Conflicts of Interest

James G. Anderson, Ph.D.

Department of Sociology &
Anthropology

Questions

What situations represent a Professional Conflict of

Interest?
How extensive are conflicts of interest?
What challenges do they pose for the traditional
physician commitment to act on behalf of the patient?
What has been the medical professions response?
How do professional groups deal with this problem?
What steps should the medical profession take to
cope with conflicts of interest?

Definition
Conflict of interest refers to any situation in
which an individual with responsibilities to
others (including professional
responsibilities) might be, consciously or
unconsciously influenced by financial, or
other factors that involve self interest (JAMA,
1994)

The Problem

Current practices provide doctors with financial

incentives that may conflict with patient interests
Doctors financial well-being are tied to medical care
providers, suppliers, pharmaceutical companies, thirdparty payers
These arrangements may predispose physicians to
provide too many or too few services or to make
inappropriate referrals
Patients may receive poor quality care or be harmed
Patients and society pay for wasteful services

Types of Conflicts of Interest

Conflicts between the physicians interest

(usually financial) and the patients interest
Conflicts that divide a physicians loyalty
between a patient and a third-party

The Changing Context of Medicine

Monetarization of medicine
Third-party payment
Increased supply of physicians/hospital beds
Changes in hospital payment
Technology
Loss of physician autonomy
The federal government

Incentives to Increase Services

Fee-for-service practice
Kickbacks for referrals
Self-referral to medical facilities in which the
physician invests
Income from dispensing drugs, medical products,
ancillary services
Hospital purchase of physician practices
Payments made by hospitals to recruit and bond
physicians
Gifts to physicians by medical suppliers

Audiologists

Receive commissions/gifts from hearing aid

manufacturers

Dispense hearing aids

Physicians

Physicians receiving kickbacks for

prescribing drugs.
Physicians dispensing drugs/products
Physicians referring patients to a hospital
that provides them with office space,
directorships, etc.
Physician-Owned Hospitals/clinics/ancillary
services

Dentists

Visits to 50 dentists in 28 states and DC

Examination plus 1 crown cost $500
Dentists ask what were his insurance limits
Estimates range from $460/1 crown to
$29,850/21 crowns

Optometrists

Accept fees, gifts from manufacturers of

lens, optical appliances, etc.

Physicians and Third Parties

Physician referral for ancillary services in

which they have a financial interest
British pharmaceutical companies owns
eleven cancer centers that provide care.

Columbia/HCA

Rewards to MDs for referring patients

Purchase of physician practices
Discharged hospital patients sent to home
health care agencies owned by Columbia
Staff MDs provided profit incentive to
reduce care

Financial/Commercial
Relationships

University faculty consultants for 90%

biotechnology companies
50% of faculty researchers serve as
consultants for biotechnology companies
Physicians have a financial stake in 2580% of ancillary medical facilities

Incentives to Decrease Services

HMO financial incentives

Control of access to physicians
Gatekeepers
Management of care by physicians
Payment incentives

Physician Incentives in HMOs

Percentage of Payment Withheld from primary

Care Physicians

Surpluses in the Reward for

Specialist Referral Fund

Other Financial Penalties for

Primary Care Physicians

Increases in the % payment withheld the following

year
Liens on future earnings
Decreases in the amount of capitation payment
the following year
Exclusion from the program
Reductions in distributions from fund surpluses
Require physician to pay amount of deficit

What Can Be Done?

Disclosure
Informed consent
Regulation
Consumer protection laws
Professional groups

Limitations of the Medical

Profession

AMA guidelines are voluntary

Today's principals contain no statement regarding
most conflicts of interest
Antitrust laws prevent the AMA from restricting
advertising and many commercial practices
The AMA has no procedures for monitoring
compliance
Enforcement is left to state medical societies and
professional licensing boards

Large Companies Express Scripts

Enriched itself at the expense of the Empire Plan and its members
by inflating the cost of generic drugs;
Diverted to itself millions of dollars in manufacturer rebates that
belonged to the Empire Plan;
Engaged in fraud and deception to induce physicians to switch a
patient's prescription from one prescribed drug to another for which
Express Scripts received money from the second drug's
manufacturer;
Sold and licensed data belonging to the Empire Plan to drug
manufacturers, data collection services and others without the
permission of the Empire Plan and in violation of the State's
contract;
Induced the State to enter into the contract by misrepresenting the
discounts the Empire Plan was receiving for drugs purchased at
retail pharmacies.

FDA

More than half of the experts hired to advise the

government on the safety and effectiveness of
medicine have financial relationships with the
pharmaceutical companies that will be helped or
hurt by their decisions, a USA TODAY study
found.
These experts are hired to advise the Food and
Drug Administration on which medicines should
be approved for sale, what the warning labels
should say and how studies of drugs should be
designed.

FDA

A USA TODAY analysis of financial conflicts at 159 FDA

advisory committee meetings from Jan. 1, 1998, through last
June 30 found:
At 92% of the meetings, at least one member had a financial
conflict of interest.
At 55% of meetings, half or more of the FDA advisers had
conflicts of interest.
Conflicts were most frequent at the 57 meetings when
broader issues were discussed: 92% of members had
conflicts.
At the 102 meetings dealing with the fate of a specific drug,
33% of the experts had a financial conflict.

Journals

Large medical journals such as those put out by

the AMA and the New England Journal of
medicine admit that conflicts of interest have
inflated findings published in medical journals.
The Journal of Thoracic and Cardiovascular
Surgery has threatened to bar authors and their
institutions who do not disclose conflicts of
interest from publishing in the journal for some
period of time.

Drug Company Sponsorship of

Clinical Trials

One study compiled previously published clinical trials to conclude

that patients could both develop a tolerance for beta-agonists and
be at increased risk for asthma attacks, compared with those who
do not use the drug at all. The second study shows that betaagonist use increases cardiac risks, such as heart attacks, by more
than two-fold, compared with the use of a placebo.
Furthermore, the researchers say that their analyses lead them to
suspect a conflict of interest among scientists who are supported by
pharmaceutical companies that make beta-agonists, among the
world's most widely used drugs. This conflict, they say, could be
putting 16 million U.S. asthma sufferers in harm's way. Their
statement comes as the American Medical Association is voicing its
concerns that drug industry sponsorship of clinical tests is affecting
the quality of research.

Vioxx: Merck Vs. FDA

March 2000: Merck reveals that a new study found Vioxx patients had double the
rate of serious cardiovascular problems than those on naproxen, an older
nonsteroidal anti-inflammatory drug, or NSAID.
November 2000: The New England Journal of Medicine publishes the study, called
VIGOR.
February 2001: An advisory panel recommends the FDA require a label warning of
the possible link to cardiovascular problems.
September 2001:The FDA warns Merck to stop misleading doctors about Vioxx's
effect on the cardiovascular system.
April 2002:The FDA tells Merck to add information about cardiovascular risk to
Vioxx's label.
Aug. 25, 2004: An FDA researcher presents results of a database analysis of 1.4
million patients; it concludes that Vioxx users are more likely to suffer a heart attack
or sudden cardiac death than those taking Celebrex or an older NSAID.
Sept. 23, 2004: Merck says it learned this day that patients taking Vioxx in a study
were twice as likely to suffer a heart attack or stroke as those on placebo.
Sept. 30, 2004:Merck withdraws Vioxx from the U.S. and the more than 80 other
countries in which it was marketed.

Paxil

The manufacturers of antidepressants continue to market their

drugs for children / adolescents even after a causal relation has
been scientifically established between antidepressants, such as
Paxil / Seroxat and suicide-related behavior. They do so because
FDA officials continue to drag their feet about issuing black box
warnings on antidepressant labels. Even after an FDA advisory
panel urged the agency to require black box warnings about an
increased suicide risk--on the labels read by physicians and on the
package labels read by consumers--top officials are undecided.
The NJ Star Ledger obtained an internal (September 8, 2003)
GlaxoSmithKline memo that was distributed to the company's sales
representatives. The memo advises them NOT to discuss the
suicide-related risk of Paxil / Seroxat with doctors.

Paxil

A 2003 memo cites a discredited published report in the Journal of

the Academy of Child and Adolescent Psychiatry (2001, pp. 762772) that maintained that Paxil was "safe and effective and well
tolerated." It was co-authored by leading US child psychiatrists.
However, its claimed findings are refuted by a 1998 internal GSK's
memo which states that only "positive data from study 329" would
be published. The unpublished data, the memo stated, would not
be published or submitted to the FDA because:
"It would be commercially unacceptable to include a statement that
efficacy had not been demonstrated as this would undermine the
profile of paroxetine [Paxil]."

Drugs

Adverse prescription drug reactions are the third

largest cause of death in the US, topped only by
tobacco and alcohol. According to an article in the
Journal of the American Medical Association, over
100,000 hospitalized patients died as a result of
an adverse drug reaction. The researchers found
that over 75% of these ADRs were dosedependent, which suggests they were due to the
inherent toxicity of the drugs rather than to allergic
reactions.

FDA Working for the Drug Industry?

What makes the issue so controversial is how the

FDA has dealt with an internal debate on the
matter. Congressional investigators have been
examining the agency's decision to block a staffer
from revealing this past February his finding of a
tie between antidepressants and suicidal
tendencies in young people, which drew on many
of the same trials. FDA officials said his
conclusion was premature, and based on
ambiguous data.

FDA Working for the Drug Industry?

Instead of protecting the public health, FDA

officials have aggressively and improperly
invoked FDA's pre-emptive authority by
intervening in court cases to shield drug
manufacturers who were challenged about
their failure to include warnings on drug
labels.