$243 Million Gone From UMDNJ

After yet another brief hiatus, UMDNJ is back in the news once again. The university now is operating under a federal deferred prosecution agreement with the supervision of a federal monitor (see most recent posts here, here, here and here.) We had previously discussed allegations that UMDNJ had offered no-bid contracts, at times requiring no work, to the politically connected; had paid for lobbyists and made political contributions, even though UMDNJ is a state institution; and seemed to be run by political bosses rather than health care professionals. (See post here, with links to previous posts.)

Per the Newark Star-Ledger, The federal monitor has just released another report, which included an updated estimate of the price-tag of the mismanagement at UMDNJ. The price-tag is staggering. The report said, "At this stage of our review, losses due to 'overbilling,' 'double-billing,' and 'waste' could exceed $243 million," and also, "It must be emphasized that we anticipate that this amount may increase as we continue to do our work."

Among the reports findings were:

- The initial figure of $4.9 million in Medicaid fraud at the university represents 'a mere fraction of the potential fraud, waste and financial abuse that has occurred at UMDNJ.'

- The amount that was double-billed to federal and state Medicare and Medicaid programs by UBHC in the last five years totals more than $35.5 million, and is in excess of $49 million prior to 2001.

- The state's charity care program, which reimburses hospitals for services for the indigent, was double-billed by UBHC for $11.7 million since 2001.

- UMDNJ could face a reimbursement charge of more than $52 million for overpayments from state and federal governments.

- The university's board had virtually no oversight over $104 million awarded in outside contracts in the last five years.

- Between 1999 and 2006, UMDNJ spent $3.9 million on lobbying and government-relations firms, 'all of which was improperly authorized.'

- In the last five years, more than $88 million was paid to outside contractors without the proper paperwork.

- Medicaid was overbilled more than $155,000 for food services to patients at University Hospital in Newark.

One of the most flagrant examples of over-billing for you computer buffs out there was "that $301,660.77 was billed for the simple removal of two malicious software programs -- one so-called 'Trojan horse' and one Spyware protocol -- that were found on just one desktop computer."

Some pithy comments by John Inglesino, counsel to the federal monitor:

There's certainly a fraud component, but there's a tremendous amount of waste. We have found numerous instances where vendors were paid large sums and we found no evidence that any work was ever done. [in the Philadelphia Inquirer]

There’s a culture of entitlement there dating back 20 years. Some of the people there seem to think that the money should go into their pockets or for perks for themselves and their friends. There’s a sense that people don’t have to do their jobs very well in order to remain gainfully employed and they can waste taxpayer dollars and not be held accountable. [in the New York Times]

$243 million - wasted by a single health care university? - And people wonder why health care is so expensive? And academic physicians wonder why there never seems to be sufficient money to pay for teaching and teaching programs (see post here)?

Yet Transparency International's 2006 Global Corruption Report cited corruption as an important, but often ignored drain on health care world-wide.

Will anyone take it seriously now?

By the way, as we mentioned earlier, the debacle at UMDNJ has gone on out of sight of most physicians, and health care and policy researchers, at least those outside of New Jersey. This story has gone unmentioned in any medical or health care journal, as best as I can tell from repeated PubMed searches. The anechoic effect continues. And those who are kept ignorant of history may be doomed to repeat it.

More Stories About the Fall of the FDA

Related, disturbing stories about how far the US Food and Drug Administration (FDA) has fallen have just come out.

Ketek Approval

We previously posted about the ill-fated clinical trial, study 3014, of the antibiotic telithromycin (Ketek) made by Sanofi-Aventis, run by Pharmaceutical Product Development Inc. (PPD). Problems with the trial included fabrication of data at one clinical site, and allegations of manipulation of data at another. The physician in charge of the first site was convicted of mail fraud, and the physician in charge of the second had his license suspended. Although the results of this trial were never published, it still crept into the clinical literature: it was cited in a review article in the New England Journal of Medicine. We also posted about how US Senator Charles Grassley, (Republican - Iowa), chair of the Senate Finance Committee, alleged that the FDA was covering up the process it used to approve Ketek.

Now the New York Times reported that Dr David Graham, now known as an internal FDA whistle-blower, and other FDA scientists challenged the initial approval of Ketek, to no avail. Graham wrote:

It’s as if every principle governing the review and approval of new drugs was abandoned or suspended where telithromycin is concerned.

The Times reported that four other agency officials, including Dr Charles Cooper, Dr David Ross, and Dr Rosemary Johann-Liang, "expressed serious reservations about Ketek."

Senator Grassley commented:

It’s no surprise to learn that the F.D.A. didn’t listen to Dr. Graham on the dangers of Ketek.

The F.D.A. has made it their business to discredit Dr. Graham and others who aren’t willing to cater to the drug companies.

FDA spokesperson Susan Bro countered, "Every issue or question raised during the Ketek review process and subsequently since approval has been rigorously reviewed by the nation’s best physicians, statisticians and epidemiologists both internal and external to the F.D.A."

Vioxx Aftermath

The Associated Press reported (here in USA Today) that Senator Grassley also "asked the inspector general at the Health and Human Services Department to probe whether the Food and Drug Administration and Merck acted in concert to call into question the safety findings made by Dr. David Graham, an FDA drug safety official." The report continued,

In a letter Wednesday, Grassley cited handwritten notes made by the Merck employee documenting an Oct. 13, 2004, conversation with the FDA official that suggests the two collaborated.
The FDA official mentioned an 'opportunity to get (the) message out' on Graham, a longtime employee of the agency, and provide journalists with a company critique of him, according to notes quoted in the letter.

'It is no secret that Dr. Graham was and is a critic of the FDA. However, that does not mean the FDA should scheme with drug sponsors to discredit its own employees,' Grassley said in the letter to Inspector General Daniel Levinson. The FDA, Grassley said, must maintain a 'clear, bright line between the regulated and the regulator.'

This time, FDA spokesperson Bro "had no comment."

Further details provided by AP were:

FDA e-mails seen by The Associated Press indicate that the agency shared in advance with Merck details about a presentation that Graham was to make in France in August 2004 about the dangers of Vioxx. The e-mails suggested that such a practice was commonplace.

Merck then issued a statement saying it stood by the safety of Vioxx. An FDA spokeswoman at the time said removing the drug was 'not on the table.'

The notes excerpted by Grassley indicate the FDA later went even further in helping Merck rebut Graham's work.

The FDA's Dr. Brian Harvey suggested to Merck's Dr. Ned Braunstein 'an official rebuttal on Graham,' according to the notes, which were admitted as evidence in a federal Vioxx trial.

Graham said he was 'quite shocked' to learn about Braunstein's notes.

FDA Employee Survey

The Baltimore Sun reported on a survey by the Union of Concerned Scientists of FDA scientists. The survey was sent to 5918 people, of whom 997 responded. The Sun reported that key findings were:

• "Fifteen percent of the 997 FDA scientists who answered the questionnaire said they were asked to keep information out of agency documents or alter their conclusions for nonscientific reasons."
• "Nearly one in three said the FDA doesn't routinely provide complete and accurate information to the public."
• "37 percent said the agency's leadership wasn't as committed to product safety as to approving products for sale."
• "Fifty-two percent said their job satisfaction had fallen the last few years, and 70 percent said the agency lacked the resources to carry out its mission."
• "two out of five scientists saying superiors didn't consistently stand behind staff whose "scientifically defensible positions" might have been politically controversial."
• "Eighty-one percent of respondents said the agency needed to strengthen its oversight of drugs after they go on sale."

Responses were bi-partisan. Senator Barbara A Mikulsi (Democrat - Maryland) responded, "This agency has been politicized and degraded. Many FDA employees don't feel the FDA is doing enough to protect the public's health and are afraid to speak candidly about it." Senator Grassley responded that the FDA needs "major overhaul and a culture change at the highest levels." He also said it "needs to re-establish its relationship with its own scientists and distance itself from the drug industry. The FDA needs to get rid of its mindset that it's a facilitator for the drug industry and become regulator once again. The FDA's focus should be only on science and the public good."

Spokesperson Bro responded by criticizing the "scientific rigor" of the survey, and charging "This is a counterproductive exercise based on leading questions and innuendo. For centuries, science has depended on rigorous and disciplined processes to distill truth from exploration and debate -these principles above all others guide our daily work at the FDA on behalf of the American public health."

By the way, regarding technical issues about the survey: I agree that a response rate of less than 20% does raise concern about the generalizability of the results of the survey. However, given the content of the responses (and given the content of some written comments made on the sruvey), these results are still very disturbing. And I'm not sure on what Ms Bro's charge that the survey questions were "leading" was based.
Unfortunately, these stories make it even more imperative for doctors and patients to be extremely skeptical about what they are being told about pharmaceutical products, even by the formerly respected FDA.
These stories added together suggests that Senator Grassley's call for a complete overhaul of the FDA is on target. Unfortunately, the FDA, once regarded as a paragon of integrity (albeit one that may have been ponderous, bureaucratic, and sometimes inefficient), seems to have fallen into the same muck that too many other health care organizations, from hospitals to to managed care organizations to pharma and device manufacturers now occupy. Thus now doctors and patients must be extremely skeptical about nearly anything they hear about health care when it is said by someone who could possibly have vested interests other than improving patient care or the integrity of science.

We have a lot of overhauling and much-raking to do. Meanwhile, we have to work in a health care system in which doubt, ambiguity, and skepticism rule.

NOTE: See the takes on this by Pharma Gossip here, here, and here. See a related story by Dr Aubrey Blumsohn on the Scientific Misconduct blog here.

How Hospital CEOs Get Paid Tens of Thousands to Advise Hospital Suppliers

The New York Times just reported on the activities of an organization called the Healthcare Research and Development Institute (HRDI).

Despite its name, HRDI is a "for-profit company owned by about three dozen hospital executives, but underwritten by 40 or so of its handpicked corporate members, all suppliers to hospitals." These "executives benefit from payments made by companies their hospitals do business with." HRDI industry members are limited to "only two competing companies in any specific field."

The purpose of the organization is apparently to give hospital suppliers access to the CEOs of large not-for-profit hospitals. "Last May, more than 130 representatives from 40 health care companies were scheduled to attend confidential consulting sessions at the Broadmoor, a Colorado Springs hotel. When not attending the sessions, hospital chief executives and suppliers mingled at company-sponsored tennis, golf and social events. Each year, H.R.D.I. holds two gatherings like the one in Colorado, where each corporate member gets a meeting of up to three hours with five or six chief executives, according to [HRDI CEO]Mr. Mecklenburg." "'The typical organization is paying $40,000,' Mr. Mecklenberg said. 'It can be more, but that would not be typical.' Additional access to hospital executives and their institutions can cost companies $55,000 a year or even more. For example, a special two- to three-day visit to a specific hospital costs $2,000 a person, according to H.R.D.I., which says most of that money is eventually passed on to the hospital."

"It is unclear exactly how much hospital executives, who are the shareholders of the healthcare institute, earn annually for consulting at the two conferences. Asked to verify a report that some members earned as much as $50,000, Mr. Mecklenberg initially denied it. 'Our observation and recollection is $20,000 to $30,000 a year,' he said. 'It may be more than that but we don’t have data in front of us, but it’s certainly not $50,000.'

Mr Mecklenberg himself has an interesting history. He is "a former chairman of the American Hospital Association, the industry’s largest trade group." Furthermore, now he "not only runs a large nonprofit hospital, Northwestern Memorial in Chicago, but he also serves on the board of Becton, Dickinson and Company, a major supplier of medical devices to hospitals around the world, including his own. Becton, Dickinson pays the institute for marketing advice, and the institute pays Mr. Mecklenburg $50,000 a year, mostly for participating in two national conferences, according to the group."

HRDI is now under the scrutiny of Connecticut Attorney General Richard Blumenthal, who "is investigating whether the organization allows certain vendors to buy access to hospital leaders who are in a position to influence what supplies or services their institutions purchase. As a result, Mr. Blumenthal said, hospitals may not be getting the best deals, either in terms of cost or quality. 'At the very least it suggests insider dealings — an insidious, incestuous, insider system,' said Mr. Blumenthal...." He is also investigating whether the limitation on HRDI membership to only two companies from each sector violates anti-trust regulations. Mr Blumenthal recently testified that HRDI is a "secretive" network of "ethically questionable business arrangements." Note that until recently, the organization did not allow public access to its web-site, and did not list its members, although its current membership list and list of corporate sponsors are currently on the web.

The Times' investigative reporting has opened yet another window on the pervasive web of conflicts of interest that entangles health care. The report reveals problems at multiple levels:

• Hired leadership of not-for-profit hospitals seem to be personally profiting from their positions of trust
• Hospital leaders not only have cozy relationships with at least some suppliers, but are paid handsomely by these same suppliers for their supposed market advice, raising questions about how effectively their hospitals will negotiate with these suppliers
• The leader of the organization that makes these cozy relationships possible is simultaneously a not-for-profit hospital CEO and a member of the board of directors to a major hospital supplier, and hence has a fiduciary duty to that organization that seemingly clashes with his duty to his main employer

You just can't make this stuff up.
And people wonder why health care is so expensive? And think that the only solution to the rising cost of health care is to keep cutting physicians' fees for "cognitive services?" (See post here.)
Note that the well-publicized article by Brennan et al that castigated physicians for accepting so much as a coffee mug with a company logo from a drug or device company would have put academic medical center administrators in charge of enforcement of this stringent policy, the same administrators who may personally get paid tens of thousands of dollars to sit give market advice to the companies whose logos are on the coffee mugs. LOL. (See post here.)
Instead, as we have said before, there needs to be a broad, impartially enforced policy that bans major conflicts of interest affecting all decision makers in health care.
And we need some of leaders of large health care organizations, not just pharma and device companies, but also managed care organizations and insurance companies, hospitals, academic medical centers and health care systems, and medical schools and universities, to to look in the mirror to see who has been dodging responsibility for rising costs, declining access, stagnant quality, and demoralized providers.

MedPundit is Back Too

And now MedPundit is back too. Every day things get better and better in every possible way. Could Healthy Policy be next?

More Ambiguous Financial Arrangements at the NIH

We have posted frequently, most recently here and here, about conflicts of interest affecting top US National Institutes of Health (NIH) scientists and leaders.

The Los Angeles Times again has published another investigative report (in two articles, here and here) on relationships between officials at the NIH and pharmaceutical and bio-technology companies. The articles focused on Dr Thomas J Walsh, Head, Immunocompromised Host Section, Pediatric Oncology Branch, Center for Cancer Research and the National Cancer Institute (NCI).

The articles raise two questions:

• Were Walsh's spoken or written comments about anti-fungal drugs influenced by his relationships with several pharmaceutical companies, particularly when Walsh was speaking to US Food and Drug Agency (FDA) advisory panels as an NIH scientist?
• Were clinical studies of these drugs, with which Walsh was involved in a variety of ways, designed so that they were likely to favor particular drugs?

Since the issues raised by the second question are very complex, I can't hope to try to answer it without spending a lot of time reading reports of all the trials, and relevant background information. So I will set it aside for now.

The issues raised by the first question are perhaps clearer. I will summarize what the articles said about Dr Walsh's relationships with several companies.

Merck & Co

By 1999, Walsh was collaborating with Merck & Co., on its new antifungal drug, Cancidas.

Merck persuaded the FDA to conduct a fast-track review of Cancidas for a more narrow use: treating aspergillus in patients who had either not tolerated or failed to improve while taking another antifungal drug.

On Jan. 10, 2001, representatives of Merck — assisted by Walsh — presented the company's case for approval of the drug to the FDA advisory committee in Bethesda.

Walsh, in his statement to The Times, said: 'I did not appear as a consultant to Merck.'

But that is how Merck identified him to the FDA committee, both orally and in a slide.

Tamara Goodrow, a Merck regulatory affairs official, said: 'Merck has brought several consultants to the meeting today so that they are available to facilitate the advisory committee's discussion and deliberations.' Goodrow then named the consultants, including 'Dr. Thomas Walsh.'
Another Merck official said Walsh served as the head of a company committee of three researchers who assessed how patients with aspergillus infections had responded to treatment with Cancidas in the smaller company study.

A videotape of the meeting shows, Merck's senior director of clinical research, Dr. Carole A. Sable, gestured to the audience and said: 'Perhaps Dr. Walsh, who is actually the head of our expert panel, would like to make a comment.'

Walsh strode to the podium, took the microphone and assured the FDA committee that Merck's case-by-case information for the 69 patients was reliable.

An editorial by Walsh, published in December 2002 by the New England Journal of Medicine, referred to an antifungal drug made by Merck & Co. — but did not mention his receipt of fee income from the company. The journal's conflict-of-interest policy requires authors to acknowledge such income.

After inquiries from The Times, the journal asked Walsh to submit a revised disclosure statement. A spokeswoman for the journal, Karen Pedersen, said Walsh had 'failed to disclose' the income from Merck when he submitted the editorial. On March 16, the journal published a correction, saying the editorial 'should have included the fact that Dr. Walsh received an honorarium from Merck.'

Walsh told The Times that his lack of disclosure was inadvertent.

A Merck spokesman said recently that Walsh was paid a total of $3,000 in fees, in 1999 and 2001, not related to his involvement with the company's drug. Walsh said in his statement to The Times that Merck had not paid him for any appearance before the FDA.

U.S. conflict of interest law generally prohibits a federal employee from representing anyone before a government agency, regardless of whether outside compensation is paid.

Fujisawa USA Inc

The first major study that Walsh helped lead compared one of the new, modified drugs, AmBisome, with conventional amphotericin.

The study was paid for by the developer of the new drug, Fujisawa USA Inc., and by a grant from the NIH. Walsh had conferred about the study design with Fujisawa and with a national network of other physicians who would carry out the project.

On July 16, 1997, Walsh anchored Fujisawa's presentation of AmBisome to the FDA advisory committee, which met in Silver Spring, Md. The FDA's agenda listed Walsh as part of the 'Fujisawa USA Presentation.'
Fujisawa's vice president for regulatory affairs, Jerry Johnson, told the FDA committee: 'Our presentation will conclude with Dr. Walsh presenting the key results from the U.S. study.'

Walsh narrated a series of slides and told the committee that AmBisome 'was more effective in preventing proven invasive fungal infections and fungal-infection-related deaths' than conventional amphotericin.

In his recent statement to The Times, Walsh said: 'I have never appeared at any FDA meeting as a consultant to Fujisawa.' Referring broadly to industry, Walsh also said: 'While a company might consult with me, i.e., in the generic sense of seeking my insights or knowledge, these are not consultancies in the official, governmental sense, but rather collaborations.'

A spokeswoman for Fujisawa, which now operates as Astellas Pharma US Inc., said the company had paid the NIH for Walsh's efforts dating to the 1990s and the development of its first antifungal drug, AmBisome.

'He's been a consultant of ours since the early days, since the preapproval of AmBisome, through currently,' said the spokeswoman, Maribeth Landwehr, adding that the company had paid for Walsh's 'general consulting' by writing checks to the NIH, not to him. Fujisawa, she said, paid 'at a rate which we believe to be acceptable.'

Vestar Inc., a San Dimas company that developed AmBisome originally and later in partnership with Fujisawa, also worked closely with Walsh. Richard T. Proffitt, a co-inventor of AmBisome who headed research for Vestar, said the company collaborated with Walsh on testing the drug in animals.

Proffitt said Walsh suggested that Vestar could make contributions to a foundation that would make funds available for Walsh's research. Proffitt said that from about 1990 to 1993, Vestar wrote checks, totaling approximately $60,000, to the foundation. Proffitt said he did not recall its name. 'It wasn't like he implied that we had to give money to the foundation,' said Proffitt. 'But he certainly gave me the foundation name.'

Records obtained under the Freedom of Information Act show that some companies supported Walsh's government research by making donations to the Gift Fund of the National Cancer Institute.

For instance, in March 1998, Fujisawa sent Walsh a $40,000 check to the fund along with a letter of explanation, saying the money was intended for his government laboratory and '"clinical research program.' Fujisawa also told Walsh that the money could be used for 'personnel, support services and travel,' plus equipment and supplies.

After reviewing the NIH's overall policy for accepting gifts, the Government Accountability Office last year raised concern. The federal auditors said the NIH's policy 'does not provide sufficient assurance that potential conflicts of interest between NIH and donor organizations will be appropriately considered.'

Pfizer Inc.

Walsh also has consulted with Pfizer, said Mariann Caprino, a spokeswoman for the company. She said Walsh was paid from 2001 to 2005 for participating in private meetings at Pfizer 'to discuss clinical trial designs.'

'We did compensate him for his time,' Caprino said in an interview.

When Pfizer brought its antifungal drug before an FDA advisory committee in October 2001, a company executive identified Walsh as part of its 'sponsor section.' The FDA approved the drug, Vfend, about seven months after the advisory committee meeting.

'He attended the advisory committee in the capacity of an expert in this area,' Caprino said, adding: 'His relationship was fully disclosed by us at that meeting.'

Walsh said that he was not paid by Pfizer to attend the meeting. He did not respond to questions seeking details about his compensation from Pfizer.

Caprino declined to state how much Pfizer had paid Walsh over the years, but said: 'He received a standard per-diem rate. Basically, that compensates him for time out of the office.'

In response to questions from the LA Times,

In written comments for this article, Walsh said his advice to industry did not conflict with his position at the NIH's National Cancer Institute, or affect his scientific judgment.

'I am not and have never been a representative of, or advocate for, any pharmaceutical company,' Walsh said.

Walsh, 54, heads a medical research and treatment unit within the pediatric branch of the National Cancer Institute, where he arrived in 1986. He said that collaborating with companies has been fundamental to his government work.

'My efforts are in service of the public interest in sound, reliable science concerning potentially effective agents for the treatment of life-threatening infections in children and adults with cancer,' Walsh said in a statement to The Times. 'This mission frequently includes collaboration with companies that research and develop new compounds in this area — for example, utilizing my [staff's] expertise to ensure that clinical trials relating to these compounds are designed and implemented in a manner that elicits reliable and useful results.'

He said he has appeared before the FDA only 'as a government scientist providing information and/or evaluation' regarding clinical trials. Referring to studies he helped lead, Walsh said, 'There is no conflict of interest, and the trials were well and appropriately designed.'

This tangled story reminds us of several points.

When people have financial relationships with multiple organizations with differing agendas, it is hard to tell who they are representing at any given time.

People who have such financial relationships often seem honestly unaware of how others may perceive the relationships, and seem to ignore the influence of particular relationships, while acknowledging the influence of others.

My conclusions are:

• There is nothing wrong with government-industry, or academia-industry collaborations.
• However, those physicians, researchers, faculty, and administrators involved in such collaborations should not try to work for two or more parties whose interests are not necessarily the same.
• If the actors in a particular collaboration do have conflicts of interest, the rest of us must be very skeptical about interpreting what they say and understanding what they do

With any luck, since the NIH has restored the rigor of its policies about conflicts of interest, its collaborations with industry should produce less ambiguous results.

It would be nice if other government agencies, and also academic medical institutions, would also develop much more rigorous policies about conflicts of interest. Meanwhile, we need to be very skeptical about assessing their work.

More Lucrative Stock Options for Top Health Care Company Executives

The Wall Street Journal has reported yet another way companies have developed to make stock options more lucrative for their top executives. Two examples cited involved well-known health care companies. (Since the article is not available without a subscription, I will quote extensively.)

On Sept. 21, 2001, rescuers dug through the smoldering remains of the World Trade Center. Across town, families buried two firefighters found a week earlier. At Fort Drum, on the edge of New York's Adirondacks, soldiers readied for deployment halfway across the world.

Boards of directors of scores of American companies were also busy that day. They handed out millions of bargain-priced stock options to their top executives.

The terrorist attack shut the U.S. stock market for days. When it reopened Sept. 17, stocks skidded more than 14% over five days, in the worst full week for the Dow Jones Industrial Average since Germany invaded France in May 1940. But for recipients of options, the lower their company's stock price when options are awarded the better, since the options grant a right to buy shares at that price for years to come. The grants set recipients up for millions of dollars in profit if the shares recovered.

Ninety-one companies that didn't regularly grant stock options in September did so in the first two weeks of trading after the terror attack. Their grants were concentrated around Sept. 21, when the market reached its post-attack low.

Stock options were originally designed to align executives' incentives with the goals of shareholders, encouraging recipients to work hard to improve their companies' stock price. When those options are granted at favorable prices, executives get some of their gain free -- that is, they get a chance to buy in an unusual dip below the price many investors have paid.
There's nothing illegal about granting options after the market plunges. But acting so quickly after a national tragedy drove down stocks shows the eagerness of some companies to increase their executives' potential wealth. These grants also offer important new fodder for an already fractious debate over what constitutes the proper use of options in executive compensation.

UnitedHealth Group

Some of the post-9/11 grants were extraordinarily well-timed, hitting the exact low for the period. At least six of the companies that granted options dated after the attack are under investigation in the wider options-timing probe. That raises the question of whether some grants that appear to have been granted in the post-attack period were actually made later, then backdated.

UnitedHealth, which granted stock options dated shortly after the terror attack, also faces investigations of its other options practices by the Securities and Exchange Commission and federal prosecutors. The former CEO of one UnitedHealth unit, R. Channing Wheeler, received option grants dated on quarterly lows for four straight years, 1999 through 2002. In September 2001, UnitedHealth gave Mr. Wheeler 96,000 options, adjusted for later stock splits, priced at the managed-care company's post-9/11 quarterly low. UnitedHealth declined to comment and Mr. Wheeler didn't return calls.

On UnitedHealth's compensation committee in September 2001 were New York investor William Spears, Columbia University nursing dean Mary Mundinger and former New Jersey Gov. Thomas Kean -- later head of the federal commission that investigated Sept. 11 intelligence failures. Mr. Kean and Ms. Mundinger didn't return calls, while Mr. Spears declined to comment.

Stryker Corp

At Stryker Corp., a Michigan maker of orthopedic products, onetime stock-option-committee member John Lillard said he didn't regret the decision to award options nine days after the attack. 'If you believe the company is going to do well, and here is an external event that is affecting the market and you've made a decision to reward executives, you go ahead with it,' Mr. Lillard said. 'Life goes on.'

At Stryker, in Kalamazoo, Mich., post-9/11 stock-option grants to several executives appear to have been initiated by the chairman and CEO at the time, John W. Brown. They were dated Sept. 20, 2001, at the bottom of a sharp 'V' pattern in the share price.

Mr. Brown would 'periodically tell us if he thought the stock was attractive,' and then the board would decide whether to award options, said Mr. Lillard, the former member of Stryker's stock-option committee. 'We didn't just sit down after Sept. 11th and say, 'Gee, how can we take advantage of this?' ' Mr. Lillard said. Besides, he added, no one could have known whether the stock would rebound immediately or continue to slide.

Mr. Brown said that for the past 10 to 12 years, the company, to compensate for a relatively small number of options given to executives, has tried to 'pick what we think would be the low point of the year. That's what we're gunning for.'

Stryker's option grant came on the lowest closing stock price for the second half of the calendar year. Mr. Brown said he believes that he called both members of the stock-option committee on Sept. 20 to recommend they choose that day to grant options. He added that he couldn't remember a time when the board didn't follow his advice.

Mr. Brown said that while he didn't remember the details of the 2001 grant, 'that was the year of 9/11. I'm sure that the market hammered us and that was the reason I was doing it at that time.'

Mr. Brown, still chairman but no longer CEO, said he could understand how it might strike some as unseemly to give executives stock options so soon after a catastrophe. 'That would be a legitimate point, I suppose,' he said.

He added that in retrospect, he probably wouldn't have advised that the grant be given. Today, Mr. Brown said, Stryker gives its grants during a relatively narrow period in the spring.

This seems yet another illustration about how focused the top leadership of large health care corporations are on the compensation they receive.

Furthermore, as we have commented before (here and here, and see links to earlier posts), there has been a marked contrast between the compensation received by UnitedHealth Group top executives, especially CEO Dr William McGuire, and the company's mission "to make health care more affordable."

And we wonder why health care is so expensive, and why health care costs rise faster than inflation?

Widespread Conflicts of Interest at Stanford: the Dean Responds

In an a commentary fo the San Jose Mercury News, Dr Philip A Pizzo, the Dean of the Stanford University School of Medicine responded to the series of articles in that newspaper documenting widespread conflicts of interest at the Medical School, which we posted about here and here. Some key quotes:

What would be the cost to the health of the American public if such ties between academia and industry were severed?

It should be noted that the federal government has explicitly promoted these ties since 1980, when Congress enacted the Bayh-Dole act, which authorized and encouraged universities to hold ownership of inventions made under federal funding. In fact this law mandates universities and private industry to work together to bring the fruits of university research to the public. This process has resulted in many medical innovations and advances that have improved the lives of millions of Americans.

There are now some 1,000 therapies and technologies that are based on university-licensed discoveries.

Of course, collaboration between university researchers and private companies carries with it the potential for conflicts of interest. The July 9 article describes one way Stanford addresses this: by requiring faculty members to disclose potential conflicts, regardless of the dollar amount of the financial interest.

But disclosure is far from the only strategy that the Stanford School of Medicine uses to protect the public's interest. When we identify a significant conflict, we take steps to eliminate, mitigate or manage it. These steps include modifying the research plan, disclosing the conflict to the public, disqualifying a faculty member from participating in all or a portion of a research project and in some cases requiring the faculty member to sever a relationship with industry.

As for the July 10 article, it is important to point out that Dr. Alan F. Schatzberg's research over the past 25 years has been consistently subject to rigorous peer review by scientific leaders at the National Institutes of Health and throughout the nation. His research findings have been published in highly respected peer-reviewed medical and scientific journals.

It is misleading to air criticism of his pilot studies for lack of statistical significance when, in fact, the studies were exploratory and not designed to show statistical significance in the first place. More important, and above all, through his research and care of patients, Dr. Schatzberg is a man devoted to alleviating the pain and suffering of those who face the challenge of the most severe and chronic forms of depression.

Dr Pizzo's response did not seem to address the points made in our previous posts about the conflicts at Stanford. (Of course, he probably has not read our posts.)

It also seems important to note that criticizing conflicts of interests does not mean criticizing the general concept of industry-academic collaboration. However, there are many ways in which universities and corporations can interact that minimize such conflicts. For example, for-profits can sponsor research at universities, but need not control the design and implementation of studies, and the analysis and dissemination of their results.

However, the examples described in the San Jose Mercury News were not simply of academic researchers collaborating with industry. They included researchers and academic leaders who owned substantial numbers of company stock options, who had corporate administrative titles, or who sat on corporate boards while doing research on the companies' products, or as full-time academics expressing opinions on topics relevant to the companies' products. It is not clear why university researchers need to get stock options, administrative positions, or board memberships from corporations in order to work collaboratively with them.

Furthermore, how can an academic be "full-time" while working for industry in an administrative position, or getting the sort of incentives that corporations usually only give to top management and key employees? At a minimum, a person in such a situation should acknowledge being only a part-time academic.

Finally, an academic who also works for industry ought to make completely transparent what masters he or she serves when expressing opinions about topics relevant to the company's product or service. Such opinions may be regarded differently than those from true full-time academics. But that's life.

However, what sort of trust is inspired when an author of scientific articles about a drug turns out to be not just a full-time university professor with some "financial interest" in the company that makes the drug, but the Chairman of the Board of the company?

Pharma Watch is Back

Pharma Watch is back on the air. Now we can hope for the return of Healthy Policy and MedPundit.

Widespread Conflicts of Interest at Stanford: Affecting the Board of Trustees

We recently posted about reports of widespread conflicts of interest at Stanford University School of Medicine found in an investigative series in the San Jose Mercury News (see links here and here).

Just before that series was published, the San Francisco Chronicle was looking into conflicts of interest affecting the Stanford University Board of Trustees.

The most glaring example was of Trustee Mary Cranston, who runs a law firm entitled Pillsbury Winthrop Shaw Pittman. But, "according to its 990 tax form, Stanford paid $2.18 million in legal fees during fiscal 2003-04 to Pillsbury Winthrop Shaw Pittman." Also, "Pillsbury Winthrop has consistently ranked among the five highest paid independent contractors the university used between 2001 and 2004. The firm earned between $937,000 and $2.7 million annually during that period."

Although "Stanford has done business with Pillsbury Winthrop since 1993, and Cranston began serving as trustee in 2000. Only in the most recent tax form filed with the IRS that has been made public -- for the year ending Aug. 31, 2004 -- did Stanford make clear it did significant business with one of its trustees' companies and give details."

The Chronicle interviewed governance experts who found the relationship between Stanford University, Ms Cranston, and her law firm "troubling." "Such relationships, they said, while not illegal, can be inherently problematic because they can make it difficult to avoid conflicts of interest or, at least, the appearance of conflicts of interest. As a trustee, she is a watchdog for the university at the same time her law firm is paid millions of dollars for legal advice and litigation services. 'It affects the perception of her ability to be independent,' said Charles Elson, chairman of the John L. Weinberg Center for Corporate Governance at the University of Delaware. 'If she voices opposition to the administration, the fear is the law firm loses legal fees -- that's the public perception.'

The Chronicle found that "Cranston declined to discuss the matter. In January, she announced plans to step down as chairwoman of Pillsbury Winthrop at year's end to become a senior partner. A spokesman for Stanford, which as a private institution does not open its business records to the public, said the university stands by the relationship. Jeff Wachtel, senior assistant to [University President John] Hennessy, said Cranston would recuse herself from any legal decisions. 'We're confident this is an appropriate relationship,' he added. Burton McMurtry, chairman of the Stanford board, agreed, saying people like Cranston are too valuable to exclude simply because there's a potential conflict of interest -- a conflict that can be managed. 'You would cut off your nose to spite your face if you eliminate all people who could have a potential conflict,' he said.

In my humble opinion, it is hard to believe that among the immense pool of talented Stanford alumni and donors one could not find capable potential board members whose firms do not do major business with the University.

The Chronicle also noted other potential conflicts of interest involving Stanford University's board:

-- University President John Hennessy, an ex officio member of Stanford's Board of Trustees, serves on the board of Google Inc. Stanford had $282 million invested in Google as of as of Aug. 31, 2004. According to the federal Security and Exchange Commission, Hennessy owns $2.5 million in Google stock and an additional 44,300 shares in stock options.

-- Former Stanford trustee William Landreth served as an advisory director for Goldman Sachs, an investment banking firm that underwrote $50 million in bonds for the university at the time Landreth was a board member.

-- Stanford trustee Jon Blum served as managing director for Morgan Stanley, an investment banking firm that underwrote $80 million in bonds.

I believe that the corporate culture of contemporary universities, which hardly operate as representative democracies, for better or worse is set at the top. Thus it should not be surprising that a university whose top leaders have conflicts of interest would also be susceptible to conflicts of interest affecting medical school leaders and faculty.

When leaders and faculty up and down the university and medical school hierarchy have financial arrangements with outside organizations whose interests may not always coincide with those of the university or the medical school, one wonders whom these leaders and faculty really speak for, what mission they really put first, and how well an academic institution with such leaders can fulfill its academic and clinical mission.

How Pfizer Cloaks Its Lobbying

Bloomberg News reported how companies have "increased their lobbying and other efforts to influence public officials by funding nonprofit groups to promote corporate goals without publicly disclosing backers." Such non-profit groups "can legally engage in lobbying and can air political ads that don't advocate the election or defeat of a candidate. The groups aren't required to report their financial backers except on their annual tax returns. Bloomberg News obtained lists of donors to nonprofits from state regulators, who often receive copies of the groups' tax returns. Donations to these organizations, which are known as 501(c)(4) groups after the section of U.S. tax code under which they operate, aren't tax-deductible."

One corporation who has used this strategy is Pfizer Inc., the world's largest pharmaceutical company.

Pfizer gave $145,000 in 2000 and 2001 to the 60-Plus Association and United Seniors Association, tax records show. The two groups paid for ads in 2002 supporting Republicans who backed the proposed Medicare prescription drug benefit, enacted the following year. One was Representative Nancy Johnson, 71, of Connecticut, according to a study of the campaign by University of Connecticut professor Sarah Morehouse and researcher Sandra Anglund.

Earlier, the 60-Plus and United Seniors groups joined an organization called Citizens for Better Medicare. In 1999 and 2000 it aired ads in western states opposing then-President Bill Clinton's proposed drug benefit, which would have been run by Medicare rather than by insurers and health-maintenance organizations, according to Public Citizen.

The drug industry's trade organization, Washington-based Pharmaceutical Research and Manufacturers of America, of which Pfizer is a member, gave at least $1.56 million to 60-Plus and United Seniors in 2001 and 2002, tax records show. The donations by Pfizer and the trade group were first made public in 2004 by a newsletter of AARP, the Washington-based senior-citizens' advocacy group.

Pfizer spokeswoman Darlene Taylor said in a statement that the New York-based company 'complies fully with all federal, state, and local laws and reporting requirements.' The company's Web site lists its political contributions that are publicly available through reports to the Federal Election Commission. It doesn't mention donations to nonprofit groups like the 60-Plus Association and United Seniors.

Ed Fulginiti, a spokesman for Arlington, Virginia-based 60- Plus, said in a statement his group doesn't reveal the names of its more than 1 million donors, whose gifts averaged less than $20. Charles Jarvis, chief executive officer of United Seniors, based in Fairfax, Virginia, wasn't available for comment.

Bloomberg quoted Taylor Lincoln, from the organization Public Citizen, who said donations like those above "appear to be in clear evasion of the intent of lobbying disclosure laws, even if they are legal." They also appear to be essentially deceptive. In the examples above, Pfizer cloaked its lobbying activities in the garb of grass-roots citizens' organizations.

We recently posted about how Pfizer CEO Henry McKinnell defended his huge compensation in the face of decreasing stock prices. He said his work should be judged not so much by stock prices but by how he has added "long-term value" to the company, and that only his board of directors is competent to judge that value.

I wonder whether the Pfizer board thinks that a reputation for evasive lobbying practices adds to that long term value? (And the previous post mentioned above wondered if a reputation for questionable marketing practices, as alleged in the recent European Consumers International report, also added to that long term value.)

Conflicts of Interest at Stanford: the Mifespristone Studies

Paul Jacobs' series on conflicts of interest at Stanford University also included a detailed case study.

Its subject was Dr Alan F Schatzberg, Chair of the Psychiatry Department at the Medical School. Dr Schatzberg is currently running a federal grant on mifepristone as a treatment of depression. Dr Schatzberg has previously been the senior author of two related articles:
- Belanoff JK, Rothschild AJ, Cassidy F, DeBattista C, Baulieu E, Schold C, Schatzberg AF. An open label trial of C-1073 (mifepristone) for psychotic major depression. Biol Psychiatr 2002; 52: 386-392. (Link here.)
- Flores BH, Kenna H, Keller J, Solvason HB, Schatzberg AF. Clinical and biological effects of mifepristone treatment for psychotic depression. Neuropsychpharmacol 2006; 31: 628-636. (Link here.)

The first article disclosed that the study was supported by a grant from Corcept Therapeutics, and that Schatzberg has "a financial interest" in the company, as did other authors.

The second article disclosed support from the National Institutes of Health. It further noted, "Dr Alan Schatzberg is cofounder of Corcept Therapeutics and is the only author involved in this resubmission who has any financial interest in the company. However, Dr. Schatzberg continues to be full-time faculty at Stanford University. Dr. Schatzberg played no direct role in the recruitment, assessment, or follow-up of subjects enrolled in this study. Dr. Schatzberg was not directly involved in the analysis of data stemming from this research."

Nonetheless, Jacobs' article showed that Schatzberg's ties to Corcept Therapeutics were extensive:

With the backing of Silicon Valley biotech investors, Schatzberg and [Dr Joseph K] Belanoff [a research fellow in psychiatry] in 1998 founded Corcept Therapeutics.

Belanoff became the company's full-time chief executive officer. Schatzberg took a seat on the board of directors and a part-time post as chairman of the company's scientific advisory board, a job that now pays him $60,000 a year. He and his family were granted 3 million Corcept shares for $1,000 -- today worth nearly $12 million.

After the company was formed,

Schatzberg decided he could no longer play a direct role in RU-486 studies in depression. But he remained principal investigator with overall responsibility for NIH grants that have paid for ongoing Stanford research on the drug Corcept hopes to market.

Schatzberg says he helped design the RU-486 studies being conducted on campus but leaves it to others to recruit patients, administer treatments and analyze results. Monitoring committees at NIH and Stanford review the studies to ensure patient safety.

However, Schatzberg acknowledges that he has considerable influence over the junior faculty members doing the studies. As chairman of psychiatry, he helps set their salaries and can affect their career advancement. And he continues as a co-author of the resulting papers.

After the study reported by the first paper above was performed,

on the strength of these early findings, Corcept had raised $29 million from private sources. Four months later, the results of the five-patient pilot study were published in a scientific journal, claiming 'a rapid reversal of psychotic depression.'

Just before Christmas that year, Corcept filed plans with the Securities and Exchange Commission to raise as much as $90 million in an initial public stock offering. While the company waited to issue stock, Schatzberg, Belanoff and others reported in the journal Biological Psychiatry the results of the larger Corcept-sponsored study of RU-486 in 30 patients at six academic centers, including Stanford.

However, some strongly criticized this study.

Bernard Carroll recalls first reading the Biological Psychiatry study in his home-office in Carmel, where he runs his non-profit institute, the Pacific Behavioral Research Foundation.

'The spin was unmistakable,'' Carroll said. His reaction, he said, was 'sadness and dismay at the low standards evident in the report and in the editorial commentary.'' That commentary, written by the journal's editors, described the work as a possible 'paradigm shift in the treatment of depression.'

Later that afternoon, he got a call from his friend Robert Rubin, then a professor of psychiatry at Drexel University and Allegheny General Hospital in Pittsburgh. The two had become self-appointed guardians of scientific rigor in psychiatric research -- gadflies who periodically fire off salvos to journals to complain about papers that don't measure up to their standards.

They sent such a letter to Biological Psychiatry. They criticized Schatzberg for claiming the drug 'may be the equivalent of shock treatments in a pill.' They accused the authors of 'obfuscation' and the editors of ignoring the study's 'fatal flaws.'

Schatzberg and Belanoff responded, saying the letter was an 'ad hominem attack,' and that Carroll and Rubin had 'cut and pasted snips of quotes . . . and mis-characterized what we said.'

Weighing what to do with this unusually heated exchange, the journal's editors sent the correspondence to four outside, anonymous reviewers, who split, two and two, on whether the letter and response should be published. In the end, the editors decided not to print the exchange, setting the stage for Carroll and Rubin to go public in Puerto Rico [at the 2004 meeting of the American College of Neuropsychopharmacology].

[There] Schatzberg's critics publicly unveiled their critique of his work in the form of a poster -- really a scientific paper in outline form, pinned to a board in an exhibit hall.

The contents were explosive.

The poster, by Drs. Bernard J. Carroll and Robert T. Rubin, systematically picked apart the conclusions in three published studies of RU-486 in depression, two by Schatzberg and his colleagues, one by an independent group.

But in a departure from the usual give and take of scientific debate, the poster quoted positive public statements about the drug by Schatzberg and other researchers and juxtaposed those statements against the individual's financial interest in Corcept.

There, for example, was Schatzberg saying RU-486 may be 'the equivalent of shock treatments in a pill' and a statement pointing out that he owned 3 million shares of Corcept stock. The point was hard to miss: Researchers with a financial interest were expressing 'considerable enthusiasm' for a treatment of questionable effectiveness.

The poster was seen by many of the top brain scientists in the country, people whose opinions matter deeply to Schatzberg as well as his critics. Carroll, former head of psychiatry at Duke University and now semi-retired in Carmel, recalls that people came up to him during the session, slapped him on the back and said, 'It's about time somebody said this.'

But he and Rubin soon learned that other members, Schatzberg among them, were furious. A lawyer for Corcept says the ACNP admonished Carroll and Rubin for their conduct. Both Carroll and Rubin say they were faulted for making their criticisms public, not for the content of the presentation.

Even now, Schatzberg can hardly contain his anger. 'Those that are critical,' he said, 'ought to be careful about impugning others.'

Two independent experts asked by the Mercury News to review the three key RU-486 studies co-written by Schatzberg side with Carroll and Rubin.

University of California-San Francisco Professor of Medicine Stanton A. Glantz, the author of 'Primer of Biostatistics,' found several statistical errors in the papers he was asked to look at.

'These are elementary statistical methods,' he said. 'They have applied them incorrectly.' The result was to 'bias their results toward reporting an effect when the data doesn't justify that. Scientists shouldn't make these dumb mistakes.'

The other expert is Steven G. Self, a professor at the University of Washington, who heads the program in biostatistics and biomathematics at the Fred Hutchinson Cancer Research Center in Seattle.

Commenting on the 2002 paper in Biological Psychiatry, he said, 'there is no evidence at all' for a meaningful difference in the response of patients given high doses of RU-486 and those given a very low dose presumed to have no effect at all. All you have to do is look at the data, he said, to see this. 'No formal statistics are required.'

Schatzberg said that applying statistical analyses to these small, preliminary case studies is 'absolutely silly.' And Corcept CEO Belanoff agrees.

I will add a few technical comments. The 2002 Biological Psychiatry paper was an "open-label trial" in which all 30 patients got some dose of mifepristone. It had no control which received placebo or another drug. Given the unpredictable course of depression, it is impossible to tell whether any differences seen in groups receiving different doses of the drug were due to effects of the different doses, or the natural variability in the course of disease across patients. Many authorities on evidence-based medicine would hugely discount studies of drug or other treatments that did not randomize patients to the treatment of interest or some comparison treatment. (See, for example, Guyatt GH, Sackett DL and Cook DJ. Users' guides to the medical literature. II. How to use an article about therapy or prevention. A. Are the results of the study valid? JAMA 1993; 270 2598-2601. )

The study is so small, moreover, that any differences could simply have been due to random noise. Thus, the study's conclusions that "mifepristone appeared to be effective" seem to go beyond the evidence provided.

Furthermore, the disclosure in this article seems not to convey the degree of financial involvement of Dr Schatzberg in Corcept Therapeutics.

The important investigative reporting by Paul Jacobs in the Mercury News gives us an important example again of how pervasive are conflicts of interest among leaders of academic medicine. Unfortunately, the pervasiveness of such conflicts means that everyone now ought to be skeptical about in whose interests academic medicine now speaks and acts.

Widespread Conflicts of Interest at Stanford: Defining Deviance Down?

The San Joses Mercury News just published a major series of investigative reports about conflicts of interest at the Stanford University School of Medicine, written by Paul Jacobs. In three articles published Sunday (How Profits, Research Mix at Stanford; Federal Rules Often Go Unenforced; and How We Did This Series), Jacobs describes the scope of conflicts of interest at the Medical School.

First, for an overview:

• The school's 700-plus faculty members last year disclosed 299 potential conflicts of interest related to their research, according to figures provided by Stanford.

• Potential conflicts occur throughout the school's ranks. More than a third of the school's administrators, department heads and other leaders -- at least 26 out of 67 reviewed by the Mercury News -- have reported outside financial interests related to their research within the last four years. These are scientists who are role models for junior faculty members and graduate students.
• Perhaps most important, seven of the 10 members of the school's conflicts of interest committee, which is responsible for enforcing the rules, have financial relationships with medical companies. Unlike a comparable committee at the University of California-San Francisco, Stanford's panel includes no outside volunteers.

And here are some telling anecdotes:

One researcher has founded six companies, most based on research that came out of his own lab. He is a managing partner of a venture capital firm focused on medical research and sits on the boards of several other companies. His role at the venture company was approved by the dean several years ago because he has no day-to-day management responsibilities. The researcher is a member of the school's conflict of interest committee.

One senior associate dean started a biotech company based on her federally sponsored lab work.

And the physician who until January chaired the department of gynecology and obstetrics is a longtime director of Wyeth, which manufactures controversial hormone replacement therapy for women -- therapy she defended in 2002 when potentially serious health risks were emerging.

Note that this information was not easy to obtain. Jacobs wrote:

To get information for this series, the Mercury News:

• Obtained correspondence between the university and the National Institutes of Health for the past five years under the federal Freedom of Information Act.

• Searched medical journals, most of which require authors to disclose any conflicts when they publish an article, and disclosures accompanying speeches given at medical conferences.

• Reviewed corporate news releases and other documents filed with the Securities and Exchange Commission, which frequently list information about faculty members who are company founders, directors or scientific advisers.

Stanford's main response to conflicts of interest is to require disclosure, and if necessary, management.

Stanford medical school has a 10-member conflict of interest committee, created in 2001 to oversee how substantial conflicts that exceed certain thresholds are handled. All faculty members are required to disclose their financial relationships at least once a year. Those reports go to the school's conflicts manager, who determines which cases must go to the committee.

The committee does its work in secret.

Stanford admininstrators defended the University's approach to conflicts of interest. For example,

'I'm not really sure where this wild West idea came from,' said Dr. Harry B. Greenberg, a senior associate dean for research. 'Very early on, Stanford has been associated with a lot of entrepreneurial activity and people may have equated the ability to carry out entrepreneurial activity with lack of oversight and regulation. I really don't think that has been the case.'

[However,] Greenberg holds stock options in and is a consultant to MedImmune, which makes an influenza vaccine he is studying under a federal grant.

Also,

However, despite rules requiring prompt reporting of substantial conflicts, Stanford failed to report six grants to NIH until after the Mercury News asked NIH and Stanford earlier this year for documentation of conflicts. Med school spokesman Costello said the failure was an administrative error and that all the scientists followed Stanford's disclosure rules.

One of those six grants involves Greenberg, a senior associate dean for research and chairman of the school's conflict of interest committee.

Greenberg is an expert on vaccines. In late 2000, he took a two-year leave from Stanford to become vice president of research at Aviron, now MedImmune Vaccines, where he helped develop the Mountain View company's nasal flu vaccine, FluMist. While there, he made the case for FDA approval of FluMist to the agency's vaccine advisory committee, which he had chaired just nine months before.

Today, Greenberg remains a paid member of MedImmune's scientific advisory board and holds stock options issued while he was employed by Aviron. He said the options are ``still underwater,'' meaning that exercising them would cost him more than the stock is currently worth. ``I had a great time at Aviron, but becoming filthy rich was not part of it, unfortunately,'' he said.

He is also one of three Stanford scientists now working on a federal grant to compare MedImmune's FluMist vaccine and Fluzone, a more traditional, injectable vaccine from Aventis Pasteur. Both vaccines have been approved by the FDA and are commercially available.

The principal investigator on the NIH-funded grant, which was worth $3.1 million last year, is Dr. Ann Arvin, the Stanford-wide associate dean for research -- a position with responsibility for faculty conflict of interest issues across the university.

For the past several years, she, like Greenberg, has been a paid member of MedImmune's scientific advisory board and holds stock options in the company.

The husband of a third researcher, Dr. Elizabeth Mellins, was vice president for clinical research at MedImmune Vaccines and helped bring FluMist to market. Mellins says she has no direct involvement in the clinical trial.

I will let the reader be the judge of how convincing Greenberg's defense of how Standford handles conflicts of interest is. Some are skeptical, though.

'There is a focus on procedural solutions and this magical belief that disclosure is the answer as opposed to dealing with the fact that many of these things should not be allowed,' said Barbara A. Koenig, a bioethics researcher at the Mayo Clinic and former executive director of Stanford's Center for Biomedical Ethics.

Tufts University Professor Sheldon Krimsky, author of 'Science in the Private Interest,' argues that fields such as law have stricter conflict policies than universities. A judge, for instance, isn't allowed to have any financial relationship with a party that might benefit from a ruling.

But is disclosure enough? Being on a corporate board of directors, for example, carries a legal responsibility that can clash with the interests of students and patients, said Dr. Roy Poses, who runs the non-profit Foundation for Integrity and Responsibility in Medicine. [That's you - ed. I know.]

'I am quite surprised that there seem to be many leaders in academic medicine, who also simultaneously have clear responsibilities to protect the interests of corporations and stockholders,' he said.

As the man said, read the whole thing.

My comments, in addition to the one above, are that this is yet another demonstration about how pervasive conflicts of interest have become in health care in general, and in academic medicine in particular. While conflicts have become so pervasive, individuals with conflicts may seem to blithely disregard any possible downside to such relationships. Thus, this seems to be an example of defining down deviance.

In my humble opinion, however, such pervasive conflicts threaten the core mission of academic medicine. If substantial numbers of faculty and administrators have major financial entanglements with outside organizations whose goals are to sell products or services (or to promote ideologies or belief systems, for that matter), how can one trust the medical school or academic medical center to provide unbiased, disinterested teaching, research, and patient care?

Aubrey Blumsohn Joins the Blogsphere

We have posted several times (most recently here, with links backward) about the story of Dr Aubrey Blumsohn's dispute with Proctor and Gamble (P&G) and Sheffield University in the UK. In summary, Blumsohn and Professor Richard Eastell had done clinical research on the risedronate (Actonel), sponsored by P&G, the drug's manufacturer. P&G refused Blumsohn access to the original data from the study he was ostensibly running, and hired a ghost-writer to write abstracts in his name. Blumsohn protested to Eastell, who advised him not to make waves because P&G "is a good source of income" for the university. When protests to other university officials produced no results, Blumsohn told the story to the press, whereupon the university suspended him.

Dr Blumsohn has now joined the blogsphere. His effort is entitled the "Scientific Misconduct Blog." Based on his upclose and personal experience with concentration and abuse of power in health care, I'm sure he will have some interesting and perceptive things to say. Stay tuned.

The Anechoic Effect Explained

In a new book from Oxford University Press, The Elephant in the Room, Rutgers sociologist Eviatar Zerubavel explains more broadly what I've been noticing for quite some time in medicine, something I've called the anechoic effect. Why is it that folks can behave like such miscreants and everyone turns a blind eye?

Turns out there is a real science, and tons of data, behind the mechanism for this phenomenon of "conspiracies of silence." I plan to read the whole book, having just read reviews and excerpts so far. But I want to bring it, in the meantime, to the blog readership's attention.

In the book notes, the author (or his editor) notes that, unlike the parable of the Emperor's New Clothes, "the denial of social realities--whether incest, alcoholism, corruption, or even genocide--is no fairy tale." Further, "the longer we ignore 'elephants,' the larger they loom in our minds, as each avoidance triggers an even greater spiral of denial."

Sound familiar?

In a useful explanation of his approach to selective memory, presented to the University of Virginia several months ago, Zerubavel talks about the "sociology of attention," in which the intensely social activities of remember things, "telling on" one's colleagues, and whistle-blowing (another, even more fraught form of "telling on") all become susceptible to "denial and oblivion."

Do things like this happen in healthcare? Let us know what you think.

Pay for Whose Idea of Performance?

In the US, the latest fashionable approach to controlling health care costs and improving quality is "pay for performance" (of physicians) (P4P). We have posted several times about why P4P may not yet be ready for prime time (most recently here and here.) Our main concerns were:

• Use of outcome measures not adequately adjusted for disease severity and other relevant patient characteristics may lead to perverse incentives.
• Process-based measures may assess processes not under physicians' control, and hence be invalid.
• Use of often inaccurate administrative data may threaten measures' validity.
• Measures intended to control costs will not control quality.
• Measures focused on only a few processes will distract from improving quality for other patients, physicians, and problems.

David Healy's recent discussion of how sponsors may manipulate research studies to increase the likelihood of getting results that support their vested interests suggests yet another problem with pay for performance (see our post here).
Healy concentrated on ways in data from pharmaceutical company sponsored studies of selective serotonin reuptake inhibitors (SSRIs) for depression were manipulated to minimize the apparent harms of these drugs.
There is already anecdotal evidence that pharmaceutical companies have manipulated how data about SSRIs is disseminated, even suppressing unfavorable data. A meta-analysis that included previously unpublished data suggested that the risks of treatment with some SSRIs for children and adolescents outweighed their benefits, although data from published trials showed benefits commensurate or outweighing risks. (Whittington CJ, Kendall T, Fonagy P et al. Selective serontonin reuptake inhibitors in childhood depression: systematic review of published versus unpublished data. Lancet 2004; 363: 1341-1345.) The authors concluded, "drug sponsors who withhold trial data (or do not make full trial reports available) undermine the guideline programme, which can ultimately lead to recommendations for treatments that are ineffective, cause harm, or both."
Two years ago, the Canadian Medical Association Journal reported that "an internal document advised staff at the international drug giant GlaxoSmithKline (GSK) to withhold clinical trial findings in 1998 that indicated the antidepressant paroxetine (Paxil in North America and Seroxat in the UK) had no beneficial effect in treating adolescents." (Kondro W, Sibbald B. Drug company experts advised staff to withhold data about SSRI use in children. Can Med Assoc J 2004; 170: 783.)
There is also evidence that pharmaceutical companies manipulated the discussion of SSRIs by supporting the publication of ghost-written articles. For example, David Healy also determined that Pfizer Inc. paid Current Medical Directions, a medical information company, to prepare 85 articles on sertraline (Zoloft). Of these 55 were published, often in widely read and prestigious journals, outnumbering other articles on the drug published from 1998-2000. (Healy D, Cattall D. Interface between authorship, industry and science in the domain of therapeutics. Brit J Psychiatr 2003; 183: 22-27. Link is here.)
Thus, Healy's latest article combined with previously available information raises strong doubts about the integrity of the data available to support the wide-spread use of SSRIs in depression. Furthermore, it is not clear whether physicians' generally favorable attitudes to treatment of depression with SSRIs were unduly influenced by articles cloaked in academic raiments, but actually ghost-written at the behest of pharmaceutical companies. This suggests we physicians ought to be re-thinking how we treat depression, and when and if to treat depression with SSRIs.
However, some P4P schemes incorporate measures of treatment of depression with SSRIs.
For example, the proportions of patients treated acutely and chronically with antidepressant drugs are two of 26 clinical performance measures in the Ambulatory Care Quality Alliance "Recommended Starter Set" of measures. This group of measures is one of the more widely measured prototypes to support P4P. (Note that although the measure does not specifically limit antidepressants assessed to SSRIs, these are certainly now the drugs most widely used as "antidepressants.") This measure was actually obtained from the National Committee on Quality Assurance, and appears to be part of the HEDIS measures already used in a voluntary system to rate health plans.
Thus it appears that P4P risks becoming a way to promote products whose manufacturers have suppressed clinical research, manipulated its design, performance, and analysis, or manipulated the dissemination of its results.
Credible P4P programs must only use measures clearly supported by clinical research data of unquestioned integrity. They should not be use measures designed to promote the vested interests of particular organizations, such as, but not limited to pharmaceutical companies, ahead of the interests of patients.
Physicians must clearly ask whose idea of performance are we supposed to be paid for?

"Can We Tame the Monster?"

Provoked by Dr David Healy's revelations about how drug companies manipulated the clinical research literature about selective serotonin reuptake inhibitors (SSRIs) (see post here), and the continuing Vioxx scandal, British Medical Journal Editor Fiona Godlee has taken on the pharmaceutical industry with a radical proposal. (See her editorial: Godlee F. Can we tame the monster? Brit Med J 2006; 333: )

She wrote that the SSRI and Vioxx cases are just symptoms of "a wider disease: an overpowerful, under-regulated drug industry and a research establishment and publishing industry in its thrall." Although, "between the interests of the public and the commercial interests of drug companies stand two potential safeguards—journal peer review and drug regulation," both these safeguards are stressed. "The pressures on journals to publish drug industry trials include the need for newsworthy content and revenues from reprint sales. These pressures are intensifying, and recent examples of selective reporting and data manipulation have made clear that peer review in its current form is unequal to the task." Meanwhile, "drug regulators too seem unequal to their task. Critics focus on their close relationship with industry; their lack of transparency; their lack of systematic post marketing surveillance; and an emphasis on efficacy over patient safety, which favours industry."

Dr Godlee's solution is radical: "Drug companies should not be allowed to evaluate their own products. To get their products licensed they would contribute to a central pot for independent, publicly funded clinical trials."

This is certainly bolder than the cautious proposals I put forth in response to Dr Healy's latest article. Therefore, Dr Godlee's approach may be more effective.

My major worry is how difficult it will be to make clinical trials truly independent. In the US, the natural approach would be to have the federal government fund and supervise the trials, to be done by medical schools and academic medical centers.

However, we have shown repeatedly how pervasive conflicts of interest are in these institutions (see recent post here). Would the most conflicted academic medical leaders really allow research to be independent? Would faculty members with all sorts of financial ties to the makers of drugs and devices really conduct independent evaluations of them?

In my humble opinion, to re-establish clinical research that is independent of vested interests, we will have to tear about the web of conflicts of interest that pervades global health care.

More on How Research Sponsors May Increase the Likelihood of Getting the Results They Want

Here in the US, during the week of July 4, it seems like everyone was on holiday, and the medical news has been quite slow. But in the UK, July 4, of course, is not a holiday, and interesting stories continue to appear.

The most recent issue of the British Medical Journal included an important commentary by Dr David Healy [Healy D. Did regulators fail over selective serotonin reuptake inhibitors. Brit Med J 2006; 333: 92-95.] It included a catalog of sophisticated techniques used by pharmaceutical companies to manipulate studies, in this case of selective serotonin reuptake inhibitors (SSRIs), so that the results would tend to favor their products. In particular, these included:

• Attributing adverse events that occurred during the placebo run-in period prior to a trial to the group that received the placebo during the trial, thus inflating the adverse event rate for the placebo group, and making the adverse event rate in the group treated with the active drug (manufactured by the pharmaceutical company that sponsored the trial) look comparatively lower. Healy noted that both GlaxoSmithKline and Pfizer, "faced with the claim made here about the way in which data had been presented to regulators, have not denied what happened.... Pfizer makes it clear that: 'Pfizer's 1990 report to FDA plainly shows ... 3 placebo [suicide] attempts as having occurered during single blind placebo phases.'"
• Attributing adverse events that occurred after the conclusion of a trial again to the placebo group, with a similar effect on interpretation of the results. "Crucially until GlaxoSmithKline's recent letter, the publicly available figures for suicides among paients on placebo in trials of paroxetine contained three suicides, all of which occurred after the active treatment phase of trials had finished."
• Analyzing adverse events that are most likely to occur soon after a drug has been started using time-dependent statistical methods that assume a "constant hazard" over time, which may dilute out the statistical significance of the events.
• Analyzing data that compare rates of adverse events in different arms of controlled trials using multi-variate statistical approaches, which may dilute out the statistical significance of differerences in the rates across patient groups. Such techniqutes ought to be superfluous in a succesfully randomized trial. Randomization should make it very unlikely that there would be differences between the groups that need to be corrected by such statistical techniques. Randomization so unsuccesful that it would require such statistical correction to analyze adverse effects ought to raise doubts whether any of the trial's results are valid. "Imbalances in these variables should be contained in the confidence interval that lies clearly in the region of the adverse effect."

These issues are obviously highly technical, and might be hard for the typical practicing physician to understand. That seems to be the point. Pharmaceutical companies and other organizations that sponsor research and have a vested interest in having the research come out a certain way may be able to devote resources to figuring out fancy ways to design, conduct, and analyze research trials that make it more likely that the results will end up favoring the sponsors products. Such manipulation may be difficult to detect for anyone without a good grasp of the concepts underlying evidence-based medicine.
We have previously posted about other, sometimes simpler, techniques that research sponsors with vested interests may use to increase the likelihood they will get the results they want (see posts here and here).
The increasing evidence that clinical research may be manipulated by sponsors with vested interests to increase the likelihood of results favorable to them, and now that the techniques used to perform such manipulation may be very sophisticated, suggests:

• Physicians (and other health professionals, and patients, and policy-makers) need to be increasing skeptical about research sponsored by those with vested interests.
• Physicians really need to be familiar enough with research design, implementation, and analysis, that is, with the concepts underlying evidence-based medicine, to critically and skeptically review important research studies well enough to discover such manipulation.
• Since no physician has the time and expertise to review but a small fraction of the available studies, we need to develop watchdog organizations that will skeptically review such research, independent of any influence from vested interests.

Meanwhile, every claim for new medicines, devices, and diagnostic tests that is based on research sponsored by those with vested interests should be taken with extreme skepticism.

"From Optimism to Disillusion about Commitment to Transparency in the Medico-Industrial Complex"

Iain Chalmers has just published an important commentary. Its content is evident from the title above. (Full citation: Chalmers I. From optimism to disillusion about commitment to transparency in the medico-industrial complex. J Royal Soc Med 2006; 99: 337-341.)

Chalmers began by explaining why he was optimistic during the 1990s that the pharmaceutical industry was beginning to show willingness to increase the transparency of the clinical research they sponsored. However, towards the end of the decade, disillusionment set in, as he found that promises were not being kept. Although there was some apparent progress after Eliot Spitzer, the Attorney General for the state of New York in the US, sued GlaxoSmithKline "for witholding information about important possible adverse effects of drugs taken by children for depression," this again appeared illusory. Chalmers wrote,

Only then did the drug industry start to try to limit the damage caused by its failure to follow the lead given by Schering Healthcare and Glaxo Wellcome nearly a decade earlier. In a press release issued in June 2004, GlaxoSmithKline announced that it would make the results of all its clinical trials publicly available. The company did not explain how, given that its trials register had been allowed to fall into disrepair, the public would know whether all results were being made available.

If GlaxoSmithKline really is committed to the kind of openness the public has come to realise is needed, one might have expected it to have endorsed the Good Publication Practice for Pharmaceutical Companies Guidelines developed by its dismissed former employees and colleagues in other companies. It has not. Indeed, at the time of writing, only six pharmaceutical companies have endorsed the guidelines—Aventis, Amgen, LEO Pharma, Otsuka, Serono and 3M Pharmaceuticals.

On 6 January 2005, the industry announced a global commitment to clinical trial registration and publication. Whether this commitment amounts to the‘big changes' that Richard Sykes judges are needed is an open question. First, the commitment applies to only a tiny proportion of the clinical trials which should be informing prescribing practices because it is not being applied to trials conducted in the past. Second, there is a continuing flow of empirical evidence of biased reporting and interpretation of industry trials. My judgement is, therefore, that industry's actions are simply too little and too late to deal with its current reputation for being less than honest with its research....

Chalmers' conclusions were striking.

Biased under-reporting of research harms and sometimes kills patients, quite apart from the waste of resources that results from this form of scientific and ethical misconduct.

As I have made clear, biased reporting and lack of transparency is not limited to commercially-sponsored research; but the empirical evidence makes clear that it is a particularly noticeable problem in that sphere. Those who collaborate with industry need to be clear that their acquiescence in these forms of scientific misconduct inevitably casts doubt on their integrity....

The responsibilities of doctors should be unambiguously to their patients. Yet some clinician researchers (with plenty of encouragement from government and the institutions with which they are associated) appear to have become so seduced by the financial rewards resulting from collusion with industry's agenda and practices that they have forgotten this most fundamental of their professional duties. Indeed, that is the most depressing cause of my optimism of a decade ago becoming disillusionment today.

Chalmers ended with some practical suggestions:

1. All pharmaceutical companies should join Aventis, Amgen, LEO Pharma, Otsuka, Serono and 3M Pharmaceuticals in publicly endorsing the Good Publication Practice Guidelines for Pharmaceutical Companies
2. Industry as a whole should put in place mechanisms for promoting and monitoring adherence to these guidelines, thus making clear to the public that it regards under-reporting of research as just as serious a form of scientific misconduct as fabrication of data
3. Industry should voluntarily take steps that go beyond the minimum currently being required for clinical trial registration,30 for example, by publishing full protocols at the inception of all randomized trials.

Good ideas. Is anyone listening, especially the institutions that have been encouraging researchers into sometimes dubious industry collaborations, and the researchers themselves who have entered into these collaborations without protest?

Echos of Previous Scandals in the For-Profit Hospital Sector

Two stories have surfaced that echo previous scandals.

HealthSouth

Former HealthSouth CEO Richard Scrushy was just convicted of crimes including bribery, conspiracy, and mail fraud, per the Birmingham (AL) Business Journal. He was "accused of buying his way into the state's Certificate of Need review board" by "arranging $500,000 in donations to a campaign committee for [former Alabama Governor Don] Siegelman in exchage for a seat on the state's certificate of need review board, the regulatory body that determines bed capacity at existing health-care facilities and approves construction requests for new facilities based on demonstrated demand." Scrushy is no longer at HealthSouth. The company's spokesman Andy Brimmer said said that the company is working to "put our past behind us. Mr. Scrushy is part of HealthSouth's past and today's verdict has no impact on the company."

Scrushy is still facing civil lawsuits initiated by the US Securities and Exchange Commission (SEC) and private investors, per the Associated Press.

Tenet Healthcare

According to the Los Angeles Times, "Tenet Healthcare, the nation's second-largest hospital chain, today agreed to a $900-million settlement to resolve numerous government investigations into allegations that the company overcharged Medicare for treatment for its sickest patients. The Dallas-based company also announced that it was selling 11 hospitals, including its facilities in New Orleans, as Tenet struggles to recover its financial health and emerge from years of government investigation and litigation regarding its business practices." Note that "Tenet has not settled all government probes into its business practices. The company said it is continuing to resolve a Securities and Exchange Commission investigation into the financial reporting of outlier and other payments."

To pay for the settlement, Tenet will sell 11 hospitals. Per the Philadelphia Inquirer, Tenet plans to sell three hospitals in the Philadelphia area, "Graduate Hospital and Roxborough Memorial Hospital in Philadelphia and Warminster Hospital in Bucks County." "Tenet entered the Philadelphia market with the purchase of eight hospitals from the bankrupt Allegheny health system in 1998. In a few years, the hospitals seemed highly profitable. But the success proved illusory after the firm's billing problems emerged." "Since 1998, Tenet has closed or sold four hospitals in the Philadelphia area: City Avenue Hospital, Parkview Hospital, Elkins Park Hospital, and Medical College of Pennsylvania Hospital."

It's ironic that Tenet's latest problem will lead to its divestment of its former Allegheny hospitals. The bankruptcy of the Allegheny Health Education and Research Foundation (AHERF) was one of the classic cases of health care mismanagement. One classic aspect was that despite the size of the case - the AHERF bankruptcy at its time was the second-largest bankruptcy to have happened in the US - the case was quite anechoic. No comprehensive account of the case has appeared, to my knowledge, in the medical or health care literature. For my summary of the case, see this link.

Our failure to appreciate the history may have doomed us to relive it. How many cases of failed health care organizations will it take before we as a society start to address the epidemic of poor leadership of such organizations?