Financial Conflict Of Interest Policy

3.3 FinancialConflict of Interest Policy

Redbud Labs, Inc. strives to create aresearch climate that promotes objectivity in research by establishingstandards such that the design, conduct and reporting of Public Health Service(PHS, which includes NIH) funded research is free from bias resulting fromfinancial conflict of interest (FCOI). NIH Requires recipient institutions and investigators (EXCEPT Phase ISBIR/STTR applicants and recipients) to comply with the requirements of 42 CFR50, Subpart F.

This policy is applicable to each employee who is planning to or isparticipating in research activity that is either partially or wholly supportedby PHS funds. 

Each such employee must:

• disclose his or her significant financial interests (SFI)B in non-Redbud entities that would appear to be related to the employee’s professional responsibilities on behalf of PRNAC;
• comply with a FCOI management plan, if a FCOI is identified; and
• undergo FCOI training, at least once every four years.

Disclosure of SFI is essential for PRNA to determine if a FCOI exists, and in cases of FCOI determine how it will be managed and reported in full compliance with government regulation. Non-disclosure of SFI or non-compliance with FCOI management plan may subject the employee to employment discipline including, without limitation, suspension or termination of employment.

I DEFINITIONS

A. 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.

B. Significant Financial Interest (SFI) exists if the value of remuneration received by the employee, employee’s spouse or dependent children that reasonably appear to be related to the employee’s PRNA responsibilities exceeds $5000;

Including:

• Salary or other payments for services (e.g., consulting fees or honoraria) received in the twelve months preceding disclosure;
• Equity interests (e.g., stocks, stock options or other ownership interests)l however, equity interest in a non-publicly traded entity, no matter the amount, constitutes an SFI; and,
• Income from intellectual property rights owned by the employee.

Excluding

• Salary, royalties, stock options or other remuneration from Redbud;
• Income from seminars, lectures, teaching engagements, service on advisory committees or review panels, derived from excluded sourcesD;
• Income from investment vehicles, such as mutual funds and retirement accounts, as long as the employee does not directly control the investment decisions; and,
• Unlicensed intellectual property owned by the employee that does not generate income. Note that Intellectual property owned by Redbud is excluded.

SFI disclosure also includes travel. Specifically, externally fundedreimbursed or sponsored travel that would appear to be related to employee’sPRNA responsibilities, however, that is not funded by Redbud. Such travel mustbe disclosed, no matter the amount, except when the expenses are covered by anyof the excluded sources.

Note that the threshold of $5000 is applied to the aggregation of theabove.

C. Employee’s professional responsibilities on behalf of PRNA includesconducting research, submitting patent applications, publication, technicalcommittee membership, and teaching as adjunct faculty at an Institute of highereducation.

D. An excluded source means a source of remuneration that is excludedfrom disclosure. With reference to the SFI (2b and 3), excluded sources are –federal, state, or local government agency, an Institution of higher education,an academic teaching hospital, a medical center, or a research institute thatis affiliated with an Institution of higher education.

III PROCEDURE

Employees who are planning to or participating in research activitythat is either partially or wholly supported by PHS funds must disclose theirSFI in a timely fashion to the CEO. The CEO will determine whether the SFIconstitutes an FCOI, based on guidance set by the CEO. Consistent with theattached, Protocol for Handling Financial Conflict of Interest, if the SFI isdetermined to be an FCOI, the CEO will take actions to discuss and approve theimplementation of an FCOI management plan consistent with government regulationand, furthermore, to promptly notify the PHS funding component (e.g., NIH) viaa FCOI report.

As a part of the FCOI management plan, the CEO will decide one or moreactions depending upon the situation, including requiring certain disclosure inpublic presentations, employee role reassignment, reduction or elimination ofthe financial interest sanctions (e.g., sale of an equity interest) orseverance of relationships that create financial conflicts. Employees with anidentified FCOI must comply with the FCOI management plan.

IV RELATED POLICIES AND PROCEDURES

Protocol for Handling Financial Conflict of Interest

V ADMINSTRATION

The CEO is responsible for administration of this policy.

VI PROTOCOL FOR HANDLING FCOI

This protocol along with the policy and procedure titled, FinancialConflict of Interest in PHS-Funded Projects, constitute the PRNA FCOI policy.Capital terms in this protocol shall have the same meaning as set forth in thepolicy. This protocol outlines the procedure that will be followed as perregulation (Title 42 CFR 50.601-50.607).

This document specifies the FCOI protocol for PHS-funded research:that is the step-by-step implementation of the PRNA FCOI policy.

1. Who is required to disclose financial interests

Employees planning to or participating in research activity that iseither partially or wholly supported by PHS funds are required to disclosefinancial interests (“PHS-funded Investigators”).

2. SFI disclosure

PHS-funded Investigators are required to disclose SFIs to either amember of CEO or the designated CEO, as follows:

Employees planning to participate in PHS-funded research are requiredto disclose all SFI's prior to submission of an application for PHS-fundedresearch.

Once the research project has been funded all PHS-funded investigatorsshall submit SFI Disclosures within thirty (30) days of acquiring any new orincreased SFI,

When a new investigator joins an ongoing PHS-funded project, theinvestigator shall submit SFI disclosures within thirty (30) days of joiningthe project.

All PHS-funded investigators shall submit an updated SFI disclosureannually.

SFI disclosures (except travel) must include the followinginformation:

• Identity of the sponsor/organizer; and
• Nature of SFI (e.g., salary, license income, stock).

Externally funded travel also constitutes SFI, and therefore thedisclosure requirements in 2 (i)-(iii) apply. That is, PHS-funded investigatorsshall submit SFI Disclosures for externally funded travel: prior to submissionof an application for PHS-funded research; and for PHS-funded projects withinthirty (30) days of externally funded travel and in an annual update. Thefollowing travel related information must be disclosed:

• Purpose,
• Identity of the sponsor/organizer,
• Destination, and,
• Duration.

3. Review of disclosures

All SFI disclosures, including those submitted by a new investigatorwho joins an ongoing PHS-funded project, will be reviewed by the designated CEO.The review will determine whether an SFI is related to the PHS-funded researchand therefore an FCOI. The CEO may involve the relevant investigator in thereview, and request additional information from the investigator.

When an SFI that was not disclosed by a PHS-funded Investigator in atimely manner is identified, the CEO will determine if FCOI exists, develop andimplement a management plan within sixty (60) days after the identification ofthe SFI. In addition, the CEO will conduct a retrospective review of SFIs forthe PHS-funded investigator within one hundred twenty (120) days and documentit.

4. Management of FCOI

For each disclosure that leads to determination of FCOI, the CEO willdiscuss and approve the implementation of a management plan developed by the CEO. PHS-funded Investigators with an identifiedFCOI must comply with the management plan. The management plan will include thefollowing elements at a minimum:

• The role and principal duties of the conflicted PHS-funded Investigator in the research project;
• Conditions of the management plan (see examples below);
• How the management plan is designed to safeguard objectivity in the research project;
• Confirmation of the PHS-funded Investigator’s agreement to the management plan; and
• How the management plan will be monitored to ensure PHS-funded Investigator compliance.

Examples of conditions or restrictions that might be imposed to managea PHS-funded Investigator’s FCOI include, but are not limited to:

• Public disclosure of financial conflicts of interests (e.g., when presenting or publishing the research; to staff members working on the project; to Institution’s Institutional Review Board(s));
• For research projects involving human subjects research, disclosure of financial conflicts of interest 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 Financial Conflict of Interest;
• Modification of the research plan;
• Change of personnel or personnel responsibilities, or disqualifications 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.

5. Reporting FCOI to PHS Awarding Component (e.g. the NIH)

Based on the FCOI management plan, the designated CEO will submit aninitial FCOI report to the PHS-funding component, for example NIH. The reportwill be submitted, for example using eRA Commons for NIH, and consist of allelements required by the regulation.

The FCOI report will be submitted prior to the expenditure of fundsunder the Notice of Award. FCOIs identified during the period of award will besubmitted to NIH within sixty (60) days of identification, including for newinvestigators joining an ongoing PHS-funded project.

Annual FCOI reports (or revised reports as a result of retrospectivereviews) will also be submitted and will include the status of financialconflict, i.e., whether the financial conflict is still being managed orexplains why the financial conflict no longer exists. These FCOI reports willalso include a description of any changes to the management plan since the lastFCOI report.

6. Training for FCOI

PHS-funded Investigators must undergo training with respect to thisPolicy and PHS FCOI rules and regulations, as follows

• When a new employee joins PRNA;
• Prior to participating in PHS-funded research, and at least once every four years;
• When the PRNA FCOI policy changes in a manner that effects PHS-funded Investigator disclosure or compliance requirements; and,
• If CEO determines that a PHS-funded Investigator is not compliant with the FCOI Policy or an FCOI Management Plan.

NIH web-based training(http://grants.nih.gov/grants/policy/coi/tutorial2011/fcoi.htm) will be used.Employees must save and print the FCOI Certificate as proof of completion.

7. Sanctions for violation of policy

Disclosure of SFI is essential for PRNA to implement its FCOI policy.If a PHS-funded Investigator fails to comply with this policy (with regard forinstance to the SFI disclosure requirement or implementation of an FCOImanagement plan), and appears to have biased the PHS-funded research, the CEOwill implement a mitigation plan and require that the Investigator disclose theFCOI in each public presentation of the results of the research, and to remedypreviously published presentations with an FCOI disclosure addendum. Inaddition, the employee may be subject to employment discipline including,without limitation, suspension or termination of employment.

In any case, the PHS-funding agency will be promptly notified.

8. Retention of records

Records of financial disclosures and any resulting action will bemaintained for three (3) years from the date of submission of the finalexpenditures report.

9. Subrecipient compliance

When working with a subrecipient, a written agreement will be put inplace to clarify: (a) which organization’s (prime awardee or subrecipient) FCOIpolicy will be followed, and, (b) in either case, clarify the timeline fordisclosure and reporting. Note that the prime awardee is responsible formonitoring subrecipient’ s compliance with the Financial Conflict of Interestregulation, management plans, and for reporting all identified financialconflicts of interest.

A “subrecipient” is the recipient of a subaward awarded to a foreignor domestic organization (either a non‐profit, educational institution, stateor local government, or private industry) for the performance of a portion ofthe work statement covered by a prime agreement that is funded either directlyor indirectly with sponsored funds. It does not include agreements withindividuals for consulting services or purchase orders for equipment, materialsor other services. A subrecipient receives an award of assistance from apass‐through entity and conducts its own scope of work. 

10. Public Accessibility

As required by PHS regulation, the PRNA FCOI policy is being madeaccessible on Redbud’s website.

If a PHS-funded investigator holds financial interests that aredetermined to be FCOI, as required by PHS regulation, these will also be postedon the web site, as follows:

• Include the minimum elements required by the regulation;
• Update within sixty (60) days of a newly identified FCOI;
• Update annually; and
• Remain available for three (3) years.