Is There a “Right” Way to Calculate FMV?

Send us Fan MailDarshan Kulkarni and Edye Edens take a deep dive into one of clinical research’s most persistent questions: how is fair market value (FMV) actually determined for clinical trial sites—and who gets to decide?Building on the previous discussion about whether all sites should be paid the same, this episode unpacks the complexity behind FMV calculations. Darshan shares an anecdote involving a DOJ official questioning the credibility of FMV data derived from industry benchmarks, asking: “How do we know they’re not all overpaying?” That central question becomes the backdrop for a broader conversation about the opacity of FMV methodology.Edye and Darshan explore the role of commercial pricing vs. Medicare/Medicaid benchmarks, the impact of patient compensation, and the often-overlooked categories of research-related costs like recruitment, reminders, and outreach. They suggest that standard FMV tools don’t always capture the true operational costs sites face—and that research-related services are fundamentally different from standard clinical care.The conversation turns to the issue of transparency, revealing how internal silos at large pharmaceutical companies often prevent project managers or CROs from understanding, let alone justifying, the FMV numbers they're using in site negotiations. Meanwhile, sites—especially smaller or independent ones—have fewer layers and greater internal access to budget decisions, leaving them at a disadvantage when sponsors can't (or won’t) explain the rationale behind their numbers.Ultimately, the episode questions whether a more transparent and stratified approach to FMV could lead to better negotiations, more equitable funding, and improved patient access. The hosts challenge the industry to consider how current power dynamics—and the lack of communication—may be shaping not just contracts, but clinical trial accessibility itself.The episode closes by teasing a future conversation: Does the sponsor-site power imbalance impact patient care outcomes? Stay tuned.Support the showwww.kulkarnilawfirm.com