PHA Policy on Conflict of Interest A Conflict of Interest (COI) is any affiliation or characteristic of an individual which could (a) interfere with or be perceived to interfere with (i.e. bias) the appropriate performance of the individual in their role on a board, committee, task force, or other entity; or (b) potentially affect others performance in their roles in the same entity. The approach to a COI encompasses four components: (1) ownership of the COI by the individual, (2) transparency by the individual regarding the COI, (3) perception of an individual s COI by others who may be influenced by the individual s actions, and (4) resolution of the COI. 1. Ownership: Each individual participating in activities within PHA is obligated to understand and acknowledge how his/her activities in all other spheres may pose a COI as defined above. 2. Transparency: Each individual is obligated to disclose for the purpose of public dissemination all COI s. 3. Perception: All others with a PHA-based relationship with the individual are invited to disclose any perceived COI of the individual which may have an impact on their (the others) function in any way. This includes those (a) serving with the individual in any capacity of an entity within PHA or (b) whose activities or outcomes are affected by decisions made by or actions taken by the individual or the entity on which they serve. Individuals or entities who have a PHA-based relationship with an individual who discloses a COI are requested to determine if the COI impacts, or could be perceived to impact, their function within PHA in any way. 4. Resolution: A policy must be in place which effectively ameliorates concerns raised by the COI of an individual. The practical implications of these principles are: 1. Ownership: The individual must critically evaluate and catalogue their range of activities related to their responsibilities on any PHA organizational entity. 2. Transparency: The individual must report these activities to PHA, and PHA will publish these activities in a manner that is accessible to all potentially interested parties, such as a publically available and clearly advertised website. 3. Perception: Other entities impacted by the individual or the entity on which they serve must be informed of the opportunity to articulate their perception either before or after (preferably before) any relevant actions have been undertaken by the individual or PHA entity with respect to the other entity. The perceived conflict may be general (that is, any action undertaken in any capacity is potentially biased) or specific (that is, actions undertaken only with respect to the other entity is potentially biased). The latter may be particularly relevant to site reviews, voting or adjudication on accreditation of institutions by the PHCC. 4. Resolution: The response to ameliorate the COI will depend on the nature of the COI. Possible responses to the presence of a COI include:
a. Recusal: Disqualification of the individual s participation in any actions (including but not limited to policy formulation, evaluations, opinions) that may possibly be influenced by the COI. This approach to resolution is most applicable to specific actual or perceived COI s. b. Nonparticipation: Disqualification of the individual s participation in the PHA entity for which the COI is relevant. This approach to resolution is most applicable to general actual or perceived COI s. Definitions of COI and their resolutions: 1. Employment of the individual or a family member by an entity with direct, indirect or possible financial incentives within the field of PH, such as pharmaceutical or medical device companies. This includes both companies with products in the PH arena and those without products in the field. a. Rationale: The potential for actual or perceived bias based on financial incentives, job security or competition is both tangible and broad, and could affect a wide range of tasks performed by the PHA entity. b. Resolution: Disqualification of the individual from participation on the PHA entity c. Application: Includes but not limited to the Board of Trustees, Scientific Leadership Committee, Pulmonary Care Centers, or any subcommittees or task forces of these entities. This does not include the Corporate Committee. 2. Stock ownership by the individual or a family member by an entity with direct, indirect or possible financial incentives within the field of PH, such as pharmaceutical or medical device companies. This includes both companies with products in the PH arena and those without products in the field. Potential conflict of interest exists when ownership is based on direct personal involvement (such as stock purchase), but excludes ownership at a distance (such as an externally managed investment fund in which the individual has no influence on decisions to buy or sell stocks). a. Rationale: The potential for actual or perceived bias based on financial profit both tangible and broad, and could affect a wide range of tasks performed by the PHA entity. However, when the financial position is limited the potential for financial gain is expected to be commensurately small and poses a minor incentive or risk of bias. b. Resolution: Disqualification individuals from participation on the PHA entity who have a financial position in any pharmaceutical or medical device company with current value $10,000. In general, professional medical caregivers are discouraged from ownership of such investments. c. Application: Includes but not limited to the Board of Trustees, Scientific Leadership Committee, Pulmonary Care Centers, or any subcommittees or task forces of these entities. This does not include the Corporate Committee. 3. Consultative or advisory roles with entities defined in #1. a. Rationale: The potential for actual or perceived bias based on financial incentives and professional recognition is hypothetical but possible and could affect some tasks
performed by the PHA entity. Distinct from employment, this role is more removed from benefiting from decisions, involves less remuneration, is independent of the financial well-being of the commercial entity, is based on specialized expertise, and is ancillary to the individual s personal livelihood. b. Resolution: Selective recusal. c. Application: Includes but not limited to the Board of Trustees, Scientific Leadership Committee, Pulmonary Care Centers, or any subcommittees or task forces of these entities. The responsibility for identifying the relatively infrequent occasions on which this COI may be relevant to the PHA-related obligations of the individual lies with the integrity of the individual and on the oversight of the PHA entity on which they serve. 4. Investigators on studies sponsored by entities defined in #1. a. Rationale: The potential for actual or perceived bias based on financial incentives and professional recognition is ambiguous but possible and is unlikely to affect tasks performed by the PHA entity. This role is unlikely to benefit from decisions, involves less and generally no personal remuneration, is independent of the financial well-being of the commercial entity, is based on specialized expertise, though it may be a component of the individual s personal livelihood by funding part of his/her salary or that of dependent staff. b. Resolution: Selective recusal. c. Application: Includes but not limited to the Board of Trustees, Scientific Leadership Committee, Pulmonary Care Centers, or any subcommittees or task forces of these entities. The responsibility for identifying the very infrequent occasions on which this COI may be relevant to the PHA-related obligations of the individual lies with the integrity of the individual and on the oversight of the PHA entity on which they serve. 5. Participation in funded speaker bureaus or educational events a. Rationale: Participation in an externally funded educational initiative may give the perception that the participant has a vested interest in the goals of the funding entity. b. Resolution: No specific action required, though the participant s actions in PHA activities will be reviewed if a concern is raised. c. Application: Includes but not limited to the Board of Trustees, Scientific Leadership Committee, Pulmonary Care Centers, or any subcommittees or task forces of these entities. 6. Employment of the individual or a family member by an entity with no tangible commercial products involved with PH management, nor competition with those that do, but which have commercial services that may be impacted by the activities of the PHA entity on which the individual serves, such as contract research organizations (CRO s) or consultative companies involved with sites potentially affected by the PHA entities on which he/she serves. a. Rationale: The potential for actual or perceived bias based on financial incentives and professional recognition is present but indirect. This role may benefit from decisions in unpredictable ways and may be a substantial component of the individual s personal livelihood. Given the ambiguities, the perceived credibility of the individual and the PHA entity on which he/she serves is paramount.
b. Resolution: Low threshold recusal, including especially whenever concerns are raised by entities impacted by the individual s participation on a PHA entity. This is most relevant to individuals serving on the PHCC site review or oversight committees. c. Application: Includes but not limited to the Board of Trustees, Scientific Leadership Committee, Pulmonary Care Centers, or any subcommittees or task forces of these entities. The responsibility for identifying the occasions on which this COI may be relevant to the PHA-related obligations of the individual lies with the integrity of the individual and on the oversight of the PHA entity on which they serve. 5. Special circumstances a. The credibility of the PHCC Site Review and Oversight Committees is particularly fragile and requires conscientious awareness of and responsiveness to any source of perceived COI. Site reviewers are required, therefore, to disclose the following potential sources of bias: i. Institutions with geographical proximity (within 150 miles) from reviewer site ii. Institutions where the reviewer trained iii. Institutions where the reviewer has been employed iv. Institutions where the reviewer has lectured/taught/visited in an official capacity (such as visiting professor) in the previous 3 years v. Institutions or individuals with whom the reviewer has been in a mentor or mentee relationship in the previous 3 years vi. Institutions or individuals with whom the reviewer is sharing extramural grants or leadership committee responsibilities in non-pharma sponsored studies vii. Institutions or individuals for whom their might be any real or perceived conflicts with or obstacles to the reviewer s objective assessment viii. In addition, all sites undergoing review are given the opportunity to request that a member be recused from reviewing their site for any reason Procedures for Dealing with COI s 1. All applicants, nominees, or newly installed members of any PHA entity must complete a COI form (see Appendix D). a. In addition, all members of the PHCC Site Review Committee must complete the form asking for information listed in item 5.a. (See Appendix B) b. All sites being reviewed by a PHCC Site Reviewer will be provided a letter inviting them to state any perceived COI of the assigned site reviewer and an alternate reviewer will be assigned. (See Appendix C) 2. All COI s will be published on a dedicated webpage of the PHA website. 3. All COI s will be updated annually when requested by PHA Staff 4. Resolution of COI s will be administered by the PHA entity for which the individual has applied, been nominated or is a member. a. The resolution will include discussion with the individual to clarify the COI
b. The decision of the entity may be appealed successively to higher levels of administration up to and including the PHA BOT. The decision of the BOT is final. c. Procedural details (See Appendix A)
Appendix A: PHCC, INC draft Conflict of Interest Policy PULMONARY HYPERTENSION XX, INC. a Maryland non-stock, not-for-profit corporation CONFLICT OF INTEREST POLICY This Conflict of Interest Policy (this Policy ) was adopted by the Board of Directors (the Board ) of Pulmonary Hypertension XX, Inc. ( PHCC ) on. It shall apply to all Covered Person Persons (as defined below.) ARTICLE I Purpose The purpose of the conflict of interest policy is to protect PHCC s interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of PHCC or might result in a possible excess benefit transaction. This policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable organizations. 1. Covered Person ARTICLE II Definitions Each member of the Board, each member of a committee of the Board (the Board Committee ), each officer, and each other employee of PHCC as the Board may determine by resolution adopted from time to time, is a Covered Person. 2. Financial Interest A person has a Financial Interest if the person has, directly or indirectly, through business, investment, or family:
a. An ownership or investment interest in any entity with which PHCC has entered into a transaction or arrangement, b. A compensation arrangement with PHCC or with any entity or individual with which PHCC has entered into a transaction or arrangement, or c. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which PHCC is negotiating a transaction or agreement. Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial. A Financial Interest is not necessarily a conflict of interest. Under Article III, Section 2 of this Policy, a person who has a Financial Interest may have a conflict of interest only if the Board or the appropriate Board Committee decides that a conflict of interest exists. 1. Duty to Disclose ARTICLE III Procedures Each Covered Person must disclose any existing or potential personal, familial or business interest or relationship, including a Financial Interest, if any, that could reasonably give rise to a conflict, or the appearance of a conflict, between his or her interests and PHCC s interests. If the interest or relationship is implicated by an existing or potential transaction or agreement with PHCC, the matter shall be brought before the Board or the appropriate Board Committee for review and approval. The Covered Person must be given the opportunity to disclose all material facts to the Board or the appropriate Board Committee considering the proposed transaction or agreement. 2. Determining Whether a Conflict of Interest Exists After disclosure of the interest or relationship, including a Financial Interest, if any, and all material facts, and after any discussion with the Covered Person, he/she shall leave the governing board or committee meeting while the determination of a conflict of interest is discussed and voted upon by the Board or appropriate Board Committee. If the determination is made by the appropriate Board Committee, then such Board Committee shall report its action on the matter to the Board at the Board s next meeting. 3. Procedures for Addressing the Conflict of Interest a. A Covered Person may make a presentation at the meeting of the Board or the appropriate Board Committee, but after the presentation, the Covered Person shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.
b. The chairperson of the Board or the appropriate Board Committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement. c. After exercising due diligence, the Board or the appropriate Board Committee shall determine whether PHCC can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest. d. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Board or appropriate Board Committee shall determine by a majority vote of the disinterested directors or members whether the transaction or arrangement is in PHCC s best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination it shall make its decision as to whether to enter into the transaction or arrangement. 4. Violations of the Conflict of Interest Policy a. If the Board or appropriate Board Committee has reasonable cause to believe that a Covered Person has failed to disclose actual or possible conflicts of interest, it shall inform the Covered Person of the basis for such belief and afford the Covered Person an opportunity to explain the alleged failure to disclose. b. If, after hearing the Covered Person s response and after making further investigation as warranted by the circumstances, the Board or appropriate Board Committee determines the Covered Person has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action. ARTICLE IV Records of Proceedings The minutes of the Board or the appropriate Board Committee shall contain: a. The names of the persons who disclosed or otherwise were found to have a Financial Interest in connection with an actual or possible conflict of interest, the nature of the Financial Interest, any action taken to determine whether a conflict of interest was present, and the decision as to whether a conflict of interest in fact existed; and b. The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings.
ARTICLE V Compensation a. A voting member of the Board who receives compensation, directly or indirectly, from PHCC for services is precluded from voting on matters pertaining to that member s compensation. b. A voting member of any Board Committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from PHCC for services is precluded from voting on matters pertaining to that member s compensation. c. No voting member of the Board or any Board Committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from PHCC, either individually or collectively, is prohibited from providing information to any Board Committee regarding compensation. ARTICLE VI Annual Statements Each Covered Person shall annually sign a statement which affirms such person: a. Has received a copy of this Policy, b. Has read and understands this Policy, c. Has agreed to comply with this Policy, d. Has disclosed any personal, familial or business interest or relationship that could reasonably give rise to a conflict or the appearance of a conflict between the Covered Person s interests and PHCC s interests, e. Has disclosed whether any such interest or relationship is implicated by an existing or potential transaction or agreement involving PHCC, and f. Understands PHCC is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of its tax-exempt purposes. ARTICLE VII Periodic Reviews To ensure PHCC operates in a manner consistent with charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects:
a. Whether compensation arrangements and benefits are reasonable, based on competent survey information, and the result of arm s length bargaining. b. Whether partnerships, joint ventures, and arrangements with management organizations conform to PHCC s written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes and do not result in inurement, impermissible private benefit or in an excess benefit transaction. ARTICLE VIII Use of Outside Experts When conducting the periodic reviews as provided for in Article VII, PHCC may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted. 1328701_1
Appendix B: PHCC Site Review and Oversight Committee Disclosure Form Pulmonary Hypertension Association PHCC Site Review Committee and Oversight Committee Disclosure Form Purpose: To identify real or perceived conflicts of interest or other obstacles which might reasonably be considered to have an impact on a Site Review Committee or Oversight Committee member s capacity to objectively directly assess a PH Center, discuss or vote on accreditation of a PH Center, or adjudicate appeals by a PH Center in the process of that Center s application for accreditation as a Comprehensive Care Center or Regional Care Center. This will permit participation of reviewers at sites without identifiable conflicts and will require recusal of those with conflicts from voting or adjudicatory roles for specific sites with whom real or perceived conflicts exist. 1 PH Centers within approximately 150 miles of your center and with whom you would likely overlap patient populations 2 Institutions where you trained 3 Previous institutions where you have been employed 4 Institutions where you have lectured/taught/visited in an official capacity (i.e. visiting professorship) in past 3 years 5 Institutions/individuals now at other institutions from yours with whom you have been in a mentor or mentee relationship in the past 5 years
6 Institutions/individuals with whom you are sharing extramural grants or leadership committee responsibilities in non-pharma sponsored studies 7 Institutions/individuals for whom there might for any reason be real or perceived conflicts with or obstacles to your objective assessment Describe: Signature below acknowledges that the real or perceived potential conflicts listed above are accurately stated. Printed Name Signature Date
Appendix C: PHCC Letter to Accreditation Applicants Dear Program Director: The following individuals will be visiting your Pulmonary Hypertension Center in order to conduct a site assessment related to your application for accreditation as a Pulmonary Hypertension Comprehensive Care Center. [Name 1] [Name 2] Neither of these reviewers has identified any real or perceived conflicts or issues which might realistically impede objective review of your facility. We feel that it is important, however, that you also feel that they are able to render an objective assessment. Therefore, please notify us promptly if you feel that an impartial opinion regarding your institution s qualifications is jeopardized in any way by the participation of either site reviewer. Additionally, the Review Committee of the Pulmonary Hypertension Comprehensive Care Center initiative is currently composed of the following individuals who are responsible for evaluating, discussing and deciding on accreditation of Comprehensive Care Centers. [Names] In your opinion, should any of these individuals be recused from the final decision process regarding your institution due to real or perceived conflicts or obstacles? Thank you for helping us provide an effective, accurate and fair accreditation process. Sincerely,
Appendix D: PHA Leadership Disclosure Form (Example 1 st Page)