Financial Conflict of Interest in Research - Policies and Policy Governance

Applies to: Faculty (including part-time and visiting faculty), postdoctoral scholars, academic staff, staff, and students (including graduate/undergraduate student workers and graduate assistants) employed by the University of Southern California and including those working for Keck Medicine of USC (“USC Employees”). This policy continues to apply to individuals who are on sabbatical or other leaves, or who are visiting other institutions.

1. POLICY

Issued: March 1, 2013
Last Revised: September 20, 2024
Last Reviewed: October 7, 2024

2. Policy Purpose

The purpose of this policy is to promote the highest ethical standards in situations where conflicts of interest may occur in the conduct of research.

The University of Southern California (“USC”) encourages its faculty, staff, and students to participate in meaningful professional relationships with industrial and other private partners. These partnerships are established for mutually beneficial reasons and often produce knowledge and technology that will help to meet societal needs.

In certain circumstances, relationships with outside interests can create, or appear to create conflicts of interest or situations where competing interests can conflict. While having a conflict of interest does not imply wrongdoing or inappropriate activity, conflicts do require review and management to ensure that the conflict does not improperly influence, or appear to improperly influence, how USC research is proposed, conducted, or reported. Transparency is the cornerstone of effective conflict oversight and management. Many times, disclosure itself minimizes a perception of bias in the conduct of research. It is therefore critical that all conflicts be disclosed promptly, fully, and thoroughly, in advance, in the manner provided in this policy. This policy explains the process for identifying and disclosing conflicts and the methods by which they are managed by the university.

3. Scope and Application

This policy applies to all university faculty members (including part-time and visiting faculty), staff and other employees, and students (including postdoctoral fellows) who propose, conduct, or report research on behalf of the university, regardless of funding source. This policy applies to all sponsored projects, including government and non-government funded projects (such as industry or foundation sponsors), university funded projects, gift funded projects, clinical trials, and also to unfunded research projects.

Investigators are not permitted to begin any research activity when there is an actual or apparent conflict of interest before they receive a written determination from the Senior Vice President of Research and Innovation (SVPRI) as to how to manage the conflict.

Special care must also be taken when students or trainees are involved with research where an actual or apparent conflict of interest exists so that academic progress is not impeded or affected by a faculty member or supervisor’s conflict of interest.

4. Definitions

Term	Definition
Close Relation	Spouse, domestic partner, intimate partner, or dependent child of an investigator or research personnel. Please note that this definition follows the National Institute of Health definition and differs from the definition under the Conflict of Interest and Commitment policy.
Conflict of Commitment	Arises when a USC Employee undertakes a role (paid or unpaid) outside of USC that interferes, appears to interfere, or has the potential to interfere with the USC Employee’s ability to perform core job responsibilities and commitments to USC.
Conflict of Interest	The term Conflict of Interest encompasses both Conflicts of Interest and Conflicts of Commitment. A Conflict of Interest arises when: – Professional, financial, or personal activities or relationships compromise, or have the appearance of compromising, a USC Employee’s professional loyalty and responsibility to USC, and ability to perform USC duties and responsibilities in a full and complete manner. – A USC Employee’s professional, financial, or personal activities compete, or have the appearance of competing, with the university. See sections Prohibited Conflicts of Interest and Outside Activities and Conflict of Commitment.
Financial Conflict of Interest in Research	A situation in which financial or other personal considerations compromise, or have the appearance of compromising, an individual’s professional judgment in proposing, conducting, supervising, or reporting research. Conflicts of interest include non-financial as well as financial conflicts because non-financial interests can also come into conflict with a researcher’s primary duties to maintain research objectivity. Investigators should not only consider situations that are set forth in this policy, but also gray areas that might create the appearance of a conflict of interest.
Conflict of Interest Review Committee (“CIRC”)	The CIRC, chaired by the Vice President of Research (VPR) or their designee, is charged with reviewing conflict of interest disclosures and formulating recommendations to manage, reduce, or eliminate conflicts of interest. The CIRC consists of faculty members appointed by the Vice President of Research, a representative from the Office of Culture, Ethics and Compliance, a representative from the USC Stevens Center for Innovation (non-voting), a representative from the Institutional Review Board (IRB) or the Office for Protection of Research Subjects (OPRS), an attorney from the Office of General Counsel (non-voting), a representative from the Department of Contracts and Grants (non-voting), and such other representatives as may be determined by the CIRC.
diSClose	USC’s on-line disclosure system which is used to submit annual disclosures, conflicts of interest in research, personal conflicts, conflicts of commitment, and financial conflicts.
Foreign Talent Recruitment Program	Any program, position, or activity that includes compensation in the form of cash, in-kind compensation, including research funding, promised future compensation, complimentary foreign travel, things of non de minimis value, honorific titles, career advancement opportunities, or other types of remuneration or consideration directly provided by a foreign country at any level (national, provincial, or local) or their designee, or an entity based in, funded by, or affiliated with a foreign country, whether or not directly sponsored by the foreign country, to an individual, whether directly or indirectly stated in the arrangement, contract, or other documentation at issue. This does not include: – Making scholarly presentations regarding scientific information not otherwise controlled under current law. – Participating in international conferences or other international exchanges, research projects or programs that involve open and reciprocal exchange of scientific information not otherwise controlled under current law. – Involvement in national or international academies or professional societies that produce publications in the open scientific literature that are not in conflict with the interests of USC. – Taking a sabbatical, serving as a visiting scholar, or engaging in continuing education activities such as receiving a doctorate or professional certification at an institution of higher education are not in conflict with USC. – Receiving awards for research and development which serve to enhance the prestige of USC (e.g., the Nobel Prize). – Academic collaborations with a foreign researcher where each side contributes to the project not otherwise controlled under current law.
Institutional Responsibilities	An investigator’s professional responsibilities on behalf of USC including, but not limited to, activities such as research, teaching, professional or clinical practice, and service including memberships on committees and panels such as Institutional Review Boards (IRBs) or Data and Safety Monitoring Boards (DSMBs).
Investigator	The principal investigator, co-principal investigator, contact principal investigator, or co-investigator. Other persons are regarded as investigators if they have independent responsibility for some aspect of the design, conduct, or reporting of research.
Malign Foreign Talent Recruitment Program	Any program, position, or activity that includes compensation in the form of cash, in-kind compensation, including research funding, promised future compensation, complimentary foreign travel, things of non de minimis value, honorific titles, career advancement opportunities, or other types of remuneration or consideration directly provided by a foreign country of concern, or an entity based in, funded by, or affiliated with a foreign country of concern, in exchange for the individual doing one or more of the following activities: engaging in the unauthorized transfer of intellectual property, materials, data products, or other nonpublic information owned by a United States entity or developed with a federal research award; being required to recruit trainees or researchers to enroll in such program, position, or activity; establishing a laboratory or company, accepting a faculty position, or undertaking any other employment or appointment; being unable to terminate the foreign talent recruitment program contract or agreement except in extraordinary circumstances; being limited in the capacity to carry out a research and development award or required to engage in work that would result in substantial overlap or duplication with a federal research and development award; being required to apply for and successfully receive funding from the sponsoring foreign government’s funding agencies with the sponsoring foreign organization as the recipient; being required to omit acknowledgment of your USC affiliation; being required to not disclose to USC or a federal research sponsor your participation in such program, position, or activity; or having a conflict of interest or conflict of commitment contrary to USC or a federal research sponsor.
Research	A systematic investigation designed to develop or contribute to generalizable knowledge, including biomedical, behavioral and social-sciences research or other scholarly activity in any discipline, whether or not it is funded.
Research Personnel	Any other USC faculty member (including part-time and visiting faculty), staff, other employees, and students (including postdoctoral fellows) who contribute to a research activity, whether or not the research is funded, and regardless of employment status (e.g., research associates, technicians, nurse coordinators, administrators, graduate assistants) who does not meet the definition of Investigator.
Significant Financial Interest	A Significant Financial Interest consists of one or more of the following interests of the Investigator or the Investigator’s Close Relation. These include: – Remuneration received from, or equity interests (e.g. stocks, stock options, other ownership interests) held in, publicly traded entities that, alone or on combination, exceeds $5,000 in the twelve month period preceding, including, or following the disclosure. – Remuneration received from non-publicly traded entities that exceeds $5,000 in the twelve months preceding or following the disclosure. – Equity interests (e.g. stocks, stock options, or other ownership interests) held in non-publicly traded entities, regardless of value. – Intellectual property rights and interests (e.g. patents, copyrights), upon receipt of income related to such rights and interests. – Reimbursed or sponsored travel received in the twelve months preceding related to institutional responsibilities (with the exception of reimbursed or sponsored travel paid by a federal, state, or local agency located in the United States; a United States institution of higher education; or an academic teaching hospital, medical center, or a research institute that is affiliated through a legal agreement with a United States institution of higher education). Disclosure must include the purpose of the trip, identify of the sponsor, the destination and the duration. – Holding a management role (paid or unpaid) that maintains significant decision-making authority in an outside entity. Examples of management roles with significant decision-making authority include chief scientific officer, board member, founder, or any similar role. A Significant Financial Interest does not include the following types of interests: – Salary, royalties, or other remuneration paid by USC to the investigator if the investigator is currently employed or otherwise appointed by USC, including intellectual property rights assigned to USC and agreements to share royalties related to such rights. – 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. NOTE: Investigators must disclose to USC Significant Financial Interests received from any foreign entity, including foreign institutions of higher education.
Student or Trainee Conflict of Interest	A student or trainee conflict of interest exists when a researcher has a financial interest in a company and retains a student or post-doc to provide services (paid or unpaid) that could benefit the company and any one of the following apply: – The student is currently enrolled in the class of an investigator, research personnel, or close relation. – The investigator, research personnel or close relation supervises the student in an academic capacity. – The investigator, research personnel or close relation can influence the academic progress of the student. – The investigator, research personnel or close relation otherwise supervises the student or trainee as a research assistant or employee.

5. Policy Details

5.1 Duty to Disclose

Investigators and research personnel are responsible for identifying and disclosing Significant Financial Interests (SFIs) covered by this policy. Investigators and/or research personnel should evaluate their SFIs on an ongoing basis and disclose, promptly and in advance, and new SFIs. This responsibility arises when a new proposal is submitted; a new relationship is established with an outside entity; or when a prior relationship with an outside entity changes.

Investigators must submit an annual disclosure of SFIs related to their institutional responsibilities (regardless of whether the interest creates a Conflict of Interest) when mandated by a research sponsor [e.g., the Public Health Services Agencies including the National Institutes of Health (NIH), the Centers for Disease Control (CDC), and the Food and Drug Administration (FDA), or other federal agencies including the Department of Energy (DoE)], in accordance with the schedule established by the university. The university may also require disclosures at other times. Investigators who have or are seeking support from any sponsors who require an annual disclosure must have a current annual disclosure at the time of proposal submission and update their disclosure on an annual basis. If the investigator assumes a new SFI that has not been previously disclosed, or a new investigator with an SFI joins an ongoing research project, the investigator must update his or her disclosure within thirty (30) days.

In the event there is subcontracted research from USC to an outside entity, all conflict identification, disclosure, and mitigation requirements will be flowed down to the subcontractor organization as required. Investigators are responsible for alerting the Office of Culture, Ethics, and Compliance if they become aware of a conflict of interest maintained by a researcher at a subcontractor organization.

Investigators are responsible for confirming that research personnel under their supervision who are involved in proposing, conducting, or reporting research on the investigator’s project identify and disclose any Conflict of Interest.

5.2 Review Process

If a SFI is found to be related to a discloser’s USC research a Conflict of Interest review will be conducted. If the Conflict of Interest is found to be manageable, the university will require the implementation of a management plan designed to mitigate or eliminate the conflict, as described below. If the university determines that the conflict cannot be effectively mitigated or eliminated through the implementation of a management plan, the research will not be allowed to proceed unless the investigator eliminates the outside interest or activity giving rise to the conflict.

Investigators and research personnel are not permitted to begin or continue any research activity when a Conflict of Interest exists, until they receive a written determination from the Senior Vice President of Research and Innovation (SVPRI), or their designee, on how to manage it.

5.3 Sponsor Required Training and Reporting

When mandated, investigators must timely complete any required training imposed by research sponsors or the university. For example, all PHS-supported investigators must complete required training at least every four years, and immediately when any of the following circumstances apply:

USC revises its financial conflict of interest policies or procedures in any manner that affects the requirements of Investigators;
An Investigator is new to USC; or
USC finds that an Investigator is not in compliance with this policy or any management plan imposed to mitigate the appearance of a conflict.

As required by sponsors, USC will provide initial and ongoing reporting to sponsors (e.g. PHS) as required under federal regulations. This includes, reporting conflicts of interests prior to the expenditure of sponsor funds, as required.

5.4 Additional Disclosure Responsibilities

Compensated Outside Research

Participation as a principal investigator, co-principal investigator, co-investigator, paid consultant, or paid staff member on sponsored projects at another entity (as distinct from research collaborations with other entities via a subcontract or subaward to USC) must be disclosed to the appropriate dean and the Senior Vice President for Research and Innovation (SVPRI) and are prohibited unless specially approved by the dean and the SVPRI or their designee.

Please note that, regardless of the nature of financial interest or covered outside activity, disclosure obligations for compensated outside research apply to domestic as well as foreign entities.

Foreign Financial Interests

Investigators must disclose to USC all foreign Significant Financial Interests. These include appointments (compensated or uncompensated) and any Significant Financial Interests (as defined in Section 4) received from any foreign entity, including foreign institutions of higher education.

5.5 Financial interests and outside activities that are not permitted

Certain types of financial interests and outside activities are not permitted because there is no feasible way to manage the Conflict of Interest. These include:

Participating in a Malign Foreign Talent Program when prohibited by a federal research sponsor. Malign Foreign Talent Programs are defined as talent programs sponsored by a foreign country of concern as defined by the United States Government or an entity in a foreign country of concern. These programs are of special concern as they can also require activities such as the recruitment of additional researchers or unauthorized transfer of intellectual property, materials, data, or other nonpublic information developed with federal research funding.
Participating in a paid “speaker’s bureau” (i.e., talks/presentations in which the topic(s) and/or content are provided by the company) for a research sponsor or a company that may benefit economically from the outcome of research.
Incentive payments, bonus payments, finder fees, or any type of payment or incentive based on outcome, where the payment or incentive is made to the researcher or to research personnel relating to the proposal, conduct, supervision, or reporting of research (e.g., additional personal payments to investigators or research personnel who enroll a certain number of participants in a project within a certain period of time), or payment or incentive with respect to the evaluation of a product or service intended for a commercial market.
Accepting personal gifts, gratuities, or special favors from an actual or prospective sponsor of an investigator’s research, other than occasional gifts or nominal or modest value (less than $200 in value per occasion or isolated invitations to meals).

Maintaining a financial interest or engaging in an outside activity for a research sponsor who seeks to restrict publication of research results, other than reasonable delays of publication in order to protect proprietary rights (i.e., patent rights). This does not include restrictions on publication for reasons of national security and/or export control, if the requirements of USC’s International Collaborations and Export Controls policy are followed.

5.6 Standards of review for disclosed SFIs

After an SFI is disclosed, the disclosure will be reviewed to determine whether it is related to a USC research project and if so whether the disclosure constitutes a Conflict of Interest. If a Conflict of Interest is determined the Conflict of Interest Review Committee (CIRC) will make a recommendation to the SVPRI on how to appropriately mitigate the Conflict of Interest in a way that preserves the integrity and objectivity of the research. Faculty must keep in mind that certain financial interests and outside activities may create a Conflict of Interest that cannot be effectively mitigated or managed.

5.7 Required elements of conflict management

When a Financial Conflict of Interest in Research is identified, all management plans implemented to mitigate the Financial Conflict of Interest will contain, at minimum, the following elements:

All relevant publications, proposals, and presentations must contain a statement disclosing the Financial Conflict of Interest in Research.
All informed consent documents in the context of human subjects research must disclose the Financial Conflict of Interest in Research. Conflicted investigators are not permitted to consent human participants.
The investigator and/or research personnel and their close relations will not represent the university in any intellectual property or other contractual negotiations between USC and the outside entity.
Investigators must notify trainees, including students, post-docs, and residents of the Financial Conflict of Interest in Research if students are to perform as research assistant or research staff on the research, along with a notification to the students and their advisors of the student’s rights. In order to protect trainee rights, the university may appoint a third-party monitor (e.g., faculty member, the Graduate School) to ensure the trainee is making timely academic progress and that their rights are otherwise protected.

Management plans implemented to mitigate a Conflict of Interest may contain additional measures, including but not limited to:

Recusal of the conflicted individual from data collection and/or data analysis for the relevant research project
Referral to a supervisor or independent individual approved by the CIRC for monitoring or oversight
Reduction of involvement or role for the conflicted individual for the relevant research project
Termination of student involvement in the research project or appointment of an independent monitor
Removal of the conflicted individual from the research project.
Divestiture of relevant financial interests
Severance of outside activities that pose a conflict of interest.

Certain types of conflicts present scenarios where the potential for actual or perceived bias is great enough that research personnel must present compelling circumstances as to why the research should proceed despite the presence of the conflict, and that may mandate the imposition of additional measures to mitigate the appearance of a conflict, to include a determination that the research cannot proceed as proposed. These scenarios include:

Equity interests held in a privately held research sponsor, unless the investigator provides verification that the equity interest is less than 10% of the outstanding stock or non-stock ownership of the sponsor.
Publicly held equity interests in excess of $50,000 in a research sponsor, except when the interest is maintained in an investment vehicle where the investigator or research personnel does not directly control the investment decisions made (e.g., mutual fund).
Management roles in a research sponsor or entity with a financial interest in the research.

In the case of human subjects research, a justification of compelling circumstances is also required when:

Receipt of consulting payments that total $25,000 or more in any twelve-month period from a sponsor or a company that may benefit economically from the outcome of the research.
Private equity interests, regardless of value.

Additional review

In cases where a Conflict of Interest disclosure also reveals a conflict of commitment, an additional review must also be undertaken as specified in the Conflict of Interest and Commitment policy applicable to all university employees.

6. Procedures

Conflict of Interest in Research Procedures (including PHS specific requirements)

7. Violations

It is serious misconduct or neglect of duty for any individual subject to this policy to fail to observe any of its requirements, including but not limited to failure to make full disclosure through diSClose promptly, fully, and in advance; failure to observe the terms of a management plan; or engaging in a prohibited activity. Findings of violation by the appropriate CIRC will be referred for consideration of sanctions or corrective action according to the Faculty Handbook, Student Handbook, or staff policies.

8. Forms

https://disclose.usc.edu/

9. Responsibilities

POSITION or OFFICE	RESPONSIBILITIES
USC Employees	Identify and report potential Conflicts of Interest to the Office of Culture Ethics and Compliance using diSClose. Obtain necessary approval on reported Conflicts of Interest in Research and adhere to management of Conflict of Interest in Research plans. Report any material changes in previously reported and approved Conflicts of Interest. Update disclosures promptly upon any changes to the research or financial interests disclosed.
Conflict of Interest Review Committee (CIRC)	The CIRC is charged with reviewing conflict of interest disclosures and formulating recommendations to manage, reduce, or eliminate conflicts of interest. The recommendations are then presented for approval to the Office of Research.
Office of Culture, Ethics and Compliance	Provide guidance on requirements and applicability of this policy and the disclosure process. Present disclosures to the CIRC for review.
Office of Research	Appoint CIRC committee members. Approve management plans proposed by the CIRC.