The National Institutes of Health (NIH), a part of the U.S. Department of Health and Human Services (HHS), is the nation’s medical research agency—making important medical discoveries that improve health and save lives. NIH is the largest source of funding for medical research in the world.
The NIH invests over $31.2 billion annually in medical research for the American people. More than 80% of the NIH’s funding is awarded through almost 50,000 competitive grants to more than 325,000 researchers at over 3,000 universities, medical schools, and other research institutions in every state and around the world.
Consequently, over the past several years, greater scrutiny has been applied to the entities who receive grants from NIH. Specifically, criticism has arisen about grantee institutions policies and procedures regarding institutional financial interests and conflicts of interest. According to a recent report released by the HHS Office of the Inspector General (OIG), “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.”
Background
Pursuant to Federal regulations, each grantee institution receiving NIH funds must have a written policy for 1) identifying researchers’ financial conflicts of interest and 2) ensuring that conflicts are identified, managed, reduced, or eliminated. Each grantee institution must collect from each researcher a listing of his/her known significant financial interests that would reasonably 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. However, none of these regulations applies to institutions’ conflicts.
One of the reasons why institutional policies are of concern to OIG is the Patent and Trademark Act Amendments, commonly known as the Bayh-Dole Act, which was enacted in 1980 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.”
Consequently, Section 493A of the PHS Act directed the Secretary of 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). 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. Although NIH issued new requirements on May 21, 2010 to strengthen the reporting and management of researcher conflicts, the regulations were not broadened to include institutional conflicts. NIH believed that further consideration was necessary before regulations could be formulated.
Because there are currently no Federal requirements to define, identify, report, and manage actual or potential institutional conflicts, and grantee institutions are not required to have policies that address either institutional financial interests or conflicts, OIG concluded that “NIH lacks information on the number of institutional conflicts at its grantee institutions and the impact these conflicts may have on NIH-sponsored research.”
Report
OIG selected a stratified random sample of 250 NIH grantee institutions to survey, to determine whether they have any policies and procedures regarding institutional financial interests and conflicts. OIG requested information on any institutional financial interests related to NIH grants awarded in FY 2008. A total of 156 grantee institutions responded.
Findings
Although not required for institutional financial interests, 70 of 156 responding NIH grantee institutions have written policies and procedures addressing institutional interests. Of those 70:
59 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. Of the 69:
- 59 have defined, in writing, what constitutes an institutional conflict, typically defining them as financial interests that could affect the research, decision-making, loyalty, or objectivity of either the institution or individuals.
- 53 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.
- 40 grantee institutions with written policies and procedures regarding institutional conflicts have a committee that reviews institutional conflicts
In addition, 18 NIH grantee institutions identified 38 institutional conflicts. 21 of one-hundred fifty-six institutions identified institutional financial interests. Of those 21:
- Almost all identified the financial interests as institutional conflicts.
- 18 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) compared to those that do not (3 of 87).
- The most common type of institutional conflict was institutions’ holding equity in non-publicly held companies.
For institutions that identified institutional conflicts, the strategy most often used to address them was disclosure.
62 of the 70 grantee institutions with written policies and procedures reported that they had incorporated recommendations from the HHS Guidance Document into their policies and procedures. 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 or administer the institution’s financial interest.
Recommendations
Based on these results, OIG continued its recommendation that NIH require grantee institutions to identify, report, and address institutional conflicts in a consistent and uniform manner to NIH. To do this, OIG recommended that NIH “promulgate regulations that address institutional financial conflicts of interest. They further added that “until regulations are promulgated, NIH should encourage grantee institutions to develop policies and procedures regarding institutional financial interests and conflicts.” OIG also recommended that NIH include in its May 21, 2010 proposed rules, institutional conflicts in regulations addressing financial conflicts of interest.
In response to the report and recommendations, NIH stated to OIG “that it is reviewing public comments to finalize regulations regarding financial conflicts of interest and will take the OIGs recommendation into consideration as it considers future actions on extramural financial conflicts of interest.”
Discussion
Given that some grantee institutions have already been the subject of Congressional oversight regarding financial conflicts of interest, King and Spalding LLP noted that the “OIG report may prompt Congress to investigate grantee institutions and their financial interests and conflicts of interest.” As a result, the law firm recommended that “grantee institutions take the prudent step of adopting appropriate written policies and procedures to address institutional financial interests and real or potential conflicts in a consistent and uniform manner.” In addition, they recommended that “grantee institutions be prepared to file comments if/when the NIH issues a notice of proposed rulemaking in response to the OIG’s recommendations.”
King and Spalding LLP also noted the willingness of Senator Charles Grassley (R-IA), and Senator Max Baucus (D-MT), Chairman of the Senate Finance Committee, to continue their investigations and aggressive oversight into this area. As a result, they recommend that “Grantee institutions be prepared to respond to requests for detailed information about their policies and procedures for identifying and managing institutional conflicts of interest, their rationale, if no written policies have been developed, and their stance on potential future regulations.”
Conclusion
As the primary Federal agency responsible for conducting and supporting medical research, NIH has a critical duty to improve the health and lives of Americans. While it is crucial that public health and safety from this research be maintained, federal regulations of institutions and researchers regarding conflicts of interest, must arrive at a careful balance to preserve the necessary relationship with industry that produces new medicines and medical technologies. If we put too many government mandated requirements between companies and research institutions then those institutions may get out of the medical products research and development area all together,
Given many recent reports that innovation in medicine in America is losing ground to other countries such as China, India, and Brazil, NIH must be extremely careful in considering proposals for grantee institutions. As countries begin to improve their medical and research facilities abroad, more stringent regulations at academic medical centers and grantee institutions in America will only stifle innovation and send our resources and funding abroad. Accordingly, it is important that grantee institutions emphasize the importance and value of collaboration with industry so that institutions can continue improving American medicine, research, and health care.