Report on Research Compliance Volume 18, Number 6. In This Month’s E-News: June 2021

Health Care Compliance Association (HCCA)

Health Care Compliance Association (HCCA)

Report on Research Compliance 18, no. 6 (June 2021)

Clemson University is pushing back against recommendations by auditors for the National Science Foundation Office of Inspector General (OIG) that it repay $276,440, agreeing only to refund NSF $133,736 of $61 million in costs claimed on awards from March 1, 2017, to February 2020. According to the April 30 report, auditors questioned “$83,248 of inappropriately applied indirect costs; $57,318 of inappropriately allocated expenses; $58,000 of unreasonable and unallocable computer cluster node access expenses; $45,620 of inadequately supported expenses; $23,689 of unallowable expenses; and $8,565 of indirect costs over-applied to supplemental funding.” They also “identified four compliance related findings for which there were no questioned costs: non-compliance with Federal requirements for pass-through entities; non-compliance with NSF terms and conditions; non-compliance with Clemson policies; and incorrect application of proposed indirect cost rates.”

However, Clemson officials said $49,814 of the questioned indirect costs, which were for a building addition, were valid, as was $20,471, spent primarily for a camera and publication expenses. In addition, Clemson disputed the entire $58,000 for computer expenses for six awards that auditors flagged that relate to “expedited and priority access to its Palmetto Computer Cluster nodes.” Clemson agreed that it used the wrong indirect cost rates on 25 NSF awards. Auditors said Clemson and its subawardees used negotiated indirect cost rate agreement (NICRA) amounts that were in effect when award proposals were submitted, instead of correctly applying ones as of the date awards were made. Clemson stated that it allowed principal investigators and subawardees “to apply the indirect cost rates included in their NSF-approved proposals because it did not want to ‘punish’ PIs and subawardees by increasing the indirect cost rate applied to their awards and subawards because the NICRA rates increased between the proposal submission date and the grant award date.” The university agreed to update its indirect cost rate policies to comply with the negotiated rates. (5/13/21)

The Environmental Protection Agency should “discontinue implementation of the 2019 directive that seeks to reduce ongoing animal research and ultimately eliminate mammalian studies by 2035,” Louis Justement, president of the Federation of American Societies for Experimental Biology (FASEB), wrote in a May 4 letter to EPA Administrator Michael Regan. “FASEB applauds the new administration’s efforts to restore the role of science and scientists in policy development and thanks the agency for pointedly stating this pledge. As the EPA finalizes its transition and reviews former policies to identify barriers that impede scientific integrity,” now is the time to abandon the 2019 directive, according to Justement, as it “will stifle toxicological research progress and is inconsistent with the EPA’s commitment to ensure that the best available science informs agency policies.” (5/13/21)

Following a confirmation hearing on April 30, the Senate Commerce, Science, and Transportation Committee expects to vote sometime later this month on the nomination of Eric Lander, director of the Broad Institute, to be the new director of the Office of Science and Technology Policy (OSTP). The committee will hold the record open until May 13 to accept additional comments and questions for Lander, after which time a vote will be scheduled. The nomination will then move to the full Senate for approval. This marks the first time an OSTP leader faces confirmation, as President Biden elevated the job to the cabinet level. In his opening statement, Lander stressed the need for more science, technology, engineering and math education, saying most Americans “lack access to great STEM schools.” (5/6/21)

After issuing a warning letter nearly a year ago for failure to post required summary trial results on, the Food and Drug Administration (FDA) has given Cambridge, Massachusetts-based Acceleron Pharma Inc. a month to submit data from a Phase 2 trial of medications for the treatment of advanced renal cancer or it will face sanctions, including fines. This is the first time FDA has taken action against a firm for noncompliance with reporting requirements. According to FDA’s April 27 letter to Acceleron, FDA alerted the firm in July of “potential noncompliance” and requested it “submit all required results information promptly.” (5/6/21)

As promised earlier, the HHS Office of Research Integrity (ORI) announced the implementation of a secure means of uploading documents. In a May 3 blog post, ORI officials said the ORI File Transfer System (ORI-FTS), a “FedRAMP authorized, cloud-based system for secure file transfer,” is now operational. The system is in response to expressed need from institutions for “an electronic file transfer system that would facilitate the secure submission of reports, files, and other documents to ORI.” The agency also “recognized the need for such a resource and has worked to identify and implement a solution. With the launch of ORI-FTS, RIOs [research integrity officers] and Institutional Officials are now able to send material securely and directly to ORI’s file transfer system, facilitating the process of sending and receiving such files,” the agency said. (5/6/21)

HHS has reversed a 2019 requirement that “all research applications for NIH grants and contracts proposing the use of human fetal tissue from elective abortions will be reviewed by an Ethics Advisory Board,” NIH recently announced. As a result, the Human Fetal Tissue Research Ethics Advisory Board will not meet, NIH said April 16. However, other requirements for funding of extramural fetal tissue research “remain unchanged.” The reversal reflects the Biden administration’s policies toward the use of tissue from elective abortions, which the Trump White House had opposed. NIH established the board in 2019, and it only met once, recommending that just one of 14 applications be funded. The notice did not mention the previous ban on fetal tissue studies by intramural researchers, but it was also lifted, according to a Science article. (4/26/21)

A former Ohio hospital researcher whose wife has already been sentenced to 30 months in prison after her guilty plea was himself given a 33-month term for “conspiring to steal exosome-related trade secrets concerning the research, identification and treatment of a range of pediatric medical conditions,” the Department of Justice (DOJ) announced. Yu Zhou and his wife, Li Chen, worked at Nationwide Children’s Hospital’s Research Institute for 10 years. “They pleaded guilty to conspiring to steal at least five trade secrets related to exosome research” from their labs at the hospital, DOJ said. “The couple will forfeit approximately $1.45 million, 500,000 shares of common stock of Avalon GloboCare Corp. and 400 shares of common stock of GenExosome Technologies Inc. They were also ordered to pay $2.6 million in restitution.” (4/26/21)

Mingqing Xiao, a math professor at Southern Illinois University-Carbondale, “fraudulently obtained $151,099 in federal grant money from NSF by concealing support he was receiving from the Chinese government and a Chinese university,” DOJ announced. The NSF grant was for a “project set to run from 2019 to 2022,” which Xiao was awarded “without informing NSF about another, overlapping grant he had already received from the Natural Science Foundation of Guangdong Province, China. Xiao also allegedly failed to inform NSF that he was on the payroll of Shenzhen University, a public university in Guangdong Province, and that he had already committed to teaching and conducting research at Shenzhen University from 2018 to 2023.” (4/26/21)

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Health Care Compliance Association (HCCA)

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