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thout regard to the requirements of Subpart D-Public Health Service --preceding sentence.

Grant Appeals Procedure c. 101, Pub. L. 95–205, 91 Stat. 1461, Dec. 9, 7)

AUTHORITY: Sec. 215, Public Health Service

Act, 58 Stat. 690 (42 U.S.C. 216); 45 CFR FR 13868, July 21, 1978, as amended at 44

16.3(c). 6 61598, Oct. 26, 1979)

SOURCE: 54 FR 34770, Aug. 22, 1989, unless 0.307 Documentation needed by pro

otherwise noted. 1 grams or projects.

850.401 What is the purpose of this Federal financial participation is un- subpart? railable for the performance of abor

This subpart establishes an informal ons or other medical procedures oth

procedure for the resolution of certain wise provided for under $850.304 and

postaward grant and cooperative agree1.306 if the program or project has

ment disputes within PHS. Lid without first having received the ertifications and documentation spec

850.402 To what programs do these ied in those sections.

regulations apply? 3 FR 4570, Feb. 2, 1978, as amended at 44 FR This subpart applies to all grant and 598, Oct. 26, 1979)

cooperative agreement programs, ex

cept block grants, which are adminis50.308 Drugs and devices and termi

tered by the U.S. Public Health Sery3 nation of ectopic pregnancies.

ice, including those administered by Federal financial participation is the National Institutes of Health; the „vailable with respect to the cost of Health Resources and Services AdminIrugs or devices to prevent implanta- istration; the Centers for Disease Conjion of the fertilized ovum, and for trol; the Agency for Toxic Substances nedical procedures necessary for the and Disease Registry; the Alcohol, jermination of an ectopic pregnancy.

Drug Abuse, and Mental Health Admin

istration; the Food and Drug Adminis$50.309 Recordkeeping requirements. tration; the Indian Health Service; the Programs or projects to which this

Office of the Assistant Secretary for subpart applies must maintain copies

Health (OASH); and the PHS regional of the certifications and documenta

offices. tion specified in $850.304 and 50.306 for

850.403 What is the policy basis for three years pursuant to the retention

these procedures? and custodial requirements for records

The Secretary of Health and Human at 45 CFR 74.20 et seq.

Services has established a Depart[43 FR 4570, Feb. 2, 1978, as amended at 44 FR mental Appeals Board for the purpose 61598, Oct. 26, 1979)

of providing a fair and flexible process

for the appeal of written final decisions $ 50.310 Confidentiality.

involving certain grant and cooperaInformation in the records or in the tive agreement programs administered possession of programs or projects by constituent agencies of the Departwhich is acquired in connection with ment. The regulatory provision which the requirements of this subpart may establishes the circumstances under not be disclosed in a form which per- which the Board will accept an appeal mits the identification of an individual (45 CFR 16.3) provides, among other without the individual's consent except things, that the appellant must have as may be necessary for the health of exhausted any preliminary appeal the individual or as may be necessary process required by regulation before a for the Secretary to monitor the ac- formal appeal to the Departmental tivities of those programs or projects. Board will be allowed. These regulaIn any event, any disclosure shall be tions provide such an informal prelimisubject to appropriate safeguards nary procedure for resolution of diswhich will minimize the likelihood of putes within PHS in order to preclude disclosures of personal information in submission of cases to the Departidentifiable form.

mental Appeals Board before PHS has had an opportunity to review decisions A minimum of three employees of its officials and to settle disputes be appointed (one of whom shall de with grantees.


ignated as chairperson) either on La

hoc, case-by-case basis, or as rema 850.404 What disputes are covered by

members of review committesi 2 these procedures?

such terms as may be designated (a) These procedures are applicable of the members of the review COC to the following adverse determina- tee reviewing any given appeal masa tions under PHS discretionary project from the office of the responsibie grants and cooperative agreements cial whose adverse determinatio: (hereinafter both referred to as grants): being appealed (e.g., project otrs

(1) Termination, in whole or in part, grants specialist, program man of a grant for failure of the grantee to grants management officer). carry out its approved project in accordance with the applicable law and $50.406 What are the steps in the pro the terms and conditions of such as

ess? sistance or for failure of the grantee (a) A grantee with respect to the otherwise to comply with any law, reg- an adverse determination described ulation, assurance, term, or condition $ 50.404(a) above has been made and applicable to the grant.

desires a review of that determinaz (2) A determination that an expendi- must submit a request for such rets ture not allowable under the grant has to the head of the appropriate age been charged to the grant or that the or his/her designee (or in the case d's grantee has otherwise failed to dis- OASH program or regional office deze charge its obligation to account for mination, to the Assistant Secre*2" grant funds.

for Health or his/her designee) nov (3) A determination that a grant is than 30 days after the written notify void.

tion of the determination is receive (4) A denial of a noncompeting con- except that if the grantee shows que tinuation award under the project pe- cause why an extension of time sbor riod system of funding where the denial be granted, the head of the appropria is for failure to comply with the terms agency or his/her designee (or in of a previous award.

case of an OASH program or region (b) A determination subject to this office determination, subpart may not be reviewed by the re- Secretary for Health or his her de view committee described in $ 50.405 un- ignee) may grant an extension of the less an officer or employee of the agen- (b) The request for review must * cy, OASH, or the regional office has no- clude a copy of the adverse determin tified the grantee in writing of the ad- tion, must identify the issue(s) in verse determination. The notification pute, and must contain a full staze must set forth the reasons for the de- ment of the grantee's position with a termination in sufficient detail to en- spect to such issue(s) and the pertine able the grantee to respond and must facts and reasons in support of the inform the grantee of the opportunity grantee's position. In addition to the for review under this subpart.

required written statement, the gran

ee shall provide copies of any doc 850.405 What is the structure of re- ments supporting its claim. view committees?

(c) When a request for review bas The head of each agency or his/her been filed under this subpart with me designee shall appoint review commit- spect to an adverse determination, E tees to review appeals of adverse deter- action may be taken by the awardios minations made by headquarters offi- agency, OASH, or regional office purse cials for programs under the jurisdic- ant to such determination until the te tion of that agency. The Assistant Sec- quest has been disposed of, except retary for Health, or his/her designee, the filing of the request shall not affec shall appoint review committees to re- any authority which view adverse determinations made by OASH, or regional office may have to OASH officials and regional officials suspend assistance or otherwise to for programs under their jurisdiction. withhold or defer payments under the

the Assistant

the agenci

and each of the other committee members. The review committee shall send the written decision with a transmittal letter to the grantee and shall send a copy of both to the official responsible for the adverse determination. If the decision is adverse to the grantee's position, the transmittal letter must state the grantee's right to appeal to the Departmental Appeals Board under 45 CFR part 16.

Subpart E-Maximum Allowable

Cost for Drugs

AUTHORITY: Sec. 215, Public Health Service Act, 58 Stat. 690 (42 U.S.C. 216).

SOURCE: 40 FR 34514, Aug. 15, 1975, unless otherwise noted.

nt during proceedings under this part. This paragraph does not rere the awarding agency, OASH, or ional office to provide continuation ding during the appeal process to a ntee whose noncompeting continuon award has been denied. 1) Upon receipt of a request for rew, the head of the agency or his/her signee (or, if the adverse determinan was made in an OASH program or ional office, the Assistant Secretary

Health or his/her designee) will ke a decision as to whether the diste is reviewable under this subpart d will promptly notify the grantee d the office responsible for the adrse determination of this decision. If e head of the agency or his/her desnee (or, if applicable, the Assistant cretary for Health or his/her desnee) determines that the dispute is viewable, he/she will forward the atter to the review committee apvinted under $50.405. (e) The agency, OASH, or regional ofce involved will provide the review -)mmittee appointed under $50.405 ith copies of all relevant background laterials (including application(s), ward(s), summary statement(s), and orrespondence) and any additional ertinent information available. These laterials must be tabbed and orgaized chronologically and accompanied y an indexed list identifying each docment. - (1) The grantee shall be given an oportunity to provide the review comnittee with additional statements and locumentation not provided in the request for review described in paragraph b) of this section. This additional subnission, which must be organized and Indexed as indicated under paragraph e) of this section, should provide only material that is relevant to the review committee's deliberation of the issues in the case.

(g) The review committee may, at its discretion, invite the grantee and/or the agency/OASH/regional office staff to discuss the pertinent issues with the committee and to submit such additional information as the committee deems appropriate.

(h) Based on its review, the review committee will prepare a written decision to be signed by the chairperson

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850.502 Definitions.

As used in this subpart:

(a) Public Health Service means the Office of the Assistant Secretary for Health, Health Resources and Services Administration, National Institutes of Health, Centers for Disease Control, Alcohol, Drug Abuse and Mental Health Administration, Food and Drug Administration, and all of their constituent agencies.

(b) Secretary means the Secretary of Health and Human Services and any other officer or employee of the Department of Health and Human Services to whom the authority involved has been delegated.

(c) Program funds means (1) Federal funds provided through grant or contract to support a program or project covered by $50.501, and (2) any non-Federal funds that are required as a condition of such grant or contract to be expended to carry out such program or project.

(d) Provider means one who furnishes and the applicable cost principles : medical or pharmaceutical services or scribed in 45 CFR part 74, no separe supplies for which program funds may dispensing fee will be recognized. be expended under any of the programs (b) In determining whether a disper or projects described in $50.501.

ing fee is reasonable, the Secrets (e) Acquisition cost means the price will take into account: generally and currently paid by provid- (1) Cost components such as OT? ers for a drug marketed or sold by a head, professional services, and proiz particular formulator or labeler in the (2) Payment practices of third-para package size of drug most frequently payment organizations, including othe purchased by providers, as determined Federal programs such as titles IL by the Secretary on the basis of drug and XIX of the Social Security price information furnished by the De- and partment.

(3) Any surveys by States, unite

sities or others of costs of pharma (40 FR 34514, Aug. 15, 1975, as amended at 49 FR 38109, Sept. 27, 1984)

operations and the fees charged in th

particular area. 850.503 Policy.

(c) A certification by a prescribe It is the policy of the Secretary that

pursuant to paragraph (a) of this se

tion, that a brand of drug is medical program funds which are utilized for the acquisition of drugs be expended in

necessary for a particular patient sts the most economical manner feasible.

be in the prescriber's own handwritis

in such form and manner as the se In furtherance of this policy, the Secretary has established, in 45 CFR part

retary may prescribe. An example of 19, a procedure for determining the

acceptable certification is the notati.

"brand necessary". A procedure Maximum Allowable Cost for drugs

checking a box on a form will not com which are purchased with program

stitute an acceptable certification. funds. 850.504 Allowable cost of drugs. Subpart F-Responsibility of Appl (a) The maximum amount which may

cants for Promoting Object be expended from program funds for

ity in Research for which Pk the acquisition of any drug shall be the Funding Is Sought lowest of (1) The maximum allowable cost

AUTHORITY: 42 U.S.C. 216, 2896–1, 2990-3. (MAC) of the drug, if any, established

SOURCE: 60 FR 35815, July 11, 1995; 60 F in accordance with 45 CFR part 19, plus

39076, July 31, 1995, unless otherwise noted a dispensing fee determined by the Secretary in accordance with paragraph (b) of this section, to be reasonable;

$50.601 Purpose. (2) The acquisition cost of the drug This subpart promotes objectivity plus a dispensing fee determined by the research by establishing standards Secretary, in accordance with para- ensure there is no reasonable expect graph (b) of this section, to be reason- tion that the design, conduct, or able; or

porting of research funded under PE (3) The provider's usual and cus- grants or cooperative agreements wi tomary charge to the public for the be biased by any conflicting financi drug; Provided, That the MAC estab- interest of an Investigator. lished for any drug shall not apply to a brand of that drug prescribed for a pa

850.602 Applicability. tient which the prescriber has cer- This subpart is applicable to each In tified, in accordance with paragraph (c) stitution that applies for PHS gran of this section, is medically necessary or cooperative agreements for resear for that patient; And Provided further, and, through the implementation That where compensation for drug dis- this subpart by each Institution, pensing is included in other costs al- each Investigator participating in suo lowable under the applicable program research (see $50.604(a)); provided, the statute and regulations, the terms and this subpart does not anply to SBI conditions of the grant or contract, Program Phase I a


> w cases where an individual, rather an an institution, is an applicant for SIS grants or cooperative agreements r research, PHS Awarding Compopants will make case-by-case deterbinations on the steps to be taken to Lisure that the design, conduct, and

porting of the research will not be bi[sed by any conflicting financial intert of the individual.

50.603 Definitions. » As used in this subpart: HHS means the United States Delrtment of Health and Human Serves, and any components of the Delrtment to which the authority inolved may be delegated.

Institution means any domestic or reign, public or private, entity or oranization (excluding a Federal ageny). Investigator means the principal inestigator and any other person who is esponsible for the design, conduct, or eporting of research funded by PHS, r proposed for such funding. For puroses of the requirements of this subart relating to financial interests,

Investigator” includes the Investigaor's spouse and dependent children.

PHS means the Public Health Servce, an operating division of the U.S. Department of Health and Human Services, and any components of the PHS to which the authority involved nay be delegated.

PHS Awarding Component means the organizational unit of the PHS that unds the research that is subject to his subpart.

Public Health Service Act or PHS Act means the statute codified at 42 U.S.C. 201 et seq.

Research means a systematic investigation designed to develop or contribute to generalizable knowledge relating broadly to public health, including behavioral and social-sciences research. The term encompasses basic and applied research and product development. As used in this subpart, the term includes any such activity for which research funding is available from a PHS Awarding Component through a grant or cooperative agree

Significant Financial Interest means anything of monetary value, including but not limited to, salary or other payments for services (e.g., consulting fees or honoraria); equity interests (e.g., stocks, stock options or other own ship interests); and intellectual property rights (e.g., patents, copyrights and royalties from such rights). The term does not include:

(1) Salary, royalties, or other remuneration from the applicant institution;

(2) Any ownership interests in the institution, if the institution is an applicant under the SBIR Program;

(3) Income from seminars, lectures, or teaching engagements sponsored by public or nonprofit entities;

(4) Income from service on advisory committees or review panels for public or nonprofit entities;

(5) An equity interest that when aggregated for the Investigator and the Investigator's spouse and dependent children, meets both of the following tests: Does not exceed $10,000 in value as determined through reference to public prices or other reasonable measures of fair market value, and does not represent more than a five percent ownership interest in any single entity; or

(6) Salary, royalties or other payments that when aggregated for the Investigator and the Investigator's spouse and dependent children over the next twelve months, are not expected to exceed $10,000.

Small Business Innovation Research (SBIR) Program means the extramural research program for small business that is established by the Awarding Components of the Public Health Service and certain other Federal agencies under Pub. L. 97–219, the Small Business Innovation Development Act, as amended. For purposes of this subpart, the term SBIR Program includes the Small Business Technology Transfer (STTR) Program, which established by Pub. L. 102-564.


850.607 Other HHS regulations that

apply. Several other regulations and policies apply to this subpart.

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