The School of Medicine Review Criteria for Faculty Consulting Agreements¹

SoM faculty are often approached by biomedical, pharmaceutical, and devise manufacturers to enter into consultancies. Consulting engagements, while important for the individual faculty member may be problematic for the institution. To ensure that these activities are consistent with the teaching, research, patient care and service missions of the SoM as well as to ensure that the highest ethical considerations are upheld, faculty are asked to comply with the School of Medicine Policy on External Consulting and Professional Activities Policy. This entails completing the University of Virginia Approval of Outside Activities (which must be signed by the Department or Division Chair) and providing it together with a review copy of all contractual engagements contemplated to the Assistant Dean for Research Administration in the SoM Dean's Office. Under normal circumstances the Assistant Dean will respond to faculty member and Department Chair via e-mail with a recommendation for how the consultancy should be treated within five (5) business days. Depending upon the scope of the contemplated consulting engagement a recommendation will be made that the agreement must be contracted between the University and the sponsor, or alternately a recommendation may made that the faculty member may contracted directly with the sponsor. In some instances the faculty member will be advised not to pursue the consultancy.

The SoM goals in reviewing the terms of Consulting Agreements are to: identify if there is a Conflict of Interest and implement a plan to manage it if possible and practical to do so; oversee potential Conflict of Commitment; protect the rights of students, particularly as they pertain to accepting confidential information or restricting publication rights unduly; protect University intellectual property; avoid inappropriate use of University services, equipment, facilities, trainees, or staff; protect the faculty member by ensuring that liability/insurance issues are adequately addressed; determine whether the business entity is a vendor of goods or services or a source of patient referrals to the Medical Center; avoid noncompliance or the appearance of noncompliance with regulatory requirements; avoid unacceptable legal and regulatory restrictions²; prevent the faculty member from inadvertently agreeing to engage in either promotional or endorsement activities; ensure, to the maximum extent possible, that consulting agreements for faculty are managed in a uniform and consistent manner; and ensure that the terms of such agreements are in compliance with University, School of Medicine and Medical Center policies.

Consulting Agreement Review Process

The Statement of Work will be reviewed carefully to ensure that the appropriate indirect cost rate is applied³: Once the faculty member is notified whether the consultancy will be treated as either: Option 1 - Contracts between an Individual Faculty Member and an External Entity; or Option 2 - Contracts between the University of Virginia and an External Entity additional paperwork including a Sponsored Programs Routing Sheet and Conflict of Interest paperwork will be requested If Option 2 is recommended then a determination will also be made regarding whether the consultancy will be either a Sponsored Research Agreement or a Sales and Service Agreement. For Option 2 The On grounds research rate will be used when: the research involves lab facilities and/or specialized equipment; or the research includes animals or humans; The Off Grounds Research Rate will be applied when: human subject approval is involved; and/or writing and/or development of clinical trials, protocols or other training materials is contemplated and/or the scope of work includes product development and/or recommendations for refinements and/or testing a drug or device. In some instances, where appropriate the Other research rate will be applied, this rate may be applied . The Sales and Service Consulting Rate will be used in situations where: none of previously described circumstances apply; the faculty member wishes to have liability protection and therefore requests that the agreement be between the Rectors and Visitors of the University of Virginia and/or use of any University facilities including office space, administrative support, e-mail, telephone, computer, facsimile, supplies, etc., and/or the Physician is "on call" to answer other physicians or clinicians and or provide on campus training is needed to fulfill the obligations of the consultancy.

Faculty may enter into Personal Consulting Agreements in accordance with Activities Exempt from this Policy. Certain activities are treated as "exempt"-see Activities Exempt from this Policy in the School of Medicine Policy on External Consulting and Professional Activities: Royalties received in connection with the writing, illustration, or editing of professional articles and books: Royalties received from the University of Virginia Patents Foundation and paid directly to the individual under the University's approved patent royalty distribution formula; Per Diem allowances and consultation fees received from the federal government or other appropriate funding agencies for service on study sections or other review groups, or related activities; and Per Diem allowances and honoraria for lectures and addresses.

 Incentive Payments Resulting from Consulting Revenues:

Sponsored Program Agreements: When agreements are deemed to be sponsored program activities, the SoM faculty member shall be paid salary in the same manner as they are paid with any sponsored activities. Appropriate effort should be charged to the sponsored program account. Depending upon whether a faculty member is meeting the minimum standard of extramural salary support for faculty in the basic science departments and the Clinical Faculty Remuneration Plan for faculty in the clinical departments, faculty may become eligible to receive an incentive payment. Any payments would be in accordance with existing SoM policies on incentive payments in the basic sciences and in the clinical departments. Incentives will not be paid directly as a result of sponsored program agreements. However incentives may result from higher levels of extramural salary support in the basic science departments under the Basic Science Incentive Plan and larger surpluses under the Clinical Remuneration Plan in the clinical departments.

 Sales and Service Agreements: Consistent with the statement regarding Income Derived from Outside Professional Activities in the SoM Consulting Policy, the payout of consulting fees for Sales and Service Agreements shall be in accordance with the minimum standard of extramural salary support for the faculty in the Basic Science Department and the Clinical Faculty Remuneration Plan for faculty in the Clinical Departments. Provided the thresholds have been met, and with Department Chair approval, an immediate bonus of up to 50% of the payment received may be issued to the faculty member. Incentive payments from consulting agreements will not be paid to faculty who are not meeting expectations. In these cases consulting fees will first be used to help the faculty member meet the minimum expectations. Once the expectations have been met, then the balance of any fee may be distributed per the policy.

NOTE: Please deliver these forms to the Grants & Contracts office in the care of Kathy Boswell for Sarah White.

consulting flow & Process Diagram

Annual Disclosure of Financial Interests (Feb 2007)

External Consulting and Professional Activites Policy (November 2007)

Invoice Attachment

[1] The SoM may as part of the negotiation process with entities wishing a faculty member to engage in consulting activities, deem it appropriate to reference the contract as a "Research Agreement" or a "Research Service Agreement."

[²]As is the case with all contractual agreements dealing with sponsored research issues, consulting engagements will be reviewed and negotiated by the staff of the SoM Contracting Office, a joint venture between the Office of Sponsored Programs and the SoM Dean's Office. Appropriate advice and review will be sought to ensure that MC and University policies and procedures are incorporated.  The MC Corporate Compliance Officer shall have the opportunity to review all consulting engagements. 

[³] Use of University owned Intellectual Property requires that the consulting agreement be between the University and the contracting party, the rate applied will be determined, in such circumstances with and evaluation of the scope of work.