Schell Games' Financial Conflict of Interest (FCOI) Policy

Purpose

The purpose of this policy is to document the require­ments and respon­si­bil­i­ties asso­ci­ated with iden­ti­fying and managing financial conflicts of interest to safeguard the integrity of Schell Games’ research and to comply with federal regu­la­tions.

This policy has been developed to address and comply with the specific federal agency require­ments as defined in the 2011 Revised Financial Conflict of Interest Regu­la­tion, Promoting Objec­tivity in Research (42 CFR part 50 subpart F). This regu­la­tion was developed to promote objec­tivity in research by estab­lishing standards that provide a reason­able expec­ta­tion ensuring the design, conduct and reporting of research funded under National Insti­tutes of Health (NIH) grants or coop­er­a­tive agree­ments will be free from bias resulting from Inves­ti­gator financial conflicts of interest. An elec­tronic version of the regu­la­tion is found at http://www.gpo.gov/fdsys/pkg/FR-2011 – 08-25/pdf/2011 – 21633.pdf.

Summary of Process

Signif­i­cant Financial Interests (SFI) (as defined below) shall be disclosed on the Signif­i­cant Financial Interest Disclo­sure Form (Exhibit 1) by an Inves­ti­gator requesting govern­ment-sponsored or company-sponsored funds for a research project or by an Inves­ti­gator when a Signif­i­cant Financial Interest arises during the course of research. Regard­less of whether a SFI exists, all Inves­ti­ga­tors and key personnel are required to submit a SFI Disclo­sure Form annually.

It is the Principal Inves­ti­ga­tor’s respon­si­bility to ensure those with financial interests in research are iden­ti­fied and make the required disclo­sures in conjunc­tion with submis­sion of a research proposal or appli­ca­tion for human subjects’ approval.

The Signif­i­cant Financial Disclo­sure Form and supporting materials are forwarded to the General Counsel for review. The Finance Depart­ment will be respon­sible for eval­u­ating and insti­tuting a plan for managing any disclosed financial interests, for producing insti­tu­tional reports and other required reports to external sponsors and govern­mental agencies, and for the general admin­is­tra­tion and enforce­ment of this policy.

Advance approval by the CEO or General Counsel is required prior to engaging in govern­ment-sponsored research. A SFI review must be completed before any expenses are incurred under an award.

Annual updates are required of all Inves­ti­ga­tors and key personnel partic­i­pating in research. Any Inves­ti­gator who has acquired a new or increased financial interest during the course of a research project shall report it imme­di­ately to the General Counsel. Annual updates and newly acquired interests are reported using the Signif­i­cant Financial Interest Disclo­sure Form.

Training

The NIH Financial Conflict of Interest tutorial was designed by the National Insti­tutes of Health (NIH) to provide education training on what consti­tutes financial conflict of interest. This course is required for anyone involved with an NIH funded project, which includes all Inves­ti­ga­tors, consul­tants and employees of Schell Games engaged in NIH-funded research or its compli­ance.

The course is acces­sible at http://grants.nih.gov/grants/policy/coi/tutorial2011/fcoi.htm. Upon comple­tion of the training, a certifi­cate of comple­tion must be turned into the General Counsel. You should retain a copy for your records. This training is required prior to engaging in research relating to any NIH-funded grant or as deemed necessary by the Company due to changes in the FCOI policy, non-compli­ance of the Investigator/​Key Personnel or new to the Company. At a minimum, the FCOI training shall be taken every three (3) years.

Key Defi­n­i­tions

The following defi­n­i­tions are provided as a reference and are consid­ered key defi­n­i­tions in under­standing the federal regu­la­tions of FCOI. A complete list of official defi­n­i­tions can be found at 42 CFR 50.603.

Insti­tu­tion – means any domestic or foreign, public or private, entity or orga­ni­za­tion (excluding a Federal agency) applying for, or receiving NIH research funding.

Inves­ti­gator – means the project director or principal inves­ti­gator and any other person, regard­less of title or position, who is or will be respon­sible for the design, conduct, or reporting of research funded by the NIH, which may include, for example, collab­o­ra­tors or consul­tants.

Insti­tu­tional respon­si­bil­i­ties – means an Inves­ti­ga­tor’s profes­sional respon­si­bil­i­ties on behalf of the Insti­tu­tion, and as defined by the Insti­tu­tion, including but not limited to, activ­i­ties such as research, research consul­ta­tion, teaching, profes­sional practice, insti­tu­tional committee member­ships, and service on panels such as Insti­tu­tional Review Boards or Data and Safety Moni­toring Boards.

Financial interest – means anything of monetary value, whether or not the value is readily ascer­tain­able.

Financial conflict of interest (FCOI) – means a signif­i­cant financial interest that could directly and signif­i­cantly affect the design, conduct, or reporting of NIH funded research.

Manage – means taking action to address a financial conflict of interest, which can include reducing or elim­i­nating the financial conflict of interest, to ensure, to the extent possible, that the design, conduct, and reporting of research will be free from bias.

Senior/​Key Personnel – means the PD/​PI and any other person iden­ti­fied as senior/​key personnel by the Insti­tu­tion in the grant appli­ca­tion, progress report, or any other report submitted to the NIH by the Insti­tu­tion under the regu­la­tion.

Signif­i­cant Financial Interest (SFI) –

(1) A financial interest consisting of one or more of the following interests of the Inves­ti­gator (and those of the Investigator’s spouse and dependent children) that reason­ably appears to be related to the Investigator’s insti­tu­tional respon­si­bil­i­ties:

(i) With regard to any publicly traded entity, a signif­i­cant financial interest exists if the value of any remu­ner­a­tion received from the entity in the twelve months preceding the disclo­sure and the value of any equity interest in the entity as of the date of disclo­sure, when aggre­gated, exceeds $5,000 (ii) With regard to any non-publicly traded entity, a signif­i­cant financial interest exists if the value of any remu­ner­a­tion received from the entity in the twelve months preceding the disclo­sure, when aggre­gated, exceeds $5,000, or when the Inves­ti­gator (or the Investigator’s spouse or dependent children) holds any equity interest (e.g. stock, stock option, or other ownership interest); or (iii) Upon receipt of income related to intel­lec­tual property rights and interests (e.g. patents, copy­rights)

(2) Inves­ti­ga­tors also must disclose the occur­rence of any reim­bursed or sponsored travel (i.e., that which is paid on behalf of the Inves­ti­gator and not reim­bursed to the Inves­ti­gator so that the exact monetary value may not be readily available), related to their insti­tu­tional respon­si­bil­i­ties, provided, however, that this disclo­sure require­ment does not apply to travel that is reim­bursed or sponsored by excluded sources provided in regu­la­tion. For example, if the PI travels to a scien­tific seminar but does not pay or receive reim­burse­ment by the Company directly (i.e. the travel was paid for by a third party/​sponsor), the PI is required to disclose basic infor­ma­tion to the Company relating to the trip, such as purpose of the trip, identify of the payer/​sponsor, desti­na­tion and duration. The Company is required to determine if addi­tional infor­ma­tion is required (e.g. monetary value) and whether the travel consti­tutes a FCI with NIH-funded research.

(3) The term signif­i­cant financial interest does not include the following types of financial interests:

(i) salary, royalties, or other remu­ner­a­tion paid by the Insti­tu­tion to the Inves­ti­gator if the Inves­ti­gator is currently employed or otherwise appointed by the Insti­tu­tion; (ii) intel­lec­tual property rights assigned to the Insti­tu­tion and agree­ments to share in royalties related to such rights; (iii) any ownership interest in the Insti­tu­tion held by the Inves­ti­gator, if the Insti­tu­tion is a commer­cial or for-profit orga­ni­za­tion; (iv) 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;

(v) income from seminars, lectures, or teaching engage­ments sponsored by a federal, state or local govern­ment agency, an Insti­tu­tion of higher education as defined at 20 U.S.C. 1001(a), an academic teaching hospital, a medical center, or a research institute that is affil­i­ated with an Insti­tu­tion of higher education; or (vi) income from service on advisory commit­tees or review panels for a federal, state or local govern­ment agency, Insti­tu­tion of higher education as defied at 20 U.S.C. 1001(a), an academic teaching hospital, a medical center, or a research institute that is affil­i­ated with an Insti­tu­tion of higher education.

Proce­dures

A. Iden­ti­fi­ca­tion of Persons Required to Disclose a Signif­i­cant Financial Interest — It shall be the respon­si­bility of the Principal Inves­ti­gator of a Research project to identify all Inves­ti­ga­tors who have a SFI requiring disclo­sure under this policy and to ensure that a SFI Disclo­sure Form is prepared and submitted. In addition, the Principal Inves­ti­gator shall be respon­sible for ensuring that annual updates and disclo­sures of new or increased financial interests are disclosed.

B. Submis­sion and Review of Signif­i­cant Financial Interest Disclo­sure Form — Every indi­vidual having a SFI requiring disclo­sure under this policy shall prepare a fully-completed SFI Disclo­sure Form that shall be submitted to the General Counsel. An initial review of the SFI Disclo­sure Form will be conducted by the General Counsel to determine whether a potential for conflict of interest exists. If it is deter­mined that there is a potential conflict of interest, then steps will be taken to determine what measures are needed to address the SFI iden­ti­fied in the SFI Disclo­sure Form. A manage­ment plan may be required to outline the terms, condi­tions and restric­tions, if any, to ensure compli­ance with this policy. The manage­ment plan may require one or more of the following actions (but not limited to) to be taken in order to manage, reduce or eliminate any actual or potential conflict of interest:

• Public disclo­sure of signif­i­cant financial interests;

• Review of research protocols by inde­pen­dent reviewers;

• Moni­toring of research by inde­pen­dent reviewers;

• Modi­fi­ca­tion of research plan;

• Disqual­i­fi­ca­tion from partic­i­pa­tion in all or a portion of the research funded;

• Divesture of signif­i­cant financial interests; or

• Severance of rela­tion­ships that create actual or potential conflicts.

All manage­ment plans are required to be signed by the Inves­ti­gator and the General Counsel. Compli­ance of the manage­ment plan shall be monitored by the General Counsel.

C. Annual Reporting and After-Acquired Signif­i­cant Financial Interests – All Inves­ti­ga­tors shall provide annual SFI Disclo­sure reports or more frequently if required by the manage­ment plan. Any Inves­ti­gator who acquires a new or increased SFI shall promptly submit a new SFI Disclo­sure Form within 30 days of discov­ering or acquiring the new SFI. It is the Principal Investigator’s respon­si­bility to ensure that any newly acquired Inves­ti­gator on a research project submits the required SFI report to the General Counsel.

D. Viola­tions of Conflict of Interest Policy – Inves­ti­ga­tors are expected to comply fully and promptly with this policy. Whenever a person has violated this policy, including failure to make a required disclo­sure of financial interests or failure to comply with a require­ment of the manage­ment plan, the General Counsel shall make recom­men­da­tions to the CEO regarding the impo­si­tions of sanctions or disci­pli­nary proceed­ings against the violating indi­vidual.

In addition, the Company shall follow Federal regu­la­tions regarding the noti­fi­ca­tion of the spon­soring agency in the event an Inves­ti­gator has failed to comply with this policy. The federal agency may take its own action as it deems appro­priate, including the suspen­sion of the funding for the Inves­ti­gator until the matter is resolved.

E. Record Keeping – Records of Inves­ti­gator SFI Disclo­sure forms, and of actions taken to manage actual or potential conflicts of interest, shall be retained by the General Counsel for three (3) years from the date the final expen­di­ture report is submitted to the NIH, or as required by 45 CFR 74.53(b) and 92.42(b) for different situ­a­tions.

F. Sub-recipient Require­ments – Sub-award recip­i­ents must comply with this policy or provide certi­fi­ca­tion that their orga­ni­za­tion is in compli­ance with the Federal policy, 2011 Revised Financial Conflict of Interest Regu­la­tion, Promoting Objec­tivity in Research (42 CFR part 50 subpart F) and that their portion of the research project, as detailed in their sub-award agreement, is in compli­ance with their insti­tu­tional policies. If a SFI is iden­ti­fied by the sub-award recipient, they are required to notify the General Counsel of the existence of the conflicting interest within 30 days of the iden­ti­fi­ca­tion of the interest. In addition, the sub-award recipient must certify and assure that any reported conflicting interest has been managed, reduced or elim­i­nated in accor­dance with federal regu­la­tions.

G. Federal Reporting – The Finance Depart­ment is respon­sible for the reporting dispo­si­tion of matters involving disclo­sures of SFI in accor­dance with applic­able federal require­ments. The following reports are required by the NIH:

i. Initial report – prior to the Company’s expen­di­ture of any funds under a NIH-funded research project, the Company must provide to the NIH an FCOI report regarding any Inves­ti­gator SFI found by the Company to be a financial conflict of interest in accor­dance with the regu­la­tion.

ii. During on-going NIH-funded research projects – the Company shall submit an FCOI report within 60 days after its deter­mi­na­tion that a new FCOI exists. If a FCOI was not disclosed timely, the Company shall submit a FCOI report to the NIH within 60 days of the discovery, as well as complete a retro­spec­tive review within 120 days of discovery of noncom­pli­ance.

iii. Annual FCOI report – For any FCOI previ­ously reported to the NIH, the Company shall provide an annual FCOI report addressing the status of the FCOI and any changes to its related manage­ment plan.