June 2, 2009

Financial Conflicts of Interest in Research: New Rules in the Works for NIH Grantees

Holland & Knight Alert
Michael J. Werner

On May 8, 2009, the National Institutes of Health (NIH) published an Advance Notice of Proposed Rulemaking in the Federal Register that affects every university, medical school and teaching hospital that obtains NIH funding. The proposal seeks comments on whether the NIH should change its conflict of interest rules. It is the latest in a series of missives from regulators and policy makers that call for greater scrutiny of academic institutions and new rules governing their relationships with the pharmaceutical, biotechnology and medical device industries.

NIH Says Potential for Bias Is Increasing

The NIH notes that current regulations address financial conflicts of interest at 42 CFR Part 50, Subpart F and 45 CFR Part 94. However, the agency argues that the medical research enterprise is growing in size and complexity, which increases the potential for bias in research projects. This, along with what the NIH refers to as “recent public scrutiny,” provides the rationale for the agency to consider whether a more rigorous and comprehensive approach to addressing financial conflicts of interest is needed.

The agency states that financial conflict of interest policies should be based on the following principles:

    • Research must be conducted with transparency and the highest scientific and ethical standards in a manner that promotes and respects the rights, safety, and welfare of all human research participants.
    • Appropriate interactions and relationships between government, academia, and industry which do not compromise objectivity in research, frequently have beneficial outcomes and should be encouraged.
    • The integrity of the scientific record is critical to the conduct of science.
    • Risk management is essential in evaluating and managing conflict of interest; risk management should be commensurate with the level of risk of the research.
    • Complete and timely disclosure of financial interests and effective management of conflicts of interest are essential to ensuring objectivity in research.

NIH Seeking Comments

The NIH is seeking comments on all aspects of potential regulation in this area, and particularly on the following issues:

Expanding the Scope of the Regulation and Disclosure of Interests

Currently, federal regulations are applicable to institutions that apply for funding for research and, through implementation of the regulations by each institution, to each investigator participating in such research. The agency is soliciting comments on whether the regulations should be extended to also apply to Phase I SBIR/STTR research applications/proposals for funding. In addition, the NIH is seeking comments on whether investigators should be required to disclose to their institutions all “Significant Financial Interests” that are related to their institutional responsibilities.

Definition of “Significant Financial Interest’’

A “Significant Financial Interest’’ is defined by the current 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 the following types of financial interests:

    • salary, royalties, or other remuneration from the institution
    • any ownership interests in the institution, if the institution is an applicant under the SBIR/STTR program
    • income from seminars, lectures, or teaching engagements sponsored by public or nonprofit entities
    • income from service on advisory committees or review panels for public or nonprofit entities
    • an equity interest that, when aggregated for the investigator and the investigator’s spouse and dependent children, does not exceed $10,000, and does not represent more than a 5 percent ownership interest in any single entity

The agency seeks comments as to whether the current exemptions should be maintained and whether the current de minimis thresholds ($10,000 and 5 percent ownership interest in any single entity) are reasonable.

Identification and Management of Conflicts by Institutions

The regulations require that an official(s) designated by the institution review all financial disclosures; determine whether a financial conflict of interest exists; and, if so, determine what actions the institution should take to manage, reduce, or eliminate the conflict of interest. The agency asks if large institutions (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.

The NIH also asks if there are certain types of research for which the institution should be required to develop a conflict management plan when the institution decides to manage or reduce – rather than eliminate – the conflict.

Moreover, the agency seeks comment on whether investigators involved in participant selection, the informed consent process, and clinical management of a trial, should be prohibited from having a Significant Financial Interest in any company whose interests could be affected by their research or clinical trial; and whether there are special circumstances that would justify waiving this condition. In addition, the agency asks if regulations should prescribe specific approaches for the management, reduction, or elimination of particular types of financial conflicts.

Assuring Institutional Compliance

The NIH seeks comments about whether existing enforcement options for noncompliance – including suspension of funding – are sufficient; whether investigators should be required to complete routine conflict of interest training; and if independent confirmation of an institution’s compliance should be required.

Requiring Institutions to Provide Additional Information to HHS

While current rules require the institution to report the existence of a financial conflict and to ensure that the interest has been managed, reduced, or eliminated, there is no current requirement that the institution provide any details about the conflict. The agency seeks comments on whether the institution should be required to provide such additional information.

Institutional Conflict of Interest

Institutional conflict of interest is currently not addressed by the regulations. The NIH is soliciting comments regarding whether the regulations should be expanded to address institutional conflicts; and if so, how it should be done.

Universities Should Submit Comments to the NIH

Universities, medical schools, and teaching hospitals receiving NIH funds should respond to this proposal. Comments are due by July 7, 2009. In the meantime, they should develop internal conflicts of interest policies and procedures to identify conflicts and manage or eliminate them once they are identified. This will help the institution avoid sanctions or loss of funding.

Related Insights