Skip Navigation and Go To Content

Sponsored Projects Administration

Clinical Trial Agreements (CTAs) govern the terms of research between the University and set the expectations and responsibilities of the parties.  Industry initiated clinical trials are executed for trials following a sponsor- or investigator-initiated protocol.

Generally CTAs are funded by pharmaceutical and medical device companies, and are an important part of the Food and Drug Administration (FDA) approval process.  The data from CTAs help to ensure the safety and efficacy of the drug or device being brought to market.


In order to properly fund a Clinical Trial from an Industry sponsor it is important to understand where the costs associated with the study come from.  Generally, three main sources account for the majority of expenses associated with a clinical trial:

  • Faculty and Staff Time and Effort
  • Administrative Fees
  • Patient Medical Costs

Payment for each of these three contributing factors can be collected in a variety of ways depending on the department and sponsor’s needs and restrictions.  The most common types of payments that are generated under clinical trials are as follows:

Start-up payments (non-refundable)

Start-up payments are received from the sponsor upon execution of the contract, prior to enrolling research subjects.  Sometimes the sponsor will require that UTHealth invoice for start-ups and sometimes they will automatically release payment.  It is important to read your contract and know whether or not you will need to invoice for this payment.  UTHealth requires that all start-up payments be non-refundable, due to the fact that these payments are reimburse UTHealth for the time, effort, and resources utilized during the administrative review process of the study.

Per patient payments

Once a study is up and running, some sponsors will only pay for completed patient visits.  Just like the start-ups, some sponsors will pay automatically upon receiving completed CRFs and study data, while other will require UTHealth to invoice for each patient visit.  Per patient payments are intended to reimburse the University for the faculty and staff’s time and effort spent attending to the study responsibilities around that patient visit.  This payment also contains the necessary funds to pay the clinic and/or hospital for all of the medical services and procedures provided for research purposes.

Milestone based payments

Milestone based payments are another way that sponsors can pay for a study after it is up and running.  Under this type of payment structure, the sponsor will only pay UTHealth once it completes a certain amount of work.  This can be after enrolling specific number of eligible study subjects, time based milestones of active work on the project, or some other measure which conveys to the sponsor that the University has successfully completed a meaningful amount of the total project contemplated under the Clinical Trial Agreement.  Similar to the other payment types, Milestone based payments can be generated automatically from the sponsor or they can require an invoice.  These requirements are detailed in the contract.

Invoiceable payments

Invoiceable payments are those which are not guaranteed to be earned by the study site.  An example of this type of payment would be an elective X-Ray required by the sponsor should the patient experience and adverse reaction to the study drug, or an MRI that is required by the sponsor which would could fall within the standard of care, but was performed outside the authorized window for third party insurance to pay for the procedure.  Invoiceable payments are never automatically generated and must be required via an invoice from the study team.


During the budgeted development process the department administrators, the study staff and billing team(s) should all meet to discuss the protocol and procedures and services provided as part of the trial.  A template for budget development is available on the SPA website.


The first thing that should be done is to complete the coverage analysis.  The coverage analysis is an itemized list of every procedure called for in the protocol.  This includes both effort based and patient care based procedures.  The coverage analysis details which visit each procedure will done at and whether or not it will generate a bill in the clinic billing system.  If an item generates a bill, the study team must designate whether that charge will be standard of care (SOC) or research.  All SOC items will need to have a justification provided to detail how that conclusion was made.  Adequate justifications include peer reviewed journal articles, nationally published guidelines from professional medical organizations, or national coverage determinations from the Centers for Medicare and Medicaid.  All coverage analysis will be reviewed by the CRF team to ensure that all procedures are identified, and that justifications properly ensure that they can be billed out to third party insurance or the patient.


After completing the coverage analysis, the study team will then need to perform a cost analysis for the study.  The cost analysis will create line items for everything being done in the study and total them into the Startup, Per Patient, and Invoiceable costs.

Start Up costs will need to be budgeted based on the requirements of the study.  Key items to remember in start up are the IRB submission fees, the administrative fees which include the time and effort for the study staff to complete all the paperwork and training prior to study initiation, investigational pharmacy setup fees, advertising fees, and anything else that will need to be paid for prior to enrolling the first patient on the study.  Remember that all of these will incur a 30% overhead on them, and thus you will need to account for this before submitting to the sponsor for approval.


In the cost analysis, all procedures being paid for by research will need to be budgeted for.  For each procedure at each visit you will need to provide how much will be expensed to the project account.  These values can be obtained from the charge master documents provided by the healthcare provider (typically UT Physicians, Memorial Hermann Hospital, and Harris Health).    Additionally, pricing fluctuates each year for procedures, so we suggest that you increase your pricing by 5-10% to ensure that there are enough funds in the account to pay for these procedures.  Remember that all charges expensed to the account will incur a 30% overhead as well, so when budgeting these values will need to be increased by 30%.

In addition to the patient care costs, effort based costs will also need to be factored in during the cost analysis.  For all effort based items provided in the trial you will need to estimate the amount of time that it will take to perform.  This can then be turned into a line item cost for the visit by multiplying by the hourly rate.  To calculate the hourly rate of a salaried employee, take their salary and divide by 2080, the average amount of hours per year for a 40 hour work week.  When calculating the hourly rate for Principal Investigator on an industry funded study, use their full salary and benefits, not just the base. 


  • Complete Coverage Analysis using the skeleton created by CRF and submit to for approval.
  • Calculate the costs associated with Start Up, Per Patient procedures and effort based costs.
  • Negotiate with sponsor to ensure that your final budget covers all costs associated with the study.
  • Send final budget to to be incorporated in the final contract.
  • Review final contract to ensure the budget is correct.


  • Create the Coverage Analysis skeleton and send to department.
  • Work with department to approve coverage analysis.
  • Provide pricing and guidance as requested by study team to assist in budget development.
  • Incorporate final budget into the agreement for execution.
  • Negotiate and execute agreement with Sponsor.