There is a strong presumption against accepting research funding in the form of grants, sub-contracts, or gifts, from a start-up** in which the employee proposing the research has an equity interest or a Board seat (or other financial interest), if the research is to be done in the individual’s research group, or the employee's students or post-doctoral fellows or associates would participate in the funded research projects. Rigorous restrictions also apply to human subject research and non-human subjects research that involves testing, when the employee has a related financial interest. The presumption is applied as follows:
Human Subject Research: Where the proposed research involves human subjects, the presumption against permitting a related start-up** to sponsor the research is particularly strong. Any financial or equity interest in the start-up** company will almost always preclude the financially interested employee from conducting human subjects research sponsored by the start-up**. The presumption may be overcome only in rare and compelling circumstances and where the Health Science Center, including its Institutional Review Board, are satisfied that effective controls to mitigate any possible effects of the conflict can and will be implemented. Such circumstances might include, for example, that the employee is uniquely qualified to perform the experimental procedure. In such circumstances, it may be appropriate for the employee should divest him or herself of the equity interest, or place the equity in a blind trust for an appropriate period of time.
Research Not Involving Human Subjects: When a start-up** proposes to sponsor research to be conducted by an employee who holds equity or a Board seat in the company, and which involves neither human subjects nor validation testing, the presumption may be rebutted if appropriate controls are in place (see below), and a condition such as one of the following is met:
Except in extraordinary circumstances, the presumption may not be rebutted when the research in question has as its objective the testing of an invention in which the employee has a financial interest in a start-up**, or a Health Science Center invention that is licensed to a start-up** in which he or she has an equity interest. For purposes of this proviso, "testing" is intended to describe doing research designed to validate to the public or perform a similar function regarding an invention created at the Health Science Center and licensed to a start-up** company. (The same restrictions would generally apply to testing undertaken for a publicly held company holding a license from the Health Science Center.)
Controls: In each case in which the research will be permitted to proceed despite the presumption against such research, the Health Science Center shall ensure, in addition to measures adopted by the cognizant Institutional Review Board, the following:
** A relatively newly formed, privately held, for profit company that is generally based on intellectual property developed at the Health Science Center.