Conflict-of-Interest: Prescription Drugs, Medical Equipment and the Medical Profession

Editor’s Note: Please also see our article: Medical Ethics and Research with the Elderly

(7/3/15)- Pharmaceutical and medical-device companies paid a total of $6.49 billion to more than 600,000 U.S. doctors and 1,100 teaching hospitals in 2014 according to figures released by the government under the terms of the Affordable Care Act.

Services rendered for the payments included consulting, research and promotional speeches about drugs as well as meals provided and promotional items and drugs to doctors’ offices.

The Affordable Care Act included a provision nicknamed the Sunshine Act, which requires manufacturers of drugs and medical devices to disclose most payments and free promotional values made to physicians and teaching hospitals.

The data is available online at the Center for Medicare and Medicaid Services (CMS) site under Open Payments.

(6/10/14)- The health-insurer Humana, Inc. has brought a lawsuit against Medtronic Inc. for an unspecified amount of damages, alleging violation of the federal criminal law known Racketeer Influenced and Corrupt Organization Statute (RICO). Humana alleges that Medtronic promoted physicians to use its bone-growth product Infuse in certain spine and neck surgeries, even though the FDA never approved it for such usage.

Humana alleges that Medtronic paid $210 million to prominent physicians who promoted its usage by recommending the product in medical journals. The complaint further alleges that Medtronic tried to conceal the payments to “key opinion leaders”. This unlawful conduct led to the insurer having to pay millions of dollars in insurance payments.

Humana filed its suit in the U.S. district Court for the Western District of Tennessee and is entitled to three times the amount of its damages under RICO, if it prevails in the lawsuit. In its suit, Humana referred to the findings in a 2012 U.S. Senate hearing report that determined that Medtronic was guilty of violating the law in connection with its marketing of the product.

(12/18/13)-Andrew Witty, GlaxoSmithKline PLC’s chief executive announced that the company will shortly cease to pay doctors to promote its drugs and would also end the practice of paying its sales representatives by the number of prescriptions he/she induce physicians to write for the company’s drugs. The company is presently being investigated in China for allegedly bribing medical professionals in that country.

Under the plan, the company would cease to pay medical professionals to speak on its behalf about its products or the disease they treat “to audiences who can prescribe or influence prescribing”. This practice would apply worldwide, and would end no later than 2016.

Glaxo would also stop providing financial incentives to doctors to attend medical conferences worldwide, since it already has ceased this practice in the United States. It would continue to pay physicians for market research and would also continue to provide “unsolicited, independent educational grants” to continue educating doctors about the company’s products.

The company’s sales representatives would be paid based on their technical knowledge, the quality of service provided to clients to improve a doctor’s patient care, and the company’s business performance.

(4/17/13)- The Patient Protection and Affordable Care Act that was passed in 2010 requires about 1.100 pharmaceutical companies and medical devices manufacturers to report payments to individual doctors on their websites. The federal government plans to post that data online.

Pfizer Inc's payments to health care professionals totaled $173.2 million in 2012, down 11% from 2011, according to data posted on the company's website.

GlaxoSmithKline reduced overall payments to U.S. physicians by 20% to $971 million in 2012, compared to 2011.

Pfizer cut its spending by more than 60% on expert-led forums in 2012 to 1,539 such events compared to 3,569 such events in 2011, Average payments per professional declined to $5,380 from $6,119.

There are now 44 medical schools that ban or severely restrict faculty participation in pharmaceutical speakers' bureaus, according to a report in the American Medical Student Association.

(1/28/12)- Under the terms of the new health care law that was passed in 2010, the administration was supposed to establish a medical payment reporting system by October 1, 2011. The public will have until February 17 to comment on the proposals and the Department of Health and Human Services will then issues final rules with the force of law.

Analyses by the New York Times found that about a quarter of doctors take cash payments from drug or medical device manufacturers, and that nearly two-thirds accept gifts of food either for themselves or their staff.

The Obama administration has recently issued the standards required under the law. If a company has even only one product covered by Medicare or Medicaid, it will have to disclose all its payments to doctors, medical professionals, pharmaceutical companies and medical equipment companies other than its own employees. The federal government will post the data on a Web site where it will be available to the public.

The administration estimates that more than 1,100 drug, medical device and medical supply companies will have to file reports. Federal officials will inspect and audit the accuracy of the reports. Companies will be subject to a penalty of up to $10,000 for each payment they fail to report. A company that knowingly fails to report payments will be subject to a penalty of up to $100,000 for each violation, up to a total of $1 million a year.

A senior official of the company must attest to the accuracy of each report.

(4/7/11)- According to the results of a study that was published in a recent edition of Archives in Internal Medicine most doctors writing medical-practice guidelines for cardiology have biases when they have financial ties to the manufacturers, even if those ties are disclosed. By merely disclosing the ties, the potential for a conflict of interest is not erased.

The researchers looked at 17 sets of guidelines issued from 2003 through 2009 by the American Heart Association and American College of Cardiology. The guidelines ranked scientific evidence of the safety and effectiveness of various treatments for heart disease, stroke and artery blockage, and recommended certain treatments over others.

Of 34 doctors on a 2008 panel to write guidelines on defibrillators and pacemakers, only seven had no financial connection to a related medical company.

James N. Kirkpatrick of the University of Pennsylvania led the researchers. In another example that was cited, 56% of the 498 doctors who helped write guidelines for treatment of heart ailments had potential conflicts of interest.

(7/27/10)- Effective January 1, 2011, professors at Harvard Medical School will no longer be able to take industry financing to speak for drug or medical equipment companies. They also will not be allowed to accept gifts, travel or meals under a new conflict-of-interest policy recently announced by the school.

A $10,000 limit was placed on the amount a faculty member can be paid by a company whose product or invention is under study by the faculty member. The previous limit had been $20,000.

The policy changes had been recommended in March by a 34-member review panel and accepted recently by Dr. Jeffrey S. Flier, dean of the medical school.

(7/22/10)- It has come to light that Dr. David Capuzzi, an endocrinologist from Philadelphia, who was one of the panelist who voted in favor of GlaxoSmithKline PLC's diabetes drug Avandia at the recent advisory panel meeting that approved continued use of the drug, is a paid speaker for the company.

The panel voted 20-12 to keep the drug on the market, with 17 members of the panel favoring a stronger warning to be placed on the drug's label. Dr. Capuzzi was one of the three panelists who did not favor adding an additional warning to the drug's label.

Glaxo's website shows that he received $3,750 from the company as a speaker from April 2009 through March 2010. A Glaxo spokesman also indicated that he had received a total of $8,000 in payments before this period of time, and an additional $3,000 in the second quarter of this year, making the total payments $14,750.

Dr. Capuzzo said he had told the FDA about his relationship with Glaxo. The FDA said that it was checking its records to see if this was true and, if so, why it was not told to the committee.

(5/23/10)- Francis Collins, the director of the National Institutes of Health announced that under new rules to take effect later this year, medical researchers receiving U.S. grants, who have been paid more than $5,000 by pharmaceutical companies must publicly disclose the payments to their institutions.

Universities would have to list those "significant financial interests" on their Web sites once the rules take effect.

Current rules require researchers on U.S. financed projects to notify their universities of financial ties that exceed $10,000, but do not require the institutions to publish that information online.

(12/20/09)- The latest governmental agency to come under fire for failing to adhere to conflict-of-interest standards is the Centers for Disease Control and Prevention (CDC). In a new report that was recently released, it was determined that the CDC did a poor job in screening medical experts for potential conflicts-of-interest when it hired them to advise the agency on vaccine safety.

Daniel R. Levinson, the inspector general of the Department of Health and Human Services, issued the report.

The report found that 64% of the advisers had potential conflicts-of-interest that were never identified or were left unresolved by the CDC. Thirteen percent failed to have an appropriate conflicts form on file at the agency at all, which should have barred their participation in the meetings entirely, and 3% voted on matters that ethics officers had already barred them from considering.

Dr. Thomas R. Frieden, the new director of the CDC agreed with the report's findings and stated that the agency had already taken steps to remedy the failures.

(10/20/09)- A new standardized form aimed at curbing conflict-of-interest questions among medical researchers will be used by many of the leading medical journals and publications. Many health experts are questioning the form, saying that it goes too far in examining issues that should be private matters of the individual researchers.

The new form comes from the International Committee of Medical Journal Editors, and was published last week by all of the group's members, which include the New England Journal of Medicine, Lancelot and the Journal of the American Medical Association.

In addition to consulting work and honoraria, researchers must disclose when they provide expert testimony, receive grants or accept payments for manuscript preparation, patents or royalties.

Researchers are required to disclose non-financial conflicts, such as religious and political affiliations. Financial relationships involving spouses, minor children or partners will have to be divulged. The new form will be broken in by the medical journals and publications over the coming months.

(7/31/09)- As a follow-up to our item dated 6/11/09, Dr. Jeffrey Wang, has been removed as co-executive director of the UCLA Comprehensive Spine Center while the university continues to investigate his failure to disclose the payments that he received from pharmaceutical and medical equipment companies whose products he was studying.

It is alleged that between 2002 and 2008, Dr. Wang repeatedly failed to report on the forms filed with the state and the medical school that he was receiving consulting payments, stocks, options and royalties from five companies on whose products he was conducting research.

Dr. Wang remains on the school faculty, but the university has appointed a committee to investigate Dr. Wang's work and determine whether the payments affected his work results.

Senator Charles Grassley, Republican of Iowa, and Senator Herb Kohl, Democrat of Wisconsin have introduced a bill in the Senate that would require companies to report payments to doctors of more than $100.

(7/15/09)- The Journal of the American Medical Association (JAMA) backed off its policy that ordered public silence from anyone filing a complaint about medical study authors possible undisclosed financial conflicts until a probe is completed. To see the background on this matter please refer to our item dated 4/9/09 below.

The editors now say they will tell anyone bringing a complaint that confidentiality would help in "gaining full cooperation of all parties with knowledge of the facts."

The original order, in March of this year, came after JAMA was criticized for taking five months to acknowledge that a study that was written by Robert Robinson, a psychiatrist at the University of Iowa failed to disclose that he had a financial relationship with the maker of the drug studied

(6/18/09)- Emory University now has a second member of its staff involved with a conflict of interest matter, but this time the university is acting faster than it did in the first matter. The university announced that its medical school dean has issued a letter of reprimand on April 30 to psychiatrist Zachary Stowe related to his "external relationships."

Dr. Stowe was instructed to immediately eliminate conflicts related to current federal grants and was barred from having any conflicts for the next two years. We at thrubins wonder why the period of time for the conflicts is only two years, when in fact such conflicts of interest should be a life time matter.

The first situation involved Dr. Charles Nemeroff, who was chairman of the psychiatry department at the university until he stepped down last year under a cloud, as we discussed in out item date 3/9/09 below.

Dr Stowe, the director of the Women's Mental Health Program at Emory, is considered a leading expert on the use of anti-depressants in pregnant women. He was listed as the primary investigator on at least three National Institutes of Health grants, that involved anti-depressant use in pregnant women, and the effects on children delivered by those women. He failed, however to report that he had been paid $154,400 by GlaxoSmithKline PLC in 2007 and $99,300 by the same company in the first 10months of 2008.

Glaxo is the maker of the antidepressant Paxil. He also made 95 promotional talks on behalf of the company.

(6/11/09)- Dr. Jeffrey Wang, chief of spine surgery at UCLA, did not inform the school of about $459,500 that he received from drug makers and medical equipment manufacturers while he was researching their products according to a May 21 letter from Senator Charles Grassley (Rep-Io) to the school's chancellor.

State university researchers in California are required to disclose any financial ties to non-governmental entities funding their work. If a researcher fails to file such a report, or if the report contains erroneous information, the researcher is subject to civil liability, as well as university discipline.

Maine, Massachusetts, Minnesota, Vermont and West Virginia have enacted laws requiring medical companies to disclose payments to in-state doctors, with certain exceptions.

According to Senator Grassley's letter, Medtronic Inc., the DePuy subsidiary of J&J and FzioMed Inc., made payments to Dr. Wang, which included payments for royalties on products Dr. Wang helped develop for the companies.

(4/19/09)- The American Medical Association announced that it has asked an oversight committee to investigate the matter that we discuss in our item dated 4/9/09. Theoretically JAMA operates with editorial independence from the AMA but a seven-member committee, its Journal Oversight Committee evaluates the actions of the editors of the journal.

The oversight committee is a standing body of the AMA that has editorial responsibility for JAMA, including evaluating the performance of the editor-in-chief.

(4/9/09)- The Journal of the American Medical Association (JAMA) has set off a firestorm among medical journal editors by instituting a new policy that requires anyone who complained about study authors published in JAMA who had failed to disclose payments from drug companies, or others that pose a conflict must remain silent until the Journal has had sufficient time to investigate the complaint.

JAMA editors, in the online edition of the Journal, criticized the actions of Jonathon Leo a professor of neuro-anatomy at Lincoln Memorial University in Harrogate, Tenn , who brought out the fact that Robert Robinson, a psychiatrist at the University of Iowa, who wrote up a study in the Journal about the use of antidepressants in stroke patients had a financial relationship with Forest Labs, the maker of the drug.

JAMA took five months to acknowledge that the author of the study, which was published last year, had a financial relationship with the manufacturer of the drug.

Dr. Leo alerted JAMA to the issue in October 2008, and in March 2009 he subsequently sent a letter to the British Medical Journal (BMJ) discussing the issue. A week after BMJ published Dr. Leo's letter, JAMA published a correction and a letter from Dr. Robinson in which he acknowledged receiving payments from Forest Lab, the manufacturer of the drug in question.

Dr. Robinson claims that his letter to the editors of JAMA was in the works before BMJ published Dr. Leo's letter.

Sorry JAMA but you are taking a position in this matter that we at therubins strongly disagree with. In this day and age, you can not keep things hidden until you decide when it should come out into the sunshine.

(3/11/09)- Senator Charles Grassley, the ranking Republican on the Senate Finance Committee sent a letter to Pfizer Inc. asking the pharmaceutical company to provide details of its payments to at least 149 faculty members at Harvard Medical School. Please also see our item dated 1/2/09 in connection with Dr. Joseph Biederman, Harvard Medical School and Massachusetts General Hospital.

The senator also requested that the company provide copies of all e-mails, faxes, letters or photos regarding Harvard medical students who have protested drug company influence at the Harvard Medical School.

An article in the New York Times detailed a Pfizer representative taking cellphone photographs of medical school students at a demonstration in October wherein the students were protesting the undue influence of pharmaceutical companies at medical schools.

The letter to Pfizer from Mr. Grassley requested details of faculty payments since January 1, 2007, and communications regarding the students since January 1, 2008. The dean of the Harvard Medical School, Dr. Jeffrey S. Flier recently appointed a 19-member committee to review the school's financial conflict of interest policies.

The New York Times reported that about 1,600 of the medical school's 8,900 professors and lecturers or relatives had a financial interest in a business related to their teaching, research or clinical care.

(3/9/09)- The Inspector General for the Health and Human Services agency, which investigates fraud in National Health Institute (NIH) programs is investigating Emory University to determine if the school misled officials at the NIH in connection with the work of Charles Nemeroff, as we described in our article dated 10/23/08 below.

Dr. Nemeroff was the primary investigator on an NIH research effort to study five GlaxoSmithKline PLC drugs for use as antidepressants. As our item below detailed, Dr. Nemeroff received several hundreds of thousands of dollars from Glaxo.

The federal probe is investigating whether Emory failed to tell the NIH about Dr. Nemeroff's potential conflicts of interest in conducting the research and if the university misrepresented the kind of work he was doing to the NIH.

The NIH requires schools to report potential conflicts of interest to the agency, and to ensure that research is carried out independently and objectively. Schools that violate these policies could face sanctions, ranging from fines to a freeze on funding. Emory received $251 million in NIH grants last year.

(2/21/09)- Pfizer Inc. announced that it would follow in the foot-steps of Eli Lilly & Co., Merck & Co., and GlaxoSmithKline PLC in regards to payments that it makes to medical professionals, hospitals and other such organizations.

Pfizer will report all payments to doctors of more than $500 for consulting and speaking arrangements and will make public the money it pays them to participate in its clinical trials.

The Physicians Payments Sunshine Act of 2009, under the sponsorship of Republican Senator Charles Grassley of Iowa and Democratic Senator Herb Kohl, was submitted to the Senate last month. The bill would require disclosure of all payments of $100 that are made to medical professionals or their organizations.

(2/12/09)- The North American Spine Society (NASS), a medical society representing over 5,000 spine surgeons has adopted a new disclosure policy that will apply to doctors who present studies at future medical conferences. The policy requires that researchers disclose not just the existence of financial ties to medical-device companies, but the dollar amounts as well.

The society said its policy "is not a voluntary guideline, but a binding covenant which applies to all relationships engaged in by all participants in all" activities of the spine society. Violations of this policy could include suspension, expulsion or public censure to a member of the society. The sanction would not restrict a violator from continuing to practice medicine, but would be a blot on the record of a member who was censured.

(1/16/09)- The New England Journal of Medicine published the results of a study, conducted in 2006 by Dr. Claudia I. Henschke of the Weill Cornell Medical College that determined that the widespread use of CT scans could prevent 80% of lung cancer deaths.

The study failed to disclose that Dr. Henschke's work had been underwritten in part by a $3.6 million grant from the parent company of the Liggett Group, a cigarette maker. Dr. Henschke had failed to disclose this information to the editors of the Journal.

She did disclose to the editors that she and her university had licensed a patent related to CT screening to General Electric, a maker of CT scanners. The editors decided against disclosing this information to its readers.

The Massachusetts Medical Society, the publisher of the Journal offers educational credits for reading and answering questions about the lung cancer study that must be approved by the Accreditation Council for Continuing Medical Education. The Council in a letter to The Cancer Letter, a cancer research newsletter, pointed out that the Society and the Journal erred in failing to disclose "relevant financial conflicts of interests of the authors."

The Journal in responding to this complaint said that it would change its procedure. It would now ask authors to disclose all patents or royalties related to their research, and that it would hereafter publish this information along with the study results

(1/2/09)- In updating our item dated 6/18/08 below, Massachusetts General Hospital announced that it would curtail the activities of Dr. Joseph Biederman, the well known child psychologist, while it investigated the charge by Senator Charles Grassley, the ranking Republican on the Senate Finance Committee of his failure to accurately report income from drug companies.

Dr. Biederman has agreed to stop participating in speaking engagements and other activities paid for by the pharmaceutical companies, and also to stop his work on industry-financed activities within the hospital. A spokeswoman for the hospital said that the trials would continue, but that Dr. Biederman would not be involved in them.

The doctor has been a prominent adherent for childhood use of J&J's anti-psychotic drug usage by children, while only reporting a fraction of that income to the hospital and to Harvard University Medical School, where he is a faculty member.

The Harvard Medical School is conducting its own investigation of Dr. Biederman, but has not curtailed any of his activities at the school at this time.

(12/22/08)- Is it a conflict-of-interest when a drug company pays a ghostwriter for articles published in medical journals or online medical sites, without revealing that it has done so? Apparently Wyeth Inc. does not think it is, as has been revealed recently as a result of some letters exchanged between the company and Senator Charles E. Grassley, Republican from Iowa, who is the minority leader on the Senate Finance Committee.

In addition to sending the letter to Wyeth, Senator Grassley also sent a letter to Design Write Inc., a Princeton, N.J. firm and also to its parent company, JMI, a medical information company in New York.

The letters sent by the senator ask the companies to disclose any payments made in connection with favorable articles written by them in connection with Wyeth's hormone replacement therapy Prempro. Senator Grassley also requested any information from Wyeth in connection with activities of doctors who were recruited by the companies to put their names on the favorable articles written by Design Write.

Senator Grassley's staff released dozens of pages of internal corporate documents gathered from lawsuits showing the central, previously undisclosed role of Wyeth and Design Write in creating articles promoting hormone therapy for menopause as far back as 1997.

One article in particular has come under question. It was published in May 2003 in the American Journal of Obstetrics and Gynecology more than a year after a federal study called Women's Health Initiative linked Wyeth's Prempro to breast cancer. The article said there was "no definitive evidence"
progestin caused breast cancer, and added that hormone users had a better chance of surviving breast cancer.

The documents show that Wyeth's executives came up with ideas for medical journal articles, titled them, and in various and sundry other ways were deeply involved in getting medical professionals to put their names onto these articles.

(12/10/08)- The Cleveland Clinic announced that it would report on its Web site, a complete disclosure of all of its doctors' and researchers' financial ties. The clinic is one of the nation's most prominent medical research centers.

Guy M. Chisholm III, a cell biologist who is chairman of the conflict-of-interest committee at the clinic said that every scientist and doctor employed by the organization must report any industry relationship at least once a year. No audit system has been set up, since the clinic now relies on information supplied by the employees, but Mr. Chisholm said that he hoped to have a check system set up so that the committee will be able to audit the data supplied by the employees and consultants.

Mr. Chisholm also said that he expected to have an exact dollar amount listed for each employee, rather than just a statement of payment from named sources. Royalty and equity interests will also be listed.

Senator Charles E. Grassley, Republican of Iowa, has introduced legislation that would require drug and device makers to divulge payments that they make to medical personnel and institutions.

(11/25/08)- Dr. Frederick K. Goodwin, the host of the popular NPR program "The Infinite Mind", and the author of an influential textbook on bipolar disorder, has earned at least $1.3 million from 2000 to 2007 giving marketing lectures for drugmakers without informing his radio audience of this income.

Dr. Goodwin is also an adjunct professor at George Washington University. The program, which is hosted by Dr. Goodwin, who is a psychiatrist, has won more than 60 journalism awards over the last 10 years, and bills itself as "public radio's most honored and listened to health and science program." He is also a past director on the National Institute of Mental Health.

It has more than one million listeners in more than 300 markets, but in light of the controversy, which was uncovered as a result of Senator Charles E. Grassley's, Republican of Iowa cross checking, will result in the program going "off the air".

In a program broadcast on September 20, 2005, Dr. Goodwin warned that children with bipolar disorder who were left untreated could suffer brain damage.

"But as we'll be hearing today, " Dr. Goodwin said "modern treatments--- mood stabilizers in particular--- have been proven to both safe and effective in bipolar children." He failed to reveal that he was being paid that very same day $2, 500 by GlaxoSmithKline to give a promotional lecture for its mood stabilizer drug, Lamicatal, at the Ritz Carlton Golf Resort in Naples, Fla.

Glaxo paid Dr. Goodwin $329,000 in 2005 for promoting Lamictal.

Dr. Goodwin claims that he told Bill Lichtenstein, the program's producer of his consulting fees, but Mr. Lichtenstein denies that Dr. Goodwin even mentioned these items to him.

Margaret Low Smith, vice-president of the National Public Radion, said that "The Infinite Mind" would be removed from its satellite radio service at the earliest possible date, and that NPR would discontinue the program.

Senator Grassley has been comparing the disclosure records of some of the nation's leading researchers and doctors with actual records of payments by the drug companies. As is shown by some of our items below, he is finding tremendous disparities between these two sources.

The Senator has proposed legislation that would require drugmakers to disclose all payment of $500 or more to doctors. Eli Lilly and Merck have promised to do so beginning next year.

(10/23/08)- The NIH has temporality frozen financing of one of the research projects being conducted by Emory University, a $9.3 million study on depression led by Dr. Charles B. Nemeroff, the former head of the psychiatric department at the university. Dr. Nemeroff has stepped down as head of the Department of Psychiatry and Behavioral Sciences at Emory, as we discussed in our item dated 10/11/08 below.

A Senate investigation revealed two weeks ago that Dr. Nemeroff had failed to report at least $1.3 million in income from consulting for drug makers. An Emory spokesman said Dr. Nemeroff would continue to teach and see patients while the university investigated the matter.

Senators Charles E. Grassley, Republican of Iowa, and Herb Kohl, Democrat of Wisconsin, have sent a letter to the Cardiovascular Research Foundation (CRF), and to Columbia University which has an affiliation with CRF requesting information about payments they received from 5 medical equipment manufacturing companies.

The five are Abbott Laboratories, Medtronic, Boston Scientific, Johnson & Johnson and Medinol. Two well-known researchers at Columbia, Dr. Maritin B. Leon and Dr. Gregg W. Stone are involved in the foundation; Dr. Leon is its former chairman and Dr. Stone is its current chairman. CRF is the sponsor of the annual conference held in Washington, D.C. known as the Transcatheter Cardiovascular Therapeutic conference.

The letter to the CRF asked for disclosure of all financing that the organization had received since 2003 from the aforementioned companies, and also to provide documentation of any payments and benefits to 22 researchers including Dr. Stone and Dr. Leon.

The letter to Columbia asked for information about disclosures that those researchers had made to Columbia about their income from industry sources.

A paper presented at the conference indicated that data showed that the Medtronic Endeavor stent was linked to more heart attacks and deadly blood clots than J & J's Cypher stent.

(10/11/08)- The Oct 17, 2007 issue of Journal of the American Medical Association reported on a study that showed "two-thirds of medical school department chairs have some form of personal relationship with a pharmaceutical or medical device company", with 28% receiving compensation such as honoraria, for participating in meetings, conferences, or other activities.

As an example of this situation, it recently came to light that Dr. Charles B. Nemeroff a psychiatrist and, until he stepped down the other day, chairman of the psychiatry department at Emory University failed to report more than $1.2 million in income that he received from pharmaceutical and medical equipment companies which was in violation of university and federal research rules.

Dr. Nemeroff was discussed in our item dated 9/8/06 below.

The National Institutes of Health's rules are discussed in our item dated 9/6/05 below. The NIH relies on the individual grantees to self-police its policies. If a university fails in enforcing its oversight duties, the NIH has the power to suspend its entire portfolio of grants, which for Emory amounted to $190 million in 2005. The NIH has never exercised this power in its entire history.

On July 15th, 2004 Dr. Nemeroff signed a letter promising Emory administrators that he would earn less than $10,000 a year from GlaxoSmithKline, when in fact he earned $170,000 from the drug company that year.

Dr. Nemeroff was the principal investigator for a five-year $3.9 million grant financed by the National Institute of Mental Health for which Glaxo provided drugs. The rules of the NIH require that an investigator who receives income of $10,000 or more be removed from that position by the university receiving a grant. Emory did not do this even though Dr. Nemeroff made more than that amount in 2003, 2004, 2005 and 2006 from Glaxo.

Dr. Nemeroff had repeatedly assured Emory that he had not exceeded the limit.

"Results from NIH-funded research must not be biased by any conflicting financial interests," John Burklow, a spokesman for the NIH said. "Officials at Emory are investigating the concerns."

Emory had investigated Dr. Nemeroff in 2004 for his outside consulting arrangements, and even though it found "serious" and "significant" violations of university procedures it took no action against him.

After the matter that we discussed in our item dated 9/8/06 below came into the public limelight, Claudia R. Adkison, an associate dean at Emory wrote on July 20, 2006, "I can't believe that anyone in the public or in academia would believe anything except that this paper was a piece of paid marketing".

The university had determined two years earlier that Dr. Nemeroff had failed to disclose conflicts of interest in trials of drugs from Merck, Eli Lilly and Johnson & Johnson.

According to Congressional documents, the doctor had earned more than $960,000 from Glaxo for the years 2000 through 2006, even though he listed only $35,000 for the period on his university disclosure form.

(7/26/08)- Charles Natanson, an anesthesiologist, and a senior NIH researcher, was the lead author of a paper in the Journal of the American Medical Association that concluded blood substitutes were associated with a significant increased risk of death and heart attack.

In the paper, Dr. Natanson said that he had received a one time $10,000 fee from a blood substitute company, but he did not disclose that he was listed as a co-inventor on a pending patent for technology being developed at the NIH that could potentially made the product safer.

Dr. Natanson said he did not report the information because he forgot his name was on the patent, and that he had not been named on a patent application before. The paper was published online in April and appeared in JAMA May 21.

He said he submitted an erratum July 7th to JAMA disclosing his role in the pending patent application, a long with a letter to the editor about the original study. He said he also disclosed the pending patent, in writing, at a joint FDA/NIH hearing on blood substituted held the day the paper appeared online.

(6/18/08)- Senator Charles Grassley, Republican from Iowa, once again has called for a national reporting system that would contain all payments made by drug and medical equipment companies to health professionals. Right now an honor system is being used, and as a recent example of this has shown, it isn't working.

Sen. Grassley said his staff compared records of payment provided by drug makers with conflict-of-interest forms that three psychiatrists submitted to Harvard University Medical School and to Massachusetts General Hospital where they practice.

The university and hospital forms made it appear that the psychiatrists- Joseph Biederman, Thomas Spencer and Timothy Wilens-were making only a "couple of hundred thousand dollars" over a seven-year period beginning in 2000.

After Senator Grassley began his inquiry, the university and the hospital asked the doctors to take another look at the amounts they received from various drug companies. After the second look, Dr. Biederman and Dr. Wilens reported revised totals of more than $1.6 million each in payments received from 2000 to 2007.

Dr. Spencer report receiving more than $1 million, according to the senator.

Senator Grassley contends that since nobody is really double checking on the conflict-of-interest forms, Congress may have to act on this matter.

(6/8/08)- According to the rankings from the American Medical Students Association (AMSA), only 7 of the 150 medical schools included in its conflict-of-interest ranking system received a grade of A, while 60 of them received a failing grade. The student association represents more than 67,000 medical students, residents and practicing physicians, and it began its ranking system in November 2007 when it requested conflict-of -interest policies from all of the medical schools in the country.

The association made at least 4 attempts to receive the information but 16 schools refused to submit their policies and 29 did not respond at all. These schools, along with 15 that did submit policies, were given failing grades.

Two graders, who were unaware of the identity of the schools, did the grading. The Association of American Medical Colleges (AAMC) also dealt with this conflict-of-interest situation as shown in our item dated 5/9/08 below. Twenty-eight of the schools were in the midst of revising their policies.

The AMSA will upgrade the rankings periodically. To see the scoreboard on a school-by-school basis go to

Mount Sinai School of Medicine in New York, the University of Pittsburgh Medical Center and the University of California schools of medicine in Los Angeles, Davis, and San Francisco were among those receiving top grades

(3/8/08)- The Senate Special Committee on Aging, which is chaired by Herb Kohl, a Wisconsin Democrat held hearings recently in connection with the practice of medical equipment manufacturers retaining surgeons as paid consultants. The committee hopes to gain information on this topic so that it can propose legislation that would make this practice more transparent so that the public knows exactly who is paying who, and for what purpose.

A government inquiry is pending, by the Justice Department and the Department of Health and Human Services that questions both the legality and ethics of such payments. Five medical equipment manufacturers paid more than $221 million to surgeon "consultants" in 2007.

The companies-Zimmer Holdings Inc., Biomet Inc., Stryker Corp., Smith & Nephews and the DePuy Orthopedics unit of Johnson & Johnson, agreed to disclose the payments in September in settling government allegations of kickback violations to surgeons.

Four of the companies (except Stryker) also agreed to pay $310 million to settle claims that the payments were, in reality, rewards to surgeons who selected the companies products, even though it might not have been the best product for a particular patient. For more on this matter please see our item dated 11/02/07.

As a related issue in the settlement matter, Congress is also investigating the appointment of the monitors to the proceedings. For more on this matter please see our items dated 1/11/08 and 10/22/07 below.

According to the investigation, the total, payments to surgeons from these companies amounted to more than $800 million from 2002 through 2006

(1/30/08)- A recent incentive program by Blue Care Network, a health-maintenance organization owned by Blue Cross Blue Shield of Michigan has brought the issue of conflict-of-interest to the forefront. The company initiated a three-month program, called Blue Reward$ wherein primary care physicians were asked to consider switching their patients from a brand-name statin drug to a generic statin version of the drug.

This situation became more evident when Merck's cholesterol lowering statin drug Zocor went off patent, and became available as a generic drug. Pfizer's statin drug Lipitor is the best selling drug in the world with an estimated over $14 billion in drug sales in 2007

The physician received a payment of $100 for each of their patients who made the switch. The program ended in March 2007, but the issue raised by this program continues to reverberate through the medical ethical system.

The American Medical Association posted advice to doctors on its Web site under the heading "Kickback Questions and Answers." Its view: "Accepting payment for moving a patient from a brand name to a generic could be viewed as an anti-kickback statute violation."

Other insurers are pushing doctors to prescribe more generics by making it a factor in annual "pay-for-performance" bonuses that have become increasingly common in the medical insurance industry.

Blue Cross Blue Shield of Massachusetts gives doctors a bonus of up to $4 per patient a month, paid annually, for meeting a list of goals that includes higher generic prescription rates.

(12/17/07)- Jay Yadav, the former head of the Cleveland Clinics vascular intervention unit has sued the hospital over alleged defamation of character and discrimination. He further alleges that the institution is ripe with conflicts-of-interests similar to the kind that were cited as grounds for his dismissal.

Dr. Yadav was fired by the hospital in 2006 for not complying with the institution's conflict-of-interest policies. He filed his lawsuit in state court in Ohio, the state in which the clinic is located.

The clinic denied his allegations and said it planned to file a response as well as a "counter claim for substantial expenses incurred to review his research." The clinic instituted tougher conflict-of-interest policies in 2006, after an article in the Wall Street Journal pointed out the fact that many of the doctors in the clinic had undisclosed interests in companies that made some of the medical equipment used on them. The patients were never informed about this possible conflict.

It was also pointed out that many of the medical professionals received payments from the drug companies as well as the medical equipment companies for doing consulting work while never revealing this fact to the institute or their patients.

Dr. Yadov had financial stakes in two companies whose experimental products were tested on clinic patients. He was fired shortly before the Cleveland Plain Dealer had an article about his outside activities.

According to the complaint in this pending case the clinic has "widespread and pervasive" conflicts-of-interest, as is exemplified by the chief executive of the clinic Delos "Toby" Cosgrove. The clinic heavily promotes and uses an invention by Dr. Cosgrove's in patients undergoing heart valve surgery. The device is known as the Cosgrove-Edwards ring for which both the clinic and Dr. Delos receive substantial royalties. Edwards Lifesciences Corp markets the product.

Dr. Yadav lawsuit also cited the surgeon Isador Lieberman, a member of the hospital's conflict-of-interest committee, who failed to disclose his significant financial interests in Kyphon Inc. That company manufactures equipment for an orthopedic procedure that Dr. Lieberman advocated and tested at the clinic. Dr. Yadav, was born in India and also alleges discrimination in his lawsuit.

Dr. Yadav says the clinic accused him of not properly disclosing royalty payments for a device he invented to prevent blockages in patients who receive a neck stent. Among the other shareholders in Angioguard Inc., the company that acquired the technology from Dr.Yadav, which in turn was acquired by Johnson & Johnson are several other top officials at the hospital.

Dr. Kenneth Ouriel, a surgeon at the hospital received some small payments for the neck device but he did not reveal them to the clinic, and yet he was not terminated for that failure to report those payments.

Dr.Yadav said that he properly disclosed the deferred payments as early as 2002 in a document filed with a clinic review board. In 2003 he made a similar disclosure to the FDA. 

(10/22/07)- As per his statement that we wrote about in our item dated 8/07/07 below, Senator Charles E. Grassley (Rep.-Io.), who is the senior Republican on the Senate Finance Committee, and Senator Herb Kohl, Democrat of Wisconsin introduced legislation in the Senate that would require drug makers and medical device manufacturers to report nearly all payments and gifts to doctors.

The FDA does not regulate the gifts or consulting arrangements that the pharmaceutical industry or the medical equipment industry make to doctors, and it reviews only a small fraction of the talks that doctors make on behalf of these companies. Minnesota and Vermont require such disclosures, and the legislatures of Maine and West Virginia have passed measure that may soon require them.

Companies with at least $100 million in annual revenues would have to make quarterly disclosures of gifts or payments that exceed $25, and the reports would be posted on a Web site. Companies failing to make the disclosures would be fined at least $10,000 per infraction. Free drug samples would not be included in the provisions of the proposal not would financing for clinical trials have to be disclosed.

Any payments or benefits made "directly, indirectly, through an agent, subsidiary or other third party" would have to be disclosed.

A Minnesota psychiatrist, who received more than $350,000 in speaking and consulting fees for pharmaceutical companies will step down from a panel that advises the state on drug for low-income Medicaid patients.

John Simon, said he would resign because the organization that asked him to serve, the Minnesota Psychiatric Society was "a little uncomfortable with the appearance of conflict of interest" posed by his membership.

Eli Lilly & Co., and other pharmaceutical companies paid Dr. Simon while he was serving on the panel, the Minnesota Medicaid Drug Formulary Committee.

(9/8/06)- The editor of the journal Neuropsychopharmacolgy, Charles Nemeroff is stepping down after he wrote a favorable review of a new device for treating depression that did not disclose his financial ties to the device maker.

The journal published a correction citing Dr. Nemoroff's tie to the device maker and those of the article's eight other authors. Seven of the other eight authors are academics while the eighth is an employee of the company that makes the device.

The company in question that made the device is Cyberonics Inc. of Houston Texas. Dr. Nemeroff is chairman of the Department of Psychiatry and Behavioral Sciences at Emory University in Atlanta. The journal is published by the American College of Neuropsychopharmacology, a medical society of scientists and physicians who study the brain.

The device in question is implanted in the chest to deliver mild electrical pulses to the vagus nerve in the neck. It is administered to patients with treatment-resistant depression

(9/06/05)- The National Institutes for Health (NIH) announced new rules that ban its scientist from consulting for drug companies, but does not ban them from delivering medical education lectures paid for by these same companies. Any outside remunerative work performed by an employee would have to be disclosed and approved in advance by ethics overseers.

At a news conference, Dr.Elias A. Zerhouni, director of the institutes said, " Our research should be based on scientific evidence that is not influenced by any other factors." The results of an investigation that the agency conducted found that 44 of its 1,200 senior scientists appeared to have violated rules governing consulting and that 9 might have violated criminal laws.

The top 200 executives will be required to keep the value of their holdings in any single drug company below $15,000. A review panel will examine the pharmaceutical holdings of the next 6,000 scientists to see if there is any conflict of interest that might arise because of the particular work that the individual was doing at the agency.

The issue came into the limelight when it was revealed that Dr. P.Trey Sunderland, a senior researcher at the institutes received more than $500,000 in consulting fees from Pfizer at the time he was consulting with the company in his official work of studying patients with Alzheimer's disease. Despite rules being in effect at that time requiring the reporting of such a conflict of interest Dr. Sunderland, did not report it.

Officials will have until January 1, 2006 to divest themselves of the stocks and the rules will be re-examined in a year to make sure that they have not had negative effects of the agency's ability to recruit top scientists


By Allan Rubin
updated July 3, 2015

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