Department of Health and Human Services

OFFICE OF
INSPECTOR GENERAL

INSTITUTIONAL CONFLICTS OF
INTEREST AT NIH GRANTEES

Daniel R. Levinson
Inspector General

January 2011
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I N T O R D U C T I O N
 E X E C U T I V E S U M M A R Y

OBJECTIVES
1. To determine whether National Institutes of Health (NIH)
grantee institutions have written policies and procedures to
address institutional financial interests and conflicts of interest.

2. To determine whether grantee institutions had financial

interests and financial conflicts of interest related to NIH
research grants in fiscal year (FY) 2008.

BACKGROUND
Grantee institutions consist of universities, medical schools, and other
research institutions (e.g., private or nonprofit research organizations)
receiving research grants from NIH. An institutional conflict may arise
when an institution’s own financial interests (e.g., royalties, equity,
stockholdings, and gifts) or those of its senior officials pose a risk of
undue influence on decisions involving the institution’s research.

Pursuant to Federal regulations, each grantee institution receiving NIH

funds must have a written policy for identifying researchers’ financial
conflicts of interest (hereinafter referred to as conflicts) and ensuring
that conflicts are managed, reduced, or eliminated. These regulations
do not apply to institutions’ conflicts. The Public Health Service (PHS)
Act directed the establishment of regulations that would protect PHS-
funded research (i.e., NIH grant research) from bias resulting from
conflicts of both researchers and entities (i.e., grantee institutions).
However, there are currently no Federal requirements to define,
identify, report, and manage actual or potential institutional conflicts.
Therefore, NIH lacks information on the number of institutional
conflicts at its grantee institutions and the impact these conflicts may
have on NIH-sponsored research.

We surveyed 250 grantee institutions to determine whether they have

any policies and procedures regarding institutional financial interests
and conflicts. We requested information on any institutional financial
interests related to NIH grants awarded in FY 2008. A total of 156
grantee institutions responded, for a response rate of 62 percent.

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E X E C U T I V E S U M M A R Y

FINDINGS
Although not required for institutional financial interests, 70 of
156 responding NIH grantee institutions have written policies and
procedures addressing institutional interests. Fifty-nine of the
seventy institutions use a variety of definitions for what constitutes an
institutional financial interest. Policies and procedures for some
institutions relate only to financial interests held by the institutions
themselves, others consider the interests of both the institutions and
their employees/officials, and still others relate only to the interests of
institutional employees/officials.
The number of definitions used by institutions for institutional financial
interests ranged from one to eight. The average number of definitions
was five. The three most common definitions are (1) an institutional
official’s individual financial interests, (2) equity held by the institution
in publicly held entities, and (3) equity held by the institution in
nonpublicly held entities.
Although not required for institutional conflicts, 69 of
156 responding NIH grantee institutions have written policies and
procedures addressing institutional conflicts. Fifty-nine of these
institutions have defined, in writing, what constitutes an institutional
conflict. These institutions typically defined institutional conflicts as
financial interests that could affect the research, decisionmaking,
loyalty, or objectivity of either the institution or individuals.

Fifty-three of the sixty-nine institutions have implemented a process to

determine whether an institutional financial interest creates an
institutional conflict. Their processes generally involve notifying an
institutional official and/or committee regarding the financial interests.
The official and/or committee then determines whether the financial
interest is an institutional conflict.
Eighteen NIH grantee institutions identified 38 institutional conflicts.
Twenty-one of one-hundred fifty-six institutions identified institutional
financial interests. Of those, almost all identified the financial interests
as institutional conflicts. Eighteen of the twenty-one institutions
identified at least 38 institutional conflicts related to NIH research
grants in FY 2008. Institutions that have written policies and
procedures were more likely to identify conflicts (15 of 69 institutions)
compared to those that do not (3 of 87 institutions). The most common
type of institutional conflict was institutions’ holding equity in

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E X E C U T I V E S U M M A R Y

nonpublicly held companies. For institutions that identified

institutional conflicts, the strategy most often used to address them was
disclosure.

RECOMMENDATION
NIH is the primary Federal agency responsible for conducting and
supporting medical research. It is vital to public health and safety that
this research be free from bias. Federal regulations establish standards
to ensure that the design, conduct, and reporting of federally funded
research will not be biased by any conflicting financial interest of a
researcher. Currently, no Federal regulations require grantee
institutions to identify and report institutional conflicts to NIH.
Therefore, NIH lacks information on the number of institutional
conflicts that exist among its grantee institutions and the impact these
conflicts may have on NIH-sponsored research.

We continue to recommend that NIH require grantee institutions to

identify, report, and address institutional conflicts in a consistent and
uniform manner to NIH. It is important that NIH know of the existence
of institutional conflicts so it can ensure that the related research is free
from any intended or unintended bias.

Therefore, we recommend that NIH:

Promulgate regulations that address institutional financial conflicts
of interest. Until regulations are promulgated, NIH should encourage
grantee institutions to develop policies and procedures regarding
institutional financial interests and conflicts.

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL

RESPONSE
NIH stated that it is reviewing public comments to finalize regulations
regarding financial conflicts of interest and, therefore, it neither concurs
nor nonconcurs with our recommendation. Instead, NIH stated it will
take the Office of Inspector General’s (OIG) recommendation into
consideration as it considers future actions on extramural financial
conflicts of interest.

OIG understands that NIH is engaged in the rulemaking process

regarding financial conflicts of interest. However, in the
May 21, 2010, Notice of Proposed Rulemaking regarding financial
conflicts of interest, NIH proposed regulatory changes that focus only on

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 researchers’ conflicts. The proposed regulations do not address
institutional conflicts. Therefore, OIG continues to recommend that
NIH include institutional conflicts in regulations addressing financial
conflicts of interest.

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 T A B L E O F C O N T E N T S

EXECUTIVE SUMMARY .....................................i

INTRODUCTION ........................................... 1

FINDINGS ................................................. 9
Although not required for institutional financial interests,
70 of 156 responding NIH grantee institutions have written
policies and procedures addressing institutional interests . . . . . . . 9

Although not required for institutional conflicts, 69 of

156 responding NIH grantee institutions have written policies
and procedures addressing institutional conflicts . . . . . . . . . . . . . 11

Eighteen NIH grantee institutions identified 38 institutional

conflicts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

R E C O M M E N D A T I O N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Agency Comments and Office of Inspector General Response . . . 18

A P P E N D I X E S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
A: Results by Stratum for Grantee Institutions With Written
Policies and Procedures Regarding Institutional Financial
Interests and Institutional Conflicts . . . . . . . . . . . . . . . . . . . . . . . 20

B: Number of Grantee Institutions That Reported Incorporating

Recommended Actions From Departmental Guidance in Written
Policies and Procedures Regarding Institutional Financial
Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

C: Methods Employed by Grantee Institutions To Manage,

Reduce, or Eliminate Institutional Conflicts . . . . . . . . . . . . . . . . . 22

D: Agency Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

A C K N O W L E D G M E N T S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
 I N T R O D U C T I O N

OBJECTIVES
1. To determine whether National Institutes of Health (NIH)
grantee institutions have written policies and procedures to
address institutional financial interests and conflicts of interest.

2. To determine whether grantee institutions had financial

interests and financial conflicts of interest related to NIH
research grants in fiscal year (FY) 2008.

BACKGROUND
Grantee institutions consist of universities, medical schools, and other
research institutions (e.g., private or nonprofit research organizations)
receiving research grants from NIH. Pursuant to Federal regulations,
each institution receiving NIH funds must have a written policy for
(1) identifying investigators’ (hereinafter referred to as researchers)
financial conflicts of interest (hereinafter referred to as conflicts) and
(2) ensuring that conflicts are managed, reduced, or eliminated. 1, 2 The
purpose of these regulations is to promote objectivity in research by
establishing standards to ensure that there is no reasonable expectation
that the design, conduct, or reporting of research funded under NIH
grants will be biased by any conflicting financial interest of a
researcher.

Conflicts can also exist for the institutions themselves. An institution’s

financial interests (e.g., royalties, equity, stockholdings, and gifts) or
those of its senior officials can become institutional conflicts when the
financial interests pose a risk of undue influence on decisions involving
the institution’s research. 3 There are no Federal regulations for
defining, identifying, reporting, and managing institutional conflicts.
Prior research has shown that not all medical schools have policies
regarding institutional financial interests and conflicts. 4

1 42 CFR pt. 50, subpart F. This regulation covers Public Health Service (PHS) grants
and NIH is the largest agency within PHS.
2 The term “researcher” includes the principal researcher or any other person who is
responsible for the design, conduct, or reporting of research funded by NIH.
3 Institute of Medicine of the National Academies, Conflict of Interest in Medical
Research, Education, and Practice, ch. 8, April 21, 2009.
4 Ehringhaus, S., et al., “Responses of Medical Schools to Institutional Conflicts of
Interest,” Journal of the American Medical Association, February 13, 2008.

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NIH Grants
NIH is the primary Federal agency responsible for conducting and
supporting medical research. Organized into 27 Institutes and Centers,
NIH receives billions of dollars annually to support its mission. In
FY 2010, NIH’s budget totaled over $31.2 billion. More than 80 percent
of this amount was distributed through almost 50,000 competitive
grants to more than 325,000 researchers at over 3,000 institutions
across the country and around the world. 5
Impact of the Bayh-Dole Act
In 1980, the Patent and Trademark Act Amendments (P.L. 96-517),
commonly known as the Bayh-Dole Act, was enacted to facilitate the
transfer of technology from grantee institutions to private industry.
The Bayh-Dole Act has encouraged the commercialization of federally
funded inventions but has also increased financial ties between grantee
institutions and private industry.

The Bayh-Dole Act allows grantee institutions to retain title to

inventions developed through federally funded research. If institutions
elect to retain title to inventions, they can license them to private
businesses or companies. Companies can then develop these inventions
into commercial products that benefit the public. These inventions have
provided institutions with millions of dollars in royalties and equity. 6
Commercial products developed as a result of NIH-funded research
include prescription drugs and other health care products.
Requirements for Grantee Institutions Regarding Researcher Conflicts
Federal regulation establishes standards to ensure that the design,
conduct, or reporting of research funded under NIH grants will not be
biased by researchers’ conflicts. 7 Each institution receiving NIH funds
must have a written policy for identifying researchers’ conflicts and
ensuring that conflicts are identified, managed, reduced, or eliminated. 8
Each grantee institution must collect from each researcher a listing of
his/her known significant financial interests that would reasonably

5 NIH budget information. Accessed at http://www.nih.gov/about/budget.htm on

April 15, 2010.
6 NIH Response to the Conference Report Request for a Plan to Ensure Taxpayers'
Interests Are Protected, July 2001. Accessed at http://www.nih.gov/news/070101wyden.htm
on April 15, 2010.
7 42 CFR pt. 50, subpart F.
8 42 CFR § 50.604.

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appear to be affected by the research. Federal regulation

(42 CFR § 50.605(a)) provides that a conflict exists when a designated
official at the institution reasonably determines that a researcher’s
significant financial interest could directly and significantly affect the
design, conduct, or reporting of NIH-funded research. If a researcher
conflict exists, it must be reported to NIH. The institution must also
manage, reduce, or eliminate the researcher conflict.
Lack of Requirements for Grantee Institutions Regarding Institutional
Conflicts
For institutional financial interests, there are no Federal regulations for
defining, identifying, reporting, or managing conflicts. Grantee
institutions are not required to have policies that address either
institutional financial interests or conflicts. However, section 493A of
the PHS Act directed the Secretary of Health & Human Services (HHS)
to establish regulations that would protect PHS-funded research (i.e.,
NIH grant research) from bias resulting from conflicts of both
researchers and entities (i.e., grantee institutions). 9 In the
July 1995 final rule that promulgated Federal regulations for
researchers’ conflicts (42 CFR pt. 50, subpart F), NIH stated that the
issue of institutional conflicts would be considered separately from
researchers’ conflicts. Currently, no Federal regulation addresses
institutional conflicts.

On May 8, 2009, NIH issued an Advance Notice of Proposed

Rulemaking (ANPRM) to gain public input on whether modifications
are needed to 42 CFR pt. 50, subpart F. NIH invited public comments
on all aspects of potential regulation in this area, including broadening
the regulations to address institutional conflicts. 10 Taking public
comments regarding the ANPRM into consideration, on May 21, 2010,
NIH issued a Notice of Proposed Rulemaking (NPRM). In the NPRM,
NIH proposed new requirements to strengthen the reporting and
management of researcher conflicts. However, the regulations were not
broadened to include institutional conflicts. NIH believed that further
consideration was necessary before regulations could be formulated that
would address institutional conflicts in the same comprehensive manner
as the proposed regulations regarding researcher conflicts. 11

9 The Secretary of HHS delegated authority to NIH to promulgate Federal regulations.

10 74 Fed. Reg. 21610, 21612 (May 8, 2009).
11 75 Fed. Reg. 28688, 28700 (May 21, 2010).

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Recommendations From HHS Regarding Financial Interests Related to

Human Subjects Research
In a guidance document finalized in May 5, 2004, HHS’ Office for
Human Research Protections recommended 12 actions for grantee
institutions to consider when handling financial interests in research
involving human subjects. 12 Two of the recommended actions included
(1) “establishing the independence of institutional responsibility for
research activities from the management of the institution’s financial
interests” and (2) “establishing policies regarding the types of financial
relationships that may be held by parties involved in the research and
circumstances under which those financial relationships and interests
may or may not be held.”
Recommendations From the Institute of Medicine Regarding Institutional
Conflicts
Institutional conflicts have prompted discussion and recommendations
from industry and the research community. In an April 2009 report by
the Institute of Medicine (IOM), the Committee on Conflict of Interest
in Medical Research, Education, and Practice (Committee) presented
challenges with managing institutional conflicts and provided
recommendations to handle such challenges. 13
According to the Committee, institutional conflicts arise when an
institution’s own financial interests pose risks of undue influence on
decisions involving the institution’s primary interests. For example,
conflicts may arise when an institution receives gifts or grants from
companies to develop clinical practice guidelines related to the
companies’ products. 14 In addition, research conducted at the
institution could affect the value of the institution’s patents or its equity
positions or options in biotechnology, pharmaceutical, or medical device
companies. 15
In addition, the IOM report highlighted that in an American Association
of Medical Colleges’ survey of its members conducted in 2006, only
38 percent of the respondents reported having a policy that applied to

12 HHS, Office for Human Research Protections, Financial Relationships and Interests in
Research Involving Human Subjects: Guidance for Human Subject Protection. Accessed at
http://www.hhs.gov/ohrp/humansubjects/finreltn/fguid.pdf on April 15, 2010.
13 Institute of Medicine of the National Academies, loc. cit.
14 A clinical practice guideline is a document that provides criteria regarding diagnosis,
management, and treatment in specific areas of health care.
15 Institute of Medicine of the National Academies, loc. cit.

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their institutions’ financial interests, although another 37 percent

reported that they were developing such a policy.

The Committee directed recommendations to NIH and grantee

institutions. The Committee recommended that NIH extend Federal
regulations to cover institutional conflicts as well as researchers’
conflicts by developing rules governing institutional conflicts for grantee
institutions. The Committee suggested that these rules require
institutions to report identified institutional conflicts and the steps that
have been taken to eliminate or manage such conflicts to NIH.

The Committee recommended to institutions that the assessment of

institutional conflicts fall to their governing boards (e.g., board of
trustees). Specifically, the governing boards should establish standing
committees on institutional conflicts that are composed of members
without conflicts relevant to the activities of the institution and at least
one member who is not a board member, an employee, or an officer of
the institution. Such standing committees would be at a greater
distance from the daily pressures of decisionmaking that senior officials
face. They would also have access to comprehensive information about
the finances of the institutions to better resolve disputes regarding
conflicts.
Related Studies by the Office of Inspector General
In a January 2008 report, the Office of Inspector General (OIG) found
that NIH relies on grantee institutions to ensure compliance with
Federal financial conflict-of-interest regulations rather than directly
overseeing or reviewing their management of researchers’ conflicts. 16
In a November 2009 report, OIG reviewed 184 financial
conflict-of-interest reports for researchers that were received by NIH
from grantee institutions during FY 2006. 17 OIG found vulnerabilities
in institutions’ identification, management, and oversight of conflicts.
OIG also found vulnerabilities related to institutional financial
interests. The potential for financial gain can pose an institutional
conflict when an institution licenses technology/intellectual property for
the purposes of commercialization. Therefore, one of our

16 HHS, OIG, National Institutes of Health: Conflicts of Interest in Extramural

Research, OEI-03-06-00460, January 2008.
17 HHS, OIG, How Grantees Manage Financial Conflicts of Interest in Research Funded
by the National Institutes of Health, OEI-03-07-00700, November 2009.

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recommendations called for NIH to develop regulations that address

institutional conflicts.

METHODOLOGY
Sample Design
We determined from a data file found on NIH’s Web site that
2,648 grantee institutions received grant money in FY 2008. 18 We
excluded any institutions located outside the United States (we included
all 50 States and the District of Columbia). We also excluded
institutions that received only training grants. 19 Finally, we excluded
any institutions for which NIH’s data listed grant award amounts of $1
or less. 20 After the exclusions, we determined that 2,321 grantee
institutions received research grants in FY 2008.

We requested from NIH a list of financial conflict-of-interest reports for

researchers submitted by grantee institutions during FY 2008. We
asked for this information to ensure that we were including in our
sample a representative number of those institutions that submitted
reports for researchers to NIH. Based on the information provided by
NIH, we determined that 64 institutions reported at least 1 researcher
conflict to NIH in FY 2008 and 2,257 institutions did not report any
conflicts.

We selected a stratified random sample of 250 institutions to survey as

shown in Table 1. Stratum 1 contains all of the institutions that
reported at least one researcher conflict in FY 2008. Stratum 2 contains
all of the institutions that did not report any researcher conflicts.

18 NIH, Aggregate Data 2008. Accessed at

http://report.nih.gov/award/trends/AggregateData.cfm?Year=2008 on August 5, 2009.
19 Training grants are designed to support the research training of scientists for careers
in the biomedical and behavioral sciences, as well as to help professional schools establish,
expand, or improve programs of continuing professional education.
20 After the initial exclusions, five institutions were listed in NIH’s file as having
received $1 in grant awards.

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Table 1: Sample of Grantee Institutions

Number of
Number of Number of
Grantee
Grantee Grantee
Stratum Description of Stratum Institutions That Response Rate
Institutions in Institutions in
Responded to
Population Sample
Survey
Grantee institutions
that submitted a
researcher financial
1 64 64 52 81%
conflict-of-interest
report to NIH in
FY 2008
Grantee institutions
that did not submit a
researcher financial
2 2,257 186 104 56%
conflict-of-interest
report to NIH in
FY 2008
Total 2,321 250 156 62%
Source: OIG analysis of NIH data and OIG sample response rate, March 2010.

We made at least three attempts by email to request responses from

nonresponding grantee institutions. A total of 156 institutions
responded, for an overall response rate of 62 percent. However, based
on the overall response rate and the difference in response rates for
Stratum 1 (81 percent) and Stratum 2 (56 percent), we did not project
our findings to the population of 2,321 NIH grantee institutions.
Instead, we have provided simple unweighted frequencies for our
findings. Appendix A provides both overall totals and totals by stratum
for the main findings in this report.
Data Collection
We collected our data between November 2009 and January 2010. We
surveyed the sampled institutions to determine whether they have
developed any policies and procedures regarding institutionally held
financial interests and conflicts. We asked whether grantee institutions
included in their policies and procedures any of the recommendations
from HHS’ Office for Human Research Protections or IOM regarding
institutionally held financial interests or conflicts.

We asked the institutions whether they had institutional financial

interests related to any NIH grants awarded in FY 2008. We requested
information about whether the institutional financial interests were
determined to be conflicts by institutions. We also asked for
information on how these conflicts were addressed.

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Data Analysis
From the survey data, we determined the frequency of responses to
closed-ended survey questions. We also reviewed and categorized
responses to open-ended survey questions that were related to
institutions’ definitions, policies, and procedures regarding
institutionally held financial interests and institutional conflicts. For
these analyses we have provided, when applicable, both the overall
totals and totals for each stratum.
Limitations
Because of the overall 62-percent response rate and the large difference
in response rates between the two strata, the data in our findings
represent only the information for responding grantee institutions. It is
possible that the data would have changed if the response rate had been
higher, especially for Stratum 2 (grantee institutions that did not
submit a researcher financial conflict-of-interest report to NIH in
FY 2008).

All of the information in the findings section of this report was

self-reported by grantee institutions. We did not collect supporting
documentation from them.
Standards
This study was conducted in accordance with the Quality Standards for
Inspections approved by the Council of the Inspectors General on
Integrity and Efficiency.

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 F I N D I N G S
 F I N D I N G S

Although not required for institutional financial Grantee institutions can acquire
interests, 70 of 156 responding NIH grantee financial interests related to
institutions have written policies and procedures NIH-funded research at their
institutions. These financial
addressing institutional interests
interests can include royalties,
equity, stockholdings, and corporate gifts. Currently, no Federal
regulations require grantee institutions to have policies and procedures
that address institutional financial interests.
Seventy of the one hundred fifty-six grantee institutions that responded
to our survey have written policies and procedures regarding
institutional financial interests. Institutions that reported a researcher
conflict to NIH in FY 2008 (Stratum 1) were more likely to have written
policies and procedures. Table 2 shows the number of institutions with
such written policies and procedures.
Table 2: Number of Grantee Institutions That Have Written Policies and
Procedures Regarding Institutional Financial Interests

Percentage of Respondents in
Number of Grantee
Stratum Description of Stratum Stratum With Written Policies
Institutions
and Procedures
Grantee institutions that
1 submitted a researcher
37 71%
(n=52) financial conflict-of-interest
report to NIH in FY 2008
Grantee institutions that did
2 not submit a researcher
33 32%
(n=104) financial conflict-of-interest
report to NIH in FY 2008
Total 70 45%
Source: OIG analysis of grantee institution survey responses, March 2010.

Fifty-nine of the seventy grantee institutions with written policies and

procedures regarding institutional financial interests have defined, in
writing, what constitutes an institutional financial interest
The 59 institutions use a variety of specific definitions for what
constitutes an institutional financial interest. Policies and procedures
for some institutions relate only to financial interests held by the
institutions themselves, others consider the interests of both the
institutions and their employees/officials, and still others relate only to
the interests of institutional employees/officials.

The number of definitions used by institutions for institutional financial

interests ranged from one to eight. The average number of definitions
used by grantee institutions was five. The three most common

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F I N D I N G S

definitions were (1) an institutional official’s individual financial

interests, (2) equity held by the institution in publicly held entities, and
(3) equity held by the institution in nonpublicly held entities. Table 3
shows the number of grantee institutions with written policies and
procedures that use the different definitions of financial interests.
Table 3: Number of Grantee Institutions With Written Policies and
Procedures Using Various Definitions of Institutional Financial Interests
Number of Grantee Number of Grantee
Institution Defined Financial Total Number of Grantee
Institutions in Institutions in 1
Interest As: Institutions
Stratum 1 Stratum 2
Institutional officials’ individual
30 20 50
financial interests
Equity in publicly held
29 19 48
companies
Equity in nonpublicly held
28 19 47
companies
Royalties resulting from
19 18 37
federally funded research
Royalties resulting from
20 16 36
nonfederally funded research
Gifts from research sponsors 17 19 36
Payments from research
sponsors for reaching
12 18 30
designated milestones in a
course of a study
Other (e.g., intellectual
5 7 12
property)
Source: OIG analysis of grantee institution survey responses, March 2010.
1
The total number of institutions with a written definition of an institutional financial interest equals 59. The number of institutions
in this column does not equal 59 because some institutions established more than 1 definition.

Most of the 70 grantee institutions with written policies and procedures

reported that they had incorporated recommendations from the HHS
Guidance Document
Sixty-two of the seventy institutions stated that they have incorporated
recommendations from the HHS Guidance Document into their policies
and procedures. The Guidance Document, issued by HHS’s Office of
Human Research Protections, outlines 12 recommended actions that
grantee institutions engaged in human subject research should consider
to help ensure that financial interests do not compromise the rights and
welfare of human research subjects.

The most common recommendation that institutions reported including

was establishing conflict-of-interest committees or identifying other
bodies or persons and procedures to deal with individuals’ or
institutional financial interests in research. The recommendation
incorporated least often was to allow independent organizations to hold

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 F I N D I N G S

or administer the institution’s financial interest. Appendix B contains

the number of institutions that incorporated each recommendation.

Institutional conflicts arise when

Although not required for institutional conflicts,
a grantee institution’s own
69 of 156 responding NIH grantee institutions financial interests or those of its
have written policies and procedures senior officials pose risks of undue
addressing institutional conflicts influence on decisions involving
the institution’s research. 21 For
example, an institutional conflict exists if the outcome of research
conducted at a grantee institution could affect the value of the
institution’s equity in a particular company. Currently, there are no
Federal requirements that grantee institutions have policies and
procedures to address institutional conflicts.
Beyond policies and procedures to address institutional financial
interests, grantee institutions also have policies and procedures
specifying how to handle instances in which those interests pose an
actual conflict with research activities. Sixty-nine institutions have
written policies and procedures regarding institutional financial
conflicts. A total of 78 institutions have not developed written policies
and procedures for either institutional financial interests or conflicts. 22
Again, institutions that reported a researcher conflict to NIH in FY
2008 (Stratum 1) were more likely to have written policies and
procedures regarding institutional conflicts. Table 4 shows the number
of institutions with written policies and procedures for institutional
conflicts.

21 Institute of Medicine of the National Academies, loc. cit.

22 Sixty-one grantee institutions have written policies and procedures for both
institutional financial interests and conflicts, nine institutions have policies and procedures
for only institutional financial interests, and eight institutions have policies and procedures
for only institutional conflicts.

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F I N D I N G S

Table 4: Number of Grantee Institutions That Have Written Policies and

Procedures Regarding Institutional Conflicts

Number of Grantee
Stratum Description of Stratum Percentage of Respondents
Institutions
Grantee institutions that
1 submitted a researcher
37 71%
(n=52) financial conflict-of-interest
report to NIH in FY 2008
Grantee institutions that did
2 not submit a researcher
32 31%
(n=104) financial conflict-of-interest
report to NIH in FY 2008
Total 69 44%
Source: OIG analysis of grantee institution survey responses, March 2010.

Fifty-nine of the sixty-nine grantee institutions with written policies and

procedures regarding institutional conflicts have defined, in writing, what
constitutes an institutional conflict
The 59 institutions typically defined institutional conflicts as financial
interests that could affect the research, decisionmaking, loyalty, or
objectivity of either the institution or individuals. Some institutions
determined that institutional conflicts exist when financial interests are
of a certain type or reach a certain threshold amount (e.g., $100,000 or
5-percent equity holding).
Fifty-three of the sixty-nine grantee institutions with written policies and
procedures have implemented a process to determine whether an
institutional financial interest creates an institutional conflict
These 53 institutions’ processes generally involved notifying an
institutional official and/or committee regarding the financial interests.
The official and/or committee then determines whether the financial
interest is an institutional conflict. Some of these officials/committees
also review institutional equity holdings and/or license/royalty
agreements to determine whether they are institutional conflicts.
Forty of the sixty-nine grantee institutions with written policies and
procedures regarding institutional conflicts have a committee that reviews
institutional conflicts
All of the committees among these 40 grantee institutions have the
authority to determine whether institutional financial interests are
institutional conflicts. All but two of the committees have the additional
authority to determine how the conflicts will be addressed. Nineteen of

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F I N D I N G S

these committees are separate entities from the committees responsible

for reviewing researchers’ conflicts at the institutions.

In its April 2009 report, IOM recommended that grantee institutions

handle challenges in managing institutional conflicts by implementing
standing committees to assess the conflicts. As recommended by IOM,
15 of the 69 institutions have boards of trustees (or an equivalent
governing body) that have established their own standing committees
on institutional conflicts. Seven institutions also have at least one
outside member of their committees who is not a board member, an
employee, or an officer of the institutions. Five of these committees
submit annual reports to the boards of trustees regarding institutional
conflicts, which are made public.

Twenty-one of one hundred

Eighteen NIH grantee institutions identified
fifty-six grantee institutions
38 institutional conflicts identified institutional
financial interests. Almost all of those 21 identified the financial
interests as institutional conflicts.
Eighteen of the twenty-one institutions identified at least
38 institutional conflicts related to NIH research grants in FY 2008. 23
The remaining three institutions that identified financial interests did
not determine them to be conflicts. Of the 18 grantee institutions that
identified institutional conflicts, 15 had written policies and procedures
regarding institutional conflicts. The remaining three institutions did
not have written policies and procedures. Therefore, our findings show
that institutions with written policies and procedures were more likely
to identify conflicts (15 of 69 institutions) than those without written
policies and procedures (3 of 87 institutions). Table 5 shows the number
of institutions per stratum that identified conflicts.

23 Three of the eighteen grantee institutions reported that they had at least one
institutional conflict, but could not provide a specific number.

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F I N D I N G S

Table 5: Number of Grantee Institutions That Reported Identifying

Institutional Conflicts

Number of Grantee Number of These Grantee

Stratum Description of Stratum Institutions With Institutions With Written
Institutional Conflicts Policies and Procedures
Grantee institutions that
1 submitted a researcher
14 13
financial conflict-of-interest
report to NIH in FY 2008
Grantee institutions that did
2 not submit a researcher
4 2
financial conflict-of-interest
report to NIH in FY 2008
Total 18 15

Source: OIG analysis of grantee institution survey responses, March 2010.

Grantee institutions tended to have the same conflicts as their

researchers. This is important because, in essence, institutions are
overseeing researchers’ conflicts when they themselves have the same
potential conflict. At 17 of the 18 institutions, researchers who worked
on the grant(s) had the same types of conflict(s) as the institutions. For
example, at one institution, both the institution and the researcher held
equity in the same nonpublicly held company.
The most common type of institutional conflict was grantee institutions’
holding equity in nonpublicly held companies
The 18 institutions that had institutional conflicts identified different
types of conflicts. The two most common types were holding equity in
nonpublicly held companies and receiving royalties resulting from
federally funded research. Table 6 shows the types of institutional
conflicts per stratum that were reported by institutions in FY 2008 and
the number of institutions reporting each type.

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F I N D I N G S

Table 6: Number of Grantee Institutions With Different Types of

Institutional Conflicts Reported Between October 1, 2007, and
September 30, 2008
Number of Grantee Number of Grantee Total Number of
Institutions in Stratum 1 Institutions in Stratum 2 Grantee Institutions
Type of Institutional Conflicts
Reporting Type of Reporting Type of Reporting Type of
1
Conflict Conflict Conflict
Equity in nonpublicly held
9 2 11
companies
Royalties resulting from
8 2 10
federally funded research
Institutional officials’ individual
4 1 5
financial interests
Royalties resulting from
3 0 3
nonfederally funded research
Equity in publicly held
2 0 2
companies
Unspecified royalties 1 0 1

Not specified/other 1 1 2
Source: OIG analysis of grantee institution survey responses, March 2010.
1
Eighteen institutions identified thirty-eight institutional conflicts. The number of institutions in this column does not equal
18 because some institutions had more than 1 type of conflict. The number of conflicts in the column does not equal 38
because, for example, some institutions reported that a conflict involved both equity and royalties.

Grantee institutions reported having various strategies available to address

their institutional conflicts
Pursuant to Federal regulation, grantee institutions must ensure that
researchers’ conflicts will be managed, reduced, or eliminated.
Although no such requirement exists for addressing institutional
conflicts, 98 of 156 institutions reported that they had strategies to
ensure that institutional conflicts do not bias research. The five most
commonly reported strategies were (1) ensuring an open exchange of
research results through publication and/or presentations, (2) disclosing
the institutional conflict during the informed consent process for human
subjects, (3) formally recusing the official who has a conflict from the
chain of authority over the project and communicating the recusal to the
official’s superior and colleagues, (4) notifying the Institutional Review
Board 24 regarding the institutional conflict, and (5) ensuring that
adequate peer review of research is performed by the institution.
Appendix C contains the number of institutions per stratum that use
these and other strategies.

24 Institutional review boards ensure the rights and safety of people participating in
clinical trials.

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F I N D I N G S

Grantee institutions that identified institutional conflicts most often used

disclosure to address them
For the 18 institutions that identified institutional conflicts, the
2 methods most often used to address conflicts were (1) disclosing them
during the informed consent process for research involving human
subjects and (2) notifying the Institutional Review Board regarding the
conflicts. The next two strategies most commonly used were disclosing
the institutional conflicts in public presentations and publications and
ensuring that adequate peer review of research was performed by the
institution.

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I N T O R D U C T I O N
 R E C O M M E N D A T I O N

NIH is the primary Federal agency responsible for conducting and

supporting medical research. It is vital to public health and safety that
this research be free from bias. Federal regulations establish standards
to ensure that the design, conduct, and reporting of federally funded
research will not be biased by a researcher’s conflict. The PHS Act
directed the establishment of regulations that would protect
PHS-funded research (i.e., NIH grant research) from bias resulting from
conflicts of both researchers and entities (i.e., grantee institutions).
However, there are currently no Federal requirements to identify and
report institutional conflicts to NIH. Therefore, NIH lacks information
on the number of institutional conflicts that exist among its grantee
institutions and the impact these conflicts may have on NIH-sponsored
research.

Our review shows that institutional conflicts do exist at grantee

institutions. Eighteen of the one hundred fifty-six institutions that
responded to our survey identified institutional conflicts related to their
NIH grants in FY 2008. We found that the institutions with written
policies and procedures regarding institutional conflicts were more
likely to identify conflicts. However, because half of the responding
institutions have no written policies and procedures, it is impossible to
know how many additional institutions would have identified
institutional conflicts if they had policies and procedures.
Even institutions with polices and procedures differed in how they
defined and addressed institutional financial interests and conflicts
related to research. Therefore, we continue to recommend that NIH
require institutions to identify, report, and address institutional
conflicts in a consistent and uniform manner. It is important that NIH
know of the existence of institutional conflicts so it can ensure that
research is free from any intended or unintended bias.

Therefore, as in our previous report, we recommend that NIH:

Promulgate regulations that address institutional financial conflicts of
interest
We recommend that the regulations include the following:

 the definition of an institutional financial conflict of interest;

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R E C O M M E N D A T I O N

 a requirement that grantee institutions have written policies

regarding the identification and oversight of institutional
financial conflicts of interest;

 the elements required in an institution’s policy regarding

institutional financial conflicts of interest (such as the
identification and management of conflicts);

 a requirement that institutions report institutional conflicts to

NIH, including reporting the details regarding the nature and
management of such conflicts; these details should include the
value of the financial interest, a description of how the financial
interest relates to the research, a description of how the
institutional conflict will be managed, and a description of how
the management of the institutional conflict will ensure
objectivity in the research; and

 guidance on how institutional conflicts should be identified,

managed, reduced, or eliminated.

Until regulations are promulgated, NIH should encourage grantee

institutions to develop policies and procedures regarding institutional
financial interests and conflicts.

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL

RESPONSE
NIH agreed that institutional conflict of interest is a significant and
timely topic worthy of serious consideration. NIH stated that it is
reviewing public comments to finalize regulations regarding financial
conflicts of interest and, therefore, it neither concurs nor nonconcurs
with our recommendation. Instead, NIH stated it will take OIG’s
recommendation into consideration as it considers future actions on
extramural financial conflicts of interest. NIH also made several
technical comments on the report, and OIG has made changes to the
report based on these comments where appropriate.

OIG understands that NIH is engaged in the rulemaking process

regarding financial conflicts of interest. However, in the
May 21, 2010, Notice of Proposed Rulemaking regarding financial
conflicts of interest, NIH proposed regulatory changes that focus only on
researchers’ conflicts. The proposed regulations do not address
institutional conflicts. Therefore, OIG continues to recommend that

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R E C O M M E N D A T I O N

NIH include institutional conflicts in regulations addressing financial

conflicts of interest. The full text of NIH’s comments is provided in
Appendix D.

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  A P P E N D I X ~ A

Table A-1: Results by Stratum for Grantee Institutions With Written Policies and
Procedures Regarding Institutional Financial Interests and Institutional Conflicts

Number of Grantee Number of Grantee Total Number of Grantee

Institutions in Stratum 1 Institutions in Stratum 2 Institutions
Number of grantee institutions that have written policies
37 33 70
and procedures regarding institutional financial interests
Number of institutions that have defined, in
writing, what constitutes an institutional financial 32 27 59
interest
Number of grantee institutions that have written policies
37 32 69
and procedures regarding institutional conflicts
Number of institutions that have defined, in
35 24 59
writing, what constitutes an institutional conflict
Number of institutions that have implemented a
process to determine whether an institutional 31 22 53
financial interest creates an institutional conflict
Number of institutions that have a committee that
26 14 40
reviews institutional conflicts
Number of institutions whose committees have
the authority to determine whether institutional 26 14 40
financial interests are institutional conflicts
Number of institutions whose committees have
the authority to determine how institutional 24 14 38
conflicts will be addressed
Number of institutions whose committees are
separate entities from the committees responsible 12 7 19
for reviewing researchers’ conflicts
Number of institutions whose boards of trustees
(or equivalent governing bodies) have also
established their own standing committees on 9 6 15
institutional conflicts as recommended by the
Institute of Medicine
Source: Office of Inspector General analysis of grantee institution survey responses, March 2010.

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  A P P E N D I X ~ B

Table B-1: Number of Grantee Institutions That Reported Incorporating

Recommended Actions From Departmental Guidance in Written Policies and
Procedures Regarding Institutional Financial Interests

Number of Grantee Number of Grantee Total Number of Grantee

Recommendation 1
Institutions in Stratum 1 Institutions in Stratum 2 Institutions
Establish conflict-of-interest committees or identify other
bodies or persons and procedures to deal with individual
or institutional financial interests in research or verify the 35 20 55
absence of such interests and address institutional
financial interests in research
Establish criteria to determine what constitutes an
institutional financial conflict, including identifying
leadership positions for which the individual’s financial 32 20 52
interests are such that they may need to be treated as
institutional financial interests
Determine whether particular individuals should report
financial interests to the conflict-of-interest committee
(individuals could include Institutional Review Board 34 17 51
members and staff, appropriate officials of the
institutions, and researchers)
Establish policies on providing information,
recommendations, or findings from conflict-of-interest 29 16 45
committee deliberations to Institutional Review Boards
Establish the independence of institutional responsibility
for research activities from the management of the 26 17 43
institution’s financial interests
Establish policies regarding the types of financial
relationships that may be held by parties involved in the
25 18 43
research and circumstances under which those
relationships and interests may or may not be held
Establish clear channels of communication between
conflict-of-interest committees and Institutional Review 29 13 42
Boards
Establish measures to foster the independence of
Institutional Review Boards and conflict-of-interest 28 14 42
committees
Establish procedures for disclosures of institutional
25 16 41
financial relationships to conflict-of-interest committees
Provide training to appropriate individuals regarding
27 11 38
financial interest requirements
Include individuals from outside the institution in the
23 10 33
review and oversight of financial interests in research
Use independent organizations to hold or administer the
12 4 16
institution’s financial interest
Source: Office of Inspector General analysis of grantee institution survey responses, March 2010.
1
The total number of institutions that reported incorporating recommendations equals 62. The number of institutions in this column does not equal 62 because some
institutions incorporated more than 1 recommendation.

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  A P P E N D I X ~ C

Table C-1: Methods Employed by Grantee Institutions To Manage, Reduce, or

Eliminate Institutional Conflicts

Number of Grantee Number of Grantee Number of Grantee

Methods 1
Institutions In Stratum 1 Institutions in Stratum 2 Institutions
Ensuring open exchange of research results through
30 40 70
publications and/or presentations
Disclosure of institutional conflicts during the informed
31 24 55
consent process for research subjects
Where the institutional conflict involves senior officials,
formal recusal of the conflicted officials from the chain of
authority over the research and communication of the 37 17 54
recusal arrangement to the officials’ superiors and
colleagues
Notification of the Institutional Review Boards regarding
31 22 53
institutional conflicts
Ensuring that adequate peer review of research is
18 34 52
performed by the institution
Disclosure of the institutional conflicts in public
25 25 50
presentations and publications
Where the institutional conflict involves a senior official,
designation of a “safe haven” (e.g., a nonconflicted senior
32 15 47
individual) with whom researchers can address
institutional-conflict-related concerns
Monitoring the use of institution facilities or prohibiting the
use of institution facilities/resources to further the interests 24 19 43
of companies connected to institutional conflicts
Ensuring that no technology/intellectual property is
inappropriately shared with companies connected to 19 23 42
institutional conflicts
External monitoring of research studies 20 19 39
Prohibiting outside companies related to institutional
conflicts from sponsoring research associated with the
17 17 34
conflicts or requiring approval for outside companies to
sponsor research
Preapproving/overseeing purchases of goods/services from
17 16 33
companies connected to institutional conflicts
Elimination of the institutional conflict 18 15 33
Disclosure of the institutional conflicts to other researchers
11 10 21
and/or centers in a multicenter trial
Additional internal monitoring of research studies 3 0 3

Prohibiting clinical research at the grantee institutions 2 0 2

Source: Office of Inspector General analysis of grantee institution survey responses, March 2010.
1
The total number of institutions equals 156. The number of institutions in this column does not equal 156 because some institutions use more than 1 method for
managing, reducing, and/or eliminating institutional conflicts.

OEI-03-09-00480 INSTITUTIONAL CONFLICTS OF INTEREST AT NIH GRANTEES 22

 A P PEN 0 x o

Agency Comments

DEPARTMENT OF HEALTH &. HUMAN SERVICES Public Health Servic.e

National Institutes of Health

,
Bethesda. Maryland 20892

NOV 2 201D

TO: Stuart Wright

Deputy Inspector General for Inspection and Evaluations, HHS

FROM: Director, NIH

SUBJECT: National Institutes of Health Comments on the Draft Office oflnspector

General Report: Institutional Conflicts ofInterest at NIH Grantees
(OEI-03-09-0048'O) . .

Attached are our general and technical comments on the draft Office ofInspector General
report, entitled Institutional Conflicts ofInterest at NIH Grantees (OEI-03-09-00480).

We appreciate the opportunity to review and comment on this important topic. Should you
have questions or concerns regarding our comments, please contact Mary Anne Mazzarino
in the Office of Management Assessment at 301·496·2461.

/S/
Francis S. Collins, M.D., Ph.D.

Attachments

OEI·03·09·00480 INSTITUTIONAL CONFLICTS OF INTEREST AT NIH GRANTEES 23

A P P E N D I X ~ D

OEI-03-09-00480 INSTITUTIONAL CONFLICTS OF INTEREST AT NIH GRANTEES 24

 A C K N O W L E D G M E N T S

This report was prepared under the direction of Robert A. Vito, Regional
Inspector General for Evaluation and Inspections in the Philadelphia
regional office, and Linda M. Ragone, Deputy Regional Inspector
General.

Tanaz Dutia served as the team leader for this study. Other principal
Office of Evaluation and Inspections staff from the Philadelphia
regional office who contributed to the report include Emily Multari;
central office staff who contributed include Heather Barton.

OEI-03-09-00480 INSTITUTIONAL CONFLICTS OF INTEREST AT NIH GRANTEES 25

 Office of Inspector General
http://oig.hhs.gov

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amended, is to protect the integrity of the Department of Health and Human Services
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