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Knowledge Hub
Understanding R&D, Placebo, Randomisation, Fair Market Value & Other Key Concepts in Healthcare & Research
The Knowledge Hub
Welcome! On this page, we will dive into the basic principles and guidelines of healthcare research and development (R&D). Our aim is to provide a clear and engaging overview of key concepts that underpin clinical research, evidence-based medicine, and informed healthcare decision-making.
These topics are essential to ensuring that health research is transparent, scientifically rigorous and ethically sound. Whether you are a researcher, healthcare professional, patient advocate, or simply curious, this page will give you a deeper understanding of how new treatments and healthcare policies are developed. Explore the principles shaping the future of health research and patient engagement, and discover how you can be part of it.
Randomised & Placebo
When researchers test new medicines or treatments, it’s essential to know whether they work, and that any effect is not just due to people’s expectations. That’s where randomised clinical trials come in. This method ensures a fair comparison by randomly assigning participants to different groups.
How does it work?
Imagine a new medication for headaches is being tested.
Participants are divided into two groups:
- One group receives the new medicine.
- The other group receives a placebo – a treatment that looks like the real thing but contains no active ingredient.
Who gets what is decided at random. This process, called randomisation, means everyone has an equal chance of being in either group. It prevents researchers from (even unintentionally) influencing who receives the real treatment.
What is a placebo and why use one?
A placebo is a harmless, inactive (has no medical effect) treatment. Interestingly, some people feel better simply because they believe they are getting real medicine. This is known as the placebo effect.
By comparing results between the two groups, researchers can tell whether the new treatment works better than the placebo. If both groups improve equally, the medicine may not have a real effect. On the other hand, if only the group receiving the actual medicine improves, it’s strong evidence the treatment is effective.
Why is randomisation important?
Everyone has unconscious biases, including researchers and doctors. If they chose who got which treatment (drug or placebo), their expectations might influence their decisions, even without realising it.
By using a computer to randomly assign participants to groups, the trial stays fair and objective, making the results far more reliable.
Safety in clinical trials
If you join a randomised clinical trial, your health and safety are always the top priority. Doctors closely monitor participants throughout the trial.
In short: Randomised clinical trials are a trusted way to test new treatments fairly. They help researchers determine whether a treatment really works, without the results being influenced by humans.
Research & Development (R&D)
R&D stands for Research & Development. It’s all about exploring new ideas, improving existing products, and creating smarter solutions. R&D is used across many industries, like healthcare, technology and environmental science – to develop new innovations that make life better.
The three types of R&D
There are three main ways researchers approach R&D:
- Basic research
- This type of research aims to understand new things. without focusing on a specific outcome.
- Example: How does the brain work?
- Applied research
- This builds on existing knowledge to solve a problem or improve something.
- Example: How can we make better, longer-lasting batteries for electric cars?
- Experimental development
- This involves testing ideas, building prototypes, and improving them through trials.
- Example: Testing a new medication to see how well it works in patients.
- Basic research
How does R&D work?
R&D usually follows a step-by-step process:
- Identify the problem – What needs to be improved?
- Research the topic – What do we already know?
- Create a prototype – Build the first version of the product or solution.
- Test it – Try it out and look for problems or bugs.
- Improve it – Fix issues and refine the design.
- Real-life testing – See how it works for actual users.
- Evaluate the results – Decide if the solution is ready for use.
Why is R&D important?
R&D helps us come up with new inventions and better products. It helps us:
- Invent new things (smartphones and electric vehicles)
- Improve everyday products (energy-efficient cars)
- Create life-saving medicines and medical treatments
R&D in healthcare
In the healthcare sector, R&D plays a vital role in:
- Developing new treatments and drugs (e.g. insulin for diabetes)
- Creating vaccines to protect against diseases
- Improving hospital technology, making care safer and more efficient
What does R&D mean for the future?
R&D helps society grow and adapt. It leads to smarter technology, healthier lives, more sustainable solutions and better tools to tackle global challenges.
In short: R&D is about discovering new ways to improve our world.
Fair Market Value (FMV) in Patient Engagement
When patients contribute to research projects, advisory boards, or other forms of patient engagement, it is essential they receive fair and transparent compensation for their time, insights, and efforts. This is where Fair Market Value (FMV) plays a crucial role. FMV helps determine appropriate compensation based on objective criteria such as time commitment, experience, and the complexity of the task.
FMV ensures that patient contributors:
- Receive fair payment for their time and expertise.
- Are treated as equals to other professionals and stakeholders in research and development.
- Avoid potential conflicts of interest through a transparent and consistent payment structure.
How is FMV calculated?
FMV in patient engagement can be calculated in several ways, drawing on practices from both financial and consulting sectors:
- Market method
- Compares fees for similar roles in research or industry.
- Example: A patient on a working group receives the same rate as an external expert consultant with equivalent knowledge.
- Time-based method
- Considers the hours spent and task complexity.
- Example: A patient providing feedback for 5 hours on a research project is paid an hourly rate equivalent with a professional consultant in a similar field.
- Experience-based method
- Takes into account the patient’s experience, education and specialised insight.
- Example: A long-time patient or peer counsellor may receive a higher rate than a newly involved patient representative.
- Market method
International Guidance and Standards
Several organisations are working to set guidelines for CME in patient engagement. Among them are:
- Patient Focused Medicines Development (PFMD): Developing global standards for meaningful and ethical patient engagement
- National Health Council (NHC): Offers guidance on fair compensation.
- Pharmaceutical Research and Manufacturers of America (PhRMA): Sets ethical standards for patient payment in industry collaborations.
Ensuring fair payment in practice
- Transparent fee models – Clearly defined rates for participation, preparation, time, travel and consultation.
- Clear contract – Provide agreements that define roles, compensation and expectations.
- Equality principle – Patients should receive equal compensation to other professionals performing similar tasks.
FMV in practice – an example
A patient with a rare disease is invited to join an advisory board at a pharmaceutical company. The CME-model sets the payment by:
- Comparing with other advisors in similar roles
- Considering the patient’s relevant experience and condition-specific expertise
- Estimating the total hours spent in meetings and preparation.
In this way, FMV ensures that the patient receives a fair payment without compromising independence, objectivity, or integrity.
Conclusion
FMV in patient engagement is essential to ensure that patients are recognised as equal partners in research and development. Fair, transparent and market-based reimbursement creates more sustainable collaborations and promotes patient engagement in the healthcare system.