A professor who is leading the University of Minnesota Medical School's effort to write tougher ethics rules was himself disciplined in 2004 for secretly steering a $501,000 research grant to his own company, according to university investigative reports obtained by the Star Tribune.
Dr. Leo Furcht, the chairman of lab medicine and pathology, was reprimanded for a "serious violation" of university conflict-of-interest policies in connection with a grant from Baxter Healthcare for stem cell research at the Medical School, according to the investigation, which the newspaper received through the state's public records law.
As a result, Medical School Dean Deborah Powell banned Furcht in May 2004 from any business-sponsored research for three years.
In 2007, Powell named Furcht to co-chair a task force to reform the Medical School's conflict-of-interest policy.
Furcht, a nationally known scientist and author, declined to comment. He said through a spokeswoman that the matter had been 'amicably resolved, and that there was nothing to be gained by talking about it.
Powell said in an interview that she chose Furcht for the task force because he had extensive experience with national professional organizations on devising conflict-of- interest rules. 'That seemed to me to be a compelling reason to appoint him to that role,' she said.
Powell said Friday she did not inform the rest of the task force members about the sanctions against Furcht. 'I did not think it was relevant,' she said.
The Strib's summary of the previous case against Furcht was as follows:
In the late 1990s, a colleague, Dr. Catherine Verfaillie, had made a breakthrough in stem-cell research. When the university declined to patent it, Furcht created his own company, MCL, and filed for the patent along with Verfaillie and another researcher.
In July 2000, Furcht lined up a research grant from Baxter to pay for more research, to be conducted in university laboratories, but did not disclose the deal to the university. Instead, Baxter paid the money, $501,000, to MCL.
Verfaillie said Friday she performed the research in her university lab, but did not receive the money. Eventually, she contacted the dean, triggering an investigation.
A panel of three faculty members investigated and concluded that Furcht 'committed a serious violation of the conflict of interest policy,' according to a Dec. 19, 2003, report.
Among other things, they found that Furcht 'knew or should have known' that he was required to disclose the financial arrangement with Baxter, because he had 'a significant financial interest' in MCL and the stem-cell technology.
'In fact, it appears Dr. Furcht stands to personally gain several million dollars from the pending sale of MCL,' the report said.
In November 2003, Furcht sold MCL for $9.5 million in stock, sharing 5 percent of the proceeds with the university.
The panel recommended that Furcht be disciplined and questioned whether he should retain his position as department chair. It also raised concerns that he may have misused his position 'to personally benefit him and his commercial interests,' and recommended further investigation.
A follow-on report published by the Star-Tribune revealed that the University had declined to provide the newspaper with the financial disclosures of the other members of the committee tasked with writing the new conflict of interest policy. When asked directly by the reporter,
Sixteen [of 26] responded (one could not be reached).
Ten said they had nothing to disclose and six reported various relationships with drug and medical device companies -- from royalties for inventions to grants for clinical research to equity stakes in start-up firms. (Furcht did not respond.)
Apparently, the members of the committee did not even reveal their financial relationships to each other. Gary Schwitzer, faculty in the University of Minnesota School of Journalism, wrote this in his Schwitzer Health News Blog,
I was asked by the dean to serve on that task force.
I never thought I would have to poll fellow task force members about their own past or present conflicts of interest, so I didn't.
No one ever told task force members - at least not me - about the history of Furcht and Powell. Maybe everyone else knew. But I was the outsider on this task force - the journalism guy from across the street.
I am disappointed and feel misled. I'm not sure that knowing these details up front would have changed anything about the task force report. But I do know I'd feel a lot better about the process had there been full transparency and disclosure up front - which is at the core of conflict of interest policies.
Finally, it turns out this is not the first time Dean Powell has made an appearance on Health Care Renewal. In 2007, we posted about how in addition to serving full-time as medical school dean, she has a part-time position as a member of the board of directors of PepsiAmericas, raising concerns about conflicts of interest. (See those raised by the director of the public health school's obesity center.) Although Powell suggested that her position on the board would be to provide "knowledge about obesity," she was not hired by PepsiAmericas as an obesity consultant. Instead, as a board member, her main duty is to protect the financial interests of the share-holders and the corporation as a whole. Were she really to mainly function as a "voice for nutrition," she would be violating her fiduciary duty to her share-holders, a duty, by the way, for which she her total compensation was $130,651 in 2007 (see this 2087 proxy statement).
So let's see... the University of Minnesota committee charged with drafting a new conflict of interest policy included members with conflicts of interests who did not reveal these conflicts to other members of the committee. Its chair had committed a "serious violation" of the current conflict of interest policy, which was known to the medical school dean who appointed him, but which was not revealed to the rest of the committee. That same medical school dean seems to have her own significant conflict of interest, a financial entanglement about which her previous pronouncements have been at best naive.
I have not been able to find much information about what the University of Minnesota committee has recommended. The Star-Tribune only noted, "The proposed policy bans gifts from industry, faculty ghostwriting in medical journals and elsewhere on behalf of industry as well as industry funding for courses that keep faculty updated in their fields. One proposal with wide appeal calls for public disclosure on the Internet of industry relationships." It is not clear to me what the policy says about the most lucrative and presumptively influential sorts of relationships faculty and administration members may have with industry, such as receiving royalties for patents, and serving as consultants, and on speakers' bureaus, advisory boards, and corporate boards of directors. One wonders whether a committee run and partially made up by people with conflicts who did not see fit to reveal them, and reporting to a dean with a hazy notion of the meaning of her own conflicts, would be capable of fairly addressing the most significant sorts of conflicts of interest.
The public and some of the apparently few unconflicted medical academics and practicing physicians who remain in business have become increasingly disillusioned as more and more leaders in academic and clinical medicine have been revealed as part-time paid marketers of drugs, devices, and for-profit medical services. Some academic medical institutions have responded by promising reform. But will "tough" new conflicts of interest policies crafted by the conflicted really provide meaningful reform? Will people who recoil from revealing their own conflicts really be trusted to police their colleagues' conflicts?
See additional comments by Margaret Soltan on the University Diaries blog.