Research Compliance YiR UT Compliance Webinar.112113 · Sunshine Act 15 Timing • Some form of this law has been proposed each year since 2007 (Senators Grassley and Kohl). • Final

Research ComplianceYear in Review

University of Texas SystemCompliance Academy Webinar Series

Austin, TX

December 6, 2013

F. Lisa Murtha, JD, CHC, CHRCDentons US LLP

Partner

T +1 202 408 5304

M +1 215 801 7824

[email protected]

www.dentons.com

2

Agenda

A Year in Review and Special Topics: What Should You Know?

• FY 2013 OIG Work Plan

• Final Sunshine Law

• Human Research Subjects Protections

• HIPAA & HITECH - Omnibus Rule

• Proposed OMB Uniform Guidance

• Sequestration

• Changes to the CCOPs

• Off-Label Promotion

• Research Misconduct

OIG Work Plan

FY 2013

4OIG 2013 Work PlanOverview

• The Work Plan highlighted the priorities that the OIG’s more than 1,700employees will have as they:

1. Conduct audits, evaluations, investigations;

2. Provide guidance; and

3. Impose civil monetary penalties, assessment and administrative sanctions.

• Familiarity with the focus of the OIG is crucial. According to reports, inFY2011, they had:

– Anticipated recoveries of $5.2 billion.

– Identified $19.8 billion in savings resulting from legislative, regulatory, andadministrative actions.

– Excluded 2,662 individuals and entities from participation in federal health careprograms.

– Prompted 723 criminal actions against individuals or entities that were identified tohave engaged in crimes against HHS programs.

5OIG 2013 Work PlanIssues Focused on Research (and related areas)

Ethics:

• COI Involving Prescription Drug Compendia

– Focus is on determining the extent to which the prescription drug compendia overseeCOI through reporting requirements and/or mitigation policies and the number andnature of the compendia’s reported conflicts.

Patient Safety and Quality of Care:

• Off Label Use of Medicare Part B Drugs

– Assessments to take place regarding off-label and off-compendia use of certainMedicare Part B prescription drugs.

– The OIG will determine the extent to which specified compendia provide support forcoverage.

– Inspectors also focused on evaluating the adequacy of CMS’ oversight mechanisms inthis area.


CDC:

• Oversight of High Risk Grantees

– The increase in federal funds that is under the supervision of the CDC as a byproductof ARRA may strain the CDC’s ability to adequately oversee grantees and preventfraud and abuse.

– The OIG aims to identify any vulnerabilities in the CDC’s oversight and confirm that it isproperly tracking the activities of those grantees deemed ‘high risk’.

– Confirm that the CDC’s oversight of HIV / AIDS prevention and research grants hasbeen handled in accordance with Federal regulations and HHS policies.

FDA:

• Oversight of Wholesale Prescription Drug Distribution

– The OIG will assess the adequacy of FDA’s oversight of wholesale prescription drugdistributors and determine the extent to which FDA ensures that States are licensingwholesalers according to applicable State and Federal laws.


FDA (continued):

• Compliant Investigation Process

– The OIG is focused on determining whether complaints are properly recorded in theConsumer Complaint System and investigated expeditiously.

– The FDA’s processes for categorizing and using complaints to identify potentiallysignificant trends or patterns in reported illnesses or injuries are also to be scrutinized.

• Oversight of INDs

– The OIG intends to asses the FDA’s management of the IND review process.

• Implementation of the Risk Evaluation and Mitigation Strategies Program

– The OIG will asses the FDA’s handling of the REMS program, designed to identify risksand benefits of drugs and confirm that drug manufacturers are compliant with theprogram.

• 510K Process for Device Applications

– The OIG will determine the extent to which FDA documented its decision to cleardevices through the less stringent 510(k) process in 2010 in accordance with 21 CFR§ 10.70.


NIH:

• Extramural Construction Grants

– The OIG will carry out reviews at facilities that received extramural construction grantsto determine whether ARRA funds were spent in accordance with requirements.

• Equipment Claims by Grantees

– OIG agents will determine whether NIH grantees’ claims for equipment purchases arein compliance with the special terms and conditions set forth by the ARRA and otherapplicable requirements.

• Human Subject Protection Practices of NCI Extramural Grantees CollectingBiospecimens

– Focus on is determining the extent to which informed consent documents for researchthat includes the collection of biospecimens comply with human subjects protectionregulations.

– Determine the extent to which IRBs that oversee this type of research are complyingwith regulations.


NIH (continued):

• Superfund Financial Activities from FY 2011

– The OIG will review payments, obligations, reimbursements, and other uses ofSuperfund amounts by NIH’s National Institute of Environmental Health Sciences.

• College and University Compliance with Cost Principles

– OIG agents will assess colleges’ and universities’ compliance with selected costprinciples issued by OMB Circular A-21, Cost Principles for Educational Institutions.

– Discussion about ANPRM on this issue discussed later.

• Extra Service Compensation Payments Made by Educational Institutions

– Are payments for extra compensation charged to federally sponsored grants, contracts,and cooperative agreements by educational institutions in compliance with regulations?

• Use of DSMBs

– Confirm that DSMBs are properly monitoring data in clinical trials.

– Determine how and to what extent NIH is ensuring that grantees comply with the NIHpolicy for DSMBs in multi-site clinical trials.


NIH (continued):

• Oversight of Grants Management Policy Implementation

– The OIG will examine the Office of Extramural Research’s (OER) oversight of thegrants administration processes.

– The OER’s oversight of each of the 24 institutions and centers compliance withregulations, department directives, and agency policies will also be under scrutiny.

• Salary Draws from Multiple Universities

– Recent indictment alleged that two professors were each inappropriately drawingsalaries from two universities.

– Extensive funding under the ARRA may have provided an opportunity for similaractions by other researchers.

• Cost Sharing

– OIG intends to assess how Universities are fulfilling cost sharing requirements onfederal grants.

• Awardee Eligibility for SBIR Awards

– Ensure awardees are meeting eligibility requirements and awards are not duplicative.


HHS Programs:

• Vulnerability to Grant Fraud

– The OIG will assess how HHS awarding agencies mitigate the potential risks of grantfraud, abuse, and mismanagement.

– They will prioritize identifying grantees that have exhibited fraudulent behavior in oneHHS program and determine whether they receive funds from other HHS programsand whether awarding programs are aware of the grantees’ past problems.

• Use of Grant Funds for Lobbying Activities

– Evaluate how HHS notifies grantees of lobbying prohibitions. The OIG will alsoexamine the extent to which HHS grantees are aware of lobbying prohibitions.

HRSA:

• Community Health Centers Compliance with Grant Requirements ofAffordable Care Act

– Determining the allowability of expenditures and the adequacy of accounting systemsand assessing the accounting for program income.

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OIG 2014 Work Plan

When Will It Be Released?

January 2014(…maybe?)

Physician PaymentsSunshine Act

Section 6002 of Affordable Care ActSection 1128G of Social Security Act

14Sunshine ActOverview

• Requires “applicable manufacturers” of drugs, devices, biologicals, ormedical supplies covered by Medicare, Medicaid or CHIP to annually reportto HHS certain payments and other transfers of value furnished to physiciansand teaching hospitals (‘‘covered recipients’’).

• Also requires applicable manufacturers and applicable GPOs to reportcertain information regarding the ownership or investment interests held byphysicians or the immediate family members of physicians in such entities.

• Designed to encourage transparency in relationships between manufacturersand physicians as ways to:

– Increase accountability and tracking;

– Enable consumers to identify potential sources of bias;

– Facilitate government’s identification of potential kickbacks or other impermissiblefinancial relationships; and

– Deter manufacturers from paying amounts in excess of fair market value to referralsources.

15Sunshine ActTiming

• Some form of this law has been proposed each year since 2007 (SenatorsGrassley and Kohl).

• Final Rule issued February 8, 2013

• Effective on April 9, 2013

• Data collection requirement will begin on August 1, 2013, allowing about an180-day preparation period.

• Data must be reported to HHS by March 31, 2014.

• There will be no retroactive reporting.

16

– Consulting Fee

– Compensation for services otherthan consulting (including servingas faculty / speaker at an eventother than CME)

– Honoraria

– Gift

– Entertainment

– Food and Beverage

– Travel and lodging (including thespecified destinations)

– Education

– Research

– Charitable contribution

– Royalty or license

– Current or prospective ownership orinvestment interest

– Compensation for serving as faculty or asa speaker for an unaccredited and non-certified CME program

– Compensation for serving as faculty or asa speaker for an accredited or certifiedCME program

– Grant

– Space rental or facility fees (teachinghospital only)

• Payments and transfers of value include:

Sunshine ActWhat is Reported?

17Sunshine ActImplications for Sponsors

• Sponsors will need to develop and implement policies, procedures andtraining for marketing and members of Medical Affairs so that theyunderstand the rules.

• Sponsors will need to develop and implement mechanisms for individualreporting and tracking of payments made to covered recipients.

• Sponsors will need to develop and implement monitoring mechanisms toensure accuracy of reporting.

• Sponsors may also need to develop an interface function for the sponsor toreconcile this information with covered recipients.

18Sunshine ActImplications for Research Sites

• Research sites will need to review and possibly edit their conflict of interestpolicies, procedures and disclosure mechanisms in order to determine ifthey are consistent with the Sunshine Act and the various state reportingrules in place in their state(s).

• Research sites will need to educate health care providers to ensure that theyreport payments made to them by sponsors.

• Research sites will need to develop monitoring mechanisms to ensureappropriate monitoring of the accuracy of payments made.

• Research sites may want to implement mechanisms to reconcile what isdisclosed by sponsors with disclosures made to physicians.

19Sunshine ActImplications for Providers

• Providers will need to ensure that they understand that payments made tothem will be disclosed on public websites and they will need to determine ifthey want to continue to accept payments and other gratuities from sponsorsin the future.

• Providers will need to ensure that they have appropriate mechanisms inplace to report and monitor payments and gratuities made to them bysponsors.

• Providers will need to determine if they want to continue to accepteducational grants and other gratuities from sponsors in light of theSunshine Act.

• Providers will also need to develop monitoring mechanisms to ensureongoing accuracy of reportable information.

Protecting Human SubjectsParticipating in Research

21Human Research ProtectionsPresidential Commission for the Study of Bioethical Issues

• “Moral Science: Protecting Participants in Human Subjects Research” is areport concerning federally-sponsored research involving human volunteers.

– Core conclusion: Current rules and regulations provide adequate safeguards tomitigate risk.

– Recommendations:

• Each federal department or agency supporting research with human subjects should maintaina core set of data for their research programs that includes the title and lead investigator ofeach project, the location of each study, and the amount appropriated for the research.

• Each office should aid the public in learning more about the government’s research efforts bydeveloping or improving publicly available electronic systems or releasing information througha government-wide system.

• The Office for Human Research Protections or another office should administer a central web-based portal that links to each individual department or agency system.

• The government should consider developing a unified federal research database, which mayultimately be more cost-effective and efficient.

• Study methods for compensating people who are injured during research.

• Consider policies to require researchers or sponsors to provide treatment, or compensation fortreatment, for injuries suffered by research subjects.

22Human Research ProtectionsThe T.E.S.T. Act

• On August 2, 2012, Rep. Edward Markey (D-MA) introduced into the U.S.Congress the Trial and Experimental Studies Transparency (TEST) Act (H.R.6272).

– Builds on clinicaltrials.gov;

– Expands reporting requirements under existing federal law by broadening the scope toinclude all interventional studies of drugs or devices, regardless of:

• Phase

• Approval status

– Requiring all foreign trials that are used to support marketing in the United States to beregistered;

– Mandating results reporting for all trials within 2 years after study completion (includingtrials of unapproved drugs or devices); and

– Extending results reporting to include the deposition of consent and protocoldocuments approved by institutional review boards.

23Human Research ProtectionsModernizing the “Common Rule” (45 CFR 46). What is the hold up?

• Seems to have stalled.

• Some blame the current political climate and the often divergent interests ofthe seventeen agencies that adhere to the rule.

• Many share a view that modernization of the Common Rule is desperatelyneeded.

• Regulatory requirements have become so complicated that most researcherscannot fully understand or remember them, and thus cannot draw theconnections between many of these requirements and the goal of protectingsubjects.

• Stay tuned! But, meaningful systemic modernization of the Common Rule isnot likely to occur any time soon.

Source: Institutional Review Blog. February 12, 2013

24Human Research ProtectionsDetermination Letters

Date Institution Issue(s) Summary

12/17/12Univ. of

Washington- Insufficient policies in 3 selected areas- Need for clarity regarding how long certain forms need to be maintained.

9/26/12 Univ. of Iowa- Applied an exemption to a research study part of which is not in any of the HHS’s six (6)

exempt categories

8/14/12Univ. of

Michigan- Subjects not adequately informed of alternatives to the research to treat their conditions.- ICF indicating that subjects may be coerced

7/5/12Tata Memorial

Hospital

- Subjects not adequately informed of alternatives to the research to treat their conditions.- No IRB meeting minutes.- Failure to meet IRB quorum.

5/8/12 UW - Madison- Insufficient policies regarding prompt reporting of serious or continuing noncompliance to

the IRB, the OHRP, and other senior leaders.- Incomplete ICF regarding contact persons

4/12/12 Brown- IRB approved research contingent upon substantive modifications or clarifications that

were directly relevant to the determinations required by the IRB without requiring additionalreview by the convened IRB.

2/16/12

Univ. ofMaryland-BaltimoreSchool ofMedicine

- Subjects not adequately informed of alternatives to the research to treat their conditions.- Complete IRB records not available for inspection.- IRB approved research without what was deemed to be adequate information to make a

reasoned approval decision.- IRB meeting minutes suggest bi-annual review but approval letter only required annual

review.

2/10/12Boston U

Med. Center- Research project conducted by a trainee under a grant award commenced prior to IRB

review or approval.

25Human Research ProtectionsOHRP Investigations

• Ongoing priorities for the OHRP’s Division of Compliance Oversight

– Findings in recent determination letters….

• Research conducted without IRB review and/or approval

• Failure of IRB to review HHS grant applications

• Lacking sufficient information to make determinations required for approval

• Inadequate review at convened meetings

• IRB members lacking expertise to make thoughtful determinations required for approval

• Approval of research not approved by the IRB

• Contingent approval of research with substantive changes expected, yet no additional reviewby convened IRB

• Meetings convened without quorum (i.e., not enough members present, no non-scientistpresent, etc.)

• Meeting convened by IRB members with a COI

• Inadequate continuing review

• Failure to conduct continuing review at least once a year

• Inappropriate use of expedited review procedures

• Failure to advise IRB members of expedited approvals

• Expedited review conducted by someone other than an IRB member

26Human Research ProtectionsOHRP Investigations

• Ongoing priorities for the OHRP’s Division of Compliance Oversight

– Findings in recent determination letters (continued):

• Failure to report unanticipated problems, noncompliance, suspensions, terminations, etc. toIRB, IO, or OHRP

• Changed to researcher initiated without IRB review and approval

• Inappropriate application of exempt categories of research

• Failure of Investigator to obtain legally effective and/or to document Informed Consent or of theIRB to waive requirements

• Failure to provide a copy of the signed ICF to the subject (or their representative)

• Inadequate ICF (e.g., lacks key elements, language too complex, exculpatory language, etc.)

• IRB membership is not aligned with standards/rules/guidance

• Poor documentation (minutes, records, files, retention of information)

• Lack of appropriate written policies and SOPs

• Lack of OHRP-approved FWA

• IRB failure to determine that criteria for IRB approval are satisfied

• Failure of IRB to make required findings when reviewing research involving children orprisoners.

• Failure to notify Investigator / Institution of IRB actions

• Failure of signatory official to fulfill obligations

HIPAA & HITECH“Omnibus Rule”

28HIPAA and HITECHOmnibus Rule Issued on January 25, 2013

• The Omnibus Final Rule makes sweeping changes to the privacy andsecurity regulations under HIPAA and, in effect, implements the HealthInformation Technology for Economic and Clinical Health (“HITECH”) Act.

• Took effect on March 26, 2013.

• Sets fines for violations at a higher level, starting at $50,000.

• Covered entities and Business Associates were expected to be incompliance with most provisions of the Final Rule by Sept. 23, 2013.


• Primary areas of focus:

– Business Associate (“BA”) Relationships – What is a BA?

• Health information organizations, e-prescribing gateways, and entities that provide datatransmission services for protected health information (“PHI”) to a covered entity and thatrequire access to PHI on a routine basis;

• Entities that offer personal health records to individuals on behalf of a covered entity; and

• Subcontractors that create, receive, maintain, or transmit PHI on behalf of another businessassociate.

– BA HIPAA Obligations

• BAs are now subject to civil monetary penalties for any violations.

• Legally required to implement certain administrative, physical, and technical safeguards toprotect the confidentiality, integrity, and availability of PHI that they create, receive, maintain, ortransmit.


• Primary areas of focus (continued):

– Update Notices of Privacy Practices

• Covered entities to provide additional information in their Notices of Privacy Practices (“NPP”)as to how PHI will (and will not) be used and disclosed.

– Policy Updates:

• Procedures for using PHI for Fundraising

• Marketing

• Access

– Direction Given About How to Determine Breaches of Unsecured PHI

• New definition of “breach of unsecured PHI”

– Covered Entities and BAs Are Encouraged to Update Training.


• Targeted Research-Related Topics Covered in the Omnibus Rule

– Policy Updates specifically related to research

• BEFORE:

– A clinical trial participant was only permitted to authorize the use of PHI forone clinical trial per authorization.

– Authorizations for future, unspecified research were prohibited.

• NOW:

– Consistent with federal human subject protection rules, the Omnibus Ruleprovides clarity and more leeway given regarding certain aspects of researchauthorizations.


• Targeted Research-Related Topics Covered in the Omnibus Rule

– An authorization for the use or disclosure of PHI for a research study may becombined with any other type of written permission for the same or anotherresearch study. This includes:

• Combining an authorization for the use or disclosure of PHI for a research studywith another authorization for the same research study.

• Combining an authorization for the creation or maintenance of a researchdatabase or repository.

• Combining an authorization with a consent to participate in research.

– Certain restrictions apply when a provider has conditioned the provision ofresearch-related treatment on the provision of an authorization.

– This change permits a single document to include consent and authorizationfor a clinical trial and a future study, as long as the authorization contains ageneral description of the types of research that may be conducted.


• Other Key implications of the Omnibus Rule for research

– A covered entity may sell or license PHI in the form of a limited data set to a third partyfor research without individual authorization but only if the remuneration received is “areasonable cost-based fee to cover the cost to prepare and transmit the PHI for suchpurposes.”

– A covered entity cannot profit from the disclosure of PHI in the form of a limited dataset to researchers for research activities.

– Authorizations for research may include an authorization for use and disclosure of PHIfor a particular research study, as well as an authorization for the future use anddisclosure of blood and/or tissue specimens (and attendant PHI) as part of abiorepository.

34HIPAA and HITECHWhat SHOULD HAVE been done by 9/23/13?

1. Update Notices of Privacy Practices ("NPPs").

2. Update Business Associate Agreements.

3. Update breach response policies.

‒ Definition of "breach" changed as did the nature of the risk assessment that must be undertaken to determine a breach.

4. Review and update your HIPAA Manual.

‒ The changes include revisions to marketing rules involving PHI, new standards relating to the sale of PHI, increased ability of patients to restrict disclosures of PHI,and changes to standards involving access to electronic medical records by patients.

5. Educate employees.

35HITECH AuditsFindings Released

• HITECH called for “periodic audits to ensure covered entities and BA’s arecomplying with” HIPAA. Key stats include:

– 115 performance audits through December 2012.

– 11% of entities had no findings.

– Security accounted for 60% of the findings and observations.

– Among Providers: 58 of 59 has at least one Security finding/observation.

– Inadequate and inaccurate risk assessment of Security issues in more than 2/3 ofcases.

• Nearly one-third of the 980 problems that HHS' Office of Civil Rightsuncovered happened because the organizations were not aware of all of therequirements facing them.

• Root-cause analyses performed by HHS contractor KPMG.

• Findings show that many healthcare companies could benefit from re-

reading the rules and regulations.

Proposed OMB UniformGuidance: Cost Principles, Audit,and Administrative Requirements

for Federal Awards

37Consolidating Guidance for Managing Federal GrantsOverview

• The OMB issued the proposed guidance on 2/1/13 to consolidate eightdifferent OMB circulars…each with its own unique rules and requirementsregarding Federal grants.

– Reforms to Audit Requirements: Merging and consistent alignment of OMB Circular A-133 and Circular A-50.

– Reforms to Cost Principles: Merges and changes to OMB cost principle Circulars A-21,A-87 and A-122 and 45 CFR Part 75.

– Reforms to Administrative Requirements: Changes to OMB Circulars A-102, A-110 andA-89.

• According to the OMB…”The guidance is aimed at eliminating duplicative oralmost duplicative language in order to clarify where policy is substantivelydifferent across types of entities, and where it is not.’’

• Follows up on an advance notice of proposed guidance (ANPG) issued inMarch 2012, which generated more than 350 comments.

• The ANPG included 18 proposed reforms, including one to consolidate thecost principles in three OMB circulars into a single document.

Source: Medical Research Law & Policy Report (BNA), 3/613

38Consolidating Guidance for Managing Federal GrantsKey Provisions and Proposed Improvements

• Single Audit:

– Fewer audited entities.

– Audit focus will be shifted to higher risk areas of Research Program management.

– Other provisions:

• Increased threshold for a single audit from $500,000 to $750,000 in federal spending.

• Direction that the audits should focus on improper payments and program outcomes ratherthan less impactful / important compliance requirements.

• Clarity about what defines a low-risk auditee.

– The A-133 Compliance Supplement requirements are now targeted in six areas:

• Activities allowed (or unallowed) and allowable costs/cost principles…which are to becombined.

• Eligibility

• Reporting

• Cash management

• Sub-recipient monitoring

• Special tests and other provisions

– Prompt responses to audit findings

– Subrecipients should have less responsibility in program-specific audits.


• Single Set of Cost Principles:

– Common accounting standards no matter the type of organization is receiving a grant.

– Extension of negotiated F&A rates for up to four years.

– Effort reporting:

• Some of the more complex language is to be removed.

• Institutions can deploy their own processes for certifying effort. Must be done at least annually.

– New details on the direct charging of administrative salaries.

– Various other accounting changes associated with the following:

• Depreciation

• Close outs

• Unused supplies

• Computing devices

• Lease purchases

• Contingency funds

• Filing of CASB disclosure statements for higher education institutions.


• Single Set of Administrative Requirements:

– Uniform rules for all who receive federal awards..

– Proposal review process to focus on merit-based selection and consideration offinancial risk.

– Greater transparency about how awards are made since criteria that a proposal mustmeet will be included in the funding opportunity announcement.

– Longer period of time given to potential awardees to develop applications for federalfinancial assistance.

– Standardization of how Federal funding opportunities are posted / announced.

Sequestration

42SequestrationUncertain Future for the Direction of Research Funding in the U.S.

• Research and development funding from the Federal government is about$30 billion, covering everything from defense, to health care, to agriculture.

• Sequester cut about 5 percent in non-defense programs and more than 7percent in defense.

• Research spending has shrunk by as much as $1 billion.

• With the budget of the NIH holding steady over the last half-decade, thechances of research grants being funded had already fallen to roughly 1 in 6,half of its historic rate.

Source: Huffington Post. February 27, 2013

43SequestrationUncertain Future for the Direction of Research Funding in the U.S.

• Impact on biomedical science has been significant.

• Competition is tougher for academics to win a grant.

‒ NSF has said it expects to make 1,000 fewer grants this year than the 11,000 ittypically makes.

‒ Undergraduate research assistants could be the first to be cut.

Information Technology and Innovation Foundation estimates the overall economic cost(or impact) from cutting federal research spending would be between $203 billion and

$860 billion over the next nine years.

Changes to the CCOPs

45NCI's Community Clinical Oncology ProgramRestructured Program Could Have a Major Impact on Community Hospitals

• While the 30-year old Program has successfully improved access to andaccrual in clinical trials, there have been challenges.

‒ Per patient funding has decreased in recent years.

‒ More difficult to underwrite the administrative structures necessary to manage CCOPtrials.

‒ Lower patient accrual, insufficient oversight, and escalating compliance risks.

• For its part, although it undertakes periodic monitoring visits and reviews,the NCI historically has been largely hands-off.

‒ The onus to preserve Program integrity and manage research risks falls principally onthe sites themselves.

The frequency of "headaches" for community hospitals who once viewed the CCOPs asproviding ready-made research opportunities for patients but, in the era of strained

resources, have struggled to adequately nurture CCOP trials.

46NCI's Community Clinical Oncology ProgramChanging Funding Priorities

• In 2007 a new funding mechanism was launched under the auspices of NCI'sCommunity Cancer Centers Program ("NCCCP").

‒ Collaborate with the designated cancer centers and are able to support a broaderrange of research functions, including laboratory and population studies.

• The size and scope of NCI's various programs, including CCOP, has becomeconsiderable.

‒ Management and oversight is more difficult and changes are coming.

• In June 2013, NCI announced the formation of the Community OncologyResearch Program ("NCORP") designation, which spells the end of CCOPsas we know them.

• While NCCCPs will endure, no funds have been awarded to CCOPs beyondthe end of 2013.

47NCI's Community Clinical Oncology ProgramChanging Funding Priorities

• The NCORP will still include community sites, minority focused sites andresearch bases just as the CCOP program does today.

• The number of sites, however, is being drastically cut.

‒ Only 40 or so NCORPs will be awarded and each site must accrue at least 80 patients per year onto treatment protocols.

• NCORP released a Funding Opportunity Announcement (FOA) on November8th which was posted on the NIH Guide.

‒ The FOA reflects an open competition to which all potential community sites (e.g., funded CCOPs, MB-CCOPs and NCCCPs) will undergo NIH Peer Review as specifiedby the Division of Extramural Activities.

‒ All applications are due 1/8/14 and Letters of Intent are due 12/8/13.

Many assume that the current set of 21 NCCCP centers are best positioned to becomeNCORP sites under the new structure so there may be fewer than 20 slots available to

accommodate the dozens of CCOPs now facing unfunded futures. Therefore, manyCCOP centers are banding together to form consortia.

48NCI's Community Clinical Oncology ProgramExpectations of the NCORP

• NCI is stepping up its oversight and monitoring efforts.

• While a more manageable number of sites will help, expect more centralstaff, a greater emphasis on investigator education, and a more prominentrole for NCI in IRB review.

• NCI monitoring visits will be more frequent, larger samples of patient datawill be evaluated, and audits will be carried out with increased rigor.

• New requirements with respect to best practices and SOPs, and accrualrequirements are likely to be more tightly enforced.

• All Phase III trials are expected to have NCI oversight rather than havingindividual sites act as trial coordinators.

The changes that NCI is instituting will have a significant impact on how cancer researchis accessed, managed, and performed in the U.S. Proactive plans to adjust to these new

initiatives are a must for CCOP sites whose funding is about to change and whoseoperating model is in a state of uncertainty and flux.

Off-Label Promotion

50Off-Label PromotionGSK Settlement

• GlaxoSmithKline (“GSK”) signed a CIA on 7/2/2012 that included anagreement to repay $3 Billion.

– Highest ever by a drug company.

– Largest health care fraud settlement in US history.

• Criminal charges:

– Misbranding Paxil and Wellbutrin by promoting them for off-label use.

– Failing to report safety data on Avandia to the FDA.

• Civil charges:

– Off-label promotion of Advair, Lamictal, and Zofran.

– Kickbacks paid to healthcare professionals to promoted and prescribe those 3 drugsplus Imitrex, Lotronex, Flovent, and Valtrex.

– False and misleading representations of Avandia’s safety.

– False pricing related to bundled drug sales.

Source: Inside Counsel Magazine. September 2012.

51Off-Label PromotionGSK Settlement Forces Changes to Many Business Practices

• Compensation programs are required to change.

– Had to abandon some incentive-based comp for sales staff…primarily those practicesthat incentivized improper promotion and sales.

– GSK, like many drug companies, has a comp model for sales staff that encouragesdrug sales to occur as a “volume business”.

– The CIA eliminates this and suggests that incentive comp programs must be re-written.

• GSK must provide reports and certifications to the Health Care Fraud Unit ofthe U.S. Attorney’s Office in Boston and the Consumer Protection Branch ofthe DOJ for five years.

52Off-Label PromotionGSK Settlement Forces Changes to Many Business Practices

• Forfeiture of performance pay if found to be engaged in misconduct.

– Establish an “executive financial recoupment program” - a so-called “clawback”mechanism.

– Execs found to be involved in any “significant misconduct” or found to be aware ofemployee violations must forfeit up to three years of annual performance pay.

– Applies to employees no longer working for GSK at the time the clawback is triggered.

– GSK settlement is first instance in which the individuals who are subject to thisprovision of the CIA didn’t necessarily do anything wrong.

• Board certification of compliance program effectiveness every 3 months.

53Off-Label PromotionUS vs. Caronia

• On Dec. 3, 2012, the Second Circuit overturned the conviction of apharmaceutical representative for one misdemeanor count of "conspiracy tointroduce a misbranded drug into interstate commerce" on the grounds thatthe conviction violated the First Amendment.

– The court determined that the First Amendment protected the defendant's speechpromoting "off label" uses of the drug Xyrem, and that the government sought toprosecute the defendant solely on the basis of his speech.

– Likely to be welcomed by pharmaceutical and medical device manufacturers seeking topromote off-label uses of their products.

– May mark an important turning point in the development of the rules and regulationssurrounding off-label promotion.

– It is not yet known whether other courts will follow the Second Circuit's lead.

Source: DENTONS Client Alert. 12/12/12/

54Off-Label PromotionUS vs. Caronia

• Just 3 days after the Caronia decision was released, the Ninth Circuit heardargument in United States v. Harkonen.

• Result of case was a jury convicting a medical executive of wire fraud on thebasis of a single press release proclaiming a medical study successful.

• Many in the legal community are wondering whether the Ninth Circuit shouldjoin the Second Circuit in finding “truthful” off-label marketing to be a formof protected speech.

55Off-Label PromotionAbbott Labs

• Plead guilty and agreed to pay $1.5 billion to resolve its criminal and civilliability arising from the company’s unlawful promotion of the prescriptiondrug Depakote.

– Criminal fine and forfeiture totaling $700 million.

– Civil settlements with the federal government and the states totaling $800 million.

– Subject to court-supervised probation and reporting obligations for Abbott’s CEO andBoard of Directors.

• At issue:

– Misbranding Depakote by promoting the drug to control agitation and aggression inelderly dementia patients and to treat schizophrenia. Neither use was FDA approved.

– From ‘98 through ‘06, the company maintained a specialized sales force trained tomarket Depakote in nursing homes for these “off label” purposes, despite the absenceof credible scientific evidence that Depakote was safe and effective for that use.

– From ‘01 to ‘06, Abbott marketed Depakote in combination with other drugs to treatschizophrenia, even after its clinical trials failed to demonstrate that adding Depakotewas any more effective than the study drugs themselves.

Source: DOJ – Office of Public Affairs. May 7, 2012.

Research Misconduct

57Research MisconductThe Latest on Anil Potti

• Recap: Manipulated data over a 5-year period and included the informationin a set of widely distributed papers designed to prove his theories regardingcancer treatment.

– More than just data corrections.

– Some patients (with months to live) had already enrolled in clinical trials based on thefraudulent data, results, and supposed benefits.

• Action / Fallout: Institute on Medicine released a report in March 2012 thatevaluated the scientific method and data gathering processes undertaken totranslate genomics research into clinical medicine.

– Sought to avoid another circumstance where data could be manipulated.

– Identified best practices to enhance development, evaluation, and translation of omics-based tests.

– Reinforce steps to ensure that tests designed for data collection are appropriatelyassessed for scientific validity before they are used to guide patient treatment in clinicaltrials.

58Research MisconductAptuit Scientist Falsifies Pre-Clinical Safety Data

• Steven Eaton was put in jail for three months under the United Kingdom’sscientific safety laws.

– First person to receive such punishment under the country’s research misconduct laws.

– Manipulated data so that failed experiments would appear successful.

– Work focused on liquid chomatography analysis associated with how a cancer drugconcentrates in the blood. In effect, he was trying to determine dosage levels.

– Potential was deemed high for incorrect dosages of drugs to be administered to cancerpatients.

59Research MisconductEmory Post Doc Falsifies Stem Cell Data

• Sinae Kim falsified data presented at national and laboratory meetings, inongoing and pending National Institutes of Health (NIH) grants, and inmanuscripts submitted to five high-profile journals.

• Outcome

– Voluntary Exclusion Agreement (2 years).

– Voluntarily will not serve as an advisor in any capacity to PHS.

– Retract all papers.

60Research MisconductOther Cases from the ORI in the news during 2013

• Rao Adibhalta - University of Wisconsin, Dept. of Neurological Surgery

– Allegations:

• Falsifying Western blot images as well as quantitative and statistical data obtained frompurported scans of the films.

• Published the false data and used it to try to get additional funding.

– Outcome:

• Voluntary Exclusion Agreement (2 years).

• Voluntarily will not serve as an advisor in any capacity to PHS.

• Retract all papers.

• Andrew Aprikyan - University of Washington, Dept. of Medicine, Division ofHematology

– Allegations:

• Falsified data, falsified diagrams, misrepresented his scientific methodology, used arbitraryflow cytometry data files to generate histograms with the desired result, etc.

– Outcome:

• Entered into a Settlement Agreement – does not admit to wrongdoing.

• Must submit to additional supervision in the future.


• Bryan Doreian - Case Western, Dept. of Dermatology

– Allegations:

• Data falsification.


– Outcome:

• Settlement Agreement (3 years).

• Must submit to additional supervision.

• Will not serve in advisory capacity to PHS.


• Matthew Poore - Advanced Liquid Logic, Inc., Technician

– Allegations:

• Falsifying data that were included in a presentation and a report to National Institute of Allergyand Infectious Diseases and in laboratory records at Liquid Logic.

– Outcome:

• Entered into a Settlement Agreement

• Must submit to additional supervision in the future.



• Adam Savine – Washington University (MO), Dept. of Psychology

– Allegations:

• Falsifying data that were included in the following three publications and six conferenceabstracts.


– Outcome:

• Settlement Agreement (3 years).

• Must submit to additional supervision.



It may be worth noting that most of these cases, the people involved - Kim (Emory) wasa post doc, Savine (Wash U.) was a doctoral student, Poore (Liquid Logic) was a

technician, and Doreian (CW) was a post doc fellow – were scientists at beginning oftheir careers. According to available reports, many caught by the ORI cite pressure to

publish and pressure to get funded as driving causes of the Misconduct.

63Research Misconduct / Conflict of InterestInsider Trading at SAC Capital

• On 11/20/12, Matthew Martoma was charged with securities fraud for tradingshares of Elan and Wyeth in advance of news about the development of anAlzheimer’s drug.

– Neurologist and Alzheimer’s expert named Dr. Sidney Gilman was at the center.

– Gilman was making $100K/year as a consultant to hedge fund managers.

– During ’07 and ‘08, Martoma and Gilman had spoken every time an Elan safetymonitoring committee held a meeting.

– Gilman has told prosecutors that he gave Martoma tons of inside information andMartoma then traded on it.

– U.S. prosecutors called “the most lucrative insider-trading scheme ever,” netting asmuch as $276 million while at the hedge fund.

64

• ORI website: http://ori.hhs.gov/

• Statutes and Regulations

– ORI Statutory Authority - 42 U.S.C. § 289b

– Public Health Service (PHS) Policies on Research Misconduct – 42 CFR Part 93 – June2005

– HHS Debarment Regulations - 45 CFR Part 76

– Federal Whistleblower Protection Act of 1989 - 5 U.S.C. § 1201

– Freedom of Information Regulation - 45 CFR Part 5

– Public Health Service Records Related to Inquiries and Investigations of ScientificMisconduct, HHS/OASH/ORI. 74 Fed. Reg. 44847 (2009)

• ORI Sample Policy and Procedures for Responding to Research MisconductAllegations

• ORI Guidelines for Institutions and Whistleblowers: Responding to PossibleRetaliation Against Whistleblowers in Extramural Research

• ORI Handbook for Institutional Research Integrity Officers

Research MisconductResources

Questions and Discussion

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Documents

Research Compliance YiR UT Compliance Webinar.112113 · Sunshine Act 15 Timing • Some form of this law has been proposed each year since 2007 (Senators Grassley and Kohl). • Final