Xzencis Consultancy – The Business Case

Xzencis AB’s consultancy services in Drug and Patient Safety, Pharmacovigilance and Translational Safety, Business Development, licensing, M&A, Governance and Change Management attract plenty of questions from clients about the rates charged and business cases involved.

So pharmaceutical-networking.com sat down with Xzencis founder and Managing Director Dr. Steffen Ernst to discuss a few of the main issues and pick through some of the main Frequently Asked Questions.

Pharmaceutical-Networking: Why do clients ask for Xzencis’ counsel, advice and services?

Steffen Ernst: Inquiries come from a diverse spectrum of topics and clients. Topics usually relate drug-project specific assessments and analysis, counsel, strategy and problem-solving activities over more general Quality Management System and regulatory tasks to departmental or corporate improvement and change initiatives – of course always in relation to “Safety” in the broadest possible sense.

Clients come from all types of pharmaceutical companies, service providers, CROs and various pharma investors.

P-N: Is it expensive to buy Xzencis’ services?

SE: Most of our general counseling and service contracts for EU/UK-clients are reimbursed at 230GBP per hour or local currency equivalent. This rate is industry typical for e.g., senior Patient Safety physicians with proven leadership track records. US contracts and tasks involving direct accountability, such as regulatory agency interactions, tend to be more expensive due to greater liability and need for prior approval by our insurers.

P-N: Are the rates for financial risk assessment the same?

SE: They can be – but it depends on the actual task. Some in-bound and outbound licensing tasks can be more expensive, for instance. Counseling rates in Merger & Acquisition activities are higher than for general advice. But the key point here is that we offer very distinctive services that have few equivalents elsewhere in the life sciences industries, and that makes them inherently more valuable.

P-N: Are there other areas of your services that have different cost structures?

SE: Clinical trial crisis management or tasks involving rectifying regulatory compliance issues can be more expensive. But that very much depends on the level of complexity involved. So, for example, a relatively simple safety problem analysis in a clinical trial is one thing, while designing and leading a strategy to lift a “Clinical Hold” for the client is quite another.

P-N: Are there any other factors to consider?

SE: Emergency and ad hoc work can trigger a higher rate for an agreed number of hours as it requires greater effort and inputs on our side. The same goes for work exceeding normal working hours.

P-N: Are there travel costs to consider?

SE: The need for travel and direct face-to-face meetings has become something of a rarity, with the world embracing online platforms. Where we absolutely do need to travel, then those cost are directly charged against actual receipts. We derive our moderate terms from the rules for national civil servants or EU officials, which exclude First or Business Class air travel within the EU, for instance.

P-N: How confident can customers be that costs and fees will remain within initially agreed scope? What safeguards are in place?

SE: As a matter of principle, we always agree on a maximum number of consulting hours with our clients, derived from the expected workload and a reasonable reserve.

Only actually delivered time is invoiced, with clients informed in writing about hours incurred to date at regular, agreed intervals.

Normal practice is to invoice monthly on the last working day of the month and the client is informed immediately should any specific task require more time than expected for whatever reason.

P-N: What aspects of charging and billing are covered by robust QA and QM systems?

SE: At Xzencis, we follow stringent Swedish accountancy regulations. All our finances and transactions are handled by a registered accountant.

Our client interactions and deliveries are also subject to oversight by an independent, accredited financial auditor.

P-N: What are the main things companies will gain from their outlay on safety consultancy. Can you quantify the benefits?

SE: Benefits accruing from Xzencis services reach into several, often interrelated dimensions that together have impact on bottom line performance. These include achieving or maintaining regulatory compliance, strategic decisions that add value on the product or portfolio level, and more efficient utilization of in-house resources.

Perhaps even more important, but more difficult to quantify, is protection of reputation, enhancement of brand value and avoidance of risk. Safety has direct impact on all those areas.

P-N: Finally, how can prospective clients approach calculations of the ROI and the payback time on their investment?

SE: Safety is not usually seen as a profit bearing investment – passengers and regulators alike, would object to safety features omitted in a passenger jet just because the financial return is unclear. Similarly, our clients do not view safety consultancy from a direct ROI perspective, since it is more viewed as an essential element in any life science business. You could call it a fixed cost of doing business in the ethical sphere since without rigorous attention to safety and governance, there would be no business at all.

Lack of Translational Safety input of the kind that Xzencis can provide can have dire consequences for any pharma company, irrespective of size.

So, while cost-effectiveness is certainly a valid calculation in the safety context, ROI and payback time are not.

Resources

Click on Xzencis pre-clinical & clinical safety services for further information.