Outsourcing Cost Tepee

Pharmaceutical Outsourcing Application

Pharmaceutical companies find it expedient to outsource some or all the work involved in running a clinical trial to CROs. This example looks at the distribution over different functions of costs in outsourcing budgets. In the other examples there was a hierarchy, levels in an organization, which spanned the vertical space of the graphic. Through this example we illustrate that such organizational hierarchies are not necessary, and, as noted elsewhere, any resource which can be represented in a two-way data matrix can be represented by the resource tepee. The costs of outsourcing are typically associated with the number of patients (N) that are to be enrolled in the study (though this association can be thrown off somewhat by special needs in the studies such as the collection and analysis of biomarker data, special study design features, clinical phase of the study etc.,). In this example the number of patients in the clinical studies being displayed is used to order the vertical space of the graphic. More generally one could create an ordering by using the row sums in the resource utilization matrix. The resource utilization matrix below shows the distribution of outsourcing costs over a collection of clinical studies.

The collection of studies could be defined as some meaningful collection such as one for those pertaining to a specific therapeutic area/drug or for a specific CRO. The idea is to develop a graphic which provides a holistic depiction of the distribution of costs in a slew of outsourced studies. The numbers in the resource utilization matrix that follows are made-up numbers (in $1000s) which bear no resemblance to any real outsourcing effort.

Regulatory Project Start Up Project Management Clinical Monitoring Medical and Safety Mgt. Data Management Statistics/ Writing Sub-contracting/ Other Row Sum
Study 21, N=80 0 3124 2756 1700 190 479 417 204 8870
Study 07, N=160 0 7234 4124 2876 0 769 589 317 15909
Study 32, N=240 212 11031 6175 4100 287 879 669 354 23707
Study 12, N=280 314 12073 7245 4301 315 912 715 287 26162
Study 08, N=430 307 18756 11237 7568 324 1234 1079 371 40876
Study 03, N=510 289 21478 13421 9861 354 1267 996 425 48091
Study 04, N=580 0 23768 15123 11345 200 1450 1179 382 53447
Study 17, N=720 355 27456 17843 13289 423 1765 1289 415 62835
Column Sum 1477 124920 77924 55040 2093 8755 6933 2755 279897

The graphic below adds a null upper node and a null lower node. These nodes make the area of the colors in the graphic exactly proportional to the total cost, across studies, of the function associated with the color.