[Federal Register Volume 75, Number 98 (Friday, May 21, 2010)]
[Proposed Rules]
[Pages 28688-28712]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-11885]
[[Page 28687]]
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Part II
Health and Human Services Department
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42 CFR Part 50
45 CFR Part 94
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Responsibility of Applicants for Promoting Objectivity in Research for
Which Public Health Service Funding Is Sought and Responsible
Prospective Contractors; Proposed Rule
Federal Register / Vol. 75, No. 98 / Friday, May 21, 2010 / Proposed
Rules
[[Page 28688]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
42 CFR Part 50
45 CFR Part 94
[Docket Number: NIH-2010-0001]
RIN 0925-AA53
Responsibility of Applicants for Promoting Objectivity in
Research for Which Public Health Service Funding Is Sought and
Responsible Prospective Contractors
AGENCY: Department of Health and Human Services.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Department of Health and Human Services (HHS or the
Department) and the HHS Public Health Service (PHS), proposes to amend
its regulations on the Responsibility of Applicants for Promoting
Objectivity in Research for which PHS Funding is Sought and Responsible
Prospective Contractors. Since the promulgation of the regulations in
1995, biomedical and behavioral research and the resulting interactions
among Government, research institutions, and the private sector have
become increasingly complex. This complexity, as well as a need to
strengthen accountability, have led to the proposal of amendments that
would expand and add transparency to investigator disclosure of
significant financial interests, enhance regulatory compliance and
effective institutional oversight and management of investigators'
financial conflicts of interests, as well as NIH's compliance
oversight.
DATES: Comments must be received on or before July 20, 2010 in order to
ensure we will be able to consider the comments when preparing the
final rule.
ADDRESSES: Individuals, organizations and institutions interested in
submitting comments identified by RIN 0925-AA53 and Docket Number [NIH-
2010-0001] may do so by any of the following methods:
Electronic Submissions
You may submit electronic comments in the following way:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
To ensure timely processing of comments, NIH is no longer
accepting comments submitted to the agency by e-mail.
Written Submissions
You may submit written comments in the following ways:
Fax: 301-402-0169.
Mail: Jerry Moore, NIH Regulations Officer, Office of
Management Assessment, National Institutes of Health, 6011 Executive
Boulevard, Suite 601, MSC 7669, Rockville, MD 20852-7669.
Instructions: All submissions received must include the agency name
and Regulatory Information Number (RIN) [0925-AA53] and docket number
[NIH-2010-0001] for this rulemaking action. All comments may be posted
without change, including any personal information provided.
Docket: For access to the docket to read background documents or
comments received concerning this rulemaking action, go to the
eRulemaking.gov Portal: http://www.regulations.gov and follow the
instructions provided for conducting a search, using the docket number
[NIH-2010-0001].
FOR FURTHER INFORMATION CONTACT: Jerry Moore, NIH Regulations Officer,
Office of Management Assessment, National Institutes of Health, 6011
Executive Boulevard, Suite 601, MSC 7669, Rockville, MD 20852-7669,
telephone 301-496-4607, fax 301-402-0169, e-mail [email protected],
concerning questions about the rulemaking process and Dr. Sally Rockey,
NIH Deputy Director for Extramural Research, concerning substantive
questions about the proposed rule, e-mail [email protected].
SUPPLEMENTARY INFORMATION: Proper stewardship of Federal funds includes
ensuring objectivity of results by protecting Federally-funded research
from potential bias due to investigator financial conflicts of interest
(FCOI).
I. Background
In 1995, the PHS and the Office of the Secretary of HHS published
regulations at 42 CFR Part 50 Subpart F and 45 CFR Part 94 (the
regulations), that are designed to promote objectivity in PHS-funded
research.\1\ The current regulations are applicable to Institutions
that apply for or seek PHS funding for research (except for Small
Business Innovation Research (SBIR)/Small Business Technology Transfer
Research (STTR) Phase I applications) and, through implementation of
the regulations by these Institutions, to each Investigator
participating in the research. Generally, under the current
regulations:
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\1\ 48 CFR Subpart 9.1, ``Responsible Prospective Contractors,''
and 48 CFR Subpart 9.5, ``Organizational and Consultant Conflicts of
Interest,'' also address conflicts of interest in Federally-funded
projects. These provisions apply only to acquisitions, not to grants
or cooperative agreements.
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The Institution \2\ is responsible for complying with the
regulations, including maintaining a written and enforced policy;
managing, reducing, or eliminating identified conflicts; and reporting
identified conflicts to the PHS Awarding Component. The reports denote
the existence of a conflicting interest and the Institution must assure
that it has been managed, reduced, or eliminated.
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\2\ ``Institution'' is currently defined under 42 CFR Part 50,
Subpart F, as any domestic or foreign, public or private, entity or
organization (excluding a Federal agency), and under 45 CFR Part 94
as any public or private entity or organization (excluding a Federal
agency) (1) that submits a proposal for a research contract whether
in response to a solicitation from the PHS or otherwise, or (2) that
assumes the legal obligation to carry out the research required
under the contract. 42 CFR 50.603; 45 CFR 94.3.
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Investigators \3\ are responsible for complying with their
Institution's written FCOI policy and for disclosing their Significant
Financial Interests \4\ (SFIs) to the Institution.
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\3\ ``Investigator'' is currently defined under the regulations
as the principal investigator and any other person who is
responsible for the design, conduct, or reporting of research (or,
in the case of PHS contracts, a research project) funded by PHS, or
proposed for such funding. For purposes of the regulatory
requirements relating to financial interests, the term
``Investigator'' includes the Investigator's spouse and dependent
children. 42 CFR 50.603; 45 CFR 94.3.
\4\ ``Significant Financial Interest'' is currently defined
under the regulations as anything of monetary value, including but
not limited to, salary or other payments for services (e.g.,
consulting fees or honoraria); equity interests (e.g., stocks, stock
options or other ownership interests); and intellectual property
rights (e.g., patents, copyrights and royalties from such rights).
The term does not include: (1) Salary, royalties, or other
remuneration from the applicant institution; (2) any ownership
interests in the institution, if the institution is an applicant
under the SBIR/STTR programs; (3) income from seminars, lectures, or
teaching engagements sponsored by public or nonprofit entities; (4)
income from service on advisory committees or review panels for
public or nonprofit entities; (5) an equity interest that when
aggregated for the Investigator and the Investigator's spouse and
dependent children meets both of the following tests: Does not
exceed $10,000 in value as determined through reference to public
prices or other reasonable measures of fair market value, and does
not represent more than a five percent ownership interest in any
single entity; or (6) salary, royalties, or other payments that when
aggregated for the investigator and the investigator's spouse and
dependent children over the next twelve months, are not expected
(or, in the case of PHS contracts, are not reasonably expected) to
exceed $10,000. 42 CFR 50.603; 45 CFR 94.3.
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The PHS Awarding Components \5\ are responsible for
overseeing
[[Page 28689]]
Institutional compliance with the regulations.
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\5\ ``PHS Awarding Component'' is currently defined as the/an
organizational unit of the PHS that funds [the] research that is
subject to the regulations. 42 CFR 50.603, 45 CFR 94.3.
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Ensuring objectivity in research requires a commitment from
Institutions and their Investigators to:
Completely disclose,
Appropriately review, and
Robustly manage identified conflicts.
The purpose of the existing regulations is to ensure that there is
no reasonable expectation that the design, conduct, or reporting of
PHS-funded research will be biased by any Investigator FCOI.
Since the publication of these regulations, the pace by which new
discoveries are translated from the research bench into effective
treatment of patients has accelerated significantly and the biomedical
and behavioral research enterprise in the United States has grown in
size and complexity. For example, an analysis of financial support of
biomedical research from 1994 to 2004 \6\ showed that funding increased
from $37.1 billion in 1994 to $94.3 billion in 2003. Fifty seven
percent of the funding in 2003 came from industry sources. At the same
time, relationships between individual academic researchers and
industry have also increased from 28% in a 1996 survey \7\ to 52.8% in
a survey conducted in 2007.\8\
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\6\ Moses H et al, JAMA; 2005; 294:1333-1342
\7\ Blumenthal D et al, N Engl J Med; 1996; 335:1734-9
\8\ Zinner DE et al, Health Aff; 2009; 28:1814-25.
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Researchers frequently work in multidisciplinary teams to develop
new strategies and approaches for translating basic research into
clinical application, thus hastening discovery and advancing human
health. In addition, these newer translational strategies often involve
complex collaborations between investigators and the private sector.
The growing complexity of biomedical and behavioral research; the
increased interaction among Government, research institutions, and the
private sector in attaining common public health goals while meeting
public expectations for research integrity; as well as increased public
scrutiny, all have raised questions as to whether a more rigorous
approach to Investigator disclosure, management of financial conflicts,
and Federal oversight is required. Consequently, we previously
published an Advance Notice of Proposed Rulemaking (ANPRM) in the
Federal Register on May 8, 2009 (74 FR 21610-21613), inviting public
comment on potential changes to the regulations.
The ANPRM invited comment on the following major areas of the
regulation:
1. Expanding the scope of the regulation and disclosure of
interests
2. Definition of ``significant financial interest'' (including
questions regarding the appropriate de minimis threshold and exemptions
to the definition)
3. Identification and management of conflicts by Institutions
4. Assuring institutional compliance
5. Requiring Institutions to provide additional information to the
PHS
6. Institutional conflict of interest
After careful consideration of the comments received in response to
the ANPRM and further deliberation within the Department, we are
proposing substantial revisions to the current regulations, detailed
below. The specific comments to the ANPRM are discussed in the relevant
sections describing the proposed changes to the regulations. We believe
that the proposed revisions would expand and add transparency to
investigator disclosure of SFIs as well as enhance regulatory
compliance and effective FCOI oversight.
II. Description of Proposed Revisions
The following provides a more detailed discussion of the proposed
revisions to the current regulations in the order that they would
appear in 42 CFR Part 50, Subpart F and 45 CFR Part 94.
Purpose (42 CFR 50.601; 45 CFR 94.1)
We are proposing minor revisions to the text of this section. These
revisions reflect a broader effort to improve internal consistency with
regard to the use of various terms and phrases throughout these
regulations. As a general matter, along with the more substantive
changes to the regulations discussed further below, we are seeking to
use this rulemaking proceeding as an opportunity to refine the current
text of the regulations to improve clarity and readability for users.
Applicability (42 CFR 50.602, 45 CFR 94.2)
The current regulations at 42 CFR Part 50, Subpart F, are
applicable to each Institution that applies for PHS grants or
cooperative agreements for research and, through implementation of the
regulations by each Institution, to each Investigator participating in
such research.\9\ The current PHS contracting regulations at 45 Part 94
similarly apply to each Institution that seeks PHS funding for research
and, through implementation of the regulations, to each Investigator
who participates in such research. In neither case do the regulations
currently apply to SBIR/STTR Phase I applications.
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\9\ In those few cases where an individual, rather than an
institution, is an applicant for PHS grants or cooperative
agreements for research, PHS Awarding Components will make case-by-
case determinations on the steps to be taken to ensure that the
design, conduct, and reporting of the research will not be biased by
any conflicting financial interest of the individual.
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When the existing regulations were published as a final rule in
1995, it was acknowledged in the preamble that SBIR/STTR Phase I
applications ``are for limited amounts.'' \10\ Since that time, the
size of these awards has increased and the amounts are not
insignificant expenditures of public funds. For example, the median
amount of an NIH Phase I award increased from approximately $99,000 in
1995 to approximately $182,000 in 2009. In addition, Phase I awards are
often used to leverage Phase II funding or significant outside
financial support, and a significant proportion of Institutions
receiving Phase I funding from NIH, in particular, already have Phase
II awards (approximately 200 Institutions in 2008 and 2009). As a
result, it would be reasonable to conclude that many Institutions with
Phase I awards will be required to implement these regulations in due
course.
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\10\ 60 FR 35810, 35814 (July 11, 1995)
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In light of these factors, we asked in the ANPRM whether the scope
of the regulations should be expanded to cover SBIR/STTR Phase I
applications. Many of the respondents to the ANPRM indicated that any
and all applications and proposals for PHS funding should be subject to
the regulations, including SBIR/STTR Phase I applications. For the
reasons stated above and the sentiment expressed in public comments on
the ANPRM, we are proposing to broaden the applicability of the
regulations by eliminating the current exception for SBIR/STTR Phase I
applications.
We also propose to add language in this section clarifying that the
regulations continue to apply once the PHS-funded research is underway
(i.e., after the application process). Finally, we are proposing to
make minor revisions to the text of this section as part of a broader
effort to improve internal consistency in the use of various terms and
phrases throughout the regulations and, where feasible, consistency
between the text of 42 CFR Part 50, Subpart F, and 45 CFR Part 94.
Definitions (42 CFR 50.603, 45 CFR 94.3)
We propose to add several new definitions in this section of the
regulations, revise some of the existing
[[Page 28690]]
definitions, and remove one definition, as follows:
1. Contractor. We propose a minor revision to the current
definition of ``Contractor'' in 45 CFR 94.3 that would clarify that the
term applies to an entity that provides property or services ``under
contract'' for the direct benefit or use of the Federal Government.
2. Disclosure of significant financial interests. This definition
would be new and would mean an Investigator's disclosure of significant
financial interests to an Institution. We propose to include this
definition--along with the definition of ``FCOI report'' below--because
of the confusion that can result from the seemingly interchangeable use
of the terms ``disclosure'' and ``report'' with regard to
communications from an Investigator to an Institution and,
correspondingly, from an Institution to the PHS. We propose to use the
phrase ``disclosure of significant financial interests'' to describe
the communication that occurs between an Investigator and the
Institution requesting SFI information from the Investigator as part of
its compliance with these regulations. We intend for the term ``FCOI
report'' to describe communications from an Institution to the PHS
regarding FCOI.
3. FCOI report. This definition would be new and would mean an
Institution's report of a financial conflict of interest to a PHS
Awarding Component. We propose to add this new definition for the
reasons described above regarding the ``disclosure of significant
financial interests'' definition.
4. Financial conflict of interest. This definition would be new and
would mean a significant financial interest that could directly and
significantly affect the design, conduct, or reporting of PHS-funded
research. Although this definition would be ``new'' in the sense that
it is not listed in the current definitions sections (42 CFR 50.603 and
45 CFR 94.3), the definition is consistent with language contained
elsewhere in the current regulations. Specifically, subsection (a)(1)
of the current 42 CFR 50.605 and 45 CFR 94.5 provides that a ``conflict
of interest exists when the designated official(s) reasonably
determines that a Significant Financial Interest could directly and
significantly affect the design, conduct, or reporting of the PHS-
funded research.'' We propose to incorporate a modified version of this
text into a freestanding financial conflict of interest definition in
order to improve the clarity and readability of the regulations.
5. Financial interest. This definition would be new and would mean
anything of monetary value or potential monetary value. We propose
adding this new definition as a companion to our proposed revision of
the ``significant financial interest'' definition, described below. In
the current regulations, the ``significant financial interest''
definition incorporates the phrase, ``anything of monetary value.'' In
the new definition of ``financial interest,'' we propose adding the
phrase ``or potential monetary value'' to capture financial interests
that may not have monetary value currently, but could become valuable
in the future. This proposed definition could apply, for example, to an
ownership interest that an Investigator may hold in a small start-up
company.
6. Institution. We propose to revise the current definition of
``Institution'' in 42 CFR 50.603 to refer specifically to an
Institution that is applying for, or that receives, PHS research
funding. We propose this revision to clarify the entities and
organizations to which the requirements in 42 CFR Part 50, Subpart F
would apply. We propose corresponding changes to the current definition
of ``Institution'' in 45 CFR 94.3 to maintain consistency, where
feasible, between the text of 42 CFR Part 50, Subpart F, and 45 CFR
Part 94.
7. Institutional responsibilities. This definition would be new and
would mean an Investigator's professional responsibilities on behalf of
the Institution including, but not limited to, activities such as
research, research consultation, teaching, professional practice,
institutional committee memberships, and service on panels such as
Institutional Review Boards or Data and Safety Monitoring Boards. We
propose to add this new definition because, as described further below,
we are proposing to modify the ``significant financial interests''
definition and Investigator disclosure obligations such that the SFIs
being disclosed are those that reasonably appear to be related to the
Investigator's ``institutional responsibilities'' as defined.
Under the current regulations, an Investigator generally is
obligated to disclose SFIs on a project-specific basis (i.e., interests
that would reasonably appear to be affected by the research for which
PHS funding is sought, or in entities whose financial interests would
reasonably appear to be affected by the research). We believe that the
proposed shift to a focus on ``institutional responsibilities'' in the
regulations would provide Institutions with a better understanding of
the totality of an Investigator's interests and would result in more
consistent identification, evaluation, and management of any identified
conflicts. We also believe that the revised approach would be
consistent with the current practices at many institutions, which
require investigators to disclose interests annually and/or on an
ongoing basis, regardless of specific research projects that are
underway. We welcome public comment on the specific elements that
should (or should not) be included in an ``institutional
responsibilities'' definition.
8. Investigator. We propose to revise the definition of
``Investigator'' to clarify that it means the PD/PI as well as any
other person, regardless of title or position, who is responsible for
the design, conduct, or reporting of research funded by the PHS, or
proposed for such funding, including persons who are subgrantees,
contractors, collaborators, or consultants (or, in the case of PHS
contracts, subcontractors, collaborators, or consultants). We propose
these revisions based on our observations regarding the current
regulations and the proper application of the ``investigator''
definition. Although we have developed regulatory guidance on this
issue with regard to grants and cooperative agreements (see NIH
``Frequently Asked Question'' A.7 at http://grants.nih.gov/grants/policy/coifaq.htm), we believe that further clarification in the
regulations themselves is warranted.
We have also revised this definition to eliminate reference to the
Investigator's spouse and dependent children. As described further
below, we propose to include reference to an Investigator's spouse and
dependent children in the revised ``significant financial interest''
definition.
9. Manage. This definition would be new and would mean to take
action to address a financial conflict of interest, which includes
reducing or eliminating the financial conflict of interest, to ensure
that the design, conduct, or reporting of research is free from bias or
the appearance of bias. We propose adding this definition as part of a
wider reconsideration of the concepts of managing, reducing, and
eliminating a FCOI. In the current regulations, these concepts are
typically listed separately (see, e.g., 42 CFR 50.604(g), 45 CFR
94.4(g)), suggesting that reducing or eliminating a FCOI may not be the
same as managing a FCOI. We believe that it would be more appropriate
to consider the reduction or elimination of a FCOI as alternate means
of managing a FCOI, depending on the circumstances. Thus, in a
hypothetical example where an Institution has concluded that an
Investigator's ownership interest in a company is a FCOI, the
Institution
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could manage the FCOI by requiring the Investigator to reduce his or
her ownership interest by some appropriate amount, or to sell the
ownership interest in its entirety.
10. PD/PI. This definition would be new and would mean a project
director or principal investigator of a PHS-funded research project. We
propose to use ``PD/PI'' in the regulation in circumstances in which we
may have traditionally used the term ``principal investigator'' (e.g.,
in the proposed ``investigator'' definition, as revised).
11. PHS. We propose to revise the definition of ``PHS'' to include
a specific reference to the National Institutes of Health. NIH is part
of the Public Health Service and provides a substantial amount of
research funding to Institutions, however, it is not otherwise
referenced specifically in these regulations. We want to clarify for
Institutions applying for, or receiving, research funding from the NIH
that they are subject to these PHS regulations.
12. Research. We propose to revise the definition of ``research''
to include a non-exclusive list of examples of different types of PHS
funding mechanisms to which the definition applies. As revised, the
definition would include any activity for which research funding is
available from a PHS Awarding Component through a grant, cooperative
agreement, or contract whether authorized under the PHS Act or other
statutory authority, such as a research grant, career development
award, center grant, individual fellowship award, infrastructure award,
institutional training grant, program project, or research resources
award.
13. Significant Financial Interest. We propose to revise
substantially the definition of ``significant financial interest''
(SFI). Under the current regulations, a SFI means anything of monetary
value, including but not limited to, salary or other payments for
services (e.g., consulting fees or honoraria); equity interests (e.g.,
stocks, stock options or other ownership interests); and intellectual
property rights (e.g., patents, copyrights and royalties from such
rights). The term does not include: (1) Salary, royalties, or other
remuneration from the applicant institution; (2) any ownership
interests in the institution, if the institution is an applicant under
the SBIR or STTR programs; (3) income from seminars, lectures, or
teaching engagements sponsored by public or nonprofit entities; (4)
income from service on advisory committees or review panels for public
or nonprofit entities; (5) an equity interest that when aggregated for
the Investigator and the Investigator's spouse and dependent children
meets both of the following tests: does not exceed $10,000 in value as
determined through reference to public prices or other reasonable
measures of fair market value, and does not represent more than a five
percent ownership interest in any single entity; or (6) salary,
royalties, or other payments that when aggregated for the investigator
and the investigator's spouse and dependent children over the next
twelve months, are not expected (or, in the case of PHS contracts, are
not reasonably expected) to exceed $10,000.
We propose to revise the definition of ``significant financial
interest'' as follows, incorporating the proposed definitions of
``financial interest'' and ``institutional responsibilities'' described
above:
``Significant financial interest means, except as otherwise
specified in this definition: ``(1) A financial interest consisting of
one or more of the following interests of the Investigator (and those
of the Investigator's spouse and dependent children) that reasonably
appears to be related to the Investigator's institutional
responsibilities:
``(i) With regard to any publicly traded entity, a significant
financial interest exists if the value of any remuneration received
from the entity in the twelve months preceding the disclosure and the
value of any equity interest in the entity as of the date of
disclosure, when aggregated, exceeds $5,000. For purposes of this
definition, remuneration includes salary and any payment for services
not otherwise identified as salary (e.g., consulting fees, honoraria,
paid authorship, travel reimbursement); equity interest includes any
stock, stock option, or other ownership interest, as determined through
reference to public prices or other reasonable measures of fair market
value;
``(ii) With regard to any non-publicly traded entity, a significant
financial interest exists if the value of any remuneration received
from the entity in the twelve months preceding the disclosure, when
aggregated, exceeds $5,000, or the Investigator (or the Investigator's
spouse or dependent children) holds any equity interest (e.g., stock,
stock option, or other ownership interest); or
``(iii) Intellectual property rights (e.g., patents, copyrights),
royalties from such rights, and agreements to share in royalties
related to such rights.
``(2) The term significant financial interest does not include the
following types of financial interests: salary, royalties, or other
remuneration paid by the Institution to the Investigator if the
Investigator is currently employed or otherwise appointed by the
Institution; any ownership interest in the Institution held by the
Investigator, if the Institution is a commercial or for-profit
organization; income from seminars, lectures, or teaching engagements
sponsored by a federal, state, or local government agency, or an
institution of higher education as defined at 20 U.S.C. 1001(a); or
income from service on advisory committees or review panels for a
federal, state, or local government agency, or an institution of higher
education as defined at 20 U.S.C. 1001(a).''
This revised SFI definition would differ from the current SFI
definition in a number of respects.
Institutional responsibilities: As indicated in the discussion of
the ``institutional responsibilities'' definition above, SFIs subject
to disclosure by an Investigator to an Institution would be those that
reasonably appear to be related to the Investigator's ``institutional
responsibilities'' and would not be specific to a particular PHS-funded
research project. As a result, when read in conjunction with the
revised Investigator disclosure requirements under 42 CFR 50.604 and 45
CFR 94.4 (discussed below), we anticipate that the revised SFI
definition would result in the disclosure by Investigators to
Institutions of a wider array of interests on a more frequent basis.
This proposed approach is consistent with many of the comments we
received in response to the ANPRM, which supported expansion of the
SFIs that should be disclosed by Investigators to Institutions.
Monetary threshold: The revised SFI definition also would lower--
and, in some circumstances, eliminate--the existing monetary thresholds
for disclosure. Under the current regulations, a SFI does not include
an equity interest that when aggregated for the investigator and the
investigator's spouse and dependent children, meets both of the
following tests: Does not exceed $10,000 in value, and does not
represent more than a five percent ownership interest in any single
entity. Similarly, a SFI does not include payments (e.g., salary) that
when aggregated for the Investigator and the Investigator's spouse and
dependent children over the next twelve months are not expected to
exceed $10,000. The revised definition would differentiate between
remuneration to the Investigator (and the Investigator's spouse and
dependent children) from a publicly traded entity and remuneration from
a non-publicly traded entity. With regard to a publicly traded entity,
a
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monetary threshold of $5,000 would apply to the aggregated value of any
remuneration received from the entity in the twelve months preceding
disclosure and the value of any equity interest as of the date of
disclosure. With regard to a non-publicly traded entity, a monetary
threshold of $5,000 would apply to any remuneration received from the
entity in the twelve months preceding disclosure; in addition, however,
a SFI would exist with regard to any equity interest in the entity,
regardless of value.
In a hypothetical example, the proposed changes to the monetary
threshold would operate as follows. Assume an Institution has required
an Investigator, who conducts biomedical research at the Institution,
to complete a form disclosing her SFIs. Among the Investigator's
financial interests are the following: $3,000 in consulting fees that
she has received in the past twelve months from Pharmaceutical Company
A; stock in Pharmaceutical Company A held by her husband worth $2,500
as of the date of disclosure; and stock options she holds in Start-Up
Company B, a private biotechnology firm whose only products are in the
early research and development stage. Assuming that these financial
interests reasonably appear to be related to the Investigator's
institutional responsibilities, the Investigator would be required to
disclose them as SFIs. A SFI in Pharmaceutical Company A would exist
because the aggregated value of her remuneration for the past twelve
months and her husband's equity interest in the company exceeds $5,000
($3,000 + $2,500 = $5,500). A SFI in Start-up Company B would exist
because the Investigator would have an obligation to disclose any
ownership interest in a non-publicly traded entity, even if the
interest has only potential monetary value as of the time of
disclosure.
We recognize that lowering the monetary threshold, as proposed, is
not without cost. In particular, while we believe that certain elements
of the revised ``significant financial interest'' definition would make
the disclosure and review obligations of Investigators and Institutions
more efficient, we recognize that incorporating a lower monetary
threshold is likely to lead to increased administrative burden on
Investigators and Institutions because more financial interests are
likely to be subject to disclosure and review. For this reason, we
considered a variety of alternatives for the proposed regulations
including a threshold that would be approximate to the current standard
(i.e., $10,000), a significantly lower threshold for all types of
financial interests (e.g., $100), as well the current proposal.
We declined to propose a threshold equivalent to the current
standard because we do not believe that this approach would be
consistent with our statutory mandate to revise the regulations for the
purpose of ``strengthening Federal and institutional oversight and
identifying enhancements, including requirements for financial
disclosure to institutions * * *.'' Public Law 111-117, Div. D, Tit.
II, sec. 219, 123 Stat. 3034 (2009). In addition, when we raised this
question in the ANPRM, a majority of respondents who addressed this
question favored lowering the monetary disclosure threshold. These
responses were consistent with our own sense that Institutions would
welcome greater transparency regarding Investigator financial interests
because additional information would help them to better manage
identified FCOI. Thus, for example, even if an Investigator's disclosed
SFIs falling below the current monetary threshold would not themselves
result in new FCOI determinations, the information could provide
context for the Institution's management of higher value SFIs that the
Institution determines are FCOI.
Given the arguments in favor of lowering the monetary threshold, we
analyzed whether a significantly lower threshold (e.g., $100) would be
appropriate for all types of financial interests. Although there has
been limited study on the effect of the exact monetary value of an
Investigator's financial interests on the integrity of his or her
research, the authors of at least one journal article note, ``a large
body of evidence from the social sciences shows that behavior can be
influenced by gifts of negligible value.'' \11\ In addition, recent
legislative initiatives have incorporated low monetary thresholds in
comparable circumstances. For example, the disclosure provisions that
apply to applicable manufacturers of drugs and other covered items with
regard to transfers of value to physicians and teaching hospitals under
title VI, section 6002, of the recently enacted Patient Protection and
Affordable Care Act, Public Law 111-148, generally apply to transfers
of value of $10 or more.
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\11\ Dana Katz, Arthur L. Caplan, and Jon F. Merz, ``All Gifts
Large and Small,'' Am. J. of Bioethics, summer 2003, vol. 3, no. 3,
at 39, 39.
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Notwithstanding these arguments for a significantly lower monetary
threshold, we are concerned that the administrative costs associated
with disclosure and review of all but negligible financial interests
would outweigh the intended benefit of these regulations in promoting
objectivity in research. For example, given the existing (and proposed)
obligation on Investigators to update SFI disclosures during the period
of award, we believe it would be a challenge for Investigators and
Institutions alike to comply with this provision every time a new, all-
but-negligible financial interest was obtained by the Investigator.
We welcome comment on all aspects of the proposed ``significant
financial interest'' definition, including comments regarding the
appropriate balance between the costs that may be associated with
expanding the number of financial interests subject to disclosure as a
result of a lower monetary threshold versus the potential benefits that
might be expected to result from the lower threshold.
Timing: As indicated in the example above, the revised SFI
definition would also change the timing for determining whether
remuneration represents a SFI. The current regulations exclude
aggregated payments (including salary and royalties) that are ``not
expected to exceed'' (or, in the case of PHS contracts, are ``not
reasonably expected to exceed'') the monetary threshold ``over the next
twelve months.'' Under the revised definition, at issue is remuneration
(including salary and any payment for services not otherwise identified
as salary) received from an entity ``in the twelve months preceding the
disclosure.'' We believe this change would help Institutions and
Investigators to determine more accurately whether or not a financial
interest represents a SFI because the payments have already occurred
and are likely to have been documented. Moreover, to the extent an
Investigator receives additional remuneration from an entity after
completing an initial SFI disclosure, such remuneration would be
subject to the Investigator's ongoing disclosure obligations assuming
the relevant monetary threshold were exceeded. This issue is addressed
further in the discussion of 42 CFR 50.604, 45 CFR 94.4 below.
Examples of payment for services: The current definition references
as examples of payments for services, receipt of consulting fees, or
honoraria. We propose to add ``paid authorship'' and ``travel
reimbursement'' as additional examples in the revised definition. With
regard to ``paid authorship,'' in particular, although there should be
little question that receipt of payment from an entity in exchange for
the drafting of a
[[Page 28693]]
publication constitutes payment for services, we believe it is
important to reference this form of payment specifically in the
regulations. This practice has come under increasing scrutiny in recent
years and we wish to make it clear to Institutions and Investigators
that such activity may be subject to the disclosure and reporting
requirements depending on the circumstances of a given case, such as
the amount of payment.
Royalties & Intellectual Property: Under the existing regulation,
royalties are included among the ``payments'' subject to the $10,000
threshold. Under the proposed regulations, the $5,000 threshold would
apply to equity interests and ``payment for services,'' which would
include salary but not royalties. Royalties nevertheless would be
potentially subject to disclosure, as would other interests related to
intellectual property. Specifically, the revised definition would
potentially apply to any of the following: Intellectual property rights
(e.g., patents, copyrights), royalties from such rights, and agreements
to share in royalties related to intellectual property rights. As
discussed further below, however, royalties received by the
Investigator from the Institution would still be excluded from the SFI
definition if the Investigator is currently employed or otherwise
appointed by the Institution.
Exclusions: We propose to modify the types of interests that are
specifically excluded from the SFI definition. For example, the revised
definition would only exclude income from seminars, lectures, teaching
engagements, if sponsored by a federal, state, or local government
agency, or an institution of higher education as defined at 20 U.S.C.
1001(a). Similarly, income from service on advisory committees or
review panels would only be excluded if from a federal, state, or local
government agency, or an institution of higher education as defined at
20 U.S.C. 1001(a). Thus, income from non-profit entities other than
institutions of higher education for the types of activities described
above would be subject to the SFI definition. We are proposing this
change due to the growth of non-profit entities that sponsor such
activities since the current regulations were promulgated in 1995. Some
of these non-profit entities receive funding from for-profit entities
that may have an interest in the outcome of the Investigators' research
(e.g., foundations supported by pharmaceutical companies or other
industrial sectors). As a result, we believe it would promote
objectivity in biomedical and behavioral research if income in excess
of the relevant monetary threshold received from such non-profit
entities for teaching and advisory committee-related activities were
included within the SFI definition and disclosed by Investigators to
Institutions for their review. Under the current 1995 exclusions to the
SFI definition, income from such entities for the above-described
activities would not be disclosed.
In developing the proposed exclusions to the SFI definition, we
considered various alternatives, including whether the exclusions
described above should be limited solely to income from federal, state,
or local government agencies (i.e., income from institutions of higher
education for such activities would be covered by the SFI definition).
However, given that many academic Investigators engage in seminars,
lectures, teaching engagements, as well as service on advisory
committees or review panels at academic Institutions other than those
at which they are employed, we concluded that the burden of requiring
disclosure of the income from these activities outweighed the potential
benefit to be gained from such disclosures.
With regard to the current exclusion for any ownership interests in
the institution if the institution is an applicant under the SBIR or
STTR programs, we propose to broaden this exclusion to include any
ownership interest in the Institution held by the Investigator if the
Institution is a commercial or for-profit organization (whether or not
an SBIR/STTR applicant). This proposed change is based primarily on the
recognition that ownership in one's own company not only is generally
an inherent and understood financial interest, but also is an interest
that the Institution is already in a position to know without having to
request an Investigator to include it in a disclosure of SFIs.
For similar reasons, we do not propose to make substantive changes
to the current exclusion for salary, royalties, or other remuneration
paid by the Institution to the Investigator, other than to limit the
exception to circumstances in which the Investigator is currently
employed or otherwise appointed by the Institution. With regard to
current employees and appointees, we believe not only that these
financial interests are inherent and understood, but also that an
Institution is in a position to know this information without having to
request Investigators to include it in a disclosure of SFIs. However,
other Investigators (e.g., subrecipient Investigators) may be involved
with a PHS-funded research project who were previously affiliated with
an Institution (e.g., former employees) but who still receive
remuneration from the Institution (e.g., royalty payments). Although an
Institution presumably maintains information regarding payments to all
third parties, it may not be obvious to institutional officials
reviewing a SFI disclosure from a subrecipient Investigator under these
circumstances that recent payments have been made to the subrecipient
Investigator. By limiting the exclusion to Investigators who are
currently employed or otherwise appointed by the Institution, as
proposed, an Institution could avoid having to investigate, as a matter
of course, possible Institution payments to every subrecipient
Investigator participating in a PHS-funded research project.
We welcome comment on the proposed exclusions to the SFI
definition, including, for example, whether the proposed exclusion for
income from teaching and advisory committee-related activities should
be expanded to apply to all public or non-profit entities (similar to
the current regulations) or to specific categories of public or non-
profit entities, or further narrowed to apply solely to federal, state,
or local government agencies. We are particularly interested in
comments about the balance between the cumulative burden of the
inclusion of non-profits (or certain categories of non-profits) in
conjunction with defining SFIs to include institutional
responsibilities and the potential benefit to be gained from such
disclosures.
14. Small Business Innovation Research (SBIR) Program. We propose
to remove the current definition for the SBIR Program. In light of the
proposed removal of reference to the SBIR program from the
``Applicability'' section and the ``significant financial interests''
definition, discussed above, the SBIR definition would no longer be
necessary in the revised regulations, as proposed.
Responsibilities of Institutions Regarding Investigator Financial
Conflicts of Interest (42 CFR 50.604, 45 CFR 94.4)
We propose to revise substantially the regulation addressing the
responsibilities of Institutions regarding Investigator FCOI.
Subsection (a) of the current regulation provides, in part, that
each Institution must maintain an appropriate written, enforced policy
on conflict of interest that complies with the regulations. We propose
to revise this provision to require an Institution
[[Page 28694]]
not only to maintain an up-to-date, written, enforced policy on FCOI
that complies with the regulations, but also to make such policy
available via a publicly accessible Web site. We believe these
revisions would foster greater transparency and accountability with
regard to institutional policies. The revised provision would also
clarify that if an Institution's policy on FCOI includes standards that
are more stringent than the regulations, the Institution shall adhere
to its policy and shall provide FCOI reports regarding identified FCOI
to the PHS Awarding Component in accordance with the Institution's own
standards. Although we have developed regulatory guidance on this issue
with regard to grants and cooperative agreements (see NIH ``Frequently
Asked Question'' B.4 at http://grants.nih.gov/grants/policy/coifaq.htm), we believe that further clarification in the regulation
itself is warranted.
The current subsection (a) also requires, in part, that each
Institution must inform each Investigator of its policy on conflict of
interest, the Investigator's disclosure responsibilities, and of these
regulations. We propose to address this requirement as a new subsection
(b), and to add to this new subsection an Investigator training
requirement. Specifically, we propose that Institutions shall require
Investigators to complete training regarding the Institution's FCOI
policy, the Investigator's responsibilities regarding disclosure of
FCOI, and the regulations, prior to engaging in PHS-funded research
and, thereafter, at least once every two years. This proposal is
consistent with the comments of a majority of the respondents to the
ANPRM, who supported adding an Investigator FCOI training requirement.
The current subsection (a) also states that if the Institution
carries out the PHS-funded research through subgrantees, contractors,
or collaborators (or, in the case of PHS contracts, subcontractors or
collaborators), the Institution must take reasonable steps to ensure
that Investigators working for such entities comply with the
regulations, either by requiring those Investigators to comply with the
Institution's policy or by requiring the entities to provide assurances
to the Institution that will enable the Institution to comply with the
regulations. We propose to create a new subsection (c) that would
provide a substantially expanded clarification of an Institution's
obligations with regard to PHS-funded research carried out through a
subrecipient (e.g., subgrantee, contractor, or collaborator or, in the
case of a PHS contract, a subcontractor or collaborator). In the ANPRM,
we included a question that asked whether specific requirements related
to FCOI identification, management, and reporting should be established
for subrecipients. This question was based, at least in part, on the
concern that awardee and subrecipient Institutions may not fully
recognize their responsibilities related to the regulations. Many ANPRM
respondents stated that they comply with the current version of
subsection (a) by requiring a subrecipient to certify to the awardee
Institution that its FCOI policy complies with the applicable Federal
regulations and, in those cases when a subrecipient cannot provide a
certification, requiring the subrecipient to comply with the awardee
Institution's policy. We believe that this type of approach provides a
useful means of reinforcing compliance with the regulations.
Therefore, we propose to include as part of the new subsection (c)
the following requirements: An Institution that carries out the PHS-
funded research through a subrecipient must incorporate as part of a
written agreement with the subrecipient legally enforceable terms that
establish whether the FCOI policy of the awardee Institution or that of
the subrecipient applies to the subrecipient's Investigators. If the
subrecipient's FCOI policy applies to subrecipient Investigators, the
subrecipient shall certify as part of the agreement that its policy
complies with the regulations. If the subrecipient cannot provide such
certification, the agreement shall state that subrecipient
Investigators are subject to the FCOI policy of the awardee
Institution. If the subrecipient's FCOI policy applies to subrecipient
Investigators, the agreement shall specify time period(s) for the
subrecipient to report all identified FCOI to the awardee Institution.
Such time period(s) shall be sufficient to enable the awardee
Institution to provide timely FCOI reports, as necessary, to the PHS.
If subrecipient Investigators are subject to the awardee Institution's
FCOI policy, the agreement shall specify time period(s) for the
subrecipient to submit all Investigator disclosures of SFIs to the
awardee Institution. Such time period(s) shall be sufficient to enable
the awardee Institution to comply timely with its review, management,
and reporting obligations under the regulations. Subsection (c) would
also require that the Institution must provide FCOI reports to the PHS
regarding all FCOI of all subrecipient Investigators consistent with
the regulations. We believe that the addition of the above text in the
new subsection (c) would help clarify for Institutions and their
subrecipients the requirements of both parties in these relationships
and promote greater compliance with the regulations.
Subsection (b) of the current regulation requires that an
Institution must designate an institutional official(s) to solicit and
review financial disclosure statements from each Investigator who is
planning to participate in PHS-funded research. In the ANPRM, we asked
whether large Institutions (defined as greater than 50 employees)
should be required to establish an independent committee to review
financial disclosures, and require that committee to report to an
organizational level within the Institution that is not conflicted by
the short-term financial interests of the Investigator or Institution.
After considering the responses, we weighed the complexity of the
issues that can arise in reviewing financial interests and evaluating
conflicts, as well as the potential practical difficulty in determining
which Institutions would fall within a ``large'' Institution definition
and which would not. As a result, we do not propose to change the
redesignated subsection (d). That being said, however, we strongly
encourage each Institution to form a committee of adequate size and
scope to review Investigator SFI disclosures and assess comprehensively
the potential conflicts that may arise in the Institution. In addition,
since reviewing Investigator financial disclosures for potential FCOI
can involve many complex issues, we recommend that Institutions consult
available resources from the Federal government (e.g., NIH materials
posted at http://grants.nih.gov/grants/policy/coi/) or other public
resources (e.g., materials prepared by academic and professional
associations or other scientific organizations).
The current subsection (c) requires that by the time an application
is submitted to the PHS, each Investigator who is planning to
participate in the PHS-funded research has submitted to the designated
official(s) a listing of his/her known SFIs (and those of his/her
spouse and dependent children): (i) That would reasonably appear to be
affected by the research for which PHS funding is sought; and (ii) in
entities whose financial interests would reasonably appear to be
affected by the research. All financial disclosures must be updated
during the period of award, either on an annual basis or as new
reportable SFIs are obtained. In the ANPRM, we asked whether this
[[Page 28695]]
requirement should be expanded to require disclosure by Investigators
of all SFIs that are related to their institutional responsibilities.
Many respondents to the ANPRM were in favor of expanding the SFIs that
should be disclosed by the Investigator. As indicated in the above
discussion of the ``significant financial interest'' definition, the
proposed revision would capture as part of the definition itself the
concept that a ``significant financial interest'' is one that
reasonably appears to be related to the Investigator's ``institutional
responsibilities.'' Accordingly, we propose to revise the current
subsection (c) language as part of a redesignated subsection (e) with
the understanding that the scope of Investigator disclosures would no
longer be project specific, but would (consistent with the revised SFI
definition) pertain to the Investigator's institutional
responsibilities. As part of the new subsection (e), we are also
proposing to revise and clarify an Investigator's annual and ongoing ad
hoc disclosure obligations.
Specifically, in addition to requiring that each Investigator who
is planning to participate in the PHS-funded research disclose to the
Institution's designated officials the Investigator's SFIs (and those
of the Investigator's spouse and dependent children), the Institution
also would have to require that each Investigator who is participating
in the PHS-funded research submit an updated SFI disclosure: (1) At
least annually during the period of the award, including disclosure of
any information that was not disclosed initially to the Institution or
in a subsequent SFI disclosure, and disclosure of updated information
regarding any previously-disclosed SFI (e.g., the updated value of a
previously-disclosed equity interest); and (2) within thirty days of
acquiring a new SFI (e.g., through purchase, marriage, or inheritance).
Although the current regulations include a requirement regarding the
updating of financial disclosures (see current subsection (c)(2)), we
believe that the revisions proposed above will provide Institutions and
Investigators with greater specificity as to the timing of disclosures
that are required after an Investigator's initial SFI disclosure to the
Institution.
The existing subsection (d) requires an Institution to provide
guidelines consistent with the regulations for the designated
official(s) to identify conflicting interests and take such actions as
necessary to ensure that such conflicting interests will be managed,
reduced, or eliminated. We propose to reorganize and expand this
requirement in a redesignated subsection (f) to clarify an
Institution's obligations. First, the guidelines to be provided by an
Institution for the designated institutional officials would be
required to address two related tasks, specifically, determination of
whether an Investigator's SFI is related to PHS-funded research and, if
so related, whether the SFI is a FCOI. Under the current regulations,
the Investigator bears the responsibility for determining the
relatedness of a SFI to the PHS-funded research as part of the
disclosure process (42 CFR 50.604(c), 45 CFR 94.4(c)). As discussed
above, however, the proposed regulations would revise the definition of
``significant financial interest'' to address ``institutional
responsibilities'' and, as a result, SFIs subject to disclosure by an
Investigator to an Institution would not be specific to a particular
PHS-funded research project. Consistent with these proposed changes,
the responsibility for determining whether an Investigator's SFI is
related to PHS-funded research would shift to the Institution. This
subsection would provide that an Investigator's SFI is related to PHS-
funded research when the Institution, through its designated officials,
reasonably determines that the SFI: (1) Appears to be affected by the
PHS-funded research; or (2) is in an entity whose financial interest
appears to be affected by the research.
To provide clarification regarding the determination of whether an
Investigator's SFI is a FCOI, the redesignated subsection (f) would
incorporate modified language moved from subsection (a)(1) of the
current 42 CFR 50.605 and 45 CFR 94.5. Specifically, this subsection
would provide that a FCOI exists when the Institution, through its
designated officials, reasonably determines that the SFI could directly
and significantly affect the design, conduct, or reporting of the PHS-
funded research. As discussed above, the proposed regulations would
also incorporate a definition of ``financial conflict of interest''
that is similarly based on this language.
With regard to the current requirement in subsection (d) regarding
FCOI management responsibilities, we propose to include this
requirement in a separate subsection (g) and clarify that the
requirement includes management of any financial conflicts of a
subrecipient Investigator pursuant to the new subsection (c), described
above. We also propose to cross-reference the Institution's revised
management responsibilities that we propose in 42 CFR 50.605(a), 45 CFR
94.5(a), including development and implementation of a management plan
and, if necessary, a mitigation plan. Additional discussion of these
proposed revisions is addressed below. As a related matter, we propose
to include a new subsection (h) that cross-references the Institution's
revised and expanded reporting requirements in the proposed new
subsection 42 CFR 50.605(b), 45 CFR 94.5(b).
Subsection (e) of 42 CFR 50.604 currently requires an Institution
to maintain records of all financial disclosures and all actions taken
by the Institution with respect to each conflicting interest for at
least three years from the date of submission of the final expenditures
report or, where applicable, from other dates specified in 45 CFR
74.53(b) for different situations. Correspondingly, subsection (e) of
45 CFR 94.4 currently requires an Institution to maintain records of
all financial disclosures and all actions taken by the Institution with
respect to each conflicting interest for three years after final
payment or, where applicable, for the other time periods specified in
48 CFR part 4, subpart 4.7. We propose to revise this requirement in a
redesignated subsection (i) of both 42 CFR 50.604 and 45 CFR 94.4 to
include a responsibility to maintain records relating to all
Investigator disclosures of financial interests and the Institution's
review of, or response to, such disclosures (whether or not a
disclosure resulted in the Institution's determination of a FCOI). We
believe that this proposed revision would help clarify for Institutions
our intent for the record retention obligation to apply not only in
cases in which the Institution has identified a FCOI, but to all
Investigator SFI disclosures whether or not such disclosure generated a
response by the Institution.
The existing regulations require at subsection (f) that
Institutions establish adequate enforcement mechanisms and provide for
sanctions where appropriate. We propose to revise this obligation in a
redesignated subsection (j) to require an Institution to establish not
only adequate enforcement mechanisms and provide for employee
sanctions, but also to provide for other administrative actions to
ensure Investigator compliance as appropriate.
We propose to revise and, in some respects, shorten the
certification requirement currently set forth in subsection (g). In a
redesignated subsection (k), the revised requirement would require an
Institution to certify that the Institution (1) has in effect at that
Institution an up-to-date, written,
[[Page 28696]]
and enforced administrative process to identify and manage FCOI with
respect to all research projects for which funding is sought or
received from the PHS; (2) shall promote and enforce Investigator
compliance with the regulations' requirements including those
pertaining to disclosure of SFIs; (3) shall manage FCOI and provide
initial and ongoing FCOI reports to the PHS consistent with the
regulations; (4) agrees to make information available, promptly upon
request, to the HHS relating to any Investigator disclosure of
financial interests and the Institution's review of, or response to,
such disclosure, whether or not the disclosure resulted in the
Institution's determination of a FCOI; and (5) shall fully comply with
the requirements of the regulations. Notably, this revised subsection
would eliminate much of the current certification language regarding an
Institution's reporting obligations. In the existing regulations, the
certification requirement in subsection (g) essentially provides the
primary source of an Institution's reporting responsibilities regarding
FCOI. As described further below, we propose a substantial revision and
expansion of the reporting requirements and, thus, propose to move the
discussion of such requirements to a newly revised subsection 42 CFR
50.605(b), 45 CFR 94.5(b).
Management and Reporting of Financial Conflicts of Interest (42 CFR
50.605, 45 CFR 94.5)
We propose to revise and expand substantially the current
regulation regarding management of FCOI to address requirements for
both management and reporting of FCOI.
The existing regulations require, at subsection (a), that an
Institution's designated official(s) review all financial disclosures
and determine whether a conflict of interest exists. If so, the
official(s) must determine what actions should be taken by the
institution to manage, reduce or eliminate such conflict of interest.
Under the existing regulation, a conflict of interest exists when the
designated official(s) reasonably determines that a SFI could directly
and significantly affect the design, conduct, or reporting of the PHS-
funded research. Subsection (a) also provides examples of conditions or
restrictions that might be imposed to manage conflicts of interest,
specifically, public disclosure of SFIs, monitoring of research by
independent reviewers, modification of the research plan,
disqualification from participation in all or a portion of the research
funded by the PHS, divestiture of SFIs, or severance of relationships
that create actual or potential conflicts.
We propose to revise the above language as part of a redesignated
subsection (a)(1) to require that, prior to the Institution's
expenditure of any funds under a PHS-funded research project, the
designated officials of an Institution shall, consistent with
subsection (f) of the preceding section (42 CFR 50.604 or 45 CFR 94.4):
Review all Investigator disclosures of SFIs; determine whether any SFIs
relate to PHS-funded research; determine whether a FCOI exists; and, if
so, develop and implement a management plan that shall specify the
actions that have been, and shall be, taken to manage such FCOI. The
most significant change in the above proposed text is the introduction
of a management plan requirement. Although the existing regulations
require Institutions to manage FCOI, the term ``management plan'' is
not used. While many Institutions currently may develop and implement
management plans as a means of fulfilling their FCOI management
responsibilities, we believe that explicitly incorporating this
requirement into the regulations would further help to prevent the
introduction of bias into PHS-funded research across the research
community. We have not proposed to specify comprehensively in this
subsection what elements must be included in a management plan,
however, as indicated in the discussion of subsection (b) below, the
expanded reporting requirements that we propose would include an
obligation to report a description of certain ``key elements'' of the
Institution's management plan in certain FCOI reports. Another change
in this subsection would be the deletion of the current sentence that
describes when a financial conflict of interest exists. As discussed
above, a modified version of this sentence would be moved to the
redesignated subsection (f) of 42 CFR 50.604 and 45 CFR 94.4, as well
as incorporated into a definition of ``financial conflict of interest''
in 42 CFR 50.603 and 45 CFR 94.3.
The revised subsection (a)(1) would also include the following
updated and expanded list of examples of conditions or restrictions
that might be imposed to manage a FCOI: Public disclosure of FCOI
(e.g., when presenting or publishing the research); for research
projects involving human subjects research, disclosure of FCOI directly
to participants; appointment of an independent monitor capable of
taking measures to protect the design, conduct, and reporting of the
research against bias, or the appearance of bias, resulting from the
FCOI; modification of the research plan; change of personnel or
personnel responsibilities, or disqualification of personnel from
participation in all or a portion of the research; reduction or
elimination of a financial interest (e.g., sale of an equity interest);
or severance of relationships that create actual or potential financial
conflicts. Among the differences from the current text would be the
addition of a specific example in the human subjects research context.
The ANPRM posed a number of questions related to the issue of whether
the regulations should be amended to require specific approaches to
management of FCOI related to certain types of research or
alternatively, specific types of financial interests or FCOI. After
considering the comments, we agree with the majority of the respondents
that this approach would not account for the full range of research
projects as well as the large contextual variation in circumstances in
which FCOI may arise. As a result, the proposed revised regulations
would impose uniform FCOI management responsibilities, regardless of
the type of research, financial interest, or identified FCOI at issue.
In addition to revising the current regulation as described above,
we also propose to introduce two new subsections that clarify an
Institution's obligations in situations in which an Institution becomes
aware of a SFI after the PHS-funded research is already underway.
Specifically, new subsection (a)(2) would require that whenever, in the
course of an ongoing PHS-funded research project, a new Investigator
participating in the research project discloses a SFI or an existing
Investigator discloses a new SFI to the Institution, the designated
officials of the Institution shall, within sixty days: Review the SFI
disclosure; determine whether it is related to PHS-funded research;
determine whether a FCOI exists; and, if so, implement, on at least an
interim basis, a management plan that shall specify the actions that
have been, and will be, taken to manage the FCOI. This subsection would
additionally provide that, depending on the nature of the SFI, an
Institution may determine that additional interim measures are
necessary with regard to the Investigator's participation in the PHS-
funded research project between the date of disclosure and the
completion of the Institution's review.
A new subsection (a)(3) would provide that whenever an Institution
identifies a SFI that was not disclosed timely by an Investigator or,
for whatever reason, was not previously reviewed by the Institution
during an ongoing PHS-funded research project
[[Page 28697]]
(e.g., was not timely reviewed or reported by a subrecipient), the
designated officials shall, within sixty days: Review the SFI;
determine whether it is related to PHS-funded research; determine
whether a FCOI exists; and, if so: (A) Implement, on at least an
interim basis, a management plan that shall specify the actions that
have been, and will be, taken to manage such FCOI going forward; and
(B) implement, on at least an interim basis, a mitigation plan which
shall include review and determination as to whether any PHS-funded
research, or portion thereof, conducted prior to the identification and
management of the FCOI was biased in the design, conduct, or reporting
of such research. This subsection would additionally provide that,
depending on the nature of the SFI, an Institution may determine that
additional interim measures are necessary with regard to the
Investigator's participation in the PHS-funded research project between
the date that the SFI is identified and the completion of the
Institution's review.
Our interest in proposing new subsections (a)(2) and (a)(3) is
based, at least in part, on our experience working with awardee
Institutions and our general impression that some Institutions may be
more diligent about addressing potential FCOI at the onset of a PHS-
funded research project than after the work is already underway. We
also believe it is important to address in the regulations
circumstances in which an Institution, for whatever reason, has not
timely reviewed a SFI, particularly when such SFI is later determined
to be a FCOI. In such circumstances, it is of course important for an
Institution to manage the FCOI going forward, however, there is also a
critical need to review and determine whether any bias was introduced
into the research during the period of time prior to review and
management of the FCOI. We have proposed to address this need in
subsection (a)(3) by introduction of a ``mitigation plan'' requirement.
We have not proposed the specific elements of a mitigation plan because
we believe different circumstances may necessitate different measures.
In some instances, for example, it may be sufficient to review a matter
internally within a given research department, while in other instances
it may be appropriate to have individuals outside the department or
outside the Institution review and determine whether the design,
conduct, or reporting of the research in question was biased by a
belatedly-identified or belatedly-reviewed FCOI.
New subsection (a)(4) would require that whenever an Institution
implements a management plan pursuant to the regulations, the
Institution must monitor Investigator compliance with the management
plan on an ongoing basis until the completion of the PHS-funded
research project. This subsection would dovetail with the new
subsections (a)(2) and (a)(3), described above, by ensuring that the
management actions taken by an Institution at the time a FCOI is
identified continue to be followed by the Investigator(s) involved
going forward through the duration of the project.
We propose to introduce at subsection (a)(5) an important and
significant new requirement to help the biomedical and behavioral
research community monitor the integrity and credibility of PHS-funded
research and underscore our commitment to fostering transparency,
accountability, and public trust. Specifically, we are proposing to
amend the regulations to require that, prior to the Institution's
expenditure of any funds under a PHS-funded research project, the
Institution shall make available via a publicly accessible Web site
information concerning any SFI that meets the following three criteria:
(A) The SFI was disclosed and is still held by the PD/PI or any other
Investigator who has been identified by the Institution as senior/key
personnel for the PHS-funded research project in the grant application,
contract proposal, contract, progress report, or other required report
submitted to the PHS; (B) the Institution determines that the SFI is
related to the PHS-funded research; and (C) the Institution determines
that the SFI is a FCOI.
As part of this new subsection, we would require that the
information posted include, at a minimum, the following: The
Investigator's name; the Investigator's position with respect to the
research project; the nature of the SFI; and the approximate dollar
value of the SFI (dollar ranges would be permissible; less than
$20,000; less than $50,000; less than $100,000; less than or equal to
$250,000; greater than $250,000), or a statement that the interest is
one whose value cannot be readily determined through reference to
public prices or other reasonable measures of fair market value. We
propose to require the Institution to update the posted information at
least annually. We would also require the Institution to update the Web
site within sixty days of the Institution's receipt or identification
of information concerning any additional SFI that was not previously
disclosed by the PD/PI or senior/key personnel for the PHS-funded
research project, or upon the disclosure of a SFI by a new PD/PI or new
senior/key personnel for the PHS-funded research project, if the
Institution determines that the SFI is related to the PHS-funded
research and is a FCOI. We would also require that information
concerning the SFIs of an individual subject to this subsection (a)(5)
shall remain available via the Institution's publicly accessible Web
site for at least five years from the date that the information was
most recently updated.
We are aware that this proposed public disclosure requirement was
not discussed in the ANPRM. However, given the number and scope of
public disclosure initiatives that have emerged since the ANPRM was
developed, we believe it is appropriate to include such a provision in
this Notice of Proposed Rulemaking. For example, similar disclosure
initiatives already are underway at some Institutions and
pharmaceutical companies, and some states have implemented similar
disclosure requirements legislatively. In addition, at the federal
level, the recently enacted Patient Protection and Affordable Care Act
(Affordable Care Act), Public Law 111-148, includes several public
disclosure provisions. Of greatest relevance, title VI, section 6002,
of the Affordable Care Act generally requires designated manufacturers
of covered drugs, devices, biological or medical supplies to submit
certain information to HHS regarding certain payments made to
designated physicians and teaching hospitals annually beginning March
31, 2013, and generally requires the Secretary of HHS to make such
information publicly available through an Internet Web site annually
beginning not later than September 30, 2013. This section of the
Affordable Care Act includes similar provisions that generally apply to
information concerning ownership or investment interests held by
designated physicians in designated manufacturers and group purchasing
organizations. In addition to these institutional and legislative
initiatives, many scientific journals require authors to publicly
disclose information regarding their research-related financial
relationships, and many scientific organizations impose similar
requirements with regard to speakers at scientific meetings and
conferences.
We recognize that the proposed public disclosure requirement would
place an additional administrative burden on Institutions, and would
also impact the privacy of Investigators who have information related
to their personal financial interests posted publicly to the extent
such interests are
[[Page 28698]]
determined to be FCOI. Consequently, it is important to identify the
optimal balance between these more onerous impacts and the imperative
to preserve the integrity of the public's investment in biomedical and
behavioral research.
Therefore, we considered several alternatives to the proposed text
of subsection (a)(5), including:
1. No requirement that Institutions publicly disclose
Investigators' SFI.
2. A requirement that an Institution shall make available via a
publicly accessible Web site information concerning any SFI disclosed
to the Institution and still held by the PD/PI or any other
Investigator who has been identified by the Institution as senior/key
personnel for the PHS-funded research project in the grant application,
contract proposal, contract, progress report, or other required report
submitted to the PHS.
The first alternative--i.e., no requirement for public disclosure--
has the advantage of reducing the burden on Institutions and the
privacy impact on Investigators. However, this alternative would not
promote as much increased transparency or accountability and, given the
increasing number of other public sources of at least some of this
information, we are unconvinced that this alternative would be
sufficient to assist the PHS in strengthening oversight and ensuring
proper management of potential bias from FCOI. The second alternative--
i.e., requiring public disclosure of all SFIs held by certain
Investigators--has the advantage of providing the public with more
complete information that aligns and harmonizes with information other
sources (e.g., disclosures in journals, at meetings, and in accordance
with the Affordable Care Act). Expanding the public disclosure
requirement in this manner, however, could increase the administrative
burden on the Institutions in some respects (due to an increase in
volume of posted information) and raise privacy concerns among impacted
Investigators given the increased scope of financial interest
information, not all of which is related to PHS-funded research, that
would be made publicly available. This requirement also risks
strengthening the misperception that all SFI constitute FCOI.
The text proposed in subsection (a)(5) is an attempt to balance the
concerns presented by these and other alternatives by including a
public disclosure requirement, but limiting it to public disclosure of
SFIs determined by the Institution to be related to the PHS-funded
research and to be FCOI. We believe that including a public disclosure
requirement in these regulations would be advantageous because, among
other reasons, the information would derive directly from the
Investigator and the Institution (as opposed to a third party not
involved in the PHS-funded research) and the information can be updated
timely. In addition, confining the public disclosure requirement solely
to those SFIs determined by the Institution to be related to the PHS-
funded research and to be FCOI limits the amount of Investigator
financial information that is made publicly available. We recognize,
however, that limiting the requirement for public disclosure in this
manner does risk strengthening the misperception that any FCOI
necessarily causes bias, which should not be the case if the FCOI is
sufficiently managed by the Institution.
We welcome comment on the proposed requirement set forth in the new
subsection (a)(5) and the alternatives described above, as well as
suggestions for modifying the proposed regulation language or
suggestions for other alternative approaches.
Subsection (b) of the current regulation provides that, in addition
to the types of conflicting financial interests described in this
paragraph that must be managed, reduced, or eliminated, an Institution
may require the management of other conflicting financial interests, as
the Institution deems appropriate. We propose to maintain this
requirement using slightly modified language in a new redesignated
subsection (a)(6).
In place of the existing subsection (b), we propose to include a
substantial revision and expansion of Institutions' existing FCOI
reporting requirements. As indicated above, the certification
requirement in the existing 42 CFR 50.604(g), 45 CFR 94.4(g),
essentially provides the primary source of an Institution's FCOI
reporting responsibilities under the current regulations. The existing
provision requires--as part of the Institution's certification in each
contract proposal or application for funding to which the regulations
apply--that, prior to the Institution's expenditure of any funds under
the award, the Institution will report to the PHS Awarding Component
the existence of a conflicting interest (but not the nature of the
interest or other details) found by the Institution and assure that the
interest has been managed, reduced, or eliminated in accordance with
the regulation; and, for any interest that the Institution identifies
as conflicting subsequent to the Institution's initial report under the
award, the report will be made and the conflicting interest managed,
reduced, or eliminated, at least on an interim basis, within sixty days
of that identification.
A new subsection (b)(1), as proposed, would continue the existing
regulation's requirement with regard to the timing of initial FCOI
reports and reference the proposed management plan requirements
addressed in the above discussion of subsection (a). Specifically, an
Institution would be required, prior to the Institution's expenditure
of any funds under a PHS-funded research project, to provide to the PHS
Awarding Component a FCOI report regarding any Investigator SFI found
by the Institution to be conflicting and ensure that the Institution
has implemented a management plan in accordance with the regulations.
Similarly, a new subsection (b)(2) would continue the existing
regulation's requirement with regard to timing of follow-up FCOI
reports with examples of when such reports may be required as well as
reference to the proposed management plan and mitigation plan
requirements addressed above in the discussion of subsection (a).
Specifically, the regulation would require that for any SFI that the
Institution identifies as conflicting subsequent to the Institution's
initial FCOI report during an ongoing PHS-funded research project
(e.g., upon the participation of a new Investigator in the research
project), the Institution shall provide to the PHS Awarding Component,
within sixty days, a FCOI report regarding the FCOI and ensure that the
Institution has implemented a management plan in accordance with the
regulations. Where such FCOI report involves a SFI that was not
disclosed timely by an Investigator or, for whatever reason, was not
previously reviewed by the Institution (e.g., was not timely reviewed
or reported by a subrecipient), the Institution also would be required
to provide with its FCOI report the mitigation plan implemented by the
Institution to determine whether any PHS-funded research, or portion
thereof, conducted prior to the identification and management of the
FCOI was biased in the design, conduct, or reporting of such research.
In the ANPRM, we requested comment on whether Institutions should
be required to report additional information to the PHS Awarding
Component and if so, what kind of information would provide valuable
data to the PHS Awarding Component in evaluating these reports and the
potential risk of bias in the conduct of research. Many respondents
supported such a requirement and indicated that
[[Page 28699]]
reporting additional information would allow for enhanced oversight by
the PHS Awarding Component.
Consistent with these public comments, we are proposing a new
subsection (b)(3) that would identify the information that must be
included in the FCOI reports required under subsections (b)(1) and
(b)(2), described above. Specifically, any FCOI report required under
these subsections would be required to include sufficient information
to enable the PHS Awarding Component to understand the nature and
extent of the financial conflict, and to assess the appropriateness of
the Institution's management plan. As proposed, elements of the FCOI
report shall include, but are not limited to the following:
Project/Contract number;
PD/PI or Contact PD/PI if multiple PD/PI model is used;
Name of the Investigator with the FCOI;
Nature of the financial interest (e.g., equity, consulting
fee, travel reimbursement, honorarium);
Value of the financial interest (dollar ranges would be
permissible: $0-$4,999; $5,000-$9,999; $10,000-$19,999; amounts between
$20,000-X$100,000 by increments of $20,000; amounts above $100,000 by
increments of $50,000), or a statement that the interest is one whose
value cannot be readily determined through reference to public prices
or other reasonable measures of fair market value;
A description of how the financial interest relates to the
PHS-funded research and the basis for the Institution's determination
that the financial interest conflicts with such research;
A description of the key elements of the Institution's
management plan, including:
[cir] The role and function of the conflicted Investigator in the
research project;
[cir] The rationale for including the conflicted Investigator in
the research project;
[cir] The conditions of the management plan;
[cir] How the management plan will safeguard objectivity in the
research project;
[cir] Confirmation of the Investigator's agreement to the
management plan;
[cir] How the management plan will be monitored to ensure
Investigator compliance;
[cir] Other information as needed.
We welcome public comment on the FCOI report elements that we
propose to include in the new subsection (b)(3).
We propose to introduce in a new subsection (b)(4) a new
requirement to provide follow-up reports in cases in which an FCOI has
been previously identified and reported. Specifically, the regulation
would require that for any FCOI previously reported by the Institution
with regard to an ongoing PHS-funded research project, the Institution
shall provide an annual FCOI report that addresses the status of the
FCOI and any changes to the management plan to the PHS Awarding
Component for the duration of the PHS-funded research project. The
annual FCOI report would be required to specify whether the financial
conflict is still being managed or explain why the FCOI no longer
exists. The regulations would require the Institution to provide annual
FCOI reports to the PHS Awarding Component for the duration of the
project period (including extensions with or without funds) in the time
and manner specified by the PHS Awarding Component. If this provision
were to be implemented as part of a Final Rule, we anticipate that PHS
Awarding Components would provide guidance to Institutions regarding
the specific mechanics for filing annual FCOI reports.
Finally, we propose in a new subsection (b)(5) language with regard
to FCOI reporting that is similar to the language for FCOI management
proposed in the redesignated subsection (a)(5), described above.
Namely, we propose that in addition to the types of financial conflicts
of interest as defined in the regulations that must be reported
pursuant to this section, an Institution may require the reporting of
other FCOI, as the Institution deems appropriate.
Remedies (42 CFR 50.606, 45 CFR 94.6)
We propose limited revisions to the existing regulation regarding
remedies. Subsection (a) currently provides that if the failure of an
Investigator to comply with the conflict of interest policy of the
Institution has biased the design, conduct, or reporting of the PHS-
funded research, the Institution must promptly notify the PHS Awarding
Component of the corrective action taken or to be taken. We propose to
revise this requirement such that it applies if an Investigator's
failure to comply with an Institution's FCOI policy or a FCOI
management plan appears to have biased the design, conduct, or
reporting of the PHS-funded research.
In subsection (b), we propose to incorporate language regarding the
Department's right of inquiry and access to records that is consistent
with the proposed certification provision in 42 CFR 50.604(k)(4), 45
CFR 94.4(k)(4), discussed above. Specifically, subsection (b) would
provide that the HHS may inquire at any time (i.e., before, during, or
after award) into any Investigator disclosure of financial interests
and the Institution's review of, or response to, such disclosure,
whether or not the disclosure resulted in the Institution's
determination of a FCOI. Similar to the existing regulations, an
Institution would be required to submit, or permit on site review of,
all records pertinent to compliance with the regulations.
Subsection (b) would also be revised to clarify the types of
actions that may be taken if a PHS Awarding Component decides that a
particular FCOI will bias the objectivity of the PHS-funded research to
such an extent that further corrective action is needed or that the
Institution has not managed the FCOI in accordance with the
regulations. With regard to grants and cooperative agreements, in
particular, subsection 50.606(b) would specify that the PHS Awarding
Component may determine that imposition of special award conditions
under 45 CFR 74.14 or suspension of funding or other enforcement action
under 45 CFR 74.62 is necessary until the matter is resolved.
Correspondingly, subsection 94.6(b) would specify for PHS contracts
that the PHS Awarding Component may determine that issuance of a Stop
Work Order by the Contracting Officer or other enforcement action is
necessary until the matter is resolved.
We propose to revise subsection (c) to add that in any case in
which the HHS determines that a PHS-funded project of clinical research
whose purpose is to evaluate the safety or effectiveness of a drug,
medical device, or treatment has been designed, conducted, or reported
by an Investigator with a FCOI that was not managed or reported by the
Institution as required by the regulations, the Institution must not
only require the Investigator involved to disclose the FCOI in each
public presentation of the results of the research, but also to request
an addendum to previously published presentations.
We propose additional minor revisions to this section as part of a
broader effort to improve internal consistency with regard to the use
of various terms and phrases throughout these regulations and, where
feasible, consistency between the text of 42 CFR Part 50, Subpart F,
and 45 CFR Part 94.
Other HHS Regulations That Apply (42 CFR 50.607)
We propose minor revisions to the list of other HHS regulations
that apply to
[[Page 28700]]
update changes that have been made in the CFR location or title of the
existing references in this section. In the course of our review, we
considered whether this section was necessary, or whether it should be
deleted as potentially confusing to readers with regard to the scope of
additional regulations that may apply to a given Institution or
Investigator. We welcome comment on whether the regulations should be
further revised to delete this section.
III. Institutional Conflict of Interest
Institutional conflict of interest is a subject that is not
specifically addressed in the current regulations. Because this is a
topic of increasing interest to the Department as well as in the
research community, we invited public comment in the ANPRM on the
possible revision of the regulations to address institutional conflict
of interest. In particular, we asked (a) how ``institutional conflict
of interest'' would be defined, and (b) what an institutional conflict
of interest policy would address in order to assure the PHS of
objectivity in research.
The comments that we received in response to these questions
demonstrated a variety of viewpoints on this complex issue and, in
particular, the extensive differences in administrative structure among
Institutions that receive PHS funding. As a result, we believe that
further careful consideration is necessary before PHS regulations could
be formulated that would address the subject of institutional conflict
of interest in the same comprehensive manner as the proposed
regulations regarding Investigator FCOI. Because we believe it is
important to revise the existing regulations regarding Investigator
FCOI in a timely manner, our proposed revisions to the text of the
regulations are limited to the subject of Investigator FCOI.
Notwithstanding this limitation, we welcome comment on whether the
regulations should be further revised to require Institutions, at a
minimum, to adopt some type of policy on institutional conflict of
interest, even if the scope and elements of the policy remain undefined
in the regulations. For example, in addition to the changes we have
proposed herein to subsection (a) of 42 CFR 50.604 and 45 CFR 94.4,
discussed above, this subsection could be further revised to require
that each Institution shall maintain up-to-date, written, enforced
policies on Investigator financial conflicts of interest and
institutional conflict of interest that comply with this subpart, and
make such policies available via a publicly accessible Web site. If
this additional revision to subsection (a) were to be incorporated,
further corresponding revisions to the regulations would be made as
necessary, e.g., to the Purpose section (42 CFR 50.601, 45 CFR 94.1).
Whether or not final regulations includes further revisions to
address institutional conflict of interest, the Department will
continue to consider the issue carefully and may propose in the future
more comprehensive revisions to the regulations to address this
subject.
IV. Regulatory Impact Analyses (RIA)
The following is provided as public information.
Analysis of Impacts
We have examined the impacts of the proposed amendments to 42 CFR
Part 50 Subpart F and 45 CFR Part 94 under Executive Order 12866, the
Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Order 12866,
Regulatory Planning and Review, directs agencies to assess all costs
and benefits of available regulatory alternatives and, when regulation
is necessary, to select regulatory approaches that maximize net
benefits (including potential economic, environmental, public health
and safety, and other advantages; distributive impacts; and equity).
The Executive Order defines an economically significant regulatory
action as one that would have an annual effect on the economy of $100
million or more. Based on our analyses, we believe that the proposed
amendments to the regulations do not constitute an economically
significant regulatory action under this definition.
The Regulatory Flexibility Act requires agencies to analyze
regulatory options that would minimize any significant impact of the
rule on small entities. For the purposes of this analysis, small
entities include small business concerns as defined by the SBA, usually
businesses with fewer than 500 employees. Approximately 2800 \12\ such
organizations apply for research funding annually, of which
approximately 1300 \13\ are awarded funds. The only proposed change to
the current regulations that pertains to applicant organizations is the
proposed removal of the exemption for SBIR/STTR Program Phase I
applications in sections 50.602 and 94.4, respectively. This would
affect approximately 2000 small business concerns that apply for SBIR/
STTR Program Phase I funding. All other proposed changes to the
regulations apply only to the approximately 1200 small business
concerns that receive PHS funding (under both the SBIR/STTR Program
Phase I and Phase II programs). The cost of implementing the amended
regulations is an allowable cost eligible for reimbursement as a
Facilities and Administrative cost on PHS-supported grants, cooperative
agreements and contracts. This generally offsets the cost burdens of
implementation. Therefore, we do not believe that the proposed changes
to the regulations would have a significant economic impact on a
substantial number of small entities. Our analysis is further supported
by the small number of FCOI reports submitted to NIH by small business
concerns--four reports were submitted in FY2008 and ten in FY2009.
Finally, we considered the impact of the proposed requirement for
Investigator training every two years on small entities. For the
current regulation, NIH developed training materials that Institutions,
including those that small businesses, can use which are available on
the NIH Web site at http://grants.nih.gov/grants/policy/coi/index.htm.
NIH will continue to update the training materials when the Final Rule
is published to ameliorate the burden on Institutions, including small
businesses.
---------------------------------------------------------------------------
\12\ All applicant Institution numbers are based on the number
of Institutions that applied for NIH funding in FY2008.
\13\ All awardee Institution numbers are based on the number of
Institutions that were awarded NIH funding in FY2008.
---------------------------------------------------------------------------
Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires
that agencies prepare a written statement, which includes an assessment
of anticipated costs and benefits, before proposing ``any rule that
includes any Federal mandate that may result in the expenditure by
State, local, and tribal governments, in the aggregate, or by the
private sector, of $100,000,000 or more (adjusted annually for
inflation with base year of 1995) in any one year.'' The current
inflation-adjusted statutory threshold is approximately $142
million.\14\ The agency does not expect that the proposed amendments to
the regulations will result in any 1-year expenditure that would meet
or exceed this amount.
---------------------------------------------------------------------------
\14\ Bureau of Labor Statistics inflation calculator.
---------------------------------------------------------------------------
Though the proposed amendments will not result in the expenditures
listed above, we do discuss the effects of the amendments elsewhere in
this preamble.
[[Page 28701]]
Benefits
The proposed amendments to the regulations on the Responsibility of
Applicants for Promoting Objectivity in Research for which PHS Funding
is Sought (42 CFR Part 50, Subpart F) and Responsible Prospective
Contractors (45 CFR Part 94) would expand and add transparency to
investigator disclosure of Significant Financial Interests as well as
enhance regulatory compliance and effective oversight of financial
conflicts of interest.
Costs
Approximately 5000 Institutions that apply for PHS funding annually
would be subject to the amended regulations. The only proposed change
to the current regulations that pertains to applicant organizations,
however, pertains to a subset of applicant organizations and that is
the proposed removal of the exemption for SBIR/STTR Program Phase I
applications in sections 50.602 and 94.4, respectively, which would
affect approximately 2000 small business concerns. The remaining
proposed amendments would affect the approximately 2800 organizations
(of all types, including small businesses) that are awarded PHS funding
annually and, through the implementation of the regulations by the
Institutions, to the estimated 40,500 Investigators participating in
PHS-funded research that have Significant Financial Interests. The cost
of implementing the amended regulations is an allowable cost eligible
for reimbursement as a Facilities and Administrative cost on PHS
supported grants, cooperative agreements and contracts. This generally
offsets the cost burdens of implementation for the affected
Institutions and through their implementation of the regulations, to
the Investigators. That said, we are including a description of the
projected costs of the proposed amendments to the regulations for
general information.
----------------------------------------------------------------------------------------------------------------
Frequency of Estimated cost Estimated
42 CFR Part 50 Subpart F/ New proposed Number of response per response annual cost
45 CFR Part 94 requirement? respondents (annual) \15\ \16\
----------------------------------------------------------------------------------------------------------------
50.602/94.2................ Only for SBIR/ Total: ~5,000 NA............. NA............. Total estimated
STTR Phase I applicant annual cost
applicants. Institutions $$12,047,525.\
and 2,800 19\
awardee
institutions
\17\ and an
estimated
40,500
investigators.
New:
Approximately
2,000
applicant
Institutions
and 700
awardee
Institutions.\
18\
50.604/94.4
(a).................... Only making the 2,800 \20\..... 1.............. $665........... $1,862,000.
policy public.
(b).................... Only the Institutions: Institutions: 1 Institutions: Institutions:
training 2,800 \21\. Investigators: $105. $294,000.
component is Investigators: 0.5. Investigators: Investigators:
new. 40,500.\22\. $17.5. $708,750.
Total: $122.5.. Total:
$1,002,750.
(c)(1)................. n--clarificatio 700 \23\....... 1.............. $35.00......... $24,500.
n of current
requirements.
(d).................... y.............. 2,800 \24\..... 1.............. $35............ $98,000.
(e)(1)................. n but scope has 40,500 \25\.... 1.............. $70............ $2,835,000.
changed.
(e)(2)................. n.............. 40,500......... 1.............. $17.50 \26\.... $708,750.
(e)(3)................. n.............. 1,000 \27\..... 1.............. $17.50......... $17,500.
(f).................... n but scope has 2,800 awardee 1.............. $35.00......... $98,000.
changed. Institutions.
(i).................... n.............. 2,800 awardee 1.............. $140........... $392,000.
Institutions.
50.605/94.5
(a)(1)................. Requirement to 2,800 awardee 1.............. $35 for review $4,217,500.\29\
develop a institutions.\ of 40,500
management 28\ disclosures
plan. and $2,800 for
developing
management
plan for 1,000
identified
FCOI.
(a)(2)................. n.............. 1,000 \30\..... NA \31\........ NA............. NA.
(a)(3)................. y.............. 500 \32\....... 1.............. $105........... $52,200.
(a)(3)(i).............. n.............. 50 \33\........ 1.............. $2,800 \34\.... $140,000.
(a)(3)(ii)............. y.............. 50 \35\........ 1.............. $280 \36\...... $14,000.
(a)(4)................. y.............. 1,000 \37\..... 12............. $35............ $420,000.
(a)(5)................. y.............. 2,800.......... 1.............. $35 \38\....... $98,000.
(b)(1)................. n but amount of Included in NA............. NA............. NA.
information 50.605(b)(3)/
reported has 94.5 (b)(3)
changed. below.
(b)(2)................. y.............. 100 \39\....... 1.............. $70............ $7,000.
(b)(3)................. y.............. 1,000.......... 1.............. $35............ $35,000.\40\
(b)(4)................. n but scope has 1,000.......... 1.............. $17.50 \41\.... $17,500.
been clarified.
50.606/94.6
[[Page 28702]]
(a).................... n--but scope 20 \42\........ 1.............. $350........... $7,000.
has been
clarified.
(c).................... n--only the 50 \43\........ 3 \44\......... $10.50......... $525.
addendum to
previously
published
presentations
is new.
----------------------------------------------------------------------------------------------------------------
Alternatives
The key alternative to the proposed amendment of these regulations
would be to continue to operate under the current regulations. In the
intervening years since the regulation was promulgated, Investigator
collaborations have become more complex and public scrutiny has
increased significantly creating an environment that would benefit from
a regulation with more effective means for management and oversight. If
we continue to operate under the current regulations, we would then
lose the opportunity to implement enhanced institutional management of
Investigator financial conflicts of interests related to PHS-funded
research, increased oversight by the PHS funding component, and
enhanced transparency. We believe that the incremental increase in the
cost of implementing the proposed regulation is outweighed by the
benefits of these changes and that the proposed regulation will
strengthen public trust in PHS-funded research. With regard to
alternative approaches to particular requirements in the regulations,
we have indicated in various provisions of the preamble to this Notice
of Proposed Rulemaking the basis for the Department's proposed approach
versus alternatives. (See, e.g., section III regarding institutional
conflicts of interest.)
---------------------------------------------------------------------------
\15\ Average burden hours x $35/hour based on recent NIH cost
analyses.
\16\ Number of respondents x estimated cost per response.
\17\ Based on FY2008 numbers.
\18\ Will be newly covered by the regulations under the proposed
expansion to include the SBIR/STTR phase I program.
\19\ Sum of all the columns below.
\20\ Assumes 2,800 awardee Institutions and 19 hours per
institution for formulating and maintaining the policy. Also assumes
that all awardee Institutions already maintain a public Web site.
Therefore, posting the policy to the Web site is an incremental
cost.
\21\ Assumes that 2,800 awardee institutions: 1. Inform
investigators about the policy on an annual basis by sending a
notification to all investigators = 1 hour and 2. Annually adapt
NIH-provided training materials to Institutional needs = 2 hours.
\22\ Assumes 40,500 Investigators undergo 1 hour of training
every two years. This refers to FCOI training only and is based on
the use of training materials developed by the NIH and adapted to
the Institution's needs.
\23\ An estimated maximum 25% of Institutions may have sub-
recipients in any one year--assuming 1 hour per Institution to
incorporate the requirement of the regulations into an already
existing written agreement.
\24\ Assumes that 2,800 awardee institutions solicit disclosures
on an annual basis by sending a notification to all investigators.
\25\ The financial disclosure burden estimate is based upon an
investigator figure of 40,500 with an average response time of 2
hours.
\26\ Assumes that updating a disclosure takes less time/effort
and therefore costs less than creating a new one.
\27\ Assumes that only a small number of the 40,500
investigators will have a new SFI in any year.
\28\ Although not more than 1,000 reports of Conflict of
Interest are expected annually, the 2,800 responding institutions
must review all financial disclosures associated with PHS-funded
awards to determine whether any conflicts of interest exist. Thus,
the review cost of $1,417,500 is based upon estimates that it will
take on the average 1 hour to review each of 40,500 financial
disclosures associated with PHS-funded awards. The cost for
developing a management plan for identified FCOI is estimated at 80
hours x 1,000 cases x $35/hour = $2,800,000.
\29\ $4,252,500 for review plus $2,800,000 for developing
management plans = $7,052,500.
\30\ Based on 50.604/94.4 (e)(3) above.
\31\ The cost is included in 50.605/94.5 (b)(2) below.
\32\ Assumes that this is a rare occurrence, based on prior
experience.
\33\ Assumes only a fraction of the newly identified SFIs will
constitute FCOI.
\34\ Development of management plan.
\35\ Assumes only a fraction of the newly identified SFIs will
constitute FCOI.
\36\ Assumes the mitigation plan will be adapted from the
management plan developed in 50.605/94.5 (a)(3)(i) above and
therefore will cost less than developing an entirely new plan.
\37\ Based on previous assumption of 1,000 FCOI reports
annually.
\38\ Assumes that all awardee Institutions already maintain a
public Web site. Adding the required information is an incremental
cost. However, updating annually does have a cost.
\39\ The cost of subsequent reports of conflicts is
significantly less, because we do not expect many additional
reportable conflicts and there will be only a limited number of
disclosures to review.
\40\ Assumes 1,000 FCOI reports annually x 1 hour x $35/hour to
prepare the report/complete an NIH-provided web form.
\41\ Assumes it takes less time to update a report than to
create a new one.
\42\ This was originally estimated in the 1995 Final Rule to be
no more than 5 instances that the failure of an investigator to
comply with the institution's conflict of interest policy has biased
the design, conduct or reporting of the research. ``Objectivity in
Research, Final Rule'' 60 FR 132 (July 11, 1995) pps. 35810-35819.
This estimate, and others were increased in 2002 ``due to increased
numbers of institutions and investigators.''
\43\ Number based on 50.605/94.5 (a)(3)(i)--of those only a
fraction will relate to a project of clinical research whose purpose
is to evaluate the safety or effectiveness of a drug, medical
device, or treatment, but we are calculating the maximum assumed
cost.
\44\ Assumes an average of 3 publications annually.
---------------------------------------------------------------------------
Paperwork Reduction Act
This proposed rule contains requirements that are subject to OMB
approval under the Paperwork Reduction Act of 1995, as amended (44
U.S.C. chapter 35). Sections 50.604(a), 50.604(b), 50.604(c)(1),
50.604(d), 50.604(e)(1), 50.604(e)(2), 50.604(e)(3), 50.604(f),
50.605(a)(1), 50.605(a)(3), 50.605(a)(3)(i), 50.605(a)(3)(ii),
50.605(a)(4), 50.605(a)(5), 50.605(b)(1), 50.605(b)(2), 50.605(b)(3),
50.605(b)(4), 50.606(a), 50.606(c); 94.4(a), 94.4(b), 94.4(c)(1),
94.4(d), 94.4(e)(1), 94.4(e)(2), 94.4(e)(3), 94.4(f), 94.5(a)(1), 94.5
(a)(3), 94.5(a)(3)(i), 94.5(a)(3)(ii), 94.5(a)(4), 94.5(a)(5),
94.5(b)(1), 94.5(b)(2), 94.5(b)(3), 94.5(b)(4), 94.6(a), and 94.6(c)
contain reporting and information collection requirements that are
subject to OMB approval under the Paperwork Reduction Act.
Sections 50.604(i), and 94.4(i), contain recordkeeping requirements
that are subject to OMB review under the Paperwork Reduction Act. The
title, description, and respondent description of the information
collection and recordkeeping requirements contained in this proposed
rule have been submitted to OMB for review. Other organizations and
individuals desiring to submit comments on the information collection
and recordkeeping requirements should send their comments to: (1) Mikia
Currie, Project Clearance Officer, National Institutes of Health,
Rockledge Center 1, 6705 Rockledge Drive, Room 3509, Bethesda, MD
20817, telephone 301-594-7949 (not a toll-free number); and (2) the
Office of Information and Regulatory Affairs, OMB, [email protected] or by fax to 202-395-6974, and mark ``Attention:
Desk Officer for the National Institutes of Health, Department of
Health and Human Services.'' After we obtain OMB
[[Page 28703]]
approval, we will publish the OMB control number in the Federal
Register.
Following are details of the estimated burden of implementing the
proposed regulations.
----------------------------------------------------------------------------------------------------------------
Frequency of
42 CFR Part 50 Subpart F/45 New proposed Number of response Average burden Annual burden
CFR Part 94 requirement? respondents (annual) hours hours \45\
----------------------------------------------------------------------------------------------------------------
50.602/94.2................ Only for SBIR/ Total: ~5,000 NA............. NA............. Total estimated
STTR Phase I applicant burden hours:
applicants. Institutions 344,215.\48\
and 2,800
awardee
institutions
\46\ and an
estimated
40,500
investigators.
New:
Approximately
2,000
applicant
Institutions
and 700
awardee
Institutions.\
47\
50.604/94.4
(a).................... Only making the 2,800 \49\..... 1.............. 19............. 53,200.
policy public.
(b).................... Only the Institutions: Institutions: 1 Institutions: 3 Institutions:
training 2,800 \50\. Investigators: Investigators: 8,400.
component. Investigators: 0.5. 1. Investigators:
40,500.\51\. 20,250.
(c)(1)................. n-clarification 700 \52\....... 1.............. 1.............. 700.
of current
requirements.
(d).................... y.............. 2,800 \53\..... 1.............. 1.............. 2,800.
(e)(1)................. n but scope has 40,500 \54\.... 1.............. 2.............. 81,000.
changed.
(e)(2)................. n.............. 40,500......... 1.............. 0.5 \55\....... 20,250.
(e)(3)................. n.............. 1,000 \56\..... 1.............. 0.5............ 500.
(f).................... n but scope has 2,800 awardee 1.............. 1.............. 2,800.
changed. Institutions.
(i).................... n.............. 2,800 awardee 1.............. 4.............. 11,200.
Institutions.
50.605/94.5
(a)(1)................. Requirement to 2,800 awardee 1.............. 1 hour per 120,500.\58\
develop a institutions.\ disclosure to
management 57\ review plus 80
plan. hours per
identified
FCOI to
develop
management
plan.
(a)(2)................. n.............. 1,000 \59\..... NA \60\........ NA............. NA.
(a)(3)................. y.............. 500 \61\....... 1.............. 3.............. 1500.
(a)(3)(i).............. n.............. 50 \62\........ 1.............. 80 \63\........ 4,000.
(a)(3)(ii)............. y.............. 50 \64\........ 1.............. 8 \65\......... 400.
(a)(4)................. y.............. 1,000 \66\..... 12............. 1.............. 12,000.
(a)(5)................. y.............. 2,800.......... 1 \67\......... 1.............. 2,800.
(b)(1)................. n but amount of Included in NA............. NA............. NA.
information 50.605(b)(3)/
reported has 94.5 (b)(3)
changed. below.
(b)(2)................. y.............. 100 \68\....... 1.............. 2.............. 200.
(b)(3)................. y.............. 1,000.......... 1.............. 1.............. 1,000.\69\
(b)(4)................. n-scope has 1,000.......... 1.............. 0.5 \70\....... 500.
been clarified.
50.606/94.6
(a).................... n-scope has 20 \71\........ 1.............. 10............. 200.
been clarified.
(c).................... n-only the 50 \72\........ 3 \73\......... 0.3............ 15.
addendum to
previously
published
presentations.
----------------------------------------------------------------------------------------------------------------
Environmental Impact
We have determined that this action is of a type that does not
individually or cumulatively have a significant effect on the human
environment. Therefore, neither an environmental assessment nor an
environmental impact statement is required.
[[Page 28704]]
Catalogue of Federal Domestic Assistance
---------------------------------------------------------------------------
\45\ Number of respondents x average burden hours x frequency of
response.
\46\ Based on FY2008 numbers.
\47\ Will be newly covered by the regulations under the proposed
expansion to include the SBIR/STTR phase I program.
\48\ Sum of all the columns below.
\49\ Assumes 2,800 awardee Institutions and 19 hours per
institution for formulating and maintaining the policy. Also assumes
that all awardee Institutions already maintain a public Web site.
Therefore, posting the policy to the Web site is an incremental
burden.
\50\ Assumes that 2,800 awardee institutions: 1. Inform
investigators about the policy on an annual basis by sending a
notification to all investigators = 1 hour, and 2. Annually adapt
NIH-provided training materials to Institutional needs = 2 hours.
\51\ Assumes 40,500 Investigators undergo 1 hour of training
every two years. This refers to FCOI training only and is based on
the use of training materials developed by the NIH and adapted to
the Institution's needs.
\52\ An estimated maximum 25% of Institutions may have sub-
recipients in any one year--assuming 1 hour per Institution to
incorporate the requirement of the regulations into an already
existing written agreement.
\53\ Assumes that 2,800 awardee institutions solicit disclosures
on an annual basis by sending a notification to all investigators.
\54\ The financial disclosure burden estimate is based upon an
investigator figure of 40,500 with an average response time of 2
hours.
\55\ Assumes that updating a disclosure takes less time/effort
than creating a new one.
\56\ Assumes that only a small number of the 40,500
investigators will have a new SFI in any year.
\57\ Although not more than 1,000 reports of Conflict of
Interest are expected annually, the 2,800 responding institutions
must review all financial disclosures associated with PHS-funded
awards to determine whether any conflicts of interest exist. Thus,
the review burden of 40,500 hours is based upon estimates that it
will take on the average 1 hour for an institutional official to
review each of 40,500 financial disclosures associated with PHS
funded awards.. The burden for developing a management plan for
identified FCOI is estimated at 80 hours x 1,000 cases = 80,000
hours.
\58\ 40,500 for reviewing disclosures from 40,500 Investigators
plus 80,000 for developing management plans for 1,000 identified
FCOI.
\59\ Based on 50.604/94.4 (e)(3) above.
\60\ The burden is included in 50.605/94.5 (b)(2) below.
\61\ Assumes that this is a rare occurrence, based on prior
experience.
\62\ Assumes only a fraction of the newly identified SFIs will
constitute FCOI.
\63\ Development of management plan.
\64\ Assumes only a fraction of the newly identified SFIs will
constitute FCOI.
\65\ Assumes the mitigation plan will be adapted from the
management plan developed in 50.605/94.5(a)(3)(i) above and
therefore will take less time/effort than developing an entirely new
plan.
\66\ Based on previous assumption of 1,000 FCOI reports
annually.
\67\ Assumes that all awardee Institutions already maintain a
public Web site. Adding the required information is an incremental
burden. However, updating annually does have a burden.
\68\ The burden for subsequent reports of conflicts is
significantly less, because we do not expect many additional
reportable conflicts and there will be only a limited number of
disclosures to review.
\69\ Assumes 1,000 FCOI reports annually x 1 hour to prepare the
report/complete an NIH-provided Web form.
\70\ Assumes it takes less time to update a report than to
create a new one.
\71\ This burden was originally estimated in the 1995 Final Rule
to be no more than 5 instances that the failure of an investigator
to comply with the institution's conflict of interest policy has
biased the design, conduct or reporting of the research.
``Objectivity in Research, Final Rule'' 60 FR 132 (July 11, 1995)
pps. 35810-35819. This burden estimate and others was increased in
2002 ``due to increased numbers of institutions and investigators.''
\72\ Number based on 50.605/94.5(a)(3)(i)--of those only a
fraction will relate to a project of clinical research whose purpose
is to evaluate the safety or effectiveness of a drug, medical
device, or treatment, but we are calculating the maximum assumed
burden/cost.
\73\ Assumes an average of 3 publications annually.
---------------------------------------------------------------------------
The Catalogue of Federal Domestic Assistance numbered programs
applicable to this proposed rule are:
93.113--Environmental Health
93.121--Oral Diseases and Disorders Research
93.142--NIEHS Hazardous Waste Worker Health and Safety Training
93.143--NIEHS Superfund Hazardous Substances--Basic Research and
Education
93.172--Human Genome Research
93.173--Research Related to Deafness and Communication Disorders
93.187--Undergraduate Scholarship Program for Individuals from
Disadvantaged Backgrounds
93.209--Contraception and Infertility Research Loan Repayment
Program
93.213--Research and Training in Complementary and Alternative
Medicine
93.220--Clinical Research Loan Repayment Program for Individuals
from Disadvantaged Backgrounds
93.233--National Center on Sleep Disorders Research
93.242--Mental Health Research Grants
93.271--Alcohol Research Career Development Awards for Scientists
and Clinicians
93.272--Alcohol National Research Service Awards for Research
Training
93.273--Alcohol Research Programs
93.279--Drug Abuse and Addiction Research Programs
93.280--National Institutes of Health Loan Repayment Program for
Clinical Researchers
93.281--Mental Health Research Career/Scientist Development Awards
93.282--Mental Health National Research Service Awards for Research
Training
93.285--National Institutes of Health Pediatric Research Loan
Repayment Program
93.286--Discovery and Applied Research for Technological Innovations
to Improve Human Health
93.307--Minority Health and Health Disparities Research
93.310--Trans-NIH Research Support
93.361--Nursing Research
93.389--National Center for Research Resources
93.393--Cancer Cause and Prevention Research
93.394--Cancer Detection and Diagnosis Research
93.395--Cancer Treatment Research
93.396--Cancer Biology Research
93.397--Cancer Centers Support Grants
93.398--Cancer Research Manpower
93.399--Cancer Control
93.701--Trans-NIH Recovery Act Research Support RECOVERY
93.702--National Center for Research Resources, Recovery Act
Construction Support Recovery
93.837--Cardiovascular Diseases Research
93.838--Lung Diseases Research
93.839--Blood Diseases and Resources Research
93.846--Arthritis, Musculoskeletal and Skin Diseases Research
93.847--Diabetes, Digestive, and Kidney Diseases Extramural Research
93.853--Extramural Research Programs in the Neurosciences and
Neurological Disorders
93.855--Allergy, Immunology and Transplantation Research
93.856--Microbiology and Infectious Diseases Research
93.859--Biomedical Research and Research Training
93.865--Child Health and Human Development Extramural Research
93.866--Aging Research
93.867--Vision Research
93.879--Medical Library Assistance
93.891--Alcohol Research Center Grants
93.989--International Research and Research Training
List of Subjects
42 CFR Part 50 45 CFR Part 94
Colleges and universities, Conflict of interests, Contracts,
Financial disclosure, Grants-health, Grants programs, Non-profit
organizations, Research, Scientists, Small businesses.
For the reasons set forth in the preamble, the Department proposes
to amend 42 CFR chapter I, subchapter D, part 50, subpart F and 45 CFR
subtitle A, subchapter A, part 94 as follows:
TITLE 42--GRANTS AND AGREEMENTS
PART 50--POLICIES OF GENERAL APPLICABILITY
1. Revise Subpart F to read as follows:
Subpart F--Promoting Objectivity in Research
Sec.
50.601 Purpose.
50.602 Applicability.
50.603 Definitions.
50.604 Responsibilities of Institutions regarding Investigator
financial conflicts of interest.
50.605 Management and reporting of financial conflicts of interest.
50.606 Remedies.
50.607 Other HHS regulations that apply.
Subpart F--Promoting Objectivity in Research
Authority: 42 U.S.C. 216, 289b-1, 299c-4; Sec. 219, Tit. II,
Div. D, Pub. L. 111-117, 123 Stat. 3034.
Sec. 50.601 Purpose.
This subpart promotes objectivity in research by establishing
standards that provide a reasonable expectation that
[[Page 28705]]
the design, conduct, and reporting of research funded under PHS grants
or cooperative agreements is free from bias resulting from Investigator
financial conflicts of interest.
Sec. 50.602 Applicability.
This subpart is applicable to each Institution that is applying
for, or that receives, PHS research funding by means of a grant or
cooperative agreement and, through the implementation of this subpart
by the Institution, to each Investigator participating in such
research. In those few cases where an individual, rather than an
Institution, is applying for, or receives, PHS research funding, PHS
Awarding Components will make case-by-case determinations on the steps
to be taken, consistent with this subpart, to provide a reasonable
expectation that the design, conduct, and reporting of the research
will be free from bias resulting from a financial conflict of interest
of the individual.
Sec. 50.603 Definitions.
As used in this subpart:
Disclosure of significant financial interests means an
Investigator's disclosure of significant financial interests to an
Institution.
FCOI report means an Institution's report of a financial conflict
of interest to a PHS Awarding Component.
Financial conflict of interest means a significant financial
interest that could directly and significantly affect the design,
conduct, or reporting of PHS-funded research.
Financial interest means anything of monetary value or potential
monetary value.
HHS means the United States Department of Health and Human
Services, and any components of the Department to which the authority
involved may be delegated.
Institution means any domestic or foreign, public or private,
entity or organization (excluding a Federal agency) that is applying
for, or that receives, PHS research funding.
Institutional responsibilities means an Investigator's professional
responsibilities on behalf of the Institution including, but not
limited to, activities such as research, research consultation,
teaching, professional practice, institutional committee memberships,
and service on panels such as Institutional Review Boards or Data and
Safety Monitoring Boards.
Investigator means the PD/PI and any other person, regardless of
title or position, who is responsible for the design, conduct, or
reporting of research funded by the PHS, or proposed for such funding,
including persons who are subgrantees, contractors, collaborators, or
consultants.
Manage means to take action to address a financial conflict of
interest, which includes reducing or eliminating the financial conflict
of interest, to ensure that the design, conduct, or reporting of
research is free from bias or the appearance of bias.
PD/PI means a project director or principal investigator of a PHS-
funded research project.
PHS means the Public Health Service, an operating division of the
U.S. Department of Health and Human Services, and any components of the
PHS to which the authority involved may be delegated, including the
National Institutes of Health.
PHS Awarding Component means the organizational unit of the PHS
that funds the research that is subject to this subpart.
Public Health Service Act or PHS Act means the statute codified at
42 U.S.C. 201 et seq.
Research means a systematic investigation designed to develop or
contribute to generalizable knowledge relating broadly to public
health, including behavioral and social-sciences research. The term
encompasses basic and applied research and product development. As used
in this subpart, the term includes any such activity for which research
funding is available from a PHS Awarding Component through a grant,
cooperative agreement, or contract, whether authorized under the PHS
Act or other statutory authority, such as a research grant, career
development award, center grant, individual fellowship award,
infrastructure award, institutional training grant, program project, or
research resources award.
Significant financial interest means, except as otherwise specified
in paragraph (1) of this definition:
(1) A financial interest consisting of one or more of the following
interests of the Investigator (and those of the Investigator's spouse
and dependent children) that reasonably appears to be related to the
Investigator's institutional responsibilities:
(i) With regard to any publicly traded entity, a significant
financial interest exists if the value of any remuneration received
from the entity in the twelve months preceding the disclosure and the
value of any equity interest in the entity as of the date of
disclosure, when aggregated, exceeds $5,000. For purposes of this
definition, remuneration includes salary and any payment for services
not otherwise identified as salary (e.g., consulting fees, honoraria,
paid authorship, travel reimbursement); equity interest includes any
stock, stock option, or other ownership interest, as determined through
reference to public prices or other reasonable measures of fair market
value;
(ii) With regard to any non-publicly traded entity, a significant
financial interest exists if the value of any remuneration received
from the entity in the twelve months preceding the disclosure, when
aggregated, exceeds $5,000, or the Investigator (or the Investigator's
spouse or dependent children) holds any equity interest (e.g., stock,
stock option, or other ownership interest); or
(iii) Intellectual property rights (e.g., patents, copyrights),
royalties from such rights, and agreements to share in royalties
related to such rights.
(2) The term significant financial interest does not include the
following types of financial interests: Salary, royalties, or other
remuneration paid by the Institution to the Investigator if the
Investigator is currently employed or otherwise appointed by the
Institution; any ownership interest in the Institution held by the
Investigator, if the Institution is a commercial or for-profit
organization; income from seminars, lectures, or teaching engagements
sponsored by a federal, state, or local government agency, or an
institution of higher education as defined at 20 U.S.C. 1001(a); or
income from service on advisory committees or review panels for a
federal, state, or local government agency, or an institution of higher
education as defined at 20 U.S.C. 1001(a).
Sec. 50.604 Responsibilities of Institutions regarding Investigator
financial conflicts of interest.
Each Institution shall:
(a) Maintain an up-to-date, written, enforced policy on financial
conflicts of interest that complies with this subpart, and make such
policy available via a publicly accessible Web site. If an Institution
maintains a policy on financial conflicts of interest that includes
standards that are more stringent than this subpart (e.g., that require
a more extensive disclosure of financial interests), the Institution
shall adhere to its policy and shall provide FCOI reports regarding
identified financial conflicts of interest to the PHS Awarding
Component in accordance with the Institution's own standards.
(b) Inform each Investigator of the Institution's policy on
financial conflicts of interest, the Investigator's responsibilities
regarding disclosure of significant financial interests, and of
[[Page 28706]]
these regulations, and require each Investigator to complete training
regarding same prior to engaging in PHS-funded research and,
thereafter, at least once every two years.
(c) If the Institution carries out the PHS-funded research through
a subrecipient (e.g., subgrantee, contractor, or collaborator):
(1) Incorporate as part of a written agreement with the
subrecipient legally enforceable terms that establish whether the
financial conflicts of interest policy of the awardee Institution or
that of the subrecipient applies to the subrecipient's Investigators.
(i) If the subrecipient's financial conflicts of interest policy
applies to subrecipient Investigators, the subrecipient shall certify
as part of the agreement that its policy complies with this subpart. If
the subrecipient cannot provide such certification, the agreement shall
state that subrecipient Investigators are subject to the financial
conflicts of interest policy of the awardee Institution;
(ii) If the subrecipient's financial conflicts of interest policy
applies to subrecipient Investigators, the agreement shall specify time
period(s) for the subrecipient to report all identified financial
conflicts of interest to the awardee Institution. Such time period(s)
shall be sufficient to enable the awardee Institution to provide timely
FCOI reports, as necessary, to the PHS;
(iii) If subrecipient Investigators are subject to the awardee
Institution's financial conflicts of interest policy, the agreement
shall specify time period(s) for the subrecipient to submit all
Investigator disclosures of significant financial interests to the
awardee Institution. Such time period(s) shall be sufficient to enable
the awardee Institution to comply timely with its review, management,
and reporting obligations under this subpart.
(2) Provide FCOI reports to the PHS regarding all financial
conflicts of interest of all subrecipient Investigators consistent with
this subpart.
(d) Designate an institutional official(s), to solicit and review
disclosures of significant financial interests from each Investigator
who is planning to participate in the PHS-funded research.
(e)(1) Require that each Investigator who is planning to
participate in the PHS-funded research disclose to the Institution's
designated official(s) the Investigator's significant financial
interests (and those of the Investigator's spouse and dependent
children).
(2) Require that each Investigator who is participating in the PHS-
funded research submit an updated disclosure of significant financial
interests at least annually during the period of the award. Such
disclosure shall include any information that was not disclosed
initially to the Institution pursuant to paragraph (e)(1) of this
section, or in a subsequent disclosure of significant financial
interests, and shall include updated information regarding any
previously-disclosed significant financial interest (e.g., the updated
value of a previously-disclosed equity interest).
(3) Require that each Investigator who is participating in the PHS-
funded research submit an updated disclosure of significant financial
interests within thirty days of acquiring a new significant financial
interest (e.g., through purchase, marriage, or inheritance).
(f) Provide guidelines consistent with this subpart for the
designated institutional officials to determine whether an
Investigator's significant financial interest is related to PHS-funded
research and, if so related, whether the significant financial interest
is a financial conflict of interest. An Investigator's significant
financial interest is related to PHS-funded research when the
Institution, through its designated officials, reasonably determines
that the significant financial interest: Appears to be affected by the
PHS-funded research; or is in an entity whose financial interest
appears to be affected by the research. A financial conflict of
interest exists when the Institution, through its designated officials,
reasonably determines that the significant financial interest could
directly and significantly affect the design, conduct, or reporting of
the PHS-funded research.
(g) Take such actions as necessary to manage financial conflicts of
interest, including any financial conflicts of a subrecipient
Investigator pursuant to paragraph (c) of this section. Management of
an identified financial conflict of interest requires development and
implementation of a management plan and, if necessary, a mitigation
plan pursuant to Sec. 50.605(a).
(h) Provide initial and ongoing FCOI reports to the PHS as required
pursuant to Sec. 50.605(b).
(i) Maintain records relating to all Investigator disclosures of
financial interests and the Institution's review of, or response to,
such disclosures (whether or not a disclosure resulted in the
Institution's determination of a financial conflict of interest), for
at least three years from the date of submission of the final
expenditures report or, where applicable, from other dates specified in
45 CFR 74.53(b) for different situations.
(j) Establish adequate enforcement mechanisms and provide for
employee sanctions or other administrative actions to ensure
Investigator compliance as appropriate.
(k) Certify, in each application for funding to which this subpart
applies, that the Institution:
(1) Has in effect at that Institution an up-to-date, written, and
enforced administrative process to identify and manage financial
conflicts of interest with respect to all research projects for which
funding is sought or received from the PHS;
(2) Shall promote and enforce Investigator compliance with this
subpart's requirements including those pertaining to disclosure of
significant financial interests;
(3) Shall manage financial conflicts of interest and provide
initial and ongoing FCOI reports to the PHS consistent with this
subpart;
(4) Agrees to make information available, promptly upon request, to
the HHS relating to any Investigator disclosure of financial interests
and the Institution's review of, or response to, such disclosure,
whether or not the disclosure resulted in the Institution's
determination of a financial conflict of interest; and
(5) Shall fully comply with the requirements of this subpart.
Sec. 50.605 Management and reporting of financial conflicts of
interest.
(a) Management of financial conflicts of interest.
(1) Prior to the Institution's expenditure of any funds under a
PHS-funded research project, the designated officials of an Institution
shall, consistent with Sec. 50.604(f): Review all Investigator
disclosures of significant financial interests; determine whether any
significant financial interests relate to PHS-funded research;
determine whether a financial conflict of interest exists; and, if so,
develop and implement a management plan that shall specify the actions
that have been, and shall be, taken to manage such financial conflict
of interest. Examples of conditions or restrictions that might be
imposed to manage a financial conflict of interest include, but are not
limited to:
(i) Public disclosure of financial conflicts of interest (e.g.,
when presenting or publishing the research);
(ii) For research projects involving human subjects research,
disclosure of financial conflicts of interest directly to participants;
(iii) Appointment of an independent monitor capable of taking
measures to
[[Page 28707]]
protect the design, conduct, and reporting of the research against
bias, or the appearance of bias, resulting from the financial conflict
of interest;
(iv) Modification of the research plan;
(v) Change of personnel or personnel responsibilities, or
disqualification of personnel from participation in all or a portion of
the research;
(vi) Reduction or elimination of the financial interest (e.g., sale
of an equity interest); or
(vii) Severance of relationships that create actual or potential
financial conflicts.
(2) Whenever, in the course of an ongoing PHS-funded research
project, a new Investigator participating in the research project
discloses a significant financial interest or an existing Investigator
discloses a new significant financial interest to the Institution, the
designated officials of the Institution shall, within sixty days:
Review the disclosure of significant financial interests; determine
whether it is related to PHS-funded research; determine whether a
financial conflict of interest exists; and, if so, implement, on at
least an interim basis, a management plan that shall specify the
actions that have been, and will be, taken to manage such financial
conflict of interest. Depending on the nature of the significant
financial interest, an Institution may determine that additional
interim measures are necessary with regard to the Investigator's
participation in the PHS-funded research project between the date of
disclosure and the completion of the Institution's review.
(3) Whenever an Institution identifies a significant financial
interest that was not disclosed timely by an Investigator or, for
whatever reason, was not previously reviewed by the Institution during
an ongoing PHS-funded research project (e.g., was not timely reviewed
or reported by a subrecipient), the designated officials shall, within
sixty days: Review the significant financial interest; determine
whether it is related to PHS-funded research; determine whether a
financial conflict of interest exists; and, if so:
(i) Implement, on at least an interim basis, a management plan that
shall specify the actions that have been, and will be, taken to manage
such financial conflict of interest going forward;
(ii) Implement, on at least an interim basis, a mitigation plan
which shall include review and determination as to whether any PHS-
funded research, or portion thereof, conducted prior to the
identification and management of the financial conflict of interest was
biased in the design, conduct, or reporting of such research. Depending
on the nature of the significant financial interest, an Institution may
determine that additional interim measures are necessary with regard to
the Investigator's participation in the PHS-funded research project
between the date that the significant financial interest is identified
and the completion of the Institution's review.
(4) Whenever an Institution implements a management plan pursuant
to this subpart, the Institution shall monitor Investigator compliance
with the management plan on an ongoing basis until the completion of
the PHS-funded research project.
(5)(i) Prior to the Institution's expenditure of any funds under a
PHS-funded research project, the Institution shall make available via a
publicly accessible Web site information concerning any significant
financial interest disclosed to the Institution that meets the
following three criteria:
(A) The significant financial interest was disclosed and is still
held by the PD/PI or any other Investigator who has been identified by
the Institution as senior/key personnel for the PHS-funded research
project in the grant application, contract proposal, contract, progress
report, or other required report submitted to the PHS;
(B) The Institution determines that the significant financial
interest is related to the PHS-funded research; and
(C) The Institution determines that the significant financial
interest is a financial conflict of interest.
(ii) The information that the Institution makes available via a
publicly accessible Web site shall include, at a minimum, the
following: The Investigator's name; the Investigator's position with
respect to the research project; the nature of the significant
financial interest; and the approximate dollar value of the significant
financial interest (dollar ranges are permissible: Less than $20,000;
less than $50,000; less than $100,000; less than or equal to $250,000;
greater than $250,000), or a statement that the interest is one whose
value cannot be readily determined through reference to public prices
or other reasonable measures of fair market value.
(iii) The information that the Institution makes available via a
publicly accessible Web site shall be updated at least annually. In
addition, the Institution shall update the Web site within sixty days
of the Institution's receipt or identification of information
concerning any additional significant financial interest that was not
previously disclosed by the PD/PI or senior/key personnel for the PHS-
funded research project, or upon the disclosure of a significant
financial interest by a new PD/PI or new senior/key personnel for the
PHS-funded research project, if the Institution determines that the
significant financial interest is related to the PHS-funded research
and is a financial conflict of interest.
(iv) Information concerning the significant financial interests of
an individual subject to this paragraph (a)(5) shall remain available
via the Institution's publicly accessible Web site for at least five
years from the date that the information was most recently updated.
(6) In addition to the types of financial conflicts of interest as
defined in this subpart that must be managed pursuant to this section,
an Institution may require the management of other financial conflicts
of interest, as the Institution deems appropriate.
(b) Reporting of financial conflicts of interest.
(1) Prior to the Institution's expenditure of any funds under a
PHS-funded research project, the Institution shall provide to the PHS
Awarding Component a FCOI report regarding any Investigator significant
financial interest found by the Institution to be conflicting and
ensure that the Institution has implemented a management plan in
accordance with this subpart.
(2) For any significant financial interest that the Institution
identifies as conflicting subsequent to the Institution's initial FCOI
report during an ongoing PHS-funded research project (e.g., upon the
participation of a new Investigator in the research project), the
Institution shall provide to the PHS Awarding Component, within sixty
days, a FCOI report regarding the financial conflict of interest and
ensure that the Institution has implemented a management plan in
accordance with this subpart. Where such FCOI report involves a
significant financial interest that was not disclosed timely by an
Investigator or, for whatever reason, was not previously reviewed by
the Institution (e.g., was not timely reviewed or reported by a
subrecipient), the Institution shall also provide with its FCOI report
the mitigation plan implemented by the Institution to determine whether
any PHS-funded research, or portion thereof, conducted prior to the
identification and management of the financial conflict of interest was
biased in the design, conduct, or reporting of such research.
(3) Any FCOI report required under paragraphs (b)(1) or (b)(2) of
this section shall include sufficient information to enable the PHS
Awarding Component to
[[Page 28708]]
understand the nature and extent of the financial conflict, and to
assess the appropriateness of the Institution's management plan.
Elements of the FCOI report shall include, but are not limited to the
following:
(i) Project/Contract number;
(ii) PD/PI or Contact PD/PI if a multiple PD/PI model is used;
(iii) Name of the Investigator with the financial conflict of
interest;
(iv) Nature of the financial interest (e.g., equity, consulting
fee, travel reimbursement, honorarium);
(v) Value of the financial interest (dollar ranges are permissible:
$0-$4,999; $5,000-$9,999; $10,000-$19,999; amounts between $20,000-
$100,000 by increments of $20,000; amounts above $100,000 by increments
of $50,000), or a statement that the interest is one whose value cannot
be readily determined through reference to public prices or other
reasonable measures of fair market value;
(vi) A description of how the financial interest relates to the
PHS-funded research and the basis for the Institution's determination
that the financial interest conflicts with such research;
(vii) A description of the key elements of the Institution's
management plan, including:
(A) The role and function of the conflicted Investigator in the
research project;
(B) The rationale for including the conflicted Investigator in the
research project;
(C) The conditions of the management plan;
(D) How the management plan will safeguard objectivity in the
research project;
(E) Confirmation of the Investigator's agreement to the management
plan;
(F) How the management plan will be monitored to ensure
Investigator compliance;
(G) Other information as needed.
(4) For any financial conflict of interest previously reported by
the Institution with regard to an ongoing PHS-funded research project,
the Institution shall provide an annual FCOI report that addresses the
status of the financial conflict of interest and any changes to the
management plan to the PHS Awarding Component for the duration of the
PHS-funded research project. The annual FCOI report shall specify
whether the financial conflict is still being managed or explain why
the financial conflict of interest no longer exists. The Institution
shall provide annual FCOI reports to the PHS Awarding Component for the
duration of the project period (including extensions with or without
funds) in the time and manner specified by the PHS Awarding Component.
(5) In addition to the types of financial conflicts of interest as
defined in this subpart that must be reported pursuant to this section,
an Institution may require the reporting of other financial conflicts
of interest, as the Institution deems appropriate.
Sec. 50.606 Remedies.
(a) If the failure of an Investigator to comply with an
Institution's financial conflicts of interest policy or a financial
conflict of interest management plan appears to have biased the design,
conduct, or reporting of the PHS-funded research, the Institution shall
promptly notify the PHS Awarding Component of the corrective action
taken or to be taken. The PHS Awarding Component will consider the
situation and, as necessary, take appropriate action, or refer the
matter to the Institution for further action, which may include
directions to the Institution on how to maintain appropriate
objectivity in the funded project.
(b) The HHS may inquire at any time (i.e., before, during, or after
award) into any Investigator disclosure of financial interests and the
Institution's review of, or response to, such disclosure, whether or
not the disclosure resulted in the Institution's determination of a
financial conflict of interest. An Institution is required to submit,
or permit on site review of, all records pertinent to compliance with
this subpart. To the extent permitted by law, HHS will maintain the
confidentiality of all records of financial interests. On the basis of
its review of records or other information that may be available, the
PHS Awarding Component may decide that a particular financial conflict
of interest will bias the objectivity of the PHS-funded research to
such an extent that further corrective action is needed or that the
Institution has not managed the financial conflict of interest in
accordance with this subpart. The PHS Awarding Component may determine
that imposition of special award conditions under 45 CFR 74.14 or
suspension of funding or other enforcement action under 45 CFR 74.62 is
necessary until the matter is resolved.
(c) In any case in which the HHS determines that a PHS-funded
project of clinical research whose purpose is to evaluate the safety or
effectiveness of a drug, medical device, or treatment has been
designed, conducted, or reported by an Investigator with a financial
conflict of interest that was not managed or reported by the
Institution as required by this subpart, the Institution shall require
the Investigator involved to disclose the financial conflict of
interest in each public presentation of the results of the research and
to request an addendum to previously published presentations.
Sec. 50.607 Other HHS regulations that apply.
Several other regulations and policies apply to this subpart. They
include, but are not necessarily limited to:
2 CFR Part 376--Nonprocurement Debarment and Suspension (HHS)
42 CFR Part 50, Subpart D--Public Health Service Grant Appeals
Procedure
45 CFR Part 16--Procedures of the Departmental Grant Appeals Board
45 CFR Part 74--Uniform Administrative Requirements for Awards and
Subawards to Institutions of Higher Education, Hospitals, Other
Nonprofit Organizations, and Commercial Organizations
45 CFR Part 79--Program Fraud Civil Remedies
45 CFR Part 92--Uniform Administrative Requirements for Grants and
Cooperative Agreements to State, Local, and Tribal Governments
TITLE 45--PUBLIC WELFARE
2. Revise Part 94 to read as follows:
PART 94--RESPONSIBLE PROSPECTIVE CONTRACTORS
Sec.
94.1 Purpose.
94.2 Applicability.
94.3 Definitions.
94.4 Responsibilities of Institutions regarding Investigator
financial conflicts of interest.
94.5 Management and reporting of financial conflicts of interest.
94.6 Remedies.
Authority: 42 U.S.C. 216, 289b-1, 299c-4.
Sec. 94.1 Purpose.
This part promotes objectivity in research by establishing
standards that provide a reasonable expectation that the design,
conduct, and reporting of research performed under PHS contracts is
free from bias resulting from Investigator financial conflicts of
interest.
Sec. 94.2 Applicability.
This part is applicable to each Institution that solicits, or that
receives, PHS research funding by means of a contract and, through the
implementation of this part by the Institution, to each Investigator
participating in such research.
[[Page 28709]]
Sec. 94.3 Definitions.
As used in this part:
Contractor means an entity that provides property or services under
contract for the direct benefit or use of the Federal Government.
Disclosure of significant financial interests means an
Investigator's disclosure of significant financial interests to an
Institution.
FCOI report means an Institution's report of a financial conflict
of interest to a PHS Awarding Component.
Financial conflict of interest means a significant financial
interest that could directly and significantly affect the design,
conduct, or reporting of PHS-funded research.
Financial interest means anything of monetary value or potential
monetary value.
HHS means the United States Department of Health and Human
Services, and any components of the Department to which the authority
involved may be delegated.
Institution means any domestic or foreign, public or private,
entity or organization (excluding a Federal agency) that solicits, or
that receives, PHS research funding.
Institutional responsibilities means an Investigator's professional
responsibilities on behalf of the Institution including, but not
limited to, activities such as research, research consultation,
teaching, professional practice, institutional committee memberships,
and service on panels such as Institutional Review Boards or Data and
Safety Monitoring Boards.
Investigator means the PD/PI and any other person, regardless of
title or position, who is responsible for the design, conduct, or
reporting of research funded by the PHS, or proposed for such funding,
including persons who are subcontractors, collaborators, or
consultants.
Manage means to take action to address a financial conflict of
interest, which includes reducing or eliminating the financial conflict
of interest, to ensure that the design, conduct, or reporting of
research is free from bias or the appearance of bias.
PD/PI means a project director or principal investigator of a PHS-
funded research project.
PHS means the Public Health Service, an operating division of the
U.S. Department of Health and Human Services, and any components of the
PHS to which the authority involved may be delegated, including the
National Institutes of Health.
PHS Awarding Component means the organizational unit of the PHS
that funds the research that is subject to this subpart.
Public Health Service Act or PHS Act means the statute codified at
42 U.S.C. 201 et seq.
Research means a systematic investigation designed to develop or
contribute to generalizable knowledge relating broadly to public
health, including behavioral and social-sciences research. The term
encompasses basic and applied research and product development. As used
in this part, the term includes any such activity for which research
funding is available from a PHS Awarding Component through a grant,
cooperative agreement, or contract, whether authorized under the PHS
Act or other statutory authority, such as a research grant, career
development award, center grant, individual fellowship award,
infrastructure award, institutional training grant, program project, or
research resources award.
Significant financial interest means, except as otherwise specified
in this definition:
(1) A financial interest consisting of one or more of the following
interests of the Investigator (and those of the Investigator's spouse
and dependent children) that reasonably appears to be related to the
Investigator's institutional responsibilities:
(i) With regard to any publicly traded entity, a significant
financial interest exists if the value of any remuneration received
from the entity in the twelve months preceding the disclosure and the
value of any equity interest in the entity as of the date of
disclosure, when aggregated, exceeds $5,000. For purposes of this
definition, remuneration includes salary and any payment for services
not otherwise identified as salary (e.g., consulting fees, honoraria,
paid authorship, travel reimbursement); equity interest includes any
stock, stock option, or other ownership interest, as determined through
reference to public prices or other reasonable measures of fair market
value;
(ii) With regard to any non-publicly traded entity, a significant
financial interest exists if the value of any remuneration received
from the entity in the twelve months preceding the disclosure, when
aggregated, exceeds $5,000, or the Investigator (or the Investigator's
spouse or dependent children) holds any equity interest (e.g., stock,
stock option, or other ownership interest); or
(iii) Intellectual property rights (e.g., patents, copyrights),
royalties from such rights, and agreements to share in royalties
related to such rights.
(2) The term significant financial interest does not include the
following types of financial interests: Salary, royalties, or other
remuneration paid by the Institution to the Investigator if the
Investigator is currently employed or otherwise appointed by the
Institution; any ownership interest in the Institution held by the
Investigator, if the Institution is a commercial or for-profit
organization; income from seminars, lectures, or teaching engagements
sponsored by a federal, state, or local government agency, or an
institution of higher education as defined at 20 U.S.C. 1001(a); or
income from service on advisory committees or review panels for a
federal, state, or local government agency, or an institution of higher
education as defined at 20 U.S.C. 1001(a).
Sec. 94.4 Responsibilities of Institutions regarding Investigator
financial conflicts of interest.
Each Institution shall:
(a) Maintain an up-to-date, written, enforced policy on financial
conflicts of interest that complies with this part, and make such
policy available via a publicly accessible Web site. If an Institution
maintains a policy on financial conflicts of interest that includes
standards that are more stringent than this part (e.g., that require a
more extensive disclosure of financial interests), the Institution
shall adhere to its policy and shall provide FCOI reports regarding
identified financial conflicts of interest to the PHS Awarding
Component in accordance with the Institution's own standards.
(b) Inform each Investigator of the Institution's policy on
financial conflicts of interest, the Investigator's responsibilities
regarding disclosure of significant financial interests, and of these
regulations, and require each Investigator to complete training
regarding same prior to engaging in PHS-funded research and,
thereafter, at least once every two years.
(c) If the Institution carries out the PHS-funded research through
a subrecipient (e.g., subcontractor or collaborator):
(1) Incorporate as part of a written agreement with the
subrecipient legally enforceable terms that establish whether the
financial conflicts of interest policy of the awardee Institution or
that of the subrecipient applies to the subrecipient's Investigators.
(i) If the subrecipient's financial conflicts of interest policy
applies to subrecipient Investigators, the subrecipient shall certify
as part of the agreement that its policy complies with this part. If
the subrecipient cannot
[[Page 28710]]
provide such certification, the agreement shall state that subrecipient
Investigators are subject to the financial conflicts of interest policy
of the awardee Institution;
(ii) If the subrecipient's financial conflicts of interest policy
applies to subrecipient Investigators, the agreement shall specify time
period(s) for the subrecipient to report all identified financial
conflicts of interest to the awardee Institution. Such time period(s)
shall be sufficient to enable the awardee Institution to provide timely
FCOI reports, as necessary, to the PHS;
(iii) If subrecipient Investigators are subject to the awardee
Institution's financial conflicts of interest policy, the agreement
shall specify time period(s) for the subrecipient to submit all
Investigator disclosures of significant financial interests to the
awardee Institution. Such time period(s) shall be sufficient to enable
the awardee Institution to comply timely with its review, management,
and reporting obligations under this part.
(2) Provide FCOI reports to the PHS regarding all financial
conflicts of interest of all subrecipient Investigators consistent with
this part.
(d) Designate an institutional official(s) to solicit and review
disclosures of significant financial interests from each Investigator
who is planning to participate in the PHS-funded research.
(e)(1) Require that each Investigator who is planning to
participate in the PHS-funded research disclose to the Institution's
designated official(s) the Investigator's significant financial
interests (and those of the Investigator's spouse and dependent
children).
(2) Require that each Investigator who is participating in the PHS-
funded research submit an updated disclosure of significant financial
interests at least annually during the period of the award. Such
disclosure shall include any information that was not disclosed
initially to the Institution pursuant to paragraph (e)(1) of this
section, or in a subsequent disclosure of significant financial
interests, and shall include updated information regarding any
previously-disclosed significant financial interest (e.g., the updated
value of a previously-disclosed equity interest).
(3) Require that each Investigator who is participating in the PHS-
funded research submit an updated disclosure of significant financial
interests within thirty days of acquiring a new significant financial
interest (e.g., through purchase, marriage, or inheritance).
(f) Provide guidelines consistent with this part for the designated
institutional officials to determine whether an Investigator's
significant financial interest is related to PHS-funded research and,
if so related, whether the significant financial interest is a
financial conflict of interest. An Investigator's significant financial
interest is related to PHS-funded research when the Institution,
through its designated officials, reasonably determines that the
significant financial interest: Appears to be affected by the PHS-
funded research; or is in an entity whose financial interest appears to
be affected by the research. A financial conflict of interest exists
when the Institution, through its designated officials, reasonably
determines that the significant financial interest could directly and
significantly affect the design, conduct, or reporting of the PHS-
funded research.
(g) Take such actions as necessary to manage financial conflicts of
interest, including any financial conflicts of a subrecipient
Investigator pursuant to paragraph (c) of this section. Management of
an identified financial conflict of interest requires development and
implementation of a management plan and, if necessary, a mitigation
plan pursuant to Sec. 94.5(a).
(h) Provide initial and ongoing FCOI reports to the PHS as required
pursuant to Sec. 94.5(b).
(i) Maintain records relating to all Investigator disclosures of
financial interests and the Institution's review of, or response to,
such disclosures (whether or not a disclosure resulted in the
Institution's determination of a financial conflict of interest), for
at least three years from the date of final payment or, where
applicable, for the time periods specified in 48 CFR part 4, subpart
4.7.
(j) Establish adequate enforcement mechanisms and provide for
employee sanctions or other administrative actions to ensure
Investigator compliance as appropriate.
(k) Certify, in each contract proposal to which this part applies,
that the Institution:
(1) Has in effect at that Institution an up-to-date, written, and
enforced administrative process to identify and manage financial
conflicts of interest with respect to all research projects for which
funding is sought or received from the PHS;
(2) Shall promote and enforce Investigator compliance with this
part's requirements including those pertaining to disclosure of
significant financial interests;
(3) Shall manage financial conflicts of interest and provide
initial and ongoing FCOI reports to the PHS consistent with this part;
(4) Agrees to make information available, promptly upon request, to
the HHS relating to any Investigator disclosure of financial interests
and the Institution's review of, or response to, such disclosure,
whether or not the disclosure resulted in the Institution's
determination of a financial conflict of interest; and
(5) Shall fully comply with the requirements of this part.
Sec. 94.5 Management and reporting of financial conflicts of
interest.
(a) Management of financial conflicts of interest.
(1) Prior to the Institution's expenditure of any funds under a
PHS-funded research project, the designated officials of an Institution
shall, consistent with Sec. 94.4(f): Review all Investigator
disclosures of significant financial interests; determine whether any
significant financial interests relate to PHS-funded research;
determine whether a financial conflict of interest exists; and, if so,
develop and implement a management plan that shall specify the actions
that have been, and shall be, taken to manage such financial conflict
of interest. Examples of conditions or restrictions that might be
imposed to manage a financial conflict of interest include, but are not
limited to:
(i) Public disclosure of financial conflicts of interest (e.g.,
when presenting or publishing the research);
(ii) For research projects involving human subjects research,
disclosure of financial conflicts of interest directly to participants;
(iii) Appointment of an independent monitor capable of taking
measures to protect the design, conduct, and reporting of the research
against bias, or the appearance of bias, resulting from the financial
conflict of interest;
(iv) Modification of the research plan;
(v) Change of personnel or personnel responsibilities, or
disqualification of personnel from participation in all or a portion of
the research;
(vi) Reduction or elimination of the financial interest (e.g., sale
of an equity interest); or
(vii) Severance of relationships that create actual or potential
financial conflicts.
(2) Whenever, in the course of an ongoing PHS-funded research
project, a new Investigator participating in the research project
discloses a significant financial interest or an existing Investigator
discloses a new significant
[[Page 28711]]
financial interest to the Institution, the designated officials of the
Institution shall, within sixty days: Review the disclosure of
significant financial interests; determine whether it is related to
PHS-funded research; determine whether a financial conflict of interest
exists; and, if so, implement, on at least an interim basis, a
management plan that shall specify the actions that have been, and will
be, taken to manage such financial conflict of interest. Depending on
the nature of the significant financial interest, an Institution may
determine that additional interim measures are necessary with regard to
the Investigator's participation in the PHS-funded research project
between the date of disclosure and the completion of the Institution's
review.
(3) Whenever an Institution identifies a significant financial
interest that was not disclosed timely by an Investigator or, for
whatever reason, was not previously reviewed by the Institution during
an ongoing PHS-funded research project (e.g., was not timely reviewed
or reported by a subrecipient), the designated officials shall, within
sixty days: Review the significant financial interest; determine
whether it is related to PHS-funded research; determine whether a
financial conflict of interest exists; and, if so:
(i) Implement, on at least an interim basis, a management plan that
shall specify the actions that have been, and will be, taken to manage
such financial conflict of interest going forward;
(ii) Implement, on at least an interim basis, a mitigation plan
which shall include review and determination as to whether any PHS-
funded research, or portion thereof, conducted prior to the
identification and management of the financial conflict of interest was
biased in the design, conduct, or reporting of such research. Depending
on the nature of the significant financial interest, an Institution may
determine that additional interim measures are necessary with regard to
the Investigator's participation in the PHS-funded research project
between the date that the significant financial interest is identified
and the completion of the Institution's review.
(4) Whenever an Institution implements a management plan pursuant
to this part, the Institution shall monitor Investigator compliance
with the management plan on an ongoing basis until the completion of
the PHS-funded research project.
(5)(i) Prior to the Institution's expenditure of any funds under a
PHS-funded research project, the Institution shall make available via a
publicly accessible Web site information concerning any significant
financial interest disclosed to the Institution that meets the
following three criteria:
(A) The significant financial interest was disclosed and is still
held by the PD/PI or any other Investigator who has been identified by
the Institution as senior/key personnel for the PHS-funded research
project in the grant application, contract proposal, contract, progress
report, or other required report submitted to the PHS;
(B) The Institution determines that the significant financial
interest is related to the PHS-funded research; and
(C) The Institution determines that the significant financial
interest is a financial conflict of interest.
(ii) The information that the Institution makes available via a
publicly accessible Web site shall include, at a minimum, the
following: The Investigator's name; the Investigator's position with
respect to the research project; the nature of the significant
financial interest; and the approximate dollar value of the significant
financial interest (dollar ranges are permissible: Less than $20,000;
less than $50,000; less than $100,000; less than or equal to $250,000;
greater than $250,000), or a statement that the interest is one whose
value cannot be readily determined through reference to public prices
or other reasonable measures of fair market value.
(iii) The information that the Institution makes available via a
publicly accessible Web site shall be updated at least annually. In
addition, the Institution shall update the Web site within sixty days
of the Institution's receipt or identification of information
concerning any additional significant financial interest that was not
previously disclosed by the PD/PI or senior/key personnel for the PHS-
funded research project, or upon the disclosure of a significant
financial interest by a new PD/PI or new senior/key personnel for the
PHS-funded research project, if the Institution determines that the
significant financial interest is related to the PHS-funded research
and is a financial conflict of interest.
(iv) Information concerning the significant financial interests of
an individual subject to this paragraph (a)(5) of this section shall
remain available via the Institution's publicly accessible Web site for
at least five years from the date that the information was most
recently updated.
(6) In addition to the types of financial conflicts of interest as
defined in this part that must be managed pursuant to this section, an
Institution may require the management of other financial conflicts of
interest, as the Institution deems appropriate.
(b) Reporting of financial conflicts of interest.
(1) Prior to the Institution's expenditure of any funds under a
PHS-funded research project, the Institution shall provide to the PHS
Awarding Component a FCOI report regarding any Investigator significant
financial interest found by the Institution to be conflicting and
ensure that the Institution has implemented a management plan in
accordance with this part.
(2) For any significant financial interest that the Institution
identifies as conflicting subsequent to the Institution's initial FCOI
report during an ongoing PHS-funded research project (e.g., upon the
participation of a new Investigator in the research project), the
Institution shall provide to the PHS Awarding Component, within sixty
days, a FCOI report regarding the financial conflict of interest and
ensure that the Institution has implemented a management plan in
accordance with this part. Where such FCOI report involves a
significant financial interest that was not disclosed timely by an
Investigator or, for whatever reason, was not previously reviewed by
the Institution (e.g., was not timely reviewed or reported by a
subrecipient), the Institution shall also provide with its FCOI report
the mitigation plan implemented by the Institution to determine whether
any PHS-funded research, or portion thereof, conducted prior to the
identification and management of the financial conflict of interest was
biased in the design, conduct, or reporting of such research.
(3) Any FCOI report required under paragraphs (b)(1) or (b)(2) of
this section shall include sufficient information to enable the PHS
Awarding Component to understand the nature and extent of the financial
conflict, and to assess the appropriateness of the Institution's
management plan. Elements of the FCOI report shall include, but are not
limited to the following:
(i) Project/Contract number;
(ii) PD/PI or Contact PD/PI if a multiple PD/PI model is used;
(iii) Name of the Investigator with the financial conflict of
interest;
(iv) Nature of the financial interest (e.g., equity, consulting
fee, travel reimbursement, honorarium);
(v) Value of the financial interest (dollar ranges are permissible:
$0-$4,999; $5,000-$9,999; $10,000-$19,999; amounts between $20,000-
$100,000 by increments of $20,000; amounts above $100,000 by increments
of $50,000), or a statement that the
[[Page 28712]]
interest is one whose value cannot be readily determined through
reference to public prices or other reasonable measures of fair market
value;
(vi) A description of how the financial interest relates to the
PHS-funded research and the basis for the Institution's determination
that the financial interest conflicts with such research;
(vii) A description of the key elements of the Institution's
management plan, including:
(A) The role and function of the conflicted Investigator in the
research project;
(B) The rationale for including the conflicted Investigator in the
research project;
(C) The conditions of the management plan;
(D) How the management plan will safeguard objectivity in the
research project;
(E) Confirmation of the Investigator's agreement to the management
plan;
(F) How the management plan will be monitored to ensure
Investigator compliance;
(G) Other information as needed.
(4) For any financial conflict of interest previously reported by
the Institution with regard to an ongoing PHS-funded research project,
the Institution shall provide an annual FCOI report that addresses the
status of the financial conflict of interest and any changes to the
management plan to the PHS Awarding Component for the duration of the
PHS-funded research project. The annual FCOI report shall specify
whether the financial conflict is still being managed or explain why
the financial conflict of interest no longer exists. The Institution
shall provide annual FCOI reports to the PHS Awarding Component for the
duration of the project period (including extensions with or without
funds) in the time and manner specified by the PHS Awarding Component.
(5) In addition to the types of financial conflicts of interest as
defined in this part that must be reported pursuant to this section, an
Institution may require the reporting of other financial conflicts of
interest, as the Institution deems appropriate.
Sec. 94.6 Remedies.
(a) If the failure of an Investigator to comply with an
Institution's financial conflicts of interest policy or a financial
conflict of interest management plan appears to have biased the design,
conduct, or reporting of the PHS-funded research, the Institution shall
promptly notify the PHS Awarding Component of the corrective action
taken or to be taken. The PHS Awarding Component will consider the
situation and, as necessary, take appropriate action, or refer the
matter to the Institution for further action, which may include
directions to the Institution on how to maintain appropriate
objectivity in the funded project.
(b) The HHS may inquire at any time (i.e., before, during, or after
award) into any Investigator disclosure of financial interests and the
Institution's review of, or response to, such disclosure, whether or
not the disclosure resulted in the Institution's determination of a
financial conflict of interest. An Institution is required to submit,
or permit on site review of, all records pertinent to compliance with
this part. To the extent permitted by law, HHS will maintain the
confidentiality of all records of financial interests. On the basis of
its review of records or other information that may be available, the
PHS Awarding Component may decide that a particular financial conflict
of interest will bias the objectivity of the PHS-funded research to
such an extent that further corrective action is needed or that the
Institution has not managed the financial conflict of interest in
accordance with this part. The PHS Awarding Component may determine
that issuance of a Stop Work Order by the Contracting Officer or other
enforcement action is necessary until the matter is resolved.
(c) In any case in which the HHS determines that a PHS-funded
project of clinical research whose purpose is to evaluate the safety or
effectiveness of a drug, medical device, or treatment has been
designed, conducted, or reported by an Investigator with a financial
conflict of interest that was not managed or reported by the
Institution as required by this part, the Institution shall require the
Investigator involved to disclose the financial conflict of interest in
each public presentation of the results of the research and to request
an addendum to previously published presentations.
Dated: March 26, 2010.
Francis S. Collins,
Director, National Institutes of Health.
Approved: April 14, 2010.
Kathleen Sebelius,
Secretary.
[FR Doc. 2010-11885 Filed 5-20-10; 8:45 am]
BILLING CODE 4140-01-P