Academic Medical Center Leaders’ Position on the Board of Directors of a Pharmaceutical Company Can Create a Conflict of Interest
Analyzing the Ethics of Deans and Directors Sitting on Boards of Drug Companies
Is it a violation of ethical standards to have leaders of academic medical centers paid for their work and sit on the boards of big drug companies? Does it create a conflict of interest that could taint ethical decision-making? These are the issues addressed in this piece.
According to a study by Dr. Walid F. Gellad of the University of Pittsburgh and colleagues that was published online on April 2, 2014 in the Journal of the American Medical Association (http://jama.jamanetwork.com/article.aspx?articleid=1853147), 16 of the 17 largest U.S. pharmaceutical companies had at least one board member who also held leadership positions at one of the some 30 academic medical centers. The leaders include CEOs, medical school deans, hospital directors or trustees and clinical department chiefs. The average compensation they received for board service was $312,564. By comparison, the average dean of medicine earns $445,781, and the average associate dean at a medical school makes $196,212, according to a 2012-2013 survey by the College and University Professional Association for Human Resources.
According to Gellad, these “ties may open the door to industry influence over important medical center or university decision-making, and may negatively influence the perceptions and trust of patients, students and the public. These risks have to be considered alongside any potential benefits.”
A risk benefit analysis requires that we weigh the potential consequences of the action to include leaders of academic medical centers on pharmaceutical company boards against the benefits of that practice. Gellad believes that the board ties could be potentially worthwhile for both sides and their institutions’ goals, including helping universities find out about industry funding available for research. Moreover, companies mentioned in the report as having board members’ “knowledge of the crucial role of research in drug discovery and development and deep understanding of science and medicine are invaluable in our quest to deliver innovative therapies to patients,” according to Pfizer spokesperson Joan Campion.
While the salaries seem high and create a cost element in the analysis, Gellad believes that it is pretty standard for someone who serves on a corporate board. I don’t think it is right to pay academic medical leaders more than associate deans. After all, how many meetings do these leaders actually attend in a given year? Also, we’re not talking about publicly-owned companies here; instead, these are academic institutions with limited funds and fiduciary responsibilities to the institution, patients, and the public at large. These stakeholders have a right to expect independent decision-making by board members supported by controls over even the appearance of a conflict of interest. It is not a matter of managing the risks but not allowing them to occur in the first place that creates the primary benefit for the public good.
Academic medical centers are quite adept at rationalizing the practice of paying leaders for board service. In an interview with Lindsey Tanner of the Associated Press (http://www.startribune.com/lifestyle/health/253443901.html), Yale spokesperson Karen Peart points to institutional policy rules that reduce the potential for real or perceived bias in research, clinical decision-making and educational programs. I don’t see how a policy can reduce the perception of bias when perceptions are based on appearances of a possible conflict of interest that might taint objective judgment. It is the relationship itself that creates the perception, which can’t be erased by a policy.
Northwestern medical school spokesman Alan Cubbage claims that these board members are required annually to disclose any potential conflicts of interest. The problem here is disclosure does not cure the ills of a potential conflict of interest occurring in the first place. The conflict still may influence the objectivity judgment of the decision-maker regardless of disclosure.
Joan Campion of Pfizer says that board members are required to “recuse themselves should any conflict of interest arise between and the company.” However, the fact is board members are obligated to support the medical center’s point of view notwithstanding the recusal and any conflicts can work in subtle ways to influence decision-making by the institution in its relationship with drug companies.
The danger of the practice of allowing leaders of academic medical centers to sit on the boards of drug companies is more than just the perception that independent judgment may be tainted by these relationships. Academic medical centers should serve the public good. How can they be expected to do so if a situation arises, for example, where the pharmaceutical product is of questionable value and the center is dependent on funding from the company? After all, the deans and directors who sit on boards are only human and just as board members of corporate entities might be biased toward the interest of the company and not the public interest, these academic leaders might overlook a problem with a drug that could threaten the public health.
Blog posted by Steven Mintz, aka Ethics Sage, on April 3, 2014