Eleven National Institutes of Health officials arrived at the University on Tuesday to determine whether to remove an NIH-imposed sanction that limited researchers’ autonomy.
The NIH committee will interview 75 University administrators and researchers about a new grants management system and other research initiatives. The system is part of an agreement between the University and the NIH to better manage and administer its grants.
“We hope (this NIH visit) will be the final site visit before exceptional status is removed from the University,” said Frank Cerra, senior vice president for health sciences in the Academic Health Center, in a memo written to colleagues Tuesday.
The University was deemed an “exceptional organization,” a type of NIH probation, in October 1995.
The sanction followed misappropriation of funds involving the anti-organ rejection drug ALG. Dr. John Najarian, then-chairman of the Medical School’s surgery department, resigned from the University following the scandal. He was later acquitted of criminal wrongdoing.
But the Food and Drug Administration found numerous University violations of program regulations. The FDA found that the University garnered more than $80 million in sales from ALG between 1969 and 1992.
Mismanagement of NIH grants was also discovered, prompting the organization to tag the Medical School with exceptional status.
Exceptional status is given to organizations after evidence of poor business-management practices surfaces. Once an organization has been identified as exceptional, the NIH closely monitors and assists in the management of all grants. Researchers in exceptional organizations also have less control over their grants.
The University created the Electronic Grants Management System to convince NIH officials to remove the status. The system allows researchers and administrators to apply for and manage grants over the Internet. The University is the first major institution to establish electronic grant applications.
Christine Maziar, vice president of research and dean of the Graduate School, said she expected NIH officials to be impressed with the seriousness with which the University has dealt with their exceptional status.
The Office of Oversight Analysis and Reporting was created in December 1998 to monitor a variety of electronic oversight reports that identify unusual activity. Officials said the purpose of the office is to responsibly monitor the University’s overall compliance with policy and regulation with respect to research grants.
University officials are adamant that recent transgressions will not prevent the removal of exceptional status.
Last June, the University reimbursed the NIH for $11,000 in grants that were awarded to Dr. Keith Kajander. The doctor died of a cocaine overdose on April 28. Before his death, he had led a team of researchers using cocaine and morphine to study pain research.
Although there was no proof that Kajander had misused the research cocaine, University officials still decided to reimburse the grant.
During a seven-month investigation of the Biomedical Engineering Institute, University auditors uncovered evidence of financial mismanagement that some felt could threaten the University’s already-shaky standing with the NIH.
The University announced it would expand the investigation in September, one day after The Minnesota Daily broke a story about the mismanagement and what some sources called a University cover-up.
NIH officials will be visiting the University through Friday. They will conduct one-on-one interviews with University researchers and administrators from 7:30 a.m. until 6 p.m. each day. The discussions are not open to the public.
University officials said they did not know when a final decision on the exceptional status would be announced but said the blemish of exceptional status is unacceptable.
“We think it’s important that the University of Minnesota be recognized as an institution that manages its research enterprise full of integrity,” Maziar said.

Craig Gustafson covers the Medical School and welcomes comments at [email protected]. He can also be reached at (612) 627-4070 x3233.