Financial Conflict of Interest Policy for WKU Office of Sponsored Programs
Western Kentucky University (WKU) has published high standards for Faculty conduct, including the conduct of research, in the WKU Faculty Manual and its Policies and Procedures. All WKU Investigators are expected to carry out research consistent with these standards.
Even when these high standards have been met, conflicts of interest or perceptions of conflicts may still occur when there is a convergence of an Investigator’s private interests with his or her research interests, such that an independent observer might reasonably question whether the Investigator’s professional actions or decisions are improperly influenced by considerations of personal financial gain. Such conflicts are common in universities and do not impugn the character or actions of any individual.
Although WKU does not require Investigators to disclose their personal financial interests as a matter of routine, WKU may be obligated by external requirements, or may establish such requirements on a program by program basis, to require disclosure processes under circumstances specified in Section II.B. of this policy. Such disclosure processes are the most widely accepted method for identifying and managing actual or potential conflicts of interest related to sponsored projects in public institutions.
Therefore, it is the policy of WKU that any Investigator (that is, any WKU employee responsible for the design, conduct, or reporting of a sponsored project at WKU) may be required to disclose significant personal financial interests related to his/her institutional responsibilities pursuant to circumstances specified by this policy.
When WKU reasonably determines that the significant financial interest could directly and significantly affect the design, conduct, or reporting of the research, WKU will take steps either to manage or to eliminate any financial conflicts of interest.
II. Purpose and Scope
This policy is intended to promote objectivity in research by establishing standards that provide a reasonable expectation that the design, conduct and reporting of research funded under externally sponsored grants, contracts and cooperative agreements will be free from bias resulting from Investigator financial conflicts of interest.
This policy shall apply automatically to research projects sponsored by the U.S. Public Health Service, including the National Institutes of Health, and the National Science Foundation. As described below, WKU may elect to apply the disclosure requirements of this policy to other externally sponsored projects and certain WKU-managed programs. Application of this policy will be expanded to other extramural sponsors as necessary to comply with official requirements subsequently imposed by those sponsors. Updated information regarding specific institutional and sponsoring agency requirements can be located at http://www.wku.edu/sponsoredprograms.
1. Federal Disclosure Requirements
This policy implements federal requirements pertaining to “Objectivity in Research for which Public Health Service Funding is Sought” promulgated by the U.S. Public Health Service (PHS), which includes the National Institutes of Health (NIH), and which are published in 42 CFR Part 50 and 45 CFR Part 94. This policy also implements federal requirements contained in the National Science Foundation’s “Investigator Financial Disclosure Policy.” Both agencies require WKU to maintain an appropriate written policy on conflict of interest disclosure as a condition for receiving federal grants. These federal requirements, as implemented in this policy, are applicable to all proposals for extramural awards submitted to these two federal agencies.
2. Other Sponsors and Programs
WKU may elect to apply the disclosure requirements of this policy to all or selected other externally funded programs. The applicability of this policy to such programs requires the joint approval of the Vice President for Research and the Provost.
3. Voluntary Disclosure On occasion, Investigators may have questions about whether certain financial interests or relationships whose disclosure is not required under the terms of this policy, but may nevertheless appear to constitute an actual or potential conflict of interest with respect to a sponsored project. In such cases, Investigators may choose voluntarily to apply the disclosure requirements of this policy to the sponsored project in question. Should WKU subsequently determine that the voluntarily disclosed interest reasonably appear to be affected by the sponsored project; WKU may take steps either to manage or to eliminate the conflict.
A. Disclosure of Financial Interests
When an Investigator has a significant financial interest that is related to his/her institutional responsibilities as defined below, a formal disclosure describing that interest is required. The absence of a significant financial interest also requires a disclosure stating that no outside interests exist.
This reporting responsibility is separate from an Investigator’s ongoing duty to update financial disclosures at least annually and as any new significant financial interests is recognized throughout the period of the sponsored award.
B. Disclosure Requirement
For each sponsored project application covered under the terms of this policy, each Investigator must fully disclose all Significant Financial Interests (and those of the Investigator’s spouse and dependent children) related to his/her institutional responsibilities no later than the time of the application for the sponsored research/project. All Investigators participating in sponsored research covered under the terms of this policy also must file an updated Disclosure of Financial Interests at least annually or within thirty days of discovering or acquiring a new significant financial interest.
C. Disclosure and Update Form(s)
When an Investigator has a significant financial interest (SFI) that is related to his/her institutional responsibilities, as defined above, a completed disclosure form detailing that interest is required. In the absence of an SFI, the Investigator must submit a negative disclosure statement using the specified reporting form. Additionally, it is an investigator’s ongoing duty to update financial disclosures annually and as new significant financial interests are recognized throughout the period of the award. Disclosure and Update form(s) will be designed by the Reviewing Official who, in consultation with the COIC, will determine the appropriate level of detail necessary for review. The Disclosure and Update form(s) must:
1. Indicate whether the Investigator (including his/her spouse or dependent children) has any significant financial interests related to his/her institutional responsibilities;
2. Provide the name of each entity in which the Investigator has a significant financial interest and the type of the financial interest (income, equity, management position, or intellectual property);
3. Indicate whether the entity in which the Investigator has a significant financial interest is a proposed subcontractor, consortium member, supplier of goods, lessor, or otherwise involved with the sponsored project(s);
4. Indicate whether the entity in which the Investigator has a significant financial interest might manufacture or commercialize any drug, vaccine, device, procedure or any other product involved in or that will predictably result from the sponsored project(s);
5. Disclosure and Update form(s) may provide the Investigator with a direct opportunity to indicate whether or not he or she believes the project(s) could directly and significantly affect the related financial interest(s) he or she is reporting; and
6. Provide notice to the Investigator that the disclosure will be open to public inspection and include a Privacy Act Notice substantially as follows: The principal purpose for requesting the information on this form is to comply with WKU policy and federal regulations regarding disclosure of any financial interests that would reasonably appear to be affected by the conduct of a sponsored project. Provision of the information is mandatory if you want to submit a proposal for support of a project covered by the terms of this policy. The information may be released or transmitted to the sponsor, including federal agency representatives, and, according to state law, may also be released to the public upon request.
D. Review of Disclosures
The Disclosure shall be reviewed by the Reviewing Official(s) and/or the COIC to determine whether any reported significant financial interest: could be affected by the funded research; or is an entity whose financial interest could be affected by the sponsored research/project. A financial conflict of interest exists when WKU through its Reviewing Official(s), reasonably determines that the significant financial interest could directly and significantly affect the design, conduct, or reporting of the sponsored research/project.
The Committee appointed by the Vice President for Research to review disclosures and relevant features of the sponsored project(s) and, on the basis of the review, to recommend to the Vice President for Research any modifications necessary to manage any financial conflicts of interests related to the project.
A direct impact occurs when the project results would be directly relevant to the development, manufacturing, or improvement of the products or services of the entity in which the Investigator has a financial interest, or when the entity is a proposed subcontractor or participant in the project. A significant impact on the financial interest is one that will materially affect the value of the entity, its earnings, or the sales of its products, or the entity is a proposed subcontractor or participant in the project.
Based on information provided in the Disclosure, the Reviewing Official(s) and/or the COIC may determine that there is no reasonable basis on which to conclude that a project could affect the financial interest and/or that the financial interest is not likely to directly and significantly affect the design, conduct, or reporting of the project. In this case, a record should be made of the Reviewing Official(s) or Committee’s action and the project can proceed without further review.
In the event that the WKU Reviewing Official(s) reasonably concludes that a project could have an impact on the financial interest and that the financial interest could affect directly and significantly the design, conduct or reporting of the project, the Disclosure and appropriate documentation shall be forwarded to the COIC. The COIC, working with the Reviewing Official(s), will make a final decision about the appropriate actions that are necessary to manage the conflict of interest. The same review process takes place when an Investigator files an Update form reporting a new significant financial interest.
E. Management or Elimination of Conflicts of Interest
When it is reasonably determined that an Investigator has financial interests that could directly and significantly affect the design, conduct, or reporting of the research/sponsored project, WKU’s Reviewing Official(s) and the COIC will recommend implementing a plan and procedures to manage the conflict of interest in order to minimize the effect of the related Significant Financial Interest(s) on the design, conduct, or reporting of the sponsored project(s). Investigators also may be asked to make recommendations about how to manage the conflict of interest. Examples of conditions or restrictions that may be imposed to manage or eliminate conflicts of interest include:
1. Public disclosure of financial conflicts of Interest(s) when presenting or publishing research;
2. For projects involving human subject research, disclosure of financial conflicts of interest directly to subjects;
3. Monitoring of the project by independent reviewers capable of taking measures to protect the design, conduct, and reporting of the research against bias resulting from financial conflicts of interest;
4. Modification of the research or project plan;
5. Disqualification of Investigator(s) from participation in all or a portion of the project;
6. Reduction or elimination of the financial interest (e.g. sale of an equity interest); or
7. Severance of relationships that create financial conflicts.
Alternatively, the Reviewing Official(s) and COIC may recommend that the project not be undertaken by WKU if it is determined that the conflicts cannot be managed satisfactorily.
The review of the Disclosure(s) and adoption of conditions or restrictions to manage or eliminate the conflict of interest must be completed prior to expending funds made available under the sponsored award. When required, a report of the existence of a conflict of interest and assurance that it has been managed, reduced, or eliminated, must be submitted to the sponsoring agency.
Failure to file a complete Disclosure of Financial Interest Form or Update Form, or to comply with any conditions or restrictions imposed on the conduct of the project under this Policy will be grounds for disciplinary action pursuant to the relevant WKU policies related to faculty conduct or other applicable employee disciplinary policies.
In addition, federal regulations may require reports to the federal sponsor of any information that may show a violation of WKU policy. Sponsors may suspend or terminate the award and/or debar an Investigator from receiving future awards in the event of failure to comply with applicable federal regulations on disclosure, review, and management of significant financial interests related to federally sponsored projects.
G. Responsibilities and Administration
The Provost, Vice President for Research, and Deans within their respective areas of responsibility, shall implement this Policy. Implementation shall be monitored by the Vice President for Research or designee, in consultation with the Provost.
Records regarding Disclosures, Reviewing Official(s) determinations, COIC recommendations, and WKU actions regarding management of a conflict of interest must be retained for three years beyond the termination or completion of an award, or until resolution of any action by the sponsor involving the records, whichever is longer.
Implementation of this Policy shall include compliance with applicable sponsor regulations governing institutional responsibilities, certification of compliance, reporting requirements, and other duties required under the specific sponsor's regulations.
H. Definitions (as defined by www.ecfr.gov – 42CFR50.603 recorded January 1, 2013)
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.
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.
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, and as defined by the Institution in its policy on financial conflicts of interest, which may include for example: 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 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.
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.
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.
PHS means the Public Health Service 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 (NIH).
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, 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 means:
(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); 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 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
(iii) Intellectual property rights and interests (e.g., patents, copyrights), upon receipt of income related to such rights and interests.
(2) 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; provided, however, that this disclosure requirement does not apply to 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. The Institution's FCOI policy will 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. 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.
(3) 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.
Small Business Innovation Research (SBIR) Program means the extramural research program for small businesses that is established by the Awarding Components of the Public Health Service and certain other Federal agencies under Public Law 97-219, the Small Business Innovation Development Act, as amended. For purposes of this subpart, the term SBIR Program also includes the Small Business Technology Transfer (STTR) Program, which was established by Public Law 102-564.
A Financial Conflict of Interest Disclosure Form can be downloaded here.
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