Outsourcing Vendor Red Flag #2: Layers Of Oversight And Process Are Impeding My Program

Misaligned expectations can result from many factors, including a misreading or misunderstanding of the average CRO’s business model, particularly large CROs. These companies typically are structured with layers of management and approval, which means that even the simplest decisions require multiple people. Ultimately, this approach can drag out timelines and run up costs.

This depth of management is less about ensuring your trial progresses smoothly and more about hiding the CRO’s deficiencies (lack of continuity, lack of therapeutic expertise, cost overruns, change orders, etc.) or appeasing their own stakeholders (e.g., legal counsel, regulators, and investors). When selecting such a vendor, you must be aware of these dynamics to operate successfully with them.

To this end, outcomes clauses tend to please CEOs or boards, but they are often ineffective in practice. A contract may stipulate bonuses or incentives for certain team members at certain milestones, but there are many elements of the industry over which neither the sponsor nor the CRO has control.