Conflict of Interest Situations with Possible Management Plans
Royalties
As a public institution, the University of Michigan is committed to teaching, research, and service. A key component of the University's mission is the application of knowledge to problems of general public interest. Technology transfer, as a beneficial outcome of teaching and research, is an application of knowledge that responds to many societal needs. By recognizing and supporting activities related to technology transfer and intellectual property development, the University acknowledges that these activities are an integral component of its mission. Faculty members, through their ongoing research activities, play a key role in supporting this component of the University's mission.
Through the University's revenue distribution plan, incentives exist for faculty participation in technology transfer activites by providing revenues for the continued support of the inventor(s)' research; supporting further investment in research and educational activities; sharing revenues directly with inventors; and fulfilling the obligations of federal regulations. As the University engages in activities related to technology transfer and development, the potential for creating conflicts of interests becomes very high.
Example 1: Royalty interest with minimal risk
Professor R is the owner of a local company that wants to license University-owned technology invented by Professor D. Through the University's revenue distribution plan, Professor D will receive royalties on the technology licensed to the company. No use of University services or facilities, nor any assignment of University employees, is obligated or contemplated in the agreement and Professor D has no financial or management interest in the company.
This situation presents minimal risks and falls into what the COI committees refer to as an "Administrative Shunt” category.
Example 2: Royalty interest with student element
In the proposed license agreement (described in example 1 above), Professor R and a graduate student are co-inventors of the technology to be licensed to Professor R's company. Professor R is the graduate student's academic advisor. This presents an unacceptable conflict (see Operating Principle #4).
Management solutions may include the following:
- A student may not be simultaneously employed by an outside entity in which their faculty advisor has a significant financial interest in.
- Appointing another faculty member (with no connection to the company) to serve as thesis advisor of the student, if the focus of the thesis is based on this research.
This situation presents more than minimal risks. The example solutions provided below are intended to be a guide for demonstrating how particular conflict situations may be managed [note: the details of some situations may make COI management unworkable and the project will not commence]. The examples are not intended to be all-inclusive as each individual situation may require a greater or lesser degree of management based upon the elements of risk presented.
- Appoint a different faculty member, who has no connection to the UM, as PI of the project at the University of ABCZ. The new PI oversees all aspects of the subcontract to the University. This minimizes the conflict of interest for Professor Z.
- Appoint a different faculty member, who has no connection to the University of ABCZ, as PI of the UM project and allow the original faculty member (Professor Z) to serve as co-investigator. The new PI oversees all aspects of the subcontract. This becomes a managed conflict of interest for Professor Z (see notes below).
- Although the least desirable, if the technical work requires that Professor Z remain as PI at both the UM and the University of ABCZ, another individual with no connection to the University of ABCZ is appointed to oversee the performance of the subcontract (although this individual may not participate in the research activity) (see notes below).
- For examples B & C the following additional management conditions may apply:
- None of these examples require disclosure to and approval by the Regents under the State of Michigan Conflict of Interest Statute.
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Notes:
Professor Z would disclose his/her University of ABCZ connection to lab staff, students, oversight committees (IRB, UCUCA), as well as in any publications about the research. Annual evaluations of staff or key personnel involved in the project would not be the sole responsibility of Professor Z; additional oversight would be provided by a higher-level academic administrator. If human subjects are involved in the research, the new PI or another individual with no connection to the University of ABCZ would oversee all aspects of human subject participation.