and specifies that the site will report any problems immediately to the study coordinator. Sample language: "Maintenance and servicing of all equipment used in the Research will be performed by the Research Site or by a Service Provider designated by the Research Site. Any service performed for any reason on the Subject Device must be recorded in the Subject Study Diary and reported to the CRO or Sponsor’s designee immediately."
Clinical Study Subject Responsibilities. This section identifies the requirements for the subjects participating in the clinical study, including co-morbidities, restrictions on alcohol, tobacco, or other substances, and follow-up requirements. It is important to note that if these requirements would be difficult for the subject, they should be clearly described in the subject rights brochure and informed consent form. Sample language: "Subjects must agree to abstain from the consumption of alcoholic beverages for the duration of participation in the Research. Subjects must agree to abstain from using tobacco or tobacco products and/or nicotine substitution therapies during participation in the Research."
Fees and Invoice Support. This section specifies the procedure for payment of fees and expenses incurred in the conduct of the research. Practical Tip: This is an important section to read closely. Often sponsors do not pay promptly and sites are not able to recover these prepaid costs. Make sure to retain these items in your accounts receivable balance and escalate with the sponsor if no response is received immediately prior to the due date listed in the clinical trial agreement.
Subject Fees and Payments. This section is important to review to ensure that the site is able to make the payments required to participants in the study. The site must have very clear policies and procedures for tracking the payments to subjects. Sample language: "The current reimbursement rates for CARA metered-dose inhalers are: $V per full inhaler; $Y per partial inhaler (i.e., metered dose has already been used); $Z per empty metered dose inhaler; $P per MDI delivery device; $R per MDPI (MDI dispensing device); and $G per CO2 cylinder."
Equipment. This section identifies the maintenance obligations for each party, describes the disposition of unused product, and identifies how product is returned. Sample language: "No unused material shall be returned to Sponsor unless otherwise required by applicable law or regulation, and such return shall be at the Research Site’s expense and of no cost to Sponsor." Practical Tip: Be sure that you address the project costs that you will be responsible for before all the materials arrive, as well as the extent of your involvement in tracking product in the study. Make sure to specify who is responsible for labeling the product and other labeling requirements.
De-Identification and Confidentiality. This section defines databases and other works that the sponsor has not yet protected. For example, the definition does not actually cover the "new" ideas that were generated by the study. Sample language: "Research Documents: all documents and materials that are created, developed or inventoried in the course of performing the Research by Sponsor or the CRO, including but not limited to any policies, procedures, methodologies, know-how, results and the like that are not in the public domain; provided, however, that Research Documents shall not include …."

Practical Tip: Recognize that much of the information and data generated in connection with the clinical trial will be owned by the sponsor after the study is complete. Consider whether there are any materials that you would like to have access to or ownership of, and make the request now while you are in the process of negotiating the clinical trial agreement for the study.
Practical Tip: Be sure to specify if you will be able to publish your results after the study is closed or if there will be a specific licensing arrangement. Often, sponsors have a strict window of time after the clinical study is closed before allowing publication to proceed and expect to have a review period for the publication.
The most important thing to keep in mind in reviewing a clinical trial agreement is to remember that your goal is to negotiate an agreement that is fair and equitable to both parties, protects your rights during the study, and protects your rights after the study is completed.

How to Negotiate Clinical Trial Agreements

A thorough understanding of the contents of a sample clinical trial agreement is essential to successful clinical research, but it is only half of the equation. The other half is negotiating the terms of a mutual understanding, because very few clinical trial agreements are acceptable in the first draft. Sponsors and clinical research institutions (CRIs) approach negotiations on the basis of unique objectives that must be accommodated.
While the parties may be miles apart when they begin negotiations, they both benefit from developing a good working relationship. Simple tips include the following.
The party best positioned to compromise is the one that will take less time to get a new investigator on board, because the CRO/SMO/PI can provide a greater pool of candidates that the party seeking to hire can access.
Finally, a sample clinical trial agreement is just that, a sample, and a starting point. A sponsor’s goal is to execute a sample clinical trial agreement with a CRI, but no one says a CRI must accept the same clinical trial agreement, or even one similar to it. The majority of CRIs are found in academic institutions which are public or quasi-public corporations that are obligated by law to protect their own interests, the interests of their faculty, and the taxpayer-supported institution.
To be sure, any trial in which a CRI is involved will require the IRB’s approval. But, those patients will also be free to participate in another clinical trial, even if that trial is at a competing CRI. Therefore, there may be strategic value in allowing the CRI to terminate the clinical trial agreement after 30 or 60 days with or without cause.

Clinical Trial Agreements: Legal and Ethical Aspects

Legal and ethical considerations involved in drafting and executing clinical trial agreements must weigh in at the front end in order to prevent downstream disputes. These considerations include compliance with regulatory requirements, including GCP, HIPAA, the Sunshine Act, state law, and IRB requirements, and addressing ethical concerns raised by the investigator and the IRB (for example, whether compensation provided to the investigator could be construed as a kickback). Well-structured CTAs attempt to address these considerations by including definitions and provisions aimed at compliance with applicable laws and best practices. For example:
Named parties (the "Parties"): will include a definition of the "Company" and "Institution," i.e., the Sponsor and each participating institution (as opposed to just the investigator). This definition should also clarify whether the principal investigator (PI) of an institution who is often not a party to the CTA also bears responsibility for complying with the terms of the CTA .
Compliance with Regulatory Requirements: proposed definitions of applicable laws, GCPs, Human Subject Protection laws, Anti-Kickback and Sunshine Act, Clinical Trial Clinical Trials Disclosure laws, F WA and other applicable federal laws, state laws (NYS, etc.), laws of the country where the study will take place, and HIPAA (privacy) and 42 CFR Part 2 (substance abuse privacy) will further ensure that the Parties understand their respective obligations under such laws.
Methods for Ensuring Compliance with Regulatory Requirements: Article provisions ensuring compliance, i.e., that the Institution will conduct the research it believes will comply with the [to-be-agreed-in-advance] protocol for the drug, human subject protection, GCPs, and other regulations that govern such drug research.
Criteria for Approval of Study: defined criteria for approving investigator participation in the study, and determination of the IRB that can approve the study.
Compensation to the Investigator: further provisions addressing "fair market value" of investigator payments.

Clinical Trial Agreements: Challenges and Tips

The negotiation and execution of clinical trial agreements can be challenging. In our experience, the most common challenges faced during the formation and execution of an agreement arise in these areas: indemnification, insurance, confidentiality, intellectual property, publication, and dispute resolution. The following provides an insight into these complications and suggestions on how parties may be able to address them more effectively.
Indemnification
An indemnification provision is intended to protect the trial sponsor from claims of injurious results directly relating to the clinical trial. However, many institutions are unable or unwilling to assume general indemnity, even for claims caused by themselves. For example, indemnifying a third party for a claim arising out of the negligence of the third party may seem quite extreme. Despite the common use of this form of gross negligence indemnity in clinical trial agreements, many clinical sites are not comfortable allowing a third party to indemnify them for its own negligence, business strategy, and relationships with institutional review boards and insurers. Indemnification provisions are also sometimes limited to third-party claims. Perhaps the best practice for parties in this context is to negotiate mutual indemnification tied to the specific conduct of each party.
Insurance
Another common problem in forming an agreement is the determination of which party will bear the insurance burden. Many institutions are seeking to move away from liability insurance and want to either require the sponsors to indemnify them or require them to accept full risk/liability. Institutions sometimes desire to shift costs to sponsors because they feel that the sponsors are better able to absorb the risks and may even have insurance that covers claims relating to the event.
While some sponsors are uncomfortable paying a site with unlimited liability, academic medical centers have been lobbying for limited facility liability in these clinical trial agreements. For example, some studies have shown that 40 to 44 percent of clinical trials result in adverse events for research subjects. As such, academic medical centers argue that they will have to defend themselves against these adverse event lawsuits even if they didn’t cause the injury or if it was unforeseen.
Clinical sites should consider the type of insurance available to the sponsor and whether limitations of liability are in line with the sponsor’s type of study.
Confidentiality
Often there are discrepancies between the obligations of the two parties to keep information confidential. Clinical sites sometimes face a serious dilemma when dealing with the proprietary information of sponsors. On one hand, most institutions have a legal obligation to provide access to public records and documents, including government-funded clinical trials. On the other hand, many sponsors require clinical sites to treat all research information as confidential, including information contained in study reports and publications, and the sites’ confidentiality obligations may extend even further. As such, there may be friction when a site is obligated to release study information as required by law, while the site may be liable for breach of contract when it releases study information that has been designated confidential by the sponsor. For any site that must comply with both law and a confidentiality provision, full disclosure of the site’s reporting obligations is critical during the negotiation of the agreement.
Intellectual Property
Intellectual property (IP) rights are sometimes not fully recognized or protected in clinical trial agreements. A clinical trial may create new IP rights of use to one or both parties. If these interests are not clearly articulated in the clinical trial agreement, sites and sponsors can have a dispute about who owns these rights. The best practice in clinical trial agreements is to clearly articulate what rights both parties have to any new IP generated during a clinical trial.
Publication
Sponsors are often concerned that a publication will be too revealing, or delivered prematurely, before they can file a patent application. Many sponsors therefore seek to have the clinical site submit a draft copy of any manuscript to the sponsor for comment prior to submission. Typically, sponsors request an opportunity to review and comment on the proposed submission within a defined time period (often 30 days). There are many ways in which sites can negotiate the terms of this process, but in order to protect the party’s interests, sites might consider retraction of the manuscript and publication of a correction in the appropriate scientific journal if the time frames are not met.
Dispute Resolution
Disputes can arise in three different phases of a clinical trial: the pre-award, award, and post-award phases. Each stage presents challenges for sites as well as sponsors. What is often necessary is to develop a coherent process for resolving disputes that may arise in a particular phase. Some of the factors to consider in deciding which alternative dispute resolution (ADR) mechanism to use for each phase include: the comparability of the trial sites’ leverage at the given time, each party’s investment in the study, the complexity of the issues being disputed, and the size of the potential disputes.

Clinical Trial Agreements: Sample Drafts and Guidelines

The negotiation process between a sponsor and a clinical trial site can be an underappreciated, yet integral step to the overall success of a clinical trial – one that is sometimes lost to other seemingly more practical matters such as the selection of principal investigators, study design and budget issues, and patient recruitment. However, the importance of the clinical trial agreement (CTA) is worth remembering, as it sets forth many risk-allocating and expense-shifting provisions between the sponsor and the site for the trial that, if not clearly articulated, could be subject to differing interpretations later down the road.
A good staging point when reviewing a CTA is to consider some of the regulations and guidelines set forth in the Code of Federal Regulations, the OIG Compliance Guidance for Clinical Investigators, sponsors, CROs and Investigators, the Declaration of Helsinki and ICH guidelines. From these sources, we’ve compiled a shortlist of best practices that are particularly relevant when drafting or reviewing a CTA. These can be factored into almost any CTA, although the use of some may be limited depending on applicable laws and practices in locations outside the United States, such as Canada and the EU. Some of these best practices may already be found in the HHS and FDA Informed Consent regulations or the OHRP Guidelines, but they’ve been added to these OIG best practices for the sake of clarity.
Secured Foundation, Inc., "OIG Compliance Program Guidance for Pharmaceutical Drug and Biologics Manufacturers," August 2005, available here; Accountability for Reasonableness Framework, December 2007, available here.

Conclusion: Future of Clinical Trial Agreements

As technology and regulations continue to change, the landscape of clinical trial agreements is also in constant flux. The way we store and exchange data is evolving with the emergence of new data storage and processing methods, such as cloud computing, artificial intelligence (AI), and blockchain technology. We also see a growing need for clinical trial agreements to include appropriate, fair compensation for study subjects, and increasing concern for the treatment of human subjects participating in clinical trials.
These changes may affect not only the terms contained in clinical trial agreements, but also how those changes may be implemented, especially in regard to technology. Notably, new regulations concerning electronic consent will likely continue to push the use of cloud-based software as a means of obtaining informed consent. In the future, we may see platforms that track patients’ automatic responses to data collected from wearables, tablets, and smartphones to streamline the informed consent process.
New regulations and guidelines, like the ICH E6-R2 draft, encourage sponsors and investigators to implement quality-by-design principles into the trial design and throughout the clinical trial conduct. The use of new technologies will likely make quality-by-design principles easier to implement , because they allow for sponsors to balance data collection with quality of the data as the trial progresses. For example, real-time data collection will allow the sponsor to detect when a site deviates from the protocol and immediately takes action to provide additional training or guidance to the site. Also, electronic systems that track performance metrics for each clinical trial site will allow sponsors to assess whether the organizational structure and processes in place for that site were appropriate to run the clinical trial effectively, and whether changes may be needed for future trials. A good clinical trial agreement will ensure that these mechanisms and technologies must be appropriately used at each given site, and will allow the sponsor access to any information that it needs to assess whether performance metrics are being met.
As technology continues to develop, it is likely that clinical trial agreements, as well as the clinical trial process itself, will adapt to remain compliant with these new changes. For now, having an up-to-date clinical trial agreement, along with a well thought out implementation strategy, will help ensure that the trial will be able to keep up with those changes.