This week, the U.S. Department of Health and Human Services (HHS) issued an updated 144 page Final Rule on conflict of interest, providing a framework for identifying, and managing investigators’ financial conflicts of interest. Staff from the National Institutes of Health (NIH) worked with others in HHS to revise the 1995 regulations to update and enhance the objectivity and integrity of the research process.
HHS Secretary Kathleen Sebelius noted that the “financial conflict of interest rules must keep up with the times if we are to maintain our leadership role in the global scientific community.”
The final rule amends the PHS regulations ``Responsibility of Applicants for Promoting Objectivity in Research for which PHS Funding is Sought’’ (42 C.F.R. Part 50, Subpart F) and ``Responsible Prospective Contractors’’ (45 C.F.R. Part 94). A full description of the changes and final rule are below.
Major changes to the regulations include the definition of significant financial interest (SFI), the extent of investigator disclosure, the information reported to the Public Health Service (PHS) awarding component, the information made accessible to the public, and investigator training. For example, the revised regulations:
- Require investigators to disclose to their institutions all of their significant financial interests related to their institutional responsibilities.
- Lower the monetary threshold at which significant financial interests require disclosure, generally from $10,000 to $5,000.
- Require institutions to report to the PHS awarding component additional information on identified financial conflicts of interest and how they are being managed.
- Require institutions to make certain information accessible to the public concerning identified SFIs held by senior/key personnel.
- Require investigators to complete training related to the regulations and their institution’s financial conflict of interest policy.
NIH Director Dr. Francis S. Collins asserted that, “The NIH is committed to safeguarding the public’s trust in federally supported research that is conducted with the highest scientific and ethical standards.” He added that, “Strengthening key provisions of the regulations with added transparency will send a clear message that NIH is committed to promoting objectivity in the research it funds.”
The regulations will be implemented no later than 365 calendar days after publication of the final rule in the Federal Register. The 1995 regulations were revised after a review of public comments from the advance notice of proposed rulemaking and the notice of proposed rulemaking.
An Institution applying for or receiving PHS funding from a grant, cooperative agreement, or contract that is covered by this rule must be in full compliance with all of the regulatory requirements herein:
- No later than August 24, 2012; and
- Immediately upon making its institutional Financial Conflict of Interest (FCOI) policy publicly accessible as described herein
In the interim, Institutions should continue to comply with the 1995 regulations and report Investigator FCOIs to the Public Health Service (PHS) Awarding Component as required in the 1995 regulations.
For information concerning questions about the rulemaking process 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, email jm40z@nih.gov.
For substantive questions about the rule contact Dr. Sally Rockey, NIH Deputy Director for Extramural Research FCOICompliance@mail.nih.gov.
We have summarized the rule and provided some comments in the remainder of this article.
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 1995 regulations), that are designed to promote objectivity in PHS-funded research. The 1995 regulations cover 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 1995 regulations:
- The Institution is responsible for complying with the regulations, including maintaining a written and enforced FCOI policy; managing, reducing, or eliminating identified conflicts; and reporting identified conflicts to the PHS Awarding Component. The reports denote the existence of an FCOI and the Institution’s assurance that it has been managed, reduced, or eliminated.
- Investigators are responsible for complying with their Institution's written FCOI policy and for disclosing their SFIs3 to the Institution.
- Maintaining objectivity in research requires a commitment from Institutions and their Investigators to completely disclose, appropriately review, and robustly manage identified conflicts.
- The PHS Awarding Components are responsible for overseeing institutional compliance with the regulations.
The purpose of the 1995 regulations was 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 the 1995 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.
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.
Consequently, NIH cited recent studies from the Association of American Medical Colleges and the Association of American Universities (AAMC/AAU), which highlighted the increasing complexity of the financial relationships between biomedical researchers and industry and the possible ramifications of those relationships. NIH noted that, “these relationships, now encouraged in many forms, may involve financial linkages that are entirely benign but will in other cases carry the potential to create serious conflicts of interest.”
NIH also cited a “recent study of the Institute of Medicine (IOM) on Conflict of Interest in Medical Research, Education, and Practice, which stated that, “physicians and researchers must exercise judgment in complex situations that are fraught with uncertainty.”
Despite citing primarily anti-industry sources, NIH acknowledged that, relationships between industry and academia/physicians “have produced important benefits, particularly through research collaborations that improve individual and public health.”
NIH also recognized “that translating basic research into clinical application is critical for advancing human health, and this process requires fruitful collaborations among government, academia, and industry.” Accordingly, NIH emphasized that the final rule is not “designed to prevent or hinder relationships among government, academia, and industry. Rather, the revisions are aimed at facilitating such relationships by increasing transparency and accountability so that the resulting research is considered objective and in the interest of the public.”
NIH also acknowledged the limitations of the research cited above. Nevertheless, NIH provided no evidence to support its reasoning and rationale and instead, only pointed to “increased public concern evidenced by statements and correspondence from members of Congress” and maintained that, “widespread relationships with industry have created significant risks that individual and institutional financial interests may unduly influence professionals’ judgments about the primary interests or goals of medicine.”
Accordingly, NIH claimed that, “such conflicts of interest threaten the integrity of scientific investigations, the objectivity of medical education, and the quality of patient care.”
Notice of Proposed Rulemaking (NPRM)
A number of factors led to HHS deciding to explore the need to revise the 1995 regulations, including 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. These issues have raised questions as to whether a more rigorous approach to Investigator disclosure, institutional management of financial conflicts, and federal oversight is required.
HHS published an Advance Notice of Proposed Rulemaking on May 8, 2009. After analyzing public comments, HHS published a Notice of Proposed Rulemaking on May 21, 2010, to amend the 1995 regulations by expanding and adding transparency to Investigators’ disclosure of SFIs, enhancing regulatory compliance and effective institutional oversight and management of Investigators’ financial conflicts of interests, as well as HHS’ compliance oversight. During the 90 day comment period that ended on August 19, 2010, NIH received 136 unique comments on the NPRM and the Extension Notice. Major changes to the 1995 regulations proposed in the NPRM included:
- Expanding the scope of the regulations to include SBIR/STTR Phase I applications.
- Amending the definition of SFI to include a de minimis threshold of $5,000 for disclosure that generally applies to payments and/or equity interests as well as any equity interest in non-publicly traded entities.
- Excluding income from government agencies or Institutions of higher education for seminars, lectures, teaching, or service on advisory or review panels.
- Expanding Investigator disclosure requirements to include SFIs that are related to an Investigator’s institutional responsibilities, with Institutions responsible for determining whether a disclosed SFI relates to the research for which PHS funding is sought and constitutes an FCOI.
- Enhancing the information on an FCOI reported by the Institution to the PHS Awarding Component to include the information required under the 1995 regulations plus the value of the financial interest or a statement that a value cannot be readily determined, the nature of the FCOI, a description of how the FCOI relates to PHS-funded research, and key elements of the Institution’s management plan.
- Requiring that before spending funds for PHS-supported research, an Institution must post on a publicly accessible Web site information on SFIs of senior/key personnel that the Institution determines are related to the PHS-funded research and constitute an FCOI.
FINAL RULE
The final rule amends the PHS regulations “Responsibility of Applicants for Promoting Objectivity in Research for which PHS Funding is Sought’” (42 C.F.R. Part 50, Subpart F) and ``Responsible Prospective Contractors’’ (45 C.F.R. Part 94). The purpose of the rule is to “promote objectivity in research by establishing standards that provide a reasonable expectation that the design, conduct, and reporting of research funded under Public Health Service (PHS) grants or cooperative agreements will be free from bias resulting from Investigator financial conflicts of interest.
The final rule 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 who is planning to participate in, or is participating in, such research; provided, however, that this subpart does not apply to SBIR Program Phase I applications.
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.
Definitions
The final rule changes and clarifies several definitions.
- Disclosure of significant financial interests means an Investigator’s disclosure of significant financial interests to an Institution.
NIH intended the term “disclosure” to capture communication from an Investigator to an Institution regarding SFIs, whereas the term “report” captures communication from an Institution to the PHS Awarding Component regarding FCOI.
- Financial conflict of interest (FCOI) means a significant financial interest that could directly and significantly affect the design, conduct, or reporting of PHS-funded research. The term “significantly” in this context means that the financial interest would have a material effect on the research, which we believe appropriately fulfills the intent of the regulations, i.e., to maintain objectivity in PHS funded research.
NIH noted that, institutions may include a variety of criteria in the review of Investigators’ SFIs and the determination of whether they constitute an FCOI with the PHS-funded research, including those suggested by respondents.
- FCOI report means an Institution’s report of a financial conflict of interest to a PHS Awarding Component.
- Financial interest means anything of monetary value, whether or not the value is readily ascertainable.
- 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, and as defined by the Institution in its policy on financial conflicts of interest, which may include for example (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.
NIH noted that, “income from any activity that is related to the Investigator’s institutional responsibilities as defined by the Institution that meets the monetary threshold must be disclosed.”
- Investigator means the project director or principal Investigator 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, which may include, for example, collaborators or consultants.
NIH eliminated the reference to the Investigator’s spouse and dependent children in this definition because they believed such reference was more appropriate to include in the SFI definition, below.
- Manage means taking action to address a financial conflict of interest, which can include reducing or eliminating the financial conflict of interest, to ensure, to the extent possible, that the design, conduct, and reporting of research will be free from bias.
NIH explained that it does “not intend to imply that every FCOI must be eliminated; the goal of the regulations is to ensure appropriate management so as to maintain objectivity of the research.”
- PD/PI means a project director or principal Investigator of a PHS-funded research project; the PD/PI is included in the definitions of senior/key personnel and Investigator under this subpart.
- Research means a systematic investigation, study or experiment 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 (e.g., a published article, book or book chapter) and product development (e.g., a diagnostic test or drug). 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 or cooperative agreement, 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.
- Senior/key personnel means the PD/PI and any other person identified as senior/key personnel by the Institution in the grant application, progress report, or any other report submitted to the PHS by the Institution under this subpart.
Significant Financial Interest (SFI)
The final NIH rule states that, Significant financial interest means:
- 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:
- 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); 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;
- 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 when the Investigator (or the Investigator’s spouse or dependent children) holds any equity interest (e.g., stock, stock option, or other ownership interest); or
- Intellectual property rights and interests (e.g., patents, copyrights), upon receipt of income related to such rights and interests.
- NIH expressed concern that with regard to “paid authorship,” that, “Investigators may have accepted payment from private entities, in return for allowing their names to be used as authors on publications for which they had very limited input”—“ghostwriting.” Accordingly, NIH explained 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.”
NIH noted that, 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 monetary threshold was met or exceeded.
In addition to disclosing SFIs received in the 12 months preceding the disclosure, Investigators are required to disclose new SFIs to the Institution within 30 days, and if payments received after the initial disclosure give rise to an SFI that is determined to be an FCOI by the institutional official(s), the Institution is required to submit an FCOI report to the PHS Awarding Component. The final rule also includes a requirement for annual updates.
NIH explained that the $5,000 threshold would apply to equity interests and “payment for services,” which would include salary but not royalties. NIH noted that, “royalties nevertheless are potentially subject to disclosure, as are other interests related to intellectual property.” Specifically, the threshold of $5,000 applies 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.
However, as discussed further below, 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.
Since income related to an intellectual property interest may be received before a patent is issued, NIH noted that, it “would expect institutional policies to require disclosure upon the filing of a patent application or the receipt of income related to the intellectual property rights or interests, whichever is earlier.” Therefore, NIH explained that, “unlicensed intellectual property that does not generate income is excluded.” Nonetheless, such interests have the potential to become significant and generate income, at which point they would become subject to the regulations.
NIH noted that Institutions are free to expand upon these requirements in their institutional policies and when considering whether an SFI is an FCOI with regard to the PHS-funded research.
Travel
Investigators also must disclose the occurrence of any reimbursed or sponsored travel (i.e., that which is paid on behalf of the Investigator and not reimbursed to the Investigator so that the exact monetary value may not be readily available), related to their institutional responsibilities.
Travel that is reimbursed or sponsored by a federal, state, or local government agency, an Institution of higher education as defined at 20 U.S.C. 1001(a), an academic teaching hospital, a medical center, or a research institute that is affiliated with an Institution of higher education is not subject to this disclosure requirement.
NIH’s final rule requires that the Institution’s FCOI policy specify the details of this disclosure, which will include, at a minimum:
- The purpose of the trip
- The identity of the sponsor/organizer
- The destination, and
- The duration
Although the regulations do not require disclosure of the monetary value of the sponsored or reimbursed travel, in accordance with the Institution’s FCOI policy, the institutional official(s) will determine if further information is needed, including a determination or disclosure of monetary value, in order to determine whether the travel constitutes an FCOI with the PHS-funded research.
NIH noted that, depending on the source of funding and other circumstances (e.g., destination, duration) of specific travel, the Institution may consider whether that sponsored travel could affect the design, conduct, or reporting of PHS-funded research.
Excluded From “Significant Financial Interest”
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, including:
- Intellectual property rights assigned to the Institution and agreements to share in royalties related to such rights;
- Any ownership interest in the Institution held by the Investigator, if the Institution is a commercial or for-profit organization;
- Income from investment vehicles, such as mutual funds and retirement accounts, as long as the Investigator does not directly control the investment decisions made in these vehicles;
- Income from seminars, lectures, or teaching engagements sponsored by a federal, state, or local government agency, an Institution of higher education as defined at 20 U.S.C. 1001(a), an academic teaching hospital, a medical center, or a research institute that is affiliated with an Institution of higher education; or
- Income from service on advisory committees or review panels for a federal, state, or local government agency, an Institution of higher education as defined at 20 U.S.C. 1001(a), an academic teaching hospital, a medical center, or a research institute that is affiliated with an Institution of higher education.
NIH noted that if a private organization is acting as a contractor to the federal, state, or local government agency, for the purposes of these regulations, such income is excluded from the definition.
The 1995 regulations excluded from the SFI definition any ownership interests in the Institution, if the Institution is an applicant under the SBIR Program. As proposed in the NPRM, NIH broadened the exclusion to cover any ownership interests in the Institution if the Institution is a commercial or for-profit organization (whether or not the Institution is an applicant under the SBIR Program).
A few respondents requested further clarification, of situations in which an Investigator is employed by an Institution and also has equity in a for-profit company. In those cases, his or her equity would only be excluded from disclosure requirements when the for-profit company is the Institution that is applying for, or that receives, the PHS research funding in which the Investigator is participating.
NIH also clarified that intellectual property rights assigned to the Institution and agreements to share in royalties related to such rights are also excluded from the SFI definition.
NIH provided guidance in the form of Frequently Asked Questions on the NIH Web site recognizing that interests in a pooled fund such as a diversified mutual fund may be sufficiently remote that it would not reasonably be expected to create a conflict of interest for a PHS-funded Investigator.
Small Business Innovation Research (SBIR) Program
The 1995 regulations were applicable to each Institution that seeks or receives PHS funding for research and, through implementation of the regulations by each Institution, to each Investigator participating in such research. However, the 1995 regulations excluded SBIR/STTR Phase I applications because of the expectation that such applications “are for limited amounts.” Because the size of these awards has increased since 1995, NIH proposed in the NPRM to include SBIR/STTR Phase I applications in the revised regulations.
However, in the final rule, NIH determined that this change from the 1995 regulations could create an undue burden. NIH noted that SBIR/STTR companies are small in size (with the average NIH SBIR/STTR company having approximately 20 employees and many have only 1-3 employees), and these companies tend to be limited in resources. Accordingly, NIH found the argument to be compelling that the investment required to comply with the regulations could create a disproportionate burden on small businesses.
Responsibilities of Institutions regarding Investigator financial conflicts of interest
The final rule requires that each institution 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 the Institution does not have any current presence on a publicly accessible Web site (and only in those cases), the Institution must make its written policy available to any requestor within five business days of a request. If, however, the Institution acquires a presence on a publicly accessible Web site during the time of the PHS award, the requirement to post the information on that Web site will apply within 30 calendar days.
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 must adhere to its policy and must provide FCOI reports regarding identified financial conflicts of interest to the PHS Awarding Component in accordance with the Institution’s own standards and within the timeframe prescribed by this subpart.
The final rule requires that each institution 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 the same prior to engaging in research related to any PHS-funded grant and at least every four years, and immediately when any of the following circumstances apply:
- The Institution revises its financial conflict of interest policies or procedures in any manner that affects the requirements of Investigators;
- An Investigator is new to an Institution; or
- An Institution finds that an Investigator is not in compliance with the Institution’s financial conflict of interest policy or management plan.
Information and other resources developed by NIH, which will be updated as appropriate, are available as resources for the new regulatory training requirement and can be accessed through the NIH Web site’s Financial Conflict of Interest page at http://grants.nih.gov/grants/policy/coi/.
If the Institution carries out the PHS-funded research through a subrecipient (e.g., subcontractors or consortium members), the Institution (awardee Institution) must take reasonable steps to ensure that any subrecipient Investigator complies with this subpart by:
- Incorporating as part of a written agreement with the subrecipient terms that establish whether the financial conflicts of interest policy of the awardee Institution or that of the subrecipient will apply to the subrecipient’s Investigators. Additional rules about subrecipient’s investigators can be found in the rule.
- Providing FCOI reports to the PHS Awarding Component regarding all financial conflicts of interest of all subrecipient Investigators consistent with this subpart, i.e., prior to the expenditure of funds and within 60 days of any subsequently identified FCOI.
The final rule requires that each institution designate an institutional official(s) to solicit and review disclosures of significant financial interests from each Investigator who is planning to participate in, or is participating in, the PHS-funded research.
The final rule requires 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) no later than the time of application for PHS-funded research.
- Each Investigator who is participating in the PHS-funded research to submit an updated disclosure of significant financial interests at least annually, in accordance with the specific time period prescribed by the Institution, during the period of the award. Such disclosure must include any information that was not disclosed initially to the Institution, or in a subsequent disclosure of significant financial interests (e.g., any financial conflict of interest identified on a PHS-funded project that was transferred from another Institution), and must include updated information regarding any previously disclosed significant financial interest (e.g., the updated value of a previously disclosed equity interest)
- Each Investigator who is participating in the PHS-funded research to submit an updated disclosure of significant financial interests within thirty days of discovering or acquiring (e.g., through purchase, marriage, or inheritance) a new significant financial interest.
The final rule requires that each institution provide guidelines for the designated institutional official(s) 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 official(s), reasonably determines that the significant financial interest:
- Could be affected by the PHS-funded research; or
- Is in an entity whose financial interest could be affected by the research.
The Institution may involve the Investigator in the designated official(s)’s determination of whether a significant financial interest is related to the PHS-funded research. A financial conflict of interest exists when the Institution, through its designated official(s), reasonably determines that the significant financial interest could directly and significantly affect the design, conduct, or reporting of the PHS-funded research.
The final rule requires that each institution take such actions as necessary to manage financial conflicts of interest, including any financial conflicts of a subrecipient Investigator. Management of an identified financial conflict of interest requires development and implementation of a management plan and, if necessary, a retrospective review and a mitigation report.
The final rule requires that each institution provide initial and ongoing FCOI reports to the PHS.
The final rule requires that each institution maintain records relating to all Investigator disclosures of financial interests and the Institution’s review of, and response to, such disclosures (whether or not a disclosure resulted in the Institution’s determination of a financial conflict of interest) and all actions under the Institution’s policy or retrospective review, if applicable, for at least three years from the date the final expenditures report is submitted to the PHS or, where applicable, from other dates specified in 45 CFR 74.53(b) and 92.42 (b) for different situations.
The final rule requires that each institution establish adequate enforcement mechanisms and provide for employee sanctions or other administrative actions to ensure Investigator compliance as appropriate.
The final rule requires that each institution to certify, in each application for funding to which this subpart applies, that the Institution:
- 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;
- Must promote and enforce Investigator compliance with this subpart’s requirements including those pertaining to disclosure of significant financial interests;
- Must manage financial conflicts of interest and provide initial and ongoing FCOI reports to the PHS Awarding Component consistent with this subpart;
- 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, and response to, such disclosure, whether or not the disclosure resulted in the Institution’s determination of a financial conflict of interest; and
- Must fully comply with the requirements of this subpart.
Management and reporting of financial conflicts of interest
Prior to the Institution’s expenditure of any funds under a PHS-funded research project, the designated official(s) of an Institution must:
- 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 must specify the actions that have been, and must 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:
- Public disclosure of FCOI (e.g., when presenting or publishing the research);
- For research projects involving humans, 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 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 the financial interest (e.g., sale of an equity interest); or
- Severance of relationships that create financial conflicts
Whenever, in the course of an ongoing PHS-funded research project, an Investigator who is new to 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 official(s) of the Institution must, within 60 days:
- review the disclosure of the significant financial interest;
- 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 must 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.
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 official(s) must, 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:
- Implement, on at least an interim basis, a management plan that must specify the actions that have been, and will be, taken to manage such financial conflict of interest going forward;
- In addition, whenever a financial conflict of interest is not identified or managed in a timely manner including failure by the Investigator to disclose a significant financial interest that is determined by the Institution to constitute a financial conflict of interest; failure by the Institution to review or manage such a financial conflict of interest; or failure by the Investigator to comply with a financial conflict of interest management plan, the Institution must, within 120 days of the Institution’s determination of noncompliance, complete a retrospective review of the Investigator’s activities and the PHS-funded research project to determine whether any PHS funded research, or portion thereof, conducted during the time period of the noncompliance, was biased in the design, conduct, or reporting of such research.
The Institution is required to document the retrospective review; such documentation must include, but not necessarily be limited to, all of the following key elements:
- Project number;
- Project title;
- PD/PI or contact PD/PI if a multiple PD/PI model is used;
- Name of the Investigator with the FCOI;
- Name of the entity with which the Investigator has a financial conflict of interest;
- Reason(s) for the retrospective review;
- Detailed methodology used for the retrospective review (e.g., methodology of the review process, composition of the review panel, documents reviewed);
- Findings of the review; and
- Conclusions of the review.
Based on the results of the retrospective review, if appropriate, the Institution must update the previously submitted FCOI report, specifying the actions that will be taken to manage the financial conflict of interest going forward. If bias is found, the Institution is required to notify the PHS Awarding Component promptly and submit a mitigation report to the PHS Awarding Component.
The mitigation report must include, at a minimum, the key elements documented in the retrospective review above and a description of the impact of the bias on the research project and the Institution's plan of action or actions taken to eliminate or mitigate the effect of the bias (e.g., impact on the research project; extent of harm done, including any qualitative and quantitative data to support any actual or future harm; analysis of whether the research project is salvageable).
Thereafter, the Institution will submit FCOI reports annually. Depending on the nature of the financial conflict of 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 financial conflict of interest or the Investigator’s noncompliance is determined and the completion of the Institution’s retrospective review.
Whenever an Institution implements a management plan pursuant to this subpart, the Institution must monitor Investigator compliance with the management plan on an ongoing basis until the completion of the PHS-funded research project.
Prior to the Institution’s expenditure of any funds under a PHS-funded research project, the Institution must ensure public accessibility, via a publicly accessible Web site or written response to any requestor within five business days of a request, of information concerning any significant financial interest disclosed to the Institution that meets the following three criteria:
- The significant financial interest was disclosed and is still held by the senior/key personnel as defined by this subpart;
- The Institution determines that the significant financial interest is related to the PHS funded research; and
- The Institution determines that the significant financial interest is a financial conflict of interest.
The information that the Institution makes available via a publicly accessible Web site or written response to any requestor within five business days of a request, must include, at a minimum, the following:
- the Investigator’s name;
- the Investigator’s title and role with respect to the research project;
- the name of the entity in which the significant financial interest is held;
- the nature of the significant financial interest; and
- the approximate dollar value of the significant 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.
If the Institution uses a publicly accessible Web site, the information that the Institution posts must be updated at least annually. In addition, the Institution must update the Web site within 60 days of the Institution’s receipt or identification of information concerning any additional significant financial interest of the senior/key personnel for the PHS-funded research project that was not previously disclosed, or upon the disclosure of a significant financial interest of senior/key personnel new to 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.
The Web site must note that the information provided is current as of the date listed and is subject to updates, on at least an annual basis and within 60 days of the Institution’s identification of a new financial conflict of interest. If the Institution responds to written requests for the purposes of this subsection, the Institution will note in its written response that the information provided is current as of the date of the correspondence and is subject to updates, on at least an annual basis and within 60 days of the Institution’s identification of a new financial conflict of interest, which should be requested subsequently by the requestor.
Information concerning the significant financial interests of an individual must remain available, for responses to written requests or for posting via the Institution’s publicly accessible Web site for at least three years from the date that the information was most recently updated.
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 in its policy on financial conflicts of interest, as the Institution deems appropriate.
Reporting of financial conflicts of interest
Prior to the Institution’s expenditure of any funds under a PHS-funded research project, the Institution must provide to the PHS Awarding Component an FCOI report regarding any Investigator’s 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. In cases in which the Institution identifies a financial conflict of interest and eliminates it prior to the expenditure of PHS-awarded funds, the Institution must not submit an FCOI report to the PHS Awarding Component.
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 an Investigator who is new to the research project), the Institution must provide to the PHS Awarding Component, within sixty days, an 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 or managed by the Institution (e.g., was not timely reviewed or reported by a subrecipient), the Institution also is required to complete a retrospective review 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. Additionally, if bias is found, the Institution is required to notify the PHS Awarding Component promptly and submit a mitigation report to the PHS Awarding Component.
Any FCOI report must 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 must include, but are not necessarily limited to the following:
- Project number;
- PD/PI or Contact PD/PI if a multiple PD/PI model is used;
- Name of the Investigator with the financial conflict of interest;
- Name of the entity with which the Investigator has a financial conflict of interest;
- Nature of the financial interest (e.g., equity, consulting fee, travel reimbursement, honorarium);
- 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;
- 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; and
- A description of the key elements of the Institution’s management plan, including:
- Role and principal duties of the conflicted Investigator in the research project;
- Conditions of the management plan;
- How the management plan is designed to safeguard objectivity in the research project;
- Confirmation of the Investigator’s agreement to the management plan;
- How the management plan will be monitored to ensure Investigator compliance; and
- Other information as needed.
For any financial conflict of interest previously reported by the Institution with regard to an ongoing PHS-funded research project, the Institution must provide to the PHS Awarding Component an annual FCOI report that addresses the status of the financial conflict of interest and any changes to the management plan for the duration of the PHS-funded research project.
The annual FCOI report must specify whether the financial conflict is still being managed or explain why the financial conflict of interest no longer exists. The Institution must 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.
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 in its policy on financial conflicts of interest, as the Institution deems appropriate.
Remedies and Enforcement
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 must 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 PHS-funded research project.
PHS may, for example, require Institutions employing such an Investigator to enforce any applicable corrective actions prior to a PHS award or when the transfer of a PHS grant(s) involves such an Investigator.
The PHS Awarding Component and/or HHS may inquire at any time before, during, or after award into any Investigator disclosure of financial interests and the Institution’s review (including any retrospective review) of, and response to, such disclosure, regardless of whether 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 and 92.12, or suspension of funding or other enforcement action under 45 CFR 74.62 and 92.43, is necessary until the matter is resolved.
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 must 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.
Consistent with the NPRM, we have also revised this section to clarify that if an Institution’s policy on FCOI includes standards that are more stringent than the regulations, the Institution must adhere to its policy and must provide FCOI reports regarding identified FCOI to the PHS Awarding Component in accordance with the Institution’s own standards within the time periods required in the regulations.
Although the regulations do not specify a standardized federal reporting form, as suggested by one respondent, the regulations identify necessary elements of the report (e.g., 42 CFR 50.605(b)(3) and 45 CFR 94.5(b)(3)), and NIH provides a framework for reporting those elements through its online reporting system.
Regulatory Impact Analysis
NIH asserted that the cost of implementing the amended regulations is an allowable cost that may be eligible for reimbursement as a Facilities and Administrative cost on PHS-supported grants, cooperative agreements and contracts. However, NIH also recognized that “in some instances, current cost principles may limit an Institution’s ability to recover costs under the Facilities and Administrative cost mechanism.”
Discussion
These rules will be especially burdensome on small to midsized medical schools, and grant recipient hospitals. NIH admits that in “some instances institutions will not be able to recover costs". This is one more example of the federal government setting up significant unfunded requirements that will necessitate additional training, and countless hours of staff time at a time when they are under resourced.
In their preamble NIH states that “these rules are not designed to prevent or hinder relationships among government, academia and industry”. Though it objectively hard to see how compliance to these rules won’t hinder that relationship
It is unclear from reading these rules that NIH has an expectation of public health benefit with the exception of increased transparency (providing “congress” with more information) and oversight. Will this decrease the cost of new medicines and time that a treatment will get to waiting patients or it will have the opposite effect?
There has been a cry that there is no website reporting requirement from those who want to end all relationships with industry and research. It is hard to understand where they are coming from. These rules will create more administrative and bureaucratic positions for those who make their livelihoods on conflict of interest regulations. It shows the true colors of those calling for restrictions and that it has nothing to do with improving patient’s lives.
The collection of this information is not in itself bad. The problem is those who have received financial information on researchers in the past have distorted it in the press to promote their own personal agendas.
Rules like these only accelerate the movement of research from the US to places like China, India and Europe, where they are not putting restrictions and feel the need to reveal everything about everyone. These economies understand that financial interests are not necessarily conflicts and focus on bringing more treatments, jobs and cures to their countries. A lesson we will look back at and wonder what spell had we come under to get us to adopt such rules and run out our best and brightest.
