Double Dipping: Many Leading Academics Serve on Industry Boards

Diana Phillips

September 29, 2015

Academics from medical schools and research institutions across the United States hold nearly 10% of the board of directors positions at publically traded healthcare companies, a study has shown.

The findings, published in the BMJ on September 29, highlight potential individual and institutional conflicts of interest that fall outside existing national guidelines, according the authors.

To understand the scope of the relationship between academia and the healthcare industry in the United States, Timothy S. Anderson, MD, chief medical resident in the Department of Internal Medicine at the University of Pittsburgh Medical Center in Pennsylvania, and colleagues examined public disclosures for 2013 from healthcare sector companies to the US Securities and Exchange Commission for the presence on company boards of directors of leaders, professors, and trustees of US academic and medical research institutions.

Of 442 companies that met the study inclusion criteria and had accessible public disclosure information, 166 were pharmaceutical companies, 107 were biotechnology companies, 94 were medical equipment and supply companies, and 75 were healthcare provider companies.

"In total, 180 out of 442 companies (41%) included at least one academically affiliated director," the authors report.

Further, 279 academics held 309 (9.0%) healthcare directorships out of a total of 3434. Of those, 73 were academic leaders, who sat on the boards of 85 companies, 121 were professors who held 132 board seats, and 85 were academic trustees who held 93 seats. In addition, seven academic leaders and four professors held secondary positions as academic trustees while serving on company boards of directors.

"Overall, 85 non-profit academic institutions, including many of the most renowned medical research and clinical centers had at least one leader, professor, or trustee who served as a director for a for profit healthcare company," the authors write. The academic roles of directors were wide-ranging, including clinical and research professors, trustees of universities and hospitals, health system chief executive officers, and medical school deans.

Compensation Nears $55 Million

The investigators also examined total compensation figures, reflecting total annual compensation for services on boards, including cash, stock awards, options, dividends, and charitable contribution matching.

After excluding 26 individuals because they joined a board midway through a year or held executive positions at a company, the authors found that total compensation to academically affiliated individuals was $54,995,786. Individual compensation ranged from $0 to $1.43 million, with a median of $193,000, the authors note. "Beyond annual compensation, board members beneficially owned major company stock, totaling 59 831 477 shares."

In addition, the authors note that unlike consultants, who may be hired by a company to advise on a particular project, a member of the board of directors has a fiduciary responsibility to shareholders to work for the best interest of the company and increase share value.

Thus, the dual obligations reflected in these financial and leadership/advisory relationships "create important conflicts of interest when the missions of their institutions diverge, while at the same time offering potential benefits when the missions overlap," the authors write.

The US Physician Payments Sunshine Act mandates the reporting of payments to physicians and academic medical centers by pharmaceutical and medical device companies, but does not require separate reporting of payments for serving as a company director.

Similarly, the authors note, professional ethical guidelines have not fully addressed approaches to managing this type of competing interests. Understanding the diversity of the potential conflicts is essential to the development of guidelines for managing addressing them, "given that some may be amenable to appropriate oversight and management and some may be irreconcilable them," they state.

These relationships "deserve additional review, regulation, and, in some cases, prohibition when conflicts cannot be reconciled." The range of possible solutions proposed by the authors includes requiring leaders to disclose the sums they receive for their industry representation, case-by case institutional review, payment caps, consultation without compensation, or prohibition of the dual roles.

Amount Is "Unsettling"

In an accompanying editorial, David Rothman, PhD, from Columbia College of Physicians and Surgeons in New York City, calls the actual compensation amount "unsettling."

Noting that "no one seeks to demonize industry," Dr Rothman acknowledges that cooperation between academia and industry is necessary for medical progress. "But how do we safeguard scientific and clinical integrity, ensuring that is knowledge and not market share that shapes research and clinical practice? How do we keep the playing field level when industry dispenses hundreds of thousands of dollars to academic leaders?" he asks.

"Although it may seem radical, excluding leaders from directorships is the only credible policy," Dr Rothman stresses. There are many ways to share knowledge, promote cooperation, and drive progress that do not involve joining a board, he notes.

The advantages for banning academics from accepting industry board directorships include education by example for medical students, fellows, and assistant professors — "share information as appropriate, but do not take payment, travel, and the rest," Dr Rothman states — and assurance that medical institutions are guided by professional principles that are "autonomous in theory and practice."

In the healthcare domain, as in others, "integrity must take precedence over individuals' compensation," Dr Rothman concludes.

One coauthor disclosed receipt of consulting fees from IMS Health and grant funding from Express Scripts. The other authors have disclosed no relevant financial relationships. Dr Rothman disclosed having served as an expert witness in two cases against Johnson & Johnson for its marketing of Risperdal.

BMJ. Published online September 29, 2015. Article full text, Editorial full text

Comments

3090D553-9492-4563-8681-AD288FA52ACE
Comments on Medscape are moderated and should be professional in tone and on topic. You must declare any conflicts of interest related to your comments and responses. Please see our Commenting Guide for further information. We reserve the right to remove posts at our sole discretion.
Post as:

processing....