Considerations for outsourcing and support within Clinical Research and Regulatory Affairs.

1. Commercial In Confidence – For Client Use Only
Position Paper
Considerations for outsourcing and support within
Clinical Research and Regulatory Affairs.
By Brigid Flanagan, VP Clinical Operations & Dr Ivan Fisher, VP Regulatory Affairs.

2. Commercial In Confidence – For Client Use Only
Selecting the Right Partner for your
Regulatory and Clinical Affairs needs
Introduction
The use of external suppliers to augment or outsource key regulatory and clinical functions is
nowadays largely seen as an important element of normal practice within the life sciences
industry.
Driven by a growing need to reduce costs, cut overheads, increase productivity, scalability,
and flexibility, as well as access new skills, outsourcing undertakings are now commonly
viewed as long-term strategic partnerships. This contrasts with the historical view of such
engagements as either providing “temporary labour” to service transient peaks in demand, or
simply a cost-cutting exercise.
The case for outsourcing within this competitive industry sector is certainly compelling. Ever-
increasing regulatory and compliance pressures combined with a need to concentrate on
core, revenue-generating activities set the scene for a progressive, strategic approach to
resourcing.
However, clients are increasingly reporting that, in the rush to outsource aspects of
regulatory to lower-cost, off-shore locations over recent years, something has been lost.
Long-perceived as a cost-effective solution to managing regulatory budgets, the use of off-
shoring locations is now coming under increasing scrutiny and the “real-world” cost-
effectiveness is being called into question. Clients recognize that loss of sponsor control,
high staff-turnover rates, and time-zone, cultural and linguistic differences are often
associated with a decrease in quality of output for all but the most transactional activities.
In this document, we explore the various options open to our clients for external support
within their Regulatory and Clinical functions, and we consider the pros and cons of the
various resourcing models.

3. Commercial In Confidence – For Client Use Only
Resourcing Models
• Staff augmentation is a resourcing strategy which is used to staff a department,
function or project and respond to business objectives. The technique consists of
evaluating the existing staff and then determining which additional skills or how much
additional headcount is required. One possible advantage of this approach is that it
leverages existing resources as well as utilizing outsourced vendors to service
specialist demands or effectively manage transient peaks in workload or project-
related activity.
• Offshoring is the relocation of an activity, department, function or project from one
country to another —typically a transactional, operational process. More recently,
offshoring has been associated primarily with the outsourcing of services supporting
domestic and global operations from outside the home country to a low-cost centre in
a geographically distant location.
• Nearshoring is the outsourcing of an activity, department, function or project from one
country to a geographically nearby country, often sharing a border with the target
country. This strategy can provide numerous benefits related to this proximity,
including geographic, travel, time-zone, cultural, linguistic, and socio-economic
factors.
There is a perceived notion that the traditional off-shoring model provides the most secure
route to cost savings. Indeed, it may be fair to say that most off-shoring has historically been
driven primarily by cost-cutting. Certainly, activities outsourced to an offshore, low-cost
centre are commonly seen to have a lower fee-per-unit cost than those performed in-house,
especially when required at high volumes. This is especially true when the off-shored
activities are largely transactional, relatively simple in nature, and require little or no direct
interaction with internal stakeholders.
However, it should be stressed that there is an important difference between cost and cost-
effectiveness. Certainly, for high volumes of transactional activities, an effectively managed
off-shored centre can deliver the necessary output at a significant discount with minimal
overheads and without the need for additional investment in infrastructure. However, as the
complexity of the work and requirement for stakeholder engagement increases, cost-
effectiveness is seen to reduce dramatically.
Cost-effectiveness is more than just a function of pricing. Beyond the simple calculation of
cost-per-unit of each activity, additional qualitative aspects of each model need to be
considered; including but not limited to sponsor control, quality, attrition, expertise and
geography. These are outlined in Figure 1 below:

4. Commercial In Confidence – For Client Use Only
Figure 1: At a glance – Relative Merits of each Resourcing Strategy
G&L Scientific’s clients are recognising that the use of a near-shore location, such as Belfast
or Dublin, for outsourcing overcomes the dilemma of loss of control and time-zone, linguistic
and cultural differences. It delivers a solution that is simultaneously cost-effective, stable and
scalable. Sponsor control is maximised, time-zones are synchronised and quality of output
assured.
The Cost/Quality Dilemma
The combination of quality of output and cost are the primary factors impacting cost-
effectiveness of a resourcing solution. A low-cost solution offering low levels of “right first-
time” quality output would not be deemed to be cost-effective. Indeed, any resultant re-work
and delayed timelines may directly impact the cost of the solution, and further erode the
cost-effectiveness. Conversely, a high-cost solution offering high levels of quality, whilst
demonstrating obvious merits, would again, not be viewed as a cost-effective solution.
Quality of output can be impacted by a considerable range of factors, many of which are not
specific to any resourcing model. However, geographical and socio-economic factors can
directly contribute to a decrease in quality.
Variability in inflation rates across the globe can have a significant impact on the cost-
effectiveness of an outsourced resourcing model, either directly impacting the cost of the
service or cost to the vendor on a year-by-year basis. In the case of the latter, many vendors
have been forced to deal with unexpected spikes in inflation rates by making a choice
between making compromises on quality or experiencing an exodus in talent.
G&L Scientific believes that a managed, near-shoring outsourcing solution provides the most
cost-effective solution, providing significant opportunities for cost-saving whilst continuing to
provide high-quality input on a sustainable level.
Relinquishment of Control
The act of outsourcing any activity to a third party by definition, necessitates the
relinquishment of some degree of control from the sponsor. Exactly how much control is lost

5. Commercial In Confidence – For Client Use Only
is driven by a range of factors, of which the resourcing model is perhaps the most important
of all.
A traditional off-shored solution generally represents the most considerable loss of sponsor
control, essentially passing high volumes of work to a geographically remote centre within a
very different time-zone, where the local language and culture may differ from the sponsor’s.
Face-to-face meetings between sponsor and vendor are inevitably more costly and time-
consuming, whilst calls and teleconferences are often necessary outside of normal work
hours.
Experience has shown that a near-shored solution provides a significantly greater amount of
sponsor control, limiting the geographical, social and linguistic challenges posed by a remote
off-shore location. Location need not be a significant barrier to regular face-to-face meetings,
working hours are closely aligned and, as a direct consequence of cultural similarities, more
effective stakeholder interaction is enabled.
G&L Scientific believes that a managed, near-shoring outsourcing solution provides
opportunities for much greater sponsor control than previously realized using traditional off-
shoring models of outsourcing.
The Problem of Attrition
In the Regulatory Affairs arena, high staff turnover rates have long been associated with
many of the traditional outsourcing locations for a combination of social, cultural and
economic reasons. The competitive local environment created by the off-shoring industry
has created a situation where it is normal practice for employees to regularly switch between
nearby employers on a regular basis, with a view to maximizing their benefits packages.
Indeed, staff turnover rates of approximately 30-40% are now treated as the norm for many
off-shoring locations. This high level of staff turnover can be at the expense of quality,
stability and continuity of the service provided.
Staff turnover also remains a perennial problem in the clinical development arena. A lack of
continuity in personnel can cause disruptions in trials and delay timelines. That turnover can
increase costs because of lower productivity, increased workload on colleagues and loss of
knowledge. Furthermore, turnover is monitored by Sponsors and is something they evaluate
when deciding on which CRO to use. i
In a study of 2016 trends by HR+ Survey Solutions, LLC, a compensation consulting and
research firm, CROs continue to be impacted by exorbitantly high clinical monitoring
employee turnover rates. Where the industry across the board experienced an 18% turnover
rate, that figure was 25% for CROs; in some firms, the turnover rate exceeded 50%. ii
For centres outside the US, turnover in clinical monitoring increased to 22% in 2016, up from
16.4% in 2015.
There is a shortage of experienced CRAs and their role is changing. A good CRA now needs
to have a comfort level with data analytics and risk-based methodology, and must be
prepared to visit a site at short notice when an issue is identified. They need soft skills as
well technical skills so they can effectively manage their assigned sites and ensure that the
investigator and site staff feel supported.

6. Commercial In Confidence – For Client Use Only
The question of how to successfully reduce staff attrition rates in such a competitive
environment remains, but major contributory factors are the potential for career growth and
development, the availability of talent and the number of alternative employers in the local
area.
G&L Scientific believes that a managed, near-shoring outsourcing solution that puts staff
development, motivation and reward at the core of its ethos provides the most effective
mechanism for providing a stable pool of regulatory talent.
Likewise, to attract and retain excellent CRA talent, G&L Scientific supports professional
development by providing access to, or financial support for, training programs, meetings
and conferences, certifications and membership of professional organizations.
Adding Value
Beyond the traditional “more with less” philosophy commonly associated with outsourcing,
clients are increasingly looking to add value. Whilst the opportunities to provide specialized
skills or local insights are arguably somewhat limited in off-shoring or near-shoring
outsourcing environments, a staff augmentation resourcing model allows a client sponsor to
directly address any transient gaps in skills or knowledge.
Staff augmentation can therefore be used to bring a wealth of specialized experience into an
organization to fulfil the obligations of a finite project or temporary requirement. It can also be
used to ensure that an organization is sufficiently resourced to successfully navigate a
period of increased activity in a manner that is flexible and scalable or to provide local
intelligence and insights for a new market.
G&L Scientific believes that a staff augmentation model, used either in conjunction with a
near-shored outsourcing model or on its own, provides the opportunity to inject new skills
and local expertise into an organization.
Resourcing Models for Regulatory Affairs
Ultimately, an optimal resourcing model solution will differ between organizations, the nature
of the activities that they perform and the primary drivers for change. Nonetheless, G&L
Scientific firmly believes that a number of clear trends and best practices do exist, which
apply across industries. Regulatory Affairs is no exception to this.
G&L Scientific believes that a combination of staff augmentation and near-shoring provides
the optimal model for the regulatory affairs function.
Regulatory strategy, project management, in-country support and local intelligence are often
best serviced through staff augmentation, providing the right people, with requisite levels of
experience in the most suitable location for the required period. This might be to address a
transient shortfall in expertise or additional project requirement.
Higher-volume, more transactional activities such as document authoring and publishing are
often best performed through a near-shored outsourcing solution, where cost and
operational efficiencies can be realised alongside consistent quality of output.

7. Commercial In Confidence – For Client Use Only
Figure 2: Resourcing Strategy for Regulatory Affairs
Resourcing Models for Clinical Affairs
For Clinical Affairs, the best resourcing model may be a hybrid of staff augmentation and
near shoring.
As both the Project Manager and CRAs are actively interacting with site personnel on a day-
to-day basis and need to be available in real time to address protocol questions and issues
that may arise during subject visits, staff augmentation is likely the best solution.
Higher-volume activities like Regulatory Documentation collection at study start is an activity
that lends itself well to a near-shoring solution. Cost savings can be realized. Although Data
Management could potentially be off-shored, time zone differences may mean that site
personnel never get to interact directly with the data manager. That can result in queries
being reissued multiple times because neither party understands what exactly each means
to convey.
G&L Scientific believes that a combination of staff augmentation and near-shoring provides
the optimal model for the clinical affairs function.
Figure 3: Resourcing Strategy for Clinical Affairs

8. Commercial In Confidence – For Client Use Only
Conclusion
G&L Scientific is a solutions provider for our partners in the life sciences industry.
One size does not fit all. To ensure our clients get the talent they need, we will first conduct a
detailed needs assessment. Outsourcing an activity may not be the best route to take. If that
is the case, we will let you know.
Once we have completed a detailed needs assessment, we begin our resourcing for the
right consultant to meet your needs. G&L maintains a database of talented individuals with
backgrounds in a variety of therapeutic areas. Depending on the specifics of the job
requirements and whether it is an on-site or remote position, we make every effort to provide
you with a consultant who will be a good cultural fit with your organisation and who has the
required technical expertise for the role.
Whether it is a short-term need of a few months or something longer, not having to hire a
candidate full time is a cost saving for the client. For smaller CROs and their clients,
consultants or independent contractors can be a short-term solution when there is a need to
ramp up a team dedicated to specific activities.
Hiring a traditional employee is costly. In addition to salary and benefits, an employer may
need to factor in a referral bonus, a sign-on bonus, employer match, paid time off,
advertising expenses, payroll taxes, interview expenses, recruiting staff overhead, perks etc.
The cost of hiring an independent consultant may be an hourly or project fee, travel
expenses and contract fees.
G&L Scientific oversees the consultant on an ongoing basis when they do join the client's
project. Should there be an issue with performance, the client can reach out directly to their
point person at G&L Scientific for input and a solution. Governance meetings are scheduled
on a recurring basis to ensure expectations are being met and to identify upcoming needs.
G&L Scientific prides itself on exceeding client expectations. We strive to keep the lines of
communication open throughout the life of the project by speaking regularly with both the
consultant providing the services and their manager and we also communicate during
scheduled governance meetings.
To schedule a consultation for a solution to your resourcing needs, please contact:
US Tel. 973 379 2255
UK Tel. 01628 400686
E-mail: info@gandlscientific.com
i
Clinical Leader, December 20, 2016 'Is CRA Shortage to Blame for CRO Turnover'.
ii
ACRP Blog May 31st
, 2017, ‘When will CROs stop the Turnover Haemorrhage’.