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Subcontract with no involvement of the faculty owner

Example 1:  Subcontract with no involvement of the faculty owner

Dr. James Richards, a professor in the College of Engineering, has developed copyrighted software that allows health care providers to directly access electronic medical records from a variety of personal digital assistants (PDAs), regardless of the manufacturer of the device.  He has formed a start-up company, Top Pocket Technologies, Inc. (TPT, Inc.), which is focusing on the commercialization of his technology.  Dr. Richards holds 25% equity in TPT. 

The company has received a Small Business Technology Transfer Research (STTR) award, and the company is issuing a subcontract to the University for some research to further develop the software program.   Dr. Richards will not be involved in the university sponsored project. 

Acknowledgement:  This example text was adapted from training material posted by the University of Iowa.

Actions Required:

  • Investigator disclosure to institution:  Professor Richards must disclose through the COISystem that he holds an equity interest in the company. This disclosure is required once a year, usually at the beginning of the fiscal year.  State law also requires a Virginia Statement of Economic Interest Form be filed by Professor Richards.   
  • Proposed management plan:
    • No participation of researcher in VT sponsored research projects:  If Dr. Richards normally does not participate in research subcontracted to Virginia Tech by his company, then a single management plan can be filed via the COISystem at the beginning of the fiscal year containing a statement confirming that Professor Richards will not work as a PI or co-PI on any Virginia Tech project involving his company.  [Individual, project-related management plans should be developed for any case where the researcher intends to be involved in a VT sponsored project.]
    • Public disclosures:  Whenever Dr. Richards is an author on any manuscript related to research involving TPT technologies, he is required to disclose to the journal that he holds intellectual property in the area of this research, and that he has an equity interest in the sponsor, TPT, Inc.  In the case of presentations related to the research study, he is required to disclose the interest to the organizers of the meeting.  Click here for a sample disclosure statement to a journal.
  • Review by department head and dean:  Disclosures and proposed management plans are reviewed and approved by the relevant department head and dean’s office (or equivalent administrators for those employed outside the academic colleges).
  • Review and approval by university officials:  According to state law, Virginia Tech must obtain special approval for the university to enter into a business arrangement with the employee-owned company prior to execution of a research and development contract.  As soon as the proposal is submitted by OSP and the designated COI Officer is notified, the COI Officer will prepare a COI Approval form for the president’s review and signature.   Once all approval signatures are obtained, any resulting award can be executed and a fund established for the sponsored project.  Each award from Dr. Richards’ company requires a separate approval by university officials.  The faculty member will be asked to update his disclosures if any changes have occurred.
    • Having approved disclosures and a management plan in place prior to the submission of the specific project expedites formal approval of the contract and execution of the award.