Policy 7114 – Financial Conflict of Interest (FCOI) Policy
Revision Date: 9/28/2021
Last Review: 9/28/2021
Responsible Office: Provost
These guidelines define general university policy and procedures regarding conflicts of interest in relationship to sponsored projects involving research, education, and university service. Their purpose is to protect the credibility and integrity of the university’s faculty and staff so that the public trust and confidence in the university’s sponsored activities are ensured.
In accordance with federal regulations, the university has a responsibility to manage, reduce, or eliminate any actual or potential conflicts of interest that may be presented by the financial interest of an investigator. Thus, the university requires that investigators disclose any significant financial interest in a research-sponsoring entity that may present an actual or potential conflict of interest in the event that the investigator becomes engaged in research in a project sponsored by that entity.
Background: Technology Transfer and Conflict of Interest
Effective interaction between universities conducting research and industry is essential to ensure the rapid application of scientific discoveries to the needs of the nation and to maintain the international competitiveness of domestic industry. Nonetheless, prudent stewardship of public funds includes protecting sponsored research from being compromised by the conflicting financial interests of any investigator responsible for the design, conduct, or reporting of sponsored research.
The value of the results of sponsored research to the health and the economy of the nation must not be compromised by any financial interest that will, or may be reasonably expected to, bias the design, conduct, or reporting of the research. This policy seeks to maintain a reasonable balance between these competing interests, give the university the ability to identify and manage financial interests that may bias the research, and minimize reporting and other burdens on the investigators.
Conflict of Interest
A potential conflict of interest occurs when there is a divergence between an individual’s private interests and his or her professional obligations to the university such that an independent observer might reasonably question whether the individual’s professional actions or decisions are determined by considerations or personal gain, financial or otherwise. An actual conflict of interest depends on the situation and on the character or actions of the individual.
Financial Conflict of Interest
Financial conflict of interest (FCOI) means a significant financial interest that could directly and significantly affect the design, conduct, or reporting of sponsored research.
Financial interest means anything of monetary value, whether or not the value is readily ascertainable.
Investigator means the principal investigator/project director, co-principal investigators, and any other person at the university, regardless of title or position, who is responsible for the design, conduct, or reporting of research, educational, or service activities funded, or proposed for funding, by an external sponsor, which may include, for example, collaborators or consultants.
Significant Financial Interest
Significant financial interest means:
- 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:
- 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;
- 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
- Intellectual property rights and interests (e.g., patents, copyrights), upon receipt of income related to such rights and interests.
- 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.
- The term significant financial interest does not include the following types of financial interests: salary, royalties, or other remuneration paid by the Institution or affiliated entities 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.
Guidelines and Procedures for Disclosure of Conflicts of Interest
Disclosure Requirements Documentation for Disclosure
At the time of submission of a grant to a federal agency or any other sponsored project, all participating investigators are required to complete a Significant Financial Interests Disclosure and Contract Committee Conflict of Interest Certificate forms and attach all required supporting documentation (FCOI Disclosures). (See also Louisiana Tech University Policy 1416 Outside/Dual Employment and Dual Office Holding). The completed and approved FCOI Disclosures must be submitted with the proposal and routing form to the Office of Sponsored Projects using normal university procedures. Supporting documentation that identifies the business or entity involved and the nature and amount of the interest should be submitted in a sealed envelope marked confidential and accompany the FCOI Disclosures and the routing form.
Regardless of the above minimum requirements, a faculty or staff member, in his or her own best interest, may choose to disclose any other financial or related interest that could present an actual conflict of interest or be perceived to present a conflict of interest. Disclosure is a key factor in protecting the reputation and career of an investigator from potentially embarrassing or harmful allegations of misconduct.
If federally funded research involves a subrecipient (e.g., subcontractors or consortium members), the University (as the awardee institution) will take reasonable steps to ensure that any subrecipient investigator complies with the federal policies by:
- Establishing in writing with the subrecipient whether the financial conflicts of interest policy of the University or that of the subrecipient will apply to the subrecipient’s investigators.
- If the subrecipient’s investigators must comply with the subrecipient’s financial conflicts of interest policy, the subrecipient shall certify that its policy is in compliance with federal policies. In the absence of this certification, the agreement will state that subrecipient investigators are subject to the financial conflicts of interest policy of University for disclosing significant financial interests that are directly related to the subrecipient’s work for the University.
- Additionally, if the subrecipient’s investigators must comply with the subrecipient’s financial conflicts of interest policy, the written agreement will specify a deadline for the subrecipient to report all identified financial conflicts of interest to University so that the University can provide timely FCOI reports, as necessary, to the relevant federal agency.
- Alternatively, if the subrecipient’s investigators must comply with University’s financial conflicts of interest policy, the written agreement will specify a deadline for the subrecipient to submit all investigator disclosures of significant financial interests to University so that the University can provide timely FCOI reports, as necessary, to the relevant federal agency.
- Providing FCOI reports to the federal agency regarding all financial conflicts of interest of all subrecipient investigators consistent with this policy, i.e., prior to the expenditure of funds and within 60 days of any subsequently identified FCOI
In addition to making this policy and associated forms available online, a certificate of completion of Financial Conflict of Interest training will be required by OSP for all investigators prior to engaging in sponsored research (federal or otherwise). The Chief Innovation and Research Officer (CIRO) or designee shall inform each Investigator of Louisiana Tech University’s Policy 7114 Conflict of Significant Interest, and Investigators responsibilities regarding the disclosure of significant financial interests, and all applicable federal regulations at a minimum every four years, and immediately when any of the following circumstances apply: (1) such time Louisiana Tech University revises the aforementioned policy or procedures in any manner that affects the requirements of Investigators, (2) an Investigator is new to Louisiana Tech University, or (3) such time Louisiana Tech University finds that an Investigator is not in compliance with the aforementioned policy or management plan.
Time Table for Disclosure
As required by federal regulation, all significant financial interests must be disclosed at the time a proposal is submitted. All FCOI Disclosures must be updated by investigators at least annually during the period of the award, or within thirty (30) days of discovering or acquiring a new significant financial interest. New investigators added to a project after the start date of the project must also complete training and FCOI Disclosures.
Conflict of Interest Review Committee
The Provost, or official designee, shall conduct an initial review of all financial disclosures to determine whether a conflict of interest exists. A conflict of interest exists when the review reasonably determines that a significant financial interest could directly and significantly affect the design, conduct, or reporting of the proposed sponsored project. If the initial determination is made that there may be a potential for conflict of interest covered by this policy, then the disclosure packet will be referred to the appropriate university Conflict of Interest Review Committee (CIRC). Committee members are appointed by the Provost. The CIRC shall contain one faculty member from each college, representing a cross section of academic disciplines, and a research administrator. The committee shall determine: (1) if an actual or potential conflict of interest exists; (2) when an actual or potential conflict of interest exists, if it can be eliminated, and (3) if not, what conditions or restrictions, if any, should be imposed by the institution to manage actual or potential conflicts of interest arising from disclosed significant financial interests, including promptly notifying the applicable federal grant awarding agency of noncompliance and plans for resolution and corrective action. If a disclosure of a new conflict arises or the discovery of an undisclosed conflict is uncovered, the CIRC will review and make recommendations within 60 days of the new conflict disclosure or unreported disclosure discovery.
Conflict of Interest Management Plan
Prior to consideration by the CIRC, the investigator, in cooperation with the academic unit or college, shall develop and present to the CIRC a Conflict of Interest Management Plan that details proposed steps that will be taken to manage, reduce, or eliminate any actual or potential conflict of interest presented by a significant financial interest. At a minimum the management plan shall address such issues as the following:
- public disclosure of significant financial interests,
- review of research protocol by independent reviewers, and
- monitoring of research by independent reviewers.
Where the CIRC deems it appropriate, the CIRC shall review the management plan and approve it or add conditions or restrictions including the following:
- modification of the research plan,
- disqualification from participation in all or a portion of the research funded,
- divestiture of significant financial interests, or
- severance of relationships that create actual or potential conflicts of interest.
If the CIRC determines that imposing the above referenced conditions or restrictions would be equitable, or that the potential negative impacts that may arise from a significant financial interest are outweighed by interests of scientific progress, technology transfer, or the public health and welfare, then the CIRC may recommend that, to the extent permitted by federal regulations, the research go forward without imposing such conditions or restrictions. In these cases, the Provost shall make the final decision regarding resolution.
Memorandum of Understanding
The approved management plan shall be incorporated into a Memorandum of Understanding between Louisiana Tech University and the faculty member that details the conditions or restrictions imposed upon the investigator in the conduct of the project or in the relationship with the business enterprise or entity. The Memorandum of Understanding shall be signed by the investigator, the department head, and, on behalf of the university, the investigator’s cognizant university administrator (usually a Dean/Director). Actual or potential conflicts of interest will be satisfactorily managed, reduced, or eliminated in accordance with these guidelines prior to accepting any award, or they will be disclosed to the sponsoring agency for action.
Whenever an investigator has violated this policy or the terms of the Memorandum of Understanding, the CIRC shall recommend sanctions which may include disciplinary action ranging from a public letter or reprimand to dismissal and termination of employment. If the violation results in a collateral proceeding under university policies regarding misconduct in science, then the CIRC shall defer a decision on sanctions until the misconduct in science process is completed. The CIRC’s recommendations on sanctions shall be presented to the investigator’s cognizant university official, who, in consultation with the Provost, shall enforce any disciplinary action. Noncompliance must also be reported to the appropriate federal funding agency. Certain agencies (e.g., NIH grants for clinical research) require public disclosure of FCOI on all public presentations and publications (including addendums for previously published items) for any funded research that did not comply with federal disclosure regulations. The CIRC or the appropriate University office or committee shall complete and document retrospective reviews within 120 days of the determination of a violation of this policy or the terms of the Memorandum of Understanding to determine whether the investigator’s activities on any research conducted during the period of noncompliance was biased in the design, conduct, or reporting of such research.
Reporting of Conflicts and Retention of Records
The University must certify in each application for funding to which this policy applies, that the University has a written and enforced administrative process to identify and manage financial conflicts of interests and that they will ensure compliance with all such related federal policies regarding FCOI. The University must provide initial and ongoing FCOI reports to the federal agency, as required. Thus, University is required to maintain records relating to all investigator disclosures of financial interests and the University’s review of, and response to, such disclosures (whether or not a disclosure resulted in the University’s determination of a FCOI) and all actions under the University’s policy or retrospective review, if applicable, for at least three years from the date the final expenditures report is submitted to the federal agency, or as required by the specific agency. University must also monitor investigator compliance with approved management plans throughout the duration of the funded project.
Public accessibility of FCOI information
Prior to the University’s expenditure of any funds under a federally funded research project, University shall ensure information concerning FCOIs related to the federal research are made publicly accessible and will:
- Make the information accessible on its website or in response to a written request within five calendar days of the request. Include the information listed in 42 CFR 50.605(a)(5)(ii).
- Update the information at least annually.
- Update the information within 60 days of a newly identified FCOI.
- Remain available for three years from the date the information was most recently updated.