Conflict of Interest

Policy Memorandum No. 150

Recommended by the Commission on Research
Approved by CFA: January 25, 1995
Approved by CGS: February 1, 1995
Approved by University Council: March 6, 1995
Approved by the President: March 6, 1995
Effective: Immediately

The University Council, on recommendation of the Commission on Research, Approved a resolution to enact a conflict of interest policy that meets the minimum standards of the Federal Guidelines and state and local conflict of interest acts, given that the conflict of interest policy of the Code of Virginia does not meet the minimum requirements of the Federal Guidelines.

Replacement pages for the relevant section of the Faculty Handbook(s) will be provided separately through campus mail.

Following is the text of the resolution as adopted by University Council:

WHEREAS, the increased involvement of academic research and education with industry and private enterprise is encouraged, but such interactions carry an increased risk of conflict of interest and

WHEREAS, the agencies of the Federal government have directed that grantee institutions employing more than 50 persons enact a conflict of interest policy that includes financial disclosure, designation of reviewer of dis- closure, management of potential conflicts, and enforcement procedure and

WHEREAS, the conflict of interest policy of the Code of Virginia does not meet the minimum requirements of the Federal guidelines,

THEREFORE, be it resolved that a conflict of interest policy be enacted that meets the minimum standards of the Federal guidelines and state and local conflict of interests acts.

2.15.4 Compliance with Federal Conflict of Interest Guidelines

The University's policy and procedure on conflict of interest requires ad- ditional restrictions in compliance with Federal guidelines for grantee in- stitutions of 50 employees or more which includes Virginia Tech. These guidelines meet the requirements of the Virginia Code for research and de- velopment contracts. These conflict of interest procedures are in addition to and not in lieu of any obligations and/or restrictions contained in the State and Local Conflict of Interests Act, 2.1-639.1, Code of Virginia.

2.15.5 Definitions

- An actual or potential conflict of interest exists when a significant financial interest could affect the design, conduct, or reporting of the research or educational activities.

- A potential conflict of interest arises when an enterprise in which an investigator has a personal interest contracts directly or through a subcontract with Virginia Tech

-An investigator means the principal investigator, co-principal investigators, and any other person at the university who is responsible for the design, conduct, or reporting of research or educational activities.

-A personal interest is defined as interests valued at greater than $5000 or represent more than 3 percent ownership for any one enterprise or entity when aggregated for the investigator/s or the investigator/s immediate family.

Immediate family means a (i) spouse and (ii) any other person who is a dependent of the employee or of whom the employee is a dependent.

Interest includes anything of monetary value such as:

(i) any financial investment in the research or other sponsored project, including ownership of stock, stock options, or any equity, debt, security or capital holding in any business enterprise, including the applicant that owns patents, marketing or manufacturing rights for any product, or competing product, likely to result from the research or other sponsored project.

(ii) salary or remuneration, or financial consideration, for services as an employee, consultant, officer or board member of any such business.

(iii) any other significant financial interest of the investigator that could affect the results of the research.

-Interest does not include:

(i) salary, royalties or other remuneration from the University. Ownership interests in an institution, or business which is an applicant under the Small Business Innovation Research Program or Small Business Technology Transfer Program

(ii) income from seminars, lectures, or teaching engagements sponsored by public or nonprofit entities.

(iii) income from service on advisory committees or review panels for public or nonprofit entities.

(iv) financial interests in business enterprises or entities if the value of such interests does not exceed $5,000 or represent more than 3 percent ownership interest for any one enterprise or entity when aggregated for the investigator and the investigator's spouse, dependent children or those of whom an employee is a dependent.

2.15.6 Financial Disclosure

Principal investigators, co-principal investigators and any other person at the University responsible for the design, conduct or reporting of research or educational activities funded or proposed for funding must determine if he/she may have a conflict of interest. If a conflict of interest is identified, he/she will indicate a conflict of interest on the internal approval form at the submission of a proposal and complete a disclosure of interests relevant to the project. Those involved with the project but exempt from the requirement of disclosure are budget and finance administrators, who are involved by virtue of his/her position with the Office of Sponsored Programs or College.

Disclosure must be updated annually or at the time new interests are obtained. A disclosure statement also is filed with the Vice Provost for Research and the Secretary of the Commonwealth of Virginia in the form required by Section 2.1-639.12-15 of the Code of Virginia.

2.15.7 Mixed Funding

Some projects may be funded by the Federal government and other organizations that have a commercial interest in the results of the research when the following conditions are met:

1. There must be no restrictions, conditions or limitations regarding the federally funded research.

2. Any direct payment to the investigator/s will be considered a per- sonal interest and subject to the guidelines of Faculty Handbook Section 2.15.

3. Other support received for the same or related projects after the receipt of the federal award must be reported to the Vice Provost for Re- search and the Federal agency within 30 days.

2.15.8 Disclosure Procedure

The disclosure, signed by the Department Head or Director, must be submitted for approval. The investigator/s have the responsibility to determine if a conflict does exist and if there is a conflict, what action might be taken to resolve the conflict. The investigators should consider preparation of the proposal and disclosure forms well in advance of the proposal deadline, since those who give approval to the proposal by signature may require additional time to determine if there is a conflict of interest.

The disclosure and plan of the investigator to resolve the actual or potential conflict of interest will be reviewed by the Department Head upon submission of the proposal. If the investigator determines that no conflict of interest exists, the "no" will be checked on the proposal internal approval form and will be forwarded for approval. The plan for the resolution of the conflict or indication that no conflict exists will be approved by the Vice Provost for Research. The review and resolution process must be completed before the award is made. An actual or potential conflict of interest exists when it is determined that a significant financial interest could affect the design, conduct or reporting of the research or educational activities proposed. Conditions or restrictions that might be imposed to manage, reduce or eliminate actual or potential conflicts of interest include but are not limited to:

(i) public disclosure of significant financial interests

(ii) monitoring of research by independent reviewers;

(iii) modification of research plan

(iv) disqualification from participation in the research affected by significant financial interests

(v) divestiture of significant financial interests

(vi) delegation of significant financial interests to trust or

(vii) severance of relationships that create actual or potential conflicts.

2.15.9 Appeal Process

In the event that the declaration of no conflict of interest by the investigator is not acceptable to the Department Head, the investigator will complete a disclosure and plan of action for resolution and resubmit to the Department Head for approval. If the Department Head agrees, the proposal will continue through the normal approval route.

In the event that the conditions or restrictions to be imposed are not ac- ceptable to either the investigator or the Department Head, the case will be referred to the Dean. If the resolution obtained in counsel with the Dean is not satisfactory to either the investigator or the Dean or Depart- ment Head, the case will be referred to the Vice Provost for Research who will refer the case to the Conflict of Interest Appeals Subcommittee of the Commission on Research for a recommendation. The subcommittee will deliver a recommendation to the Vice Provost for Research. The Vice Provost for Research will determine a final resolution based on the recommendation of the subcommittee.

In the event that the investigator does not comply with the final resol- ution by the Vice Provost for Research, the matter will be referred to the Vice Provost for Research for disposition. Sanctions may include but are not restricted to:

Removal of proposal for submission

Restrictions on submission of future proposals The funding agency will be notified within 30 calendar days of the issues/s not resolved and the action taken.

The University must maintain records of all financial disclosures and all actions taken to resolve actual or potential conflicts of interest for 3 years after the termination or completion of the award.

2.15.10 Conflict of Interest Reporting

On reporting conflict of interest, inaccuracy or neglect to report may re- sult from honest error. In such cases, the investigator/s and the Depart- ment Head should reconcile as soon as reasonably possible.

However, if inaccurate reporting or neglect to report is alleged to be de- liberate, the case will be referred to the Committee on Faculty Ethics. The Committee will formulate a written recommendation by the criteria de- scribed in Section 1.5.3 of the Faculty Handbook. For cases where it is deemed the action is a breech of faculty ethics, the committee's verdict along with a recommendation for prescribed action will be reported to the Vice Provost for Research and the Provost. The Vice Provost for Research in concurrence with the Provost shall determine what disciplinary action will be taken by the University. Disciplinary action may include, but is not limited to, a ban on submitting research proposals, conducting re- search, advising graduate students, or suspension from the University up to two semesters without pay. The sponsoring agency will be notified of the allegations.

PET:bjl


President's Policy Memorandum

URL: http://purl.vt.edu/vtdocs/policies/ppm150