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It's well-known that clinical trials of cancer treatments often can't cover their costs. But a new study suggests that government-funded trials could take at least one cue from those backed by drug companies.

In 2010, the Institute of Medicine (IOM) released a report saying that the U.S. system for conducting cancer clinical trials was approaching a "state of crisis."

The IOM -- an expert panel with federal support -- said the National Cancer Institute's Clinical Trials Cooperative Group program was inefficient, bogged down by red tape and underfunded.

The NCI program includes a number of collaborative groups -- academic cancer centers, researchers and community doctors that work together to conduct trials on cancer treatment. Altogether, the program involves more than 3,100 institutions in the U.S., Canada and Europe.

In the new study, researchers at one Canadian cancer center focused specifically on the timing of cancer clinical trial funding.

With cooperative group trials, funding typically comes as a "modest payment up front" for each patient enrolled, explained lead researcher Dr. Hsien-Yeang Seow of McMaster University and the Juravinski Cancer Center in Hamilton, Ontario.

Trials done by the drug industry, on the other hand, dole out money over time, as patients hit certain "milestones" -- like during treatment, and as they come back for follow-up visits after treatment ends.

Seow's team looked at 97 clinical trials done at its center in recent years. Two-thirds of those studies were cooperative group trials, including some with NCI funding, while the rest were industry-sponsored.

Those included early- and late-stage trials of treatments for cancers including breast, lung and stomach cancer.

The researchers found that the cooperative group trials quickly began to lose money after the initial stages because the funds were all spent early on. That leaves nothing for study patients' follow-up, which can last for years.

The industry trials, in contrast, had more money going in than out at multiple time points -- though any net income typically disappeared during longer term follow-up.

What's more, Seow's team found, its center had fallen into a pattern of starting new clinical trials in order to pay for patients' follow-up in the older, ongoing trials.

Seow likened it to a "Ponzi scheme" -- albeit an unintentional and legal variant.

"In order to stay afloat," Seow explained in an interview, "we have to start new trials and recruit new patients."

The money from that new-patient accrual then goes to "pay down the deficit" of earlier trials. "Obviously, that's not sustainable," Seow said.

One way to help with the larger issue of sustaining cooperative group trials could be to switch from "up front" payment, according to Seow.

The author of an editorial published with the study in the Journal of Clinical Oncology agrees. "Perhaps it is time to consider more closely following the pharmaceutical industry model of progress payments," writes Dr. David M. Dilts, of the Knight Cancer Institute in Portland, Oregon.

That, he adds, could help stop the "robbing Peter to pay Paul" habit of using new trials to fund old ones.

Funding gap

An alternative for individual cancer centers would be to take part in fewer and fewer cooperative group trials, and more industry-funded ones.

A recent survey of centers in the NCI cooperative program suggested that is happening: one-third said they were going to limit their participation in NCI-funded trials in the future.

But non-industry trials are vital, Seow pointed out. Drug company studies may bring us the "next blockbuster drug," he noted, but the cooperative group trials help answer the bigger questions of how to improve cancer patients' overall care.

This new analysis, Seow said, looks at just one aspect of the larger, complicated issue.

The 2010 report from the IOM recommended an overhaul of the NCI cooperative group program. Many of its suggestions focused on efficiency: the process of simply designing a trial, for example, is lengthy and cumbersome -- taking an average of two years to complete.

It also called for more funding. The NCI's payment-per-patient has not changed in a decade, standing at about $2,000. But the actual cost is thought to be closer to $6,000, Dilts points out in his editorial.

The NCI has said it plans to boost that reimbursement to $4,000, at least to "high performance" centers that enroll a large number of patients in clinical trials.

In an email to Reuters Health, a spokesperson for the organization said it recognizes the need for more funding going to individual study sites.

But centers may still end up spending the money up front, Dilts notes -- especially with today's trend of doing expensive genetic testing of patients. That's done because researchers are increasingly trying to develop treatments that are "personalized" to patients' genetic makeup.

So there still may be no money left over for years of patient follow-up.

Another option, Seow said, is to finally close some of the long-running "mega-trials" that are no longer generating useful information.

But the wider problem will ultimately need multiple solutions, according to Seow.

"There have been remarkable breakthroughs in cancer therapies," he said. "But there's a state of crisis in clinical trials right now, and there are many reasons for it."