FDA Clarifies Rules for Charging Patients to Participate in Your Clinical Trial
(Thursday, August 25, 2022)
Clinical trial sponsors with limited resources are permitted to charge patients for participating in their trial. However, there are rules and strict limitations for the cost that can be recovered from patients, and FDA’s permission must be obtained prior to charging patients. Sponsors have been allowed to charge the cost of manufacturing the investigational drug from the patients participating in their trials since 1987. FDA has published two guidance documents in the last 35 years explaining the rules, in 2009 and 2016, which describe the conditions under which IND sponsors can charge patients, how much, and for how long. The latest guidance further clarifies the rules, particularly for charging for investigational drugs under expanded access programs. The primary condition for charging patients is for the sponsor to demonstrate that the clinical trial could not be conducted without charging because the cost of the drug is “extraordinary to the sponsor”, which has generally been interpreted as meaning too expensive to afford. While the rules allow for charging for the manufacture if the cost is “extraordinary” due to manufacturing complexity, scarcity of natural resources, or the large quantity of the drug needed to complete the study, but most of these justifications would be hard to support by most sponsors. However, the rules also allow the justification for charging patients based on extraordinary circumstances “for the sponsor” which usually translates to the sponsor having limited financial resources. Hence, only small start-up entities would generally qualify for such permissions and large companies with greater resources would not meet the “extraordinary cost” criteria. The sponsor needs to demonstrate that the charge is only for the direct costs for the manufacture such as costs per unit to manufacture the drug (e.g., raw materials, labor, and nonreusable supplies and equipment used to manufacture the quantity of drug needed for the use for which charging is authorized) or costs to acquire the drug from another manufacturing source, and direct costs to ship and handle (e.g., store) the drug. Sponsor is not allowed to charge for indirect costs such as the costs for facilities and equipment used to manufacture the supply of investigational drug, research and development, administrative, labor, or other costs that would be incurred even if the clinical trial or treatment use for which charging is authorized did not occur. The sponsor can charge the patient for the entire duration of the clinical trial. When charging for providing drugs under expanded access programs, sponsor is allowed to charge the patient for only up to 1 year duration. There are also other nuances for the allowed charges to patients described in the new guidance. However, the best guidance for detailed instructions to apply to the FDA for cost proposal is the one released in 2009; the new guidance lacks several details provided in the original guidance document. Charging patients for the manufacture of the investigational drug is designed to lighten the financial burden of conducting clinical trials for resource-limited entities, and it potentially does help. However, it is not publicly known how many companies apply for and get permission to charge patients to participate in their trials. It would help if FDA published some matrices on those numbers to support the actual benefit of this rule.
Dr. Mukesh Kumar
Founder & CEO, FDAMap
Linkedin: Mukesh Kumar, PhD, RAC