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    Conflict Of Interest: Leaders Of Academic Medical Centers Serving On Pharmaceutical Boards
    By News Staff | April 1st 2014 03:00 PM | 3 comments | Print | E-mail | Track Comments
    Can you buy ethics? Are scientists simply paid guns producing research for anyone that writes a check?

    It's certainly a common cultural belief. Skeptics about global warming think that academics cozy up to politicians and apply for grants related to whatever is in the news while skeptics about medicine believe that if a researcher gets funding from anywhere except the government they are for sale. In reality, there is more disclosure and less conflict of interest that at any point in the history of science. There was a time when scientists had to read Tarot cards and make astrology charts for wealthy patrons and people who know how expensive and difficult drug discovery is dread a future where the government does it rather than corporations.

    It's because there is so much more transparency that we know that it is common for a pharmaceutical company Board of Directors to have at least one member holding a leadership position at an academic medical center. It's what we want, right? Just like we want a climate expert on committees at oil companies who are promoting green initiatives, we want to have an academic outsider having a voice in how corporations are run.

    Yet in our modern 'follow the money' conspiracy world, the climate scientists who get any money from an oil company or an academic who sits on the Board of a drug company must be unethical.

    Those people have new reasons to be outraged. A new paper found that 40 percent of pharmaceutical company boards of directors examined had annual compensation averaging approximately $300,000. Academia stopped being a low paid field long ago - the compensation is so lucrative that we are now glutted with Ph.D.s all clamoring for a six-figure tenure job. Even a state school researcher sitting in a foreign jail can argue for a pay raise, because at $107,000 he is only number 18 in compensation in his department. And that is just at one state school.

    $300,000 is not buying anyone's ethics when $500,000 salaries at colleges are common. 

    But while the relationships between pharmaceutical companies and physicians have come under scrutiny, less analyzed is the relationship between industry and academic medical centers.

    The authors of the a JAMA paper “do not make any conclusions about whether specifically identified relationships led to actual, rather than potential, conflicts of interest” but in today's culture even doing the analysis and writing the paper is implied guilt. 

    Timothy S. Anderson, M.D., of the University of Pittsburgh Medical Center, and colleagues examined how often academic medical center (AMC )leaders served on the boards of directors for pharmaceutical companies. Data on board composition and academic positions were collected in January 2013 from the websites of the 50 largest pharmaceutical companies based on 2012 global prescription drug sales. Financial compensation information was collected from company proxy statements and from shareholder reports. AMCs were defined as U.S. medical schools, health professional schools, teaching hospitals, and health care systems; leadership positions included CEOs, clinical department chairs, division directors, medical school deans, and hospital boards of directors, in addition to university presidents and boards of directors.

    Of the 50 companies examined, 3 private companies lacked public data on governance. Nineteen of 47 (40 percent) companies had at least 1 board member who also held a leadership position at an AMC, including 16 of 17 (94 percent) U.S. companies. Forty-one board members held AMC leadership positions in 2012, receiving an average financial compensation for board membership of $312,564 (excluding the 6 industry executives).

    Eighteen industry board members (3 percent of all board members) held 21 clinical or administrative leadership positions, including 2 university presidents, 6 deans, 6 hospital or health system executive officers, and 7 clinical department chairs or center directors.

    “Given the magnitude of competing priorities between academic institutions and pharmaceutical companies, dual leadership roles cannot simply be managed by internal disclosure. These relationships present potentially far-reaching consequences beyond those created when individual physicians consult with industry or receive gifts,” they write.

    What most people don't realize is that a Board of Directors is not selling a product - they are a watchful eye on the company and have a fiduciary, and therefore legal obligation, to the shareholders and the law. Enron Chairman of the Board Ken Lay went to jail because he ran the board of directors, not because he had been managing the operations of the company. They are not insiders, though they are not without scrutiny. When Apple's Steve Jobs was found to have broken federal law in granting himself options without Board approval, another Board member, Al Gore, cleared him in an internal investigation, and investors wondered why he got off without even a fine.  Letting someone go if the stock went up looks as ethically suspect as letting someone go if the stock went down.

    Criticizing outsiders if they join a Board and declaring them guilty by association just means that company Boards will not have outsiders. It's hard to imagine how that will be better for anyone.

    Citation: Timothy S. Anderson MD, Shravan Dave BS, Chester B. Good MD, MPH, Walid F. Gellad MD, MPH, Academic Medical Center Leadership on Pharmaceutical Company Boards of Directors JAMA. 2014;311(13):1353-1355. doi:10.1001/jama.2013.284925

    Comments

    "[board members] are not insiders, though they are not without scrutiny." The Securities and Exchange Commission considers them insiders, along with members of their families and friends.

    Hank
    Insider knowledge under the '34 Act is not the same thing as being an insider - an employee - of the company. The CEO will often be on the Board but that has its own restrictions and SEC rules only apply to public companies. Most drug companies are not acquired and part of a public company until they reach a stage III trial.
    OK. Anyway, from what I've seen, the main problem with having academics on the board of directors, at least for food, chemical, and tobacco companies, is that those academics are the those companies' worst enemies. If they haven't personally attacked the industry, they endorse the kind of research that does. And when the industries are confronted with lawsuits, they never have any competent scientific defense. I think that the presence of academics on those boards is evidence that they've been "pwned," as hackers would say.