Some of you may know that the Principal Investigator (PI) of any clinical trial, is responsible for the entire conduct of the study at the research clinic where the study is being conducted under their supervision. In fact, by signing the FDA 1572 Form, the PI is essentially making a promise to the FDA to conduct the study ethically and by following all Good Clinical Practice guidelines. Many private research clinics are owned by the PI or PI’s that conduct their studies at their own facilities, but many other private research clinics are not owned by PI’s. A good viewer question I received last week came from someone who owns a research clinic and is trying to find a good and fair way to compensate his PI for the studies that he is conducting. In this video, I discuss three payment options (although more certainly exist if you can get creative) that are common for research clinics in these situations. Check out the video and let me know what you think is a fair and reasonable compensation for PI’s.
Posts tagged business
The question I received from a clinical research manager recently was when to invoice for a particular cost associated with running a clinical research study at a site, the pharmacy fee. The individual asking the question wasn’t quite sure when to invoice this and also wanted to know if there were any other fees that she should invoice for that are commonly associated with invoice-able fees for clinical trials. In this video, I try to summarize when to invoice for certain clinical trial costs and also how to go about doing this. Please comment below with any other suggestions.
Today’s post is another answer to a fantastic question I received the other day from a research site director who wanted to know how many study coordinators he would need to hire if he had ten studies going on at the moment. I personally like the patients per week metric to best determine how much workload a particular study coordinator can handle, although, since every protocol is unique, every situation will also be different. This will always be a balancing act and will require your site to have a solid inflow of new studies to keep your newly hired study coordinators busy. For getting more studies, check out my inexpensive DVD on this topic. Whatever the case may be, hire slow and, when necessary, fire fast in order to maintain profitability at your research site. Let me know your thoughts!
In what will so far be the third largest Initial Public Offering of 2013, Quintiles is expected to seek $750M dollars in funding which should set it’s IPO price at around $40 per share. As I have blogged about for the past few months, Quintiles will only be issued shares reflecting about 15% of it’s total shares to the public. Roughly $500M of the IPO funds will go towards company expansion as well as paying ogg some debt, while the remaining $250 to $300M will go to founder Dennis Gillings and the four private equity firms that currently hold the majority of the ownership in the CRO giant. The majority of these shares will not be sold immediately by Gillings and the private equity firms, as they will continue to hold on to roughly 70% of the company even after the IPO. This valuation puts Quintiles at a market value of $4.9 billion. There is still no word on when the shares will actually begin trading, although we do know that they will trade under the “Q” symbol on the New York Stock Exchange and one can expect opening day to be in the early Fall of this year.
While this is certainly an exciting IPO in any industry (it is the third largest of this year), it is clear that investors and mutual funds will have no problems placing their funds into Q as it is already an established and mature company in what is still believed to be a “growth sector”. The fact of the matter remains that only 15% of the company will actually be available for public purchase, thus giving the four private equity firms a majority control in the fate of the company. While most of the IPO funds will be used for debt payback, there is some exciting potential that Quintiles can expand into China and other Asian countries in order to gain more market share by either acquiring smaller CRO’s in the region or simply growing organically while forming strategic partnerships as they have done in the past. Should Quintiles ever need to raise more funds, rather than diluting shares, it can issue more of it’s private shares while allowing the private equity firms to cash out even more at a later date. Definitely stick around for this one as it is bound to be very exciting going forward!
So today I received a great question from a viewer who has entrepreneurial ambitions and would like to know how he can go about opening his own SMO (Site Management Organization as it is known in our industry). I did a full length interview on this with Celina of ReSolve Research Solutions based out of Toronto, Canada. I highly recommend anyone who is interested in this topic to watch that video as it demonstrates the amount of work it will require to actually build a successful and profitable SMO. As always, share your comments below!
As I wrote about several weeks ago in regards to the much (over)hyped Quintiles initial public offering, Quintiles is soon to offer roughly 15% of it’s company shares for the public markets, a figure that many experts agree to be around $600M in valuation. We also know that roughly $300M of these funds will be used to pay down a sizable portion of debt. Now we are learning that, according to recently filed S-1 papers with the Securities and Exchange Commission, an additional $25 Million will go to Quintiles Founder Dennis Gillings and some other key investors. According to Fierce CRO, Gillings who is no longer company CEO, as well as certain key investors, have been retained to serve as consultants of sort with a “management service fee” of $5M annually. Since this practice would be frowned upon post-IPO, Gillings and his crew will receive the $25M upfront once the IPO funds clear the Quintiles bank account. This makes the already small (dollar wise) IPO even less significant. Ultimately, it will depend on what investors are willing to pay for Quintiles’ potential growth, so the $600M valuation may reach somewhere north of $1 billion at some point, however, with other CRO expansion into China and Asia in general, Quintiles will likely continue to have to pay for this expansion as well as it’s existing operations. Due to the fact that this IPO only reflects 15% of the company stock, I have long held the belief that this IPO is more hype than substance. However, it will still be a very interesting story to keep an eye on going forward, and I am still working with my sources on obtaining an IPO price.