CONFLICT OF INTEREST POLICY (ADDNEDUM 1) AND FINANCIAL DISCLOSURE STATEMENT (10/1995)

2            Desert Research Institute
              Policies and Procedures
2.01            Administrative Policies and Procedures
2.01.05       Conflict of Interest Policy (Addendum 1)
                   and Financial Disclosure Statement (10/1995)

This addendum to the DRI Conflict of Interest Policy (October 3, 1991) is issued to implement the recent final regulations for the National Science Foundation and the Department of Health and Human Services regarding Principal Investigator Financial Disclosure Policy. The effective date of these new regulations is October 1, 1995 and completion of the new Financial Interest Disclosure Form is required for all proposals submitted from that date forward. To comply with these changes, the Institute has a responsibility to manage, reduce, or eliminate any actual or potential conflicts of interest that may be presented by a financial interest of an investigator. Therefore, the Institute requires that investigators disclose any significant financial interest that may present an actual or potential conflict of interest in relationship with a sponsored project.

These guidelines are issued as an addition to the Desert Research Institute Conflict of Interest Policy and are not intended to replace the requirement that DRI faculty members disclose all compensated outside professional services to their Executive Directors. This new policy replaces the old procedure for the disclosure of an actual or potential conflict of interest.

PURPOSE

The purpose of this policy is to protect the credibility and integrity of the Institute's faculty and staff so that the sponsors and the publics trust and confidence in the Institute's research is ensured. The value of the results of research 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 Institute the ability to identify and manage financial interests that may bias the research, and minimize reporting and other burdens on the investigators.

DEFINITIONS

Conflict of Interest: A potential conflict of interest occurs when there is a conflict between an individual's private interests and their professional obligations to the Institute such that an independent observer might reasonably question whether the individual's professional actions or decisions are determined by considerations of personal gain, financial or otherwise. An actual conflict of interest depends on the situation and not on the character or actions of the individual. For purposes of this policy, a conflict of interest exists when the Institute, through procedures described herein, reasonably determines that a significant financial interest could directly and significantly affect the design, conduct, or reporting of sponsored projects.

Investigator: The principal investigator, project director, co-principal investigators, and any other person at the Institute who is responsible for the design, conduct, or reporting of research or service activities funded, or proposed for funding, by a sponsor. In this context, the term "Investigator" includes the investigator's spouse and dependent children.

Significant Financial Interest: Anything of monetary value, including, but not limited to:

Salary or other payments for services (e.g., consulting fees or honoraria) that exceed $10,000 in any twelve month period;
Equity interests (e.g., stocks, stock options or other ownership interests) that exceed $10,000 in fair market value and exceed five % of an ownership interest in a business entity;
Intellectual property rights (e.g., patents, copyrights and royalties from such rights).

The term does not include:

Salary, royalties, or other remuneration from the Desert Research Institute;
Income from seminars, lectures, or teaching engagements sponsored by public or nonprofit entities;
Income from service on advisory committees or review panels for public or nonprofit entities; or
An equity interest that, when aggregated for the Investigator and the Investigator's spouse and dependent children, meets both of the following tests: does not exceed $10,000 in value as determined through reference to public prices or other reasonable measures of fair market value, and does not represent more than a five percent ownership interest in any single entity; or
Salary, royalties or other payments that, when aggregated for the Investigator and the Investigator's spouse and dependent children over the next twelve months, are not expected to exceed $10,000.

DISCLOSURE PROCEDURE

Each investigator is required to annually disclose the following significant financial interests held by themselves, their spouse and dependent children:

Any Significant Financial Interest of the Investigator that would reasonably appear to be affected by the research or service activities funded, or proposed for funding, by an sponsor; or
Any Significant Financial Interest of the Investigator in a business entity whose financial interest would reasonably appear to be affected by the research or service activities funded, or proposed for funding, by a sponsor.

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 one's reputation and career from potentially embarrassing or harmful allegations of misconduct.

Each Investigator shall annually complete a Financial Interest Disclosure Form and attach any required supporting documentation. The completed Disclosure Form must be submitted to the Senior Vice President for Finance and Administration. Supporting documentation that identifies the business entity involved and the nature and amount of the interest should be submitted in a sealed envelope marked confidential and accompany the Disclosure Form.

As required by Federal regulation, all Significant Financial Interests must be disclosed prior to the time a proposal is submitted. All financial disclosures must be updated by Investigators during the period of the award as new reportable Significant Financial Interests are obtained.

REVIEW PROCEDURE

The Senior Vice President for Finance and Administration (SVPFA), or official designee, shall conduct an initial review of all financial disclosures. 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 Institute Conflict of Interest Review Committee (CIRC). Committee members will be appointed by the Vice President for Academic Affairs. The CIRC shall be chaired by the VPAA and shall contain, at a minimum, two faculty members, one division executive director, and a research administrator.

A conflict of interest exists when the CIRC reasonably determines that a Significant Financial Interest could directly and significantly affect the design, conduct, or reporting of the proposed research project. The Committee shall then determine 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.

RESOLUTION PROCEDURE

Prior to consideration by the CIRC, the Investigator, in cooperation with the Division Executive Director shall develop and present to the CIRC a Conflict of Interest Resolution 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 Resolution Plan shall address such issues as:

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 Resolution Plan and approve it, 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 either ineffective or inequitable, and 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 [PHS policy, for instance, does not permit such an action], the research go forward without imposing such conditions or restrictions. In these cases, the Senior Vice President for Finance and Administration shall make the final decision regarding resolution.

The approved Resolution Plan shall be incorporated into a Memorandum of Understanding between the Desert Research Institute 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 Division Executive Director and, on behalf of the Institute, the Senior Vice President for Finance and Administration. Actual or potential conflicts of interests will be satisfactorily managed, reduced, or eliminated in accordance with these Guidelines and all required reports regarding the conflict of interest submitted to the sponsor prior to expenditure of any funds under an award. [For example, the PHS requires the Institute to report to the PHS Awarding Component the existence of a conflicting interest (but not the nature of the interest or other details) found by the Institute and assure that the interest has been managed, reduced, or eliminated. NSF only requires the Institute to report conflicts which cannot be satisfactorily managed, reduced, or eliminated.]

Records of investigator financial disclosures and of actions taken to manage actual or potential conflicts of interest, shall be retained by the Senior Vice President for Finance and AdministrationÆs office until three years after the later of the termination or completion of the award to which they relate, or the resolution of any government action involving those records.

DISCIPLINARY PROCEDURE

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 as provided for in the DRI Faculty Personnel Manual or the Board of Regents University Community Rules and Procedures. The CIRC's recommendations on sanctions shall be presented to the Senior Vice President for Finance and Administration who shall enforce any disciplinary action. In addition, the Institute shall follow Federal regulations regarding the notification of the sponsoring agency in the event an Investigator has failed to comply with this policy. The sponsor may take its own action as it deems appropriate, including the suspension of funding for the Investigator until the matter is resolved.

COLLABORATORS, SUBRECIPIENTS, AND SUBCONTRACTORS

Collaborators, subrecipients, and subcontractors from other academic or not-for-profit institutions must either comply with this policy or provide a certification from their institutions that they are in compliance with Federal policies regarding investigator significant financial interest disclosure and that their portion of the project is in compliance with their institutional policies. Subcontractors from commercial firms need not make a certification, except when the prime award is from the Public Health Service. The PHS requires a certification from any subcontractor, including commercial firms, stating that it is in compliance with Federal policies regarding investigator significant financial interest disclosure and that its portion of the project is in compliance with company policies.

EFFECTIVE DATE

This policy is effective October 1, 1995. All principal investigators submitting proposals for a October 1, 1995 deadline or after need to have a Financial Interest Disclosure Form completed and either submitted with the proposal or on file in the Senior Vice President for Finance and AdministrationÆs office. The Proposal Routing Sheet has also been revised to include the question ôHas the Financial Interest Disclosure Form been submitted and is the information contained in it current and accurate?ö

SAMPLE FINANCIAL INTEREST DISCLOSURE FORM

A Financial Interest Disclosure Form can be printed from the DRI external web site at Research, Sponsored Research, Conflict of Interest or the internal web site at Sponsored Research, Conflict of Interest.

DESERT RESEARCH INSTITUTE FINANCIAL INTEREST DISCLOSURE FORM

NAME:_______________________________DIVISION:___________________TITLE:______________________________________________

Purpose:

The purpose of this form is for an Investigator to disclose any Significant Financial Interest as defined below. Completion and submission of this form is required before any proposals can be submitted by an investigator.

Disclosure procedure:

1. Each Investigator is required to annually disclose the following significant financial interests:

(i) Any Significant Financial Interest of the Investigator that would reasonably appear to be affected by the research or service activities funded, or proposed for funding, by an sponsor; or

(ii) Any Significant Financial Interest of the Investigator in a business entity whose financial interest would reasonably appear to be affected by the research or service activities funded, or proposed for funding, by a sponsor. 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 one's reputation and career from potentially embarrassing or harmful allegations of misconduct.

2. Each Investigator shall complete a Financial Interests Disclosure Form and attach any required supporting documentation. The completed Disclosure Form must be submitted to the Vice President of Finance and Administration. Supporting documentation that identifies the business entity involved and the nature and amount of the interest should be submitted in a sealed envelope marked confidential and accompany the Disclosure Form.

3. As required by Federal regulation, all Significant Financial Interests must be disclosed prior to the time a proposal is submitted. All financial disclosures must be updated by Investigators during the period of the award as new reportable Significant Financial Interests are obtained.

Definitions:

A potential Conflict of Interest occurs when there is a conflict between an individual's private interests and their professional obligations to the Institute such that an independent observer might reasonably question whether the individual's professional actions or decisions are determined by considerations of personal gain, financial or otherwise. An actual conflict of interest depends on the situation and not on the character or actions of the individual. For purposes of this policy, a conflict of interest exists when the Institute, through procedures described herein, reasonably determines that a significant financial interest could directly and significantly affect the design, conduct, or reporting of sponsored projects.

Investigator means the principal investigator, project director, co-principal investigators, and any other person at the Institute who is responsible for the design, conduct, or reporting of research or service activities funded, or proposed for funding, by a sponsor. In this context, the term "Investigator" includes the investigator's spouse and dependent children.

Significant Financial Interest means anything of monetary value, including, but not limited to:

1) Salary or other payments for services (e.g., consulting fees or honoraria) that exceed $10,000 in any twelve month period

2) Equity interests (e.g., stocks, stock options or other ownership interests) that exceed $10,000 in fair market value and exceed five % of an ownership interest in a business entity

3) Intellectual property rights (e.g., patents, copyrights and royalties from such rights).

The term does not include:

1) Salary, royalties, or other remuneration from the Institute;

2) Income from seminars, lectures, or teaching engagements sponsored by public or nonprofit entities;

3) Income from service on advisory committees or review panels for public or nonprofit entities; or

4) An equity interest that, when aggregated for the Investigator and the Investigator's spouse and dependent children, meets both of the following tests: does not exceed $10,000 in value as determined through reference to public prices or other reasonable measures of fair market value, and does not represent more than a five percent ownership interest in any single entity; or

5) Salary, royalties or other payments that, when aggregated for the Investigator and the Investigator's spouse and dependent children over the next twelve months, are not expected to exceed $10,000.

Questions:

1) Do you or members of your family have any stock, stock options, or equity interests in a business entity that exceeds $10,000 market value and that exceeds 5% of the total outstanding equity ownership in a business entity that is related to the intended research? If yes, please explain in an attached statement.

YES____ NO____

2) Do you or members of your family receive salary, consulting fees, dividends, royalties or any other distribution from a business entity that exceeds $10,000 over the next 12 months that is related to the intended research? If yes, please explain in an attached statement.

YES____ NO____

3) Do you or members of your family own patents or copyrights or receive royalties from any a business entity that exceeds $10,000 over the next 12 months? If yes, please explain in an attached statement.

YES____ NO____

4) Do you or members of your family have any other financial or related interests that could present an actual or perceived conflicts of interests? If yes, please explain in an attached statement.

YES____ NO____

In submitting this disclosure form, I certify that all of the above information is current and accurate to the best of my knowledge and that I have read and understand the Desert Research Institute ôPrincipal Investigator Financial Disclosure Policyö. I am supplying this information to the Desert Research Institute for confidential review purposes only and I do not authorize the release of it for any other use or disclosure to others.

Signature: _________________________________ Date:________________

Formatted 11/2004
Created 10/1995

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