A grant gone awry has led to a $155,000 settlement deal between the DOJ and a drug development researcher accused of stepping outside the boundaries of his grant's terms, as reported by the Department of Justice. Protein Engines LLC and its founder, Dr. Joshua Salafsky, reached the agreement after facing allegations that Salafsky conducted his NSF-funded research outside of the United States, contrary to the stipulations of the grant.
Acting U.S. Attorney Teal Luthy Miller highlighted the crux of the issue, stating, "Despite being repeatedly informed that all research under the grant needed to be performed in the U.S., Dr. Salafsky spent little more than a month in the U.S. while he was accepting NSF grant funding for his research." This deviation from the NSF's clear directive—a stipulation designed to ensure that the federal funds bolster American innovation—has landed Salafsky and his company in hot water.
Provided with a grant of $256,000 back in late 2021, Protein Engines was to develop pharmaceutical research from December 1 of that year until November 30, 2022. However, the principal investigator didn't adhere to these guidelines. Dr. Salafsky resided in the U.K. for the majority of the grant period, spending only 38 days stateside, which prompted the NSF to suspend the grant funding in September 2023 after discovering the noncompliance.
The Small Business Innovation Research/Technology Transfer (SBIR/STTR) program exists to fuel domestic innovation and economic expansion. "When companies fail to follow the domestic requirements of the SBIR program, it is not only a misuse of taxpayer dollars but also takes away funding from deserving U.S. businesses," said NSF’s Acting Inspector General Megan E. Wallace, affirming the program's intent to reinvest in the nation's economic and security interests.
Of the settlement, half constitutes restitution, while the remainder is a penalty for the misconduct. An additional $25,000 that was part of the original grant has been withheld from Protein Engines. In a maneuver to dodge what could have been a drawn-out and costly legal battle, Protein Engines, according to the settlement, has opted to pay the $155,000 without admitting any liability.
Investigation of the case was led by the NSF Office of Inspector General (NSF-OIG), while Assistant United States Attorney Kayla C. Stahman represented the U.S. Attorney’s Office in this matter. This case serves as a stark reminder of the stringent and non-negotiable terms that come with federal funding, particularly when they are aimed at enhancing scientific and technological capacities within the United States.
