The National Institutes of Health no longer considers the University an “exceptional organization.”
That’s good news to University officials who have spent millions of dollars filling up a hole dug by a major financial scandal five years ago.
The NIH slapped the University with the “exceptional organization” sanction following a 1995 investigation by the Food and Drug Administration into the sales of the anti-organ rejection drug, anti-lymphocyte globulin.
It was revealed that the University had misappropriated $80 million between 1969 and 1992. Mismanagement of NIH funds was also discovered.
The NIH is the single largest provider of research funds to the University. In 1999 alone, they granted $150 million of the $360 million received by the University.
Because of this, NIH sanctioning is not taken lightly.
When an institution is given exceptional status, the NIH rigorously monitors their use of research funds. As a result, researchers themselves have much less control over their projects.
The lifting of the sanction comes as a result of a site visit conducted in October by 11 NIH officials. The Site Visit Team interviewed 75 researchers and administrators during a four-day stay.
Removal of the University’s penalty is conditional, however. The NIH report listed several guidelines the University must meet by Sept. 30 for a full release from exceptional status.
Some of the conditions include familiarizing faculty and researchers with the fiscal conduct code as well as documenting who has been properly trained in its implementation.
Christine Maziar, vice president for research and dean of the Graduate School, said the conditions are reasonable.
“We’re marching in that direction anyway,” she added.
Since 1995, the University has spent $12 million, creating a new monitoring office and grants management system, to get the status changed.
Most of the money went toward the development of the Electronic Grants Management System. The system is set up to allow researchers to apply for and manage grants online. The University is the first major institution to develop such a system.
The University also created the Office of Oversight Analysis and Reporting in December 1998 to monitor the school’s compliance with policy and regulation with respect to research grants.
The multimillion-dollar effort did not go unnoticed by the NIH.
“While we have identified some actions that remain to be taken and/or completed, we also recognize that much has been done to improve the quality and effectiveness of the University’s sponsored programs administration,” said Diana Jaeger, director of NIH policy for extramural research, in a letter to University officials.
“The University is to be commended for its excellent effort in moving forward with its Grants Management Project,” she said.
The conditional designation might be removed prior to the September deadline if it is deemed the University has met all conditional requirements.
“We hope to meet all the conditions well before the deadline,” Maziar said.

Mike Wereschagin welcomes comments at [email protected]. He can also be reached at (612) 627-4070 x3226.