Medidata Blog

Big Data, Fair Market Value and "Pawn Stars"

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Viewers of the American reality television series “Pawn Stars” will know negotiation doesn’t usually begin until Rick calls in an expert to examine an item for authenticity, condition, provenance, etc. “Antiques Roadshow” follows the same formula, albeit with far better-dressed experts. This appraisal method relies on the experience of individuals for the “pertinent facts” and works best for unusual, one-of-a-kind items.

When creating trial budgets, clinical sponsors and contract research organizations (CROs) have traditionally relied on their own experts, typically internal staff. However, unlike the WW II bomber jacket and the vintage toy fire truck, clinical procedures are not unusual, one-of-a-kind items.

As consumers buying or selling a car or home, on the other hand, we are more likely to begin the process with a much more comprehensive set of data. For buying and selling cars, common sources are the Kelly Blue Book and Edmunds. For home sales, Zillow and Trulia have become staples. These databases provide a wealth of information about comparable assets with variables, like condition or location, allowing the buyer/seller to determine an accurate relative value. In today’s world of “Big Data,” transactions can be captured, reported and analyzed very cost-effectively so the trend towards comprehensive cost databases is unmistakable.

In clinical trials, when determining how much to compensate a physician investigator for procedures performed, data is a powerful tool. In the best-seller, Getting to Yes: Negotiating Agreement Without Giving In, a key principle is “Insist on using objective criteria.” Actual payments made for similar procedures, for a similar phase, indication, location and complexity level is objective criteria. Medidata’s PICAS database offers access to negotiated agreements—not rate cards or proposals—for approximately 300,000 grants, 30,000 protocols in 1,600 indications. There is no better source of data in clinical development.

Yet, the story doesn’t end there. Imagine if the experts on “Pawn Stars” and “Antiques Roadshow” had access to massive databases of similar items. What if they could find a specific product with a history of prices paid for a similar condition in a similar location and, then, applied their expertise to determine FMV? Access to PICAS, through Medidata’s Grants Manager solution, is extremely powerful but, in the hands of clinical experts, there is a multiplier effect.

However, by taking all the back and forth out of negotiation, it wouldn’t make for very good TV viewing.

Guest blogger David McNierney is a director of product marketing at Medidata. You can reach David by email.

Additional blog posts by David McNierney:

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