The Curious Case of Pfizer's Asbestos Claims

Here is a very strange and long-running story that raises some questions about how health care organizations are lead, but seems to have bee covered only in the business press.

Pfizer Goes Into the Asbestos Business (in 1968), Faced Hundreds of Thousands of Lawsuits (in the 1980s), Promised to Settle (in 2004)

Here is the background, per a 2004 report by the Associated Press, per Fox News:

Pfizer Inc. (PFE) Friday said it has agreed to pay $430 million to settle all lawsuits against it alleging injury from insulation products made by a subsidiary.

Pfizer and its Quigley Co. subsidiary were named, along with several other defendants, in 171,611 lawsuits claiming personal injury caused by exposure to asbestos, silica or mixed dust.


Pfizer acquired Quigley Co. in 1968. It sold some products containing asbestos until the early 1970s.

Pfizer will establish a trust for the payment of pending claims as well as any future claims. It will contribute $405 million to the trust over 40 years through a note, and about $100 million in insurance. Pfizer will also forgive a $30 million loan to Quigley.

Since 1982, Quigley's main business has been to manage the asbestos lawsuits.

As part of the settlement, Quigley will file for Chapter 11 bankruptcy. Its reorganization plan must be approved by the bankruptcy court and confirmed by a vote of 75 percent of the claimants.

That seems like the end of a long story, but it was not.

Bankruptcy Proceedings Go On Through 2009, No Claims Paid

By 2009, nothing had really been settled. Apparently, the bankruptcy of Pfizer's subsidiary, which was set up as if Quigley was an independent corporation, had not resulted in any resolution to the multiple lawsuits and the large claims. As reported in December, 2009, by Bloomberg:

At issue in the trial is whether Quigley, a former maker of asbestos-containing products, can confirm a plan of reorganization, ending more than five years in bankruptcy. The trial pits the U.S. government and asbestos victims against Pfizer, the world’s biggest drugmaker, with claims that its $450 million contribution under a settlement isn’t enough to satisfy its liabilities.

At the trial, the lawyer for the asbestos victims claimed that Pfizer was using the bankruptcy of its subsidiary to avoid liability:

Edward Weisfelner, a lawyer for an ad hoc group of so- called asbestos victims that represents 30,000 individuals, told Bernstein today that the plan can’t be confirmed because the purpose of the bankruptcy law being used to channel asbestos claims is to 'scrub' a viable company of liabilities.

Under bankruptcy law, courts shouldn’t approve Chapter 11 reorganizations where the primary purpose is to shield a third party, such as Pfizer, Weisfelner said.

'Courts are instructed to avoid the possibility that parties use bankruptcy to protect a third party that’s not submitting itself to the jurisdiction of the court, and that’s exactly what’s going on in this case,' Weisfelner said.

The US government also objected to what Pfizer was doing:

Opposition to the plan also comes from the U.S. Trustee, an arm of the Justice Department that monitors bankruptcies, which has said was improperly orchestrated to shield the drugmaker from liability.

t the time, Pfizer (through its Quigley subsidiary) also was attempting to keep the whole thing quiet, but not successfully:

The U.S. Trustee has fought to keep the trial open to the public, and said in court documents that some of Quigley’s requests to keep information confidential failed to meet legal standards for protecting 'commercial' information.

Of course, at that time, the opinions of the plaintiffs' lawyer and the US Trustee were just that, opinions.

By 2010, Judge Found that Pfizer "Manipulated" the Bankruptcy

But by September, 2010, according to Bloomberg then:

Pfizer Inc.’s Quigley unit, a former asbestos maker, was denied permission to exit bankruptcy by a judge who found the world’s largest drug company manipulated the bankruptcy process to benefit itself.

U.S. Bankruptcy Judge Stuart M. Bernstein in New York today rejected Quigley’s fourth reorganization plan and said parties should discuss dismissal of the case. He said the plan was filed in 'bad faith' by Pfizer and cited testimony that asbestos claims directed at Quigley could total $4.45 billion over the next 42 years.

No Progress by the End of 2010

Apparently despite the judge's opinion, the case still remained tied up in court. By December, 2010, no progress had been made. According to Bloomberg then:

Pfizer Inc., the world’s largest drug company, should have the bankruptcy of its Quigley unit which has protected it from asbestos-related health problems since 2004 dismissed, lawyers for the U.S. Trustee said.

While the bankruptcy has been pending, creditors with alleged asbestos-related health problems have been unable to sue New York-based Pfizer, and many have died, wrote lawyers for the U.S. Trustee, an arm of the Justice Department that oversees bankruptcy. A hearing to decide the U.S. Trustee’s request is set for Jan. 13, according to court papers filed Dec. 23.

'The harm in delaying the inevitable dismissal of this case is to the individuals who have filed asbestos claims against the Debtor and Pfizer,' lawyers for acting U.S. Trustee Tracy Hope Davis wrote in court papers. 'For some of those individuals, time may be of the essence.'

So Pfizer had stalled for so long that some of the plaintiffs had died off.

Summary

So let us summarize. For reasons that are unclear, Pfizer Inc, primarily a pharmaceutical company, bought out a company that made asbestos products in 1968. The health hazards of asbestos were soon recognized, and many people filed lawsuits against Pfizer's subsidiary, alleging they had been harmed. Pfizer promised to settle the matter in 2004, about 30 years since the exposures occurred. Yet by setting up a bankruptcy of its subsidiary as if it were an independent company, Pfizer stalled any resolution of the case for at least another six years, using what a Judge termed "manipulation." Now it is 2011, and the cases are still unresolved.

So for a company that claims it is

committed to applying science and our global resources to improve health and well-being at every stage of life.

and boasts

Pfizer Inc: Working Together for a Healthier World

This does not look good.

So question number one is should not the leaders of a company whose main business is ostensibly making people healthier be more sensitive to claims about the health effects of its products? Specifically, why did Pfizer's leaders not try to more speedily come up with a cleaner and more timely solution to this problem that would appear more sensitive to the health problems of the claimants?

It would be interesting if Pfizer's top leaders were to try to answer that question.

My policy observation is now familiar.  As we have said before, far too often the leaders of not-for-profit health care institutions seem more interested in padding their own bottom lines than upholding the institutions' missions. They often seem entirely unaware of their duty to put those missions ahead of their own self-interest. Like the financial services sector in the era of "greed is good," health care too often seems run by "insiders hijacking established institutions for their personal benefit." True health care reform would encourage leadership of health care who understand health care and care about its mission, rather than those who see a quick way to make a small fortune.

Executive Compensation at Non-Profit Hospitals: Pay for ... Fraud?

We have often discussed executive compensation at US hospitals and academic medical centers, which seems to run from generous to outrageous.  The usual explanation by organizational spokespeople, and occasionally boards of trustees is that this is the sort of compensation needed to attract the best and the brightest, a variation of the "pay for performance" meme that resounds throughout business schools and executive suites.  However, almost never does anyone at any hospital or AMC acknowledge that their leaders are not the best and brightest, although outside of Lake Woebegone, all cannot be above average.

Here are two recent stories about hospital executives whose compensation contrasted with their performance.

Danbury Hospital

We previously posted about how the former chief financial officer (CFO) of Danbury Hospital, now part of Western Connecticut Healthcare, was found in violation of a no-contact order that arose after he was charged with multiple counts of fraud.  It turns out that the William Roe, the former CFO, previously was paid $267,990, per the Danbury News-Times. 

This month, again according to the News-Times, he pleaded guilty:

William Roe, the former chief financial officer of Danbury Hospital arrested in August and charged with defrauding the hospital out of more than $100,000, pleaded guilty Tuesday to one count of wire fraud.

The plea reduces the charges against Roe. In September, in addition to the wire fraud charges, federal prosecutors charged him with two counts of interstate transportation of stolen money. Those charges have been dropped as part of the plea deal.

Along with the guilty plea, Roe has agreed to reimburse Danbury Hospital more than $140,000. He also will reimburse St. Rita Hospital in Lima, Ohio, where he worked as CFO before coming to Danbury Hospital, an additional $75,000 for funds he allegedly stole there.

Archbold Memorial Hospital

This is one of those cases it would be hard to make up. The Dow Jones News Service originally reported in December, 2010:

A Georgia hospital paid $13.9 million to settle allegations it submitted false claims to the state's Medicaid program, the Justice Department said Wednesday.

The settlement resolves allegations that between November 2002 and July 2008, Thomasville, Ga., John D. Archbold Memorial Hospital Inc. made false representations to the Georgia Department of Community Health, the state agency that administers the Medicaid program in Georgia, that it was a public hospital for Medicaid purposes in order to increase the amount of funds provided to the hospital.

Under Medicaid rules, only public hospitals may participate in the Medicaid Upper Payment Limit, or UPL program. Contrary to its state certification, Archbold Memorial was in fact a private hospital, the Justice Department said, and as a result received millions of dollars in funds to which it was not entitled.

A private not-for-profit hospital claimed to be a public hospital to Medicaid?  And it took years for anyone to figure out that was not the case?  It would have been hard to make that one up.
Two executives took the rap:

in early 2008, then-Chief Financial Officer William Sellers resigned after a three-month suspension and pleaded guilty to charges related to his role in the matter. Former Chief Executive Ken Beverly, who also resigned in February of that year, was recently convicted on charges regarding his involvement.

The Albany (Georgia) Herald reported that Mr Beverly did quite well between the time of his resignation and his conviction:

Former CEO Ken Beverly resigned from his post in 2008 and walked away with more than $6.1 million in compensation and benefits. He was later indicted by a federal grand jury.

Convicted Dec. 8, 2010, of six felony counts related to an indictment alleging he was part of a scheme to defraud Medicaid, Beverly remains free on bond and is awaiting a sentencing hearing.

So is that $1 million per felony count? At least we can be assured it was not a "golden parachute,"

Archbold Spokesman Mark Lowe said that the figure as noted in the hospital’s Form 990 for 2009 as filed with the IRS on August 2010 is the sum of Beverly’s deferred compensation and benefits package as it has accumulated over the course of his 30-plus year career with the hospital and was not a 'golden parachute,' as described in some media reports.

'The ‘other compensation’ is from his retirement program that accumulated deferred compensation over the entire term of his employment. In his case, that was in excess of 30 years of deferred compensation. It’s not severance; rather, it’s compensation that was earned but not paid out until retirement,' Lowe said.

Well, that is reassuring.  Of course, regardless of what you call the payment, a lump sum of $6.1 million is far more than most citizens ever will get for their retirement from any employer.  Having $6.1 million in one's retirement account would fit most peoples' definition of "rich." 

Summary

Again, almost all hospital and academic medical center executives seem to be well-paid, even if they work at small institutions, or at those with shaky finances. When their pay is noticed by the news media, the usual explanation is the executives' general brilliance and excellence, with little more than more vague adjectives supplied in justification.

Given the lack of clear evidence for most executives' large compensation, I believe it is reasonable to cite anecdotes where generous compensation was obviously, if retrospectively coupled with poor performance to challenge the rationale for ever-increasing executive compensation in health care. The two cases above are not of merely poor, but criminal performance, and so stand out.

As we have said before, far too often the leaders of not-for-profit health care institutions seem more interested in padding their own bottom lines than upholding the institutions' missions. They often seem entirely unaware of their duty to put those missions ahead of their own self-interest. Like the financial services sector in the era of "greed is good," health care too often seems run by "insiders hijacking established institutions for their personal benefit." True health care reform would encourage leadership of health care who understand health care and care about its mission, rather than those who see a quick way to make a small fortune.

BLOGSCAN - Attention to Medtronic's Payments to Spine Surgeons in the Main Stream Media

On the HealthBeat blog, Maggie Mahar takes up the case of huge royalty and consulting payments to spine surgeons by medical device company Medtronic.  We had discussed the case recently here, followed by Howard Brody on the Hooked: Ethics, Medicine and Pharma blog (see link in this post).  Ms Mahar was notably optimistic because of the continued attention to this case by the main stream media.  She argued that the increased emphasis on aspects of health care dysfunction shown by the media means "health care reform is moving ahead on the ground."  I hope she is right, but I would feel more hopeful if ill-informed, mission-hostile, self-interested, conflicted, and corrupt health care leadership was less anechoic, if health care dysfunction actually got some attention in the medical/ health care/ health services research/ health care policy literature , and if I could identify at least one prominent politician or policy-maker who talks about these issues.

KOL Phollywood

I have wondered many times about the proliferating offers I've received in increasing numbers in recent years for medical symposia, talks, conferences, etc. that appear either subtly or overtly geared to promote some treatment or product for a disease area.

Roy Poses' post "Key Opinion Leader Services Companies: the Creation of Useful Idiots and Usefully Idiotic Organization" would appear to help explain this phenomenon.

Worse:

At my Aug. 2009 post "Has Ghostwriting Infected The Experts With Tainted Knowledge, Creating Vectors for Further Spread and Mutation of the Scientific Knowledge Base?" here I wrote:

... Will we ever be able to peel back all the layers of the ghostwriting onion to get to the core of impartial and objective scientific articles related to drugs and medical devices? Perhaps not, but the practice must stop going forward.

Tainted literature creates tainted scientific knowledge, the carriers of which may then further taint the knowledge base (with the best of intentions and with firm belief in the fairness and accuracy of their activities, of course).

Practitioners of evidence-based medicine may be unwittingly practicing "evidence-tainted medicine", or "pseudo-evidence based medicine" as described by others on this blog.

We now learn that an entire industry exists to identify, catalog, index social networks, and do other data mining to quantify "KOL suitability factors", and then interact with pharma and surely other healthcare sectors to launch and "nurture" people so identified, as Hollywood might do to identify actors for a movie. It thus seems the situation with regard to medical science might be even worse than I thought.

I ask:

• Can we ever fully trust information given at medical presentations, especially by "popular", even well-published physicians any more?

• Can we truly trust any medical literature, period?

Even worse - do pharmas and other healthcare sectors use these services not just to identify what might be called "positive" KOLS to be seduced and romanced and deployed to spread the company's charms, but also to identify "negative" KOLs (with messages not to the liking of the industry) to be marginalized?

Finally, I coin a new term for this circle jerk of pharma KOL 'services companies' (a.k.a. KOL peddlers), KOL handlers and KOL promoters:

"Phollywood."

-- SS

Jan 12, 2011 addendum:

See the post "A Massive Cynical Effort" at the blog of 1BoringOldMan for interesting observations about these issues.

Key Opinion Leader Services Companies: the Creation of Useful Idiots and Usefully Idiotic Organizations

In researching the conflicts of interest of the University of California "36," I stumbled upon a fascinating corner of the pharmaceutical/ biotechnology/ medical device marketing universe, the companies that find and manage key opinion leaders (KOLs), also known as "thought leaders."  Reviewing their own marketing materials reveals how KOLs truly are health care corporate marketing's useful idiots.

I found three companies which seem entirely devoted to the adoption, care and feeding of KOLs, plus numerous companies, including some medical education and communication companies (MECCs) that provide KOL-related products and services.  I will first describe the companies briefly, then draw upon their marketing materials to underline what KOLs are really about.

Leadership in Medicine Inc

This is the company I found first, because one of its directors is a member of the UC 36, the group of top university leaders who threatened to sue the university to increase their already generous pensions.

Leadership in Medicine Inc's web-site describes its reason for being thus:

IF YOU NEED TO KNOW who are the most prominent, admired, and influential actors in healthcare, how they are interconnected, and why, you need our expertise.

Given how vastly complex are the relationships among providers, researchers, and other significant actors in healthcare, it is vital to focus on key opinion leaders (KOLs) at local, regional, and global levels, and to understand the ties among them.

Its clients are:

Over 80 client companies
* All of the top 15 largest pharmaceuticals
* 8 of the 10 largest biotechs
* 5 of the 10 largest medical device companies

A graphic on its "experience" page listed the following companies: Baxter, Wyeth, Lilly, Roche, Gilead, GlaxoSmithKline, Pfizer, Abbott Laboratories, Genzyme, Bristol-Myers-Squibb, Medtronic, Johnson and Johnson, Genentech, and Covidien.

KOL LLC

Company description:

As our name implies, we are a company devoted to providing Key Opinion Leader software and Key Opinion Leader Management services for pharmaceutical, biotechnology and device companies.

The company's graphic client list included: Cephalon, Scios, Novartis, Schering-Plough King Pharmaceuticals, Pfizer, Genentech, Reliant Pharmaceuticals, McNeil (division of Johnson and Johnson, Jazz Pharmaceuticals, Endo Pharmaceuticals, Cytogen, Health Products Research, Shire, Reckitt Benckiser, Protein Design Labs, and Odyssey Pharmaceuticals.

Thought Leader Select

The relevant parts of the company description:

Thought Leader Select is a Chapel Hill, NC-based private research and consulting firm serving the biopharmaceutical and healthcare industries.

and

We serve these industries and the medical community at large by assessing medical experts (known as 'thought leaders' and 'key opinion leaders')....

Perusal of the materials used by these companies, and other companies which market KOL or thought leader related services makes the nature of the relationship between KOLs and commercial health care firms, and the purpose of employing KOLs clear.

KOLs are Employed by Marketing Departments to do Marketing

The best example comes from a description of a KOL information technology application sold by Nagarro:

A web-based application was developed by Nagarro to help the marketing department of a global pharmaceutical company exploit Key Opinion Leader (KOL) information in order to promote products and remain ahead of its competition.

Problem Description

In today s fast-paced competitive environment, pharmaceutical companies cannot solely rely on superior products to succeed. Well organized marketing departments help sales departments reach goals and give companies an edge over competition, but without access to valuable resources, like KOLs, they are ineffective. KOLs influence the medical community and ultimately the end users of pharmaceutical products.

Pharmaceutical companies that are able to identify and work with KOLs will be better positioned to compete....

Benefits

[include]
Creation of market intelligence from highly specialized and customizable reports containing previously unavailable aggregate data....

Ability to group KOLs by product knowledge and associations in order to better promote products

Ability to maximize ROI from KOL related events

Enhanced sales and marketing productivity through streamlining of complex multi-source information

That makes it crystal clear that marketers use KOLs to market, to sell products. While at times KOLs might actually be used to advise health care corporations about clinical or scientific issues, that is hardly their major point. KOLs are almost always hired to market by marketing departments.

In case someone might argue that this is only one example, let us look at materials from the other companies.

KOL LLC described the usefulness of KOLs thus:

Everyone recognizes the value of opinion leaders (OL), or thought leaders. While national level OLs may not write many prescriptions they influence thousands of prescribers and hence prescriptions through their research, lectures, publications and their participation on advisory boards, committees, editorial boards, professional societies and guidelines/consensus document development. Regional level OLs are often involved in state societies or legislative initiatives in addition to their speaking and publications. While local level OLs may not publish, they provide advice to local colleagues and may speak at grand rounds. And who are the ‘rising stars’ in your therapeutic area?

It is imperative that you know the OLs in your market at a national, regional and local influence level as well as those ‘rising stars’.

This is a bit more indirect, but it is clear that the goal is to "influence prescribers" to prescribe, not provide scientific or clinical advice to the company.

Leadership in Medicine Inc's materials also continually emphasized the point of KOLs is to influence, for example, they boasted of pioneering analyses "to assess paths of influence in healthcare," developed a particular tool called "Centrality Ranking" to "provide fine-grained ratings of KOLs' influence," and claimed to "have identified, profiled, and mapped the influence of tens of thousands of individual KOLs...." The clear implication is that KOLs' influence is the central consideration, and what else is this influence good for other than to sell products, and perhaps advocate for corporations in general?

When KOLs are Involved, Many Activities that Appear to be Educational or Scientific Really Are For Marketing

Strikingly, KOL LLC claimed its role in guideline development:

Guidelines produced by national societies are optimal, but often can be a slow, painful and expensive process to develop. KOL, L.L.C. can provide a faster alternative. We have experience convening a panel of experts in a therapeutic area. We serve a project management role to ensure the timelines and deliverables are met. We have access to a medical writing team of 25 healthcare professionals who can write the initial drafts, as our experience tells us it is easier for experts to edit, than to write from scratch.

There has been growing realization that guidelines may be biased by commercial sponsorship and by the participation by individuals with conflicts of interest. The KOL LLC marketing materials suggest, however, that guidelines have become purpose-built marketing vehicles through the participation of selected KOLs with allegiances to drug, device and biotechnology companies. As an aside, note that guideline-development services includes the participation of a team of ghost-writers who will write the first drafts, a function that naive academics might have thought should be that of clinical and scientific experts.

For another example, KOL LLC asserted it could manage "investigator meetings," :

We’ll help you better plan to maximize the communication of the trial results through targeted abstracts, posters, publications and lectures.

so

Due to the time constraints placed on Clinical Research Departments, many times ‘research mills’ are selected as the trial sites. This is fine, but who is going to publish the results and stand up and present the results at national, regional and local meetings. We can provide you advice and counsel about how to involve your KOLs effectively, while maintaining your aggressive timelines.

The goal of KOL management here is for the company to control how the research is disseminated. Note also the cynical view of "research mills," which likely refers to contract research organizations. Do we really think that CROs are used by commercial firms because they do better research?

Key Leading Organizations

A bonus from reading through the offerings on KOL management was to discover another related business that has not been subject of polite conversation before. Leadership in Medicine Inc put it this way:

Equally essential is recognizing the roles played by key leading organizations (KLOs) such as medical institutions, payers, professional organizations, patient groups, government entities, and journals in structuring KOL activities and relationships, since those are the stages on which KOLs perform.

Key Leading Organizations (KLOs) apparently include influential organizations, e.g., academic medical institutions, medical societies, and patient advocacy groups that can be deliberately turned into organizations of useful idiots for marketing purposes. Note that we and others have discussed how institutional conflicts of interest and conflicts of interest affecting leaders of of such organizations can lead to bias in favor of commercial interests. But what Leadership in Medicine Inc has written suggests that such organizations can be deliberately taken over to function as industry's fellow travelers.

Similarly, Thought Leader Select advertised services to manage organizations to support "thought leadership":

Through Centers, all of our research and assessment skills culminate in our evaluation of universities, influential clinics, and research foundations for a holistic approach to thought leadership in the medical community. With centers of excellence assessments we take a drill-down approach, starting at the academic medical centers, then moving into affiliated hospitals and clinics....

Summary

Industry spokespeople and key opinion leaders tout themselves as clinical, educational, and/or scientific experts chosen for their expertise to advance medicine, science and public health.  There are documented instances (e.g., see posts here and here) in which defectors from marketing departments of commercial health care corporations described KOLs as salespeople who could be more influential hidden within their professional or academic cloaks.  Even some physicians paid to be speakers on behalf of pharmaceutical corporations have acknowledged their role as salespeople in fancy dress (see post here).  There are cases of documents revealed by discovery in legal actions that show how companies planned organized stealth marketing efforts for drugs that included activities by KOLs (e.g., see post here about marketing of Lexapro, and here about Neurontin).

However, the marketing materials used by KOL service companies (for lack of a better name) show that KOLs are largely meant to be stealth marketers, and hired for that purpose, that KOLs participate as marketers in the sorts of activities that to the naive appear to be educational or scientific, and that marketers try to recruit whole organizations, such as medical schools, research organizations, medical societies, and patient advocacy groups as disguised sales organizations.

This goes beyond the problem of bias of physicians, or individual health professionals due to their financial relationships.  It goes beyond the problem of bias of organizations due to their sources of financial support or the financial relationships of their leaders.  It looks like there has been a massive campaign by health care corporate marketers to make useful idiots out of possibly a majority of medical academics and academic, professional, and supposedly patient-centered organizations.  This appears to be a massive, cynical effort to hollow out our once respected health care institutions and professionals in the service of marketing.

A final word to any individuals reading this who are paid by corporate marketers to be KOLs.  If you think that you are paid for educational or scientific purposes, you likely have been made into a chump.  The people who did this to you were likely not acting in your best interests, or those of society, but to cynically market their product and increase their own earnings.  If you doubt this, look at the materials cited above.  You really don't want to continue being chumps, do you?

Why Would Directors of Health Care Corporations Push for Bigger Pensions for Academic Administrators?

We recently posted about 36 well-paid top executives in the University of California system, including leaders of medical schools, academic medical centers, and public health, who threatened a lawsuit if their pensions were not increased according to what they claim was a promise made to them in 1999.

Riddle me this: why would a group of directors of for-profit corporations that provide health care goods and services. plus a director of a leading biotechnology trade group, and the director of a leading mutual fund family band together to support this demand, thus to push for bigger pensions for these top managers of the University of California system?

Here is a list of the directors, and their corporations:

-  Mark R Laret, director of Varian Medical Systems and Nuance Communications Inc, which provides numerous health care products 
- Dr David Feinberg, director of OSI Systems, whose Spacelabs Healthcare subsidiary manufactures medical devices
- Steven C Currall, director of Leadership in Medicine Inc, which claims to be a leading provider of intelligence about key opinion leaders (KOLs) in medicine and health care.  Its web-site asserts, "IF YOU NEED TO KNOW who are the most prominent, admired, and influential actors in healthcare, how they are interconnected, and why, you need our expertise.  Given how vastly complex are the relationships among providers, researchers, and other significant actors in healthcare, it is vital to focus on key opinion leaders (KOLs) at local, regional, and global levels, and to understand the ties among them."  (Note that we have often discussed how KOLs function as stealth marketers for pharmaceuticals and devices.)

They joined:
-  Robert S Sullivan, PhD - director of BIOCOM, whose web-site asserts it is the" largest regional life science association in the world, representing more than 550 member companies in Southern California."
-  Richard K Lyons, director of iShares, a leading provider of mutual funds.

The answer is simple.  All the corporate directors listed above are also members of the group of 36 litigious executives.  See their name on the list of 36 here in the San Francisco Chronicle.

- Mark R Laret, director of Varian Medical Systems and Nuance Communications Inc, which provides numerous health care products, is also CEO of UCSF Medical Center.
- Dr David Feinberg, director of OSI Systems, whose Spacelabs Healthcare subsidiary manufactures medical devices, is also CEO of the UCLA Hospital System
- Steven C Currall, director of Leadership in Medicine Inc, which claims to be a leading provider of intelligence about key opinion leaders (KOLs) in medicine and health care, is also Dean, and Professor of Management of the University of California - Davis Graduate School of Management.
Robert S Sullivan, PhD - director of BIOCOM, whose web-site asserts it is the" largest regional life science association in the world, representing more than 550 member companies in Southern California, is also Dean of the University of California - San Diego Rady School of Management.

- Richard K Lyons, director of iShares, a leading provider of mutual funds, is also Bank of America Dean and Professor of Business, University of California - Berkeley Haas School of Business.

Their inclusion within the larger group seems ironic, at best.  As corporate directors, they have outside income and have accumulated assets that will likely keep them out of poverty in their old age.  For example, Mr Laret had accumulated the equivalent of 37,168 shares of Varian, and was paid $267,300 a year for his services according to the company's 2010 proxy statement.

Furthermore, for those who directly lead health care institutions, Mr Laret and Dr Feinberg, their memberships on the boards of health care corporations, which imply fiduciary responsibilities to the companies and their stock-holders, conflict with their duties as leaders of academic health care to uphold teaching, research and patient care.  Dean Currall's responsibilities to an organization which seems entirely dedicated to helping drug, device, and biotechnology companies turn health care professionals and academics into stealth marketers at least seems unseemly given that his school is part of a university which also includes a medical school and academic medical center. 

Since our earlier post, it appears that the University of California president will not accede to the demands of the 36, as noted in the San Francisco Chronicle.  Their demands have continued to provoke outrage.  A recent discussion in Inside Higher Ed interviewed Emeritus Professor Helen Henry, a member of the University's Academic Senate, who posited:

the debate as part of a fundamental philosophical disagreement within the university. The signatories to the letter, many of whom are based in medicine or management, have a different view of the university than faculty from other disciplines, she said.

'I don’t think there’s any question but that there are these two different mindsets that are fighting for what the university should be. It’s transparent in this letter,' said Henry, a professor emeritus of biochemistry at the Riverside campus. 'They are running businesses. But there are those of us that don’t feel this is what the university should be.'

'This is absolutely a manifestation of that clash between the people who see UC as their business … and the people who see UC’s mission as teaching, and research and service to the state. That’s a dual personality that the university always has to live with.'

Five of the university leaders demanding higher pensions for themselves have responsibilities as directors of corporations that may conflict with their academic institutions' missions, while these corporate positions ought to insulate them from financial concerns about their retirement. This corroborates Prof Henry's notion that they see themselves as businesspeople whose role is separate from, and not necessarily supportive of the university mission.

I disagree, however, with Prof Henry's implication that the University has to live with such a split among its leadership. People who lead academic institutions have a primary responsibility to support the academic mission. Their goals should not be to maximize profits, much less to enrich themselves. Letting academia, and academic medicine be lead by leaders out to make money and line their own pockets will lead to just that, but hardly better teaching, research, and patient care.

Blast from the Anechoic Past: Former UCI Fertility Doctor Arrested in Mexico

Soon after we started Health Care Renewal, we ran a series of posts about the University of California-Irvine (UCI) medical school and medical center, featuring stories of mismanagement of major programs, especially those involving organ transplantation (liver, kidney, and bone marrow) while the top executives who presided over the mess received generous compensation, sometimes in strikingly irregular ways, and while at least one whistle-blower alleged he lost his job for complaining about safety issues.  Some of the stories went back another 10 years, to 1995.  One particularly striking story involved the UCI infertility program.  Three physicians were accused of stealing ova from some women to implant in others.  One physician was convicted, and two fled the country (see post here).

One of those physicians just turned up.  As reported by ABC News at the end of 2010:

U.S. authorities are working to extradite one of the doctors accused of being behind of the biggest fertility scandals in history. Mexican authorities arrested Dr. Ricardo Asch last month.

Back in the 1990s, Asch and another fertility doctor, Jose Balmaceda, were charged with stealing embryos and eggs belonging to dozens of women who sought treatment at the University of California-Irvine Center for Reproductive Health and implanting them into other women.

They are also accused of not reporting more than $1 million in earnings, and fleeing the country to avoid prosecution.

Marla McCutcheon is one of the women who says she was victimized by Asch. She was one of his patients until she decided to switch physicians because she said she found him 'uncaring.'

McCutcheon, from Irvine, Calif., says she found out years later that after she'd left Asch's care that there were leftover eggs she didn't know about. To this day, she doesn't know what happened to those eggs.

'I would have done anything for those eggs at that time. It's still hard for me to grasp that there might be something to my eggs. Someone may have been able to get pregnant from them,' McCutcheon said.

At the time of the scandal, ABC News saw documents showing that more than 60 other women who were patients at the fertility center had eggs taken from them without their consent. Asch, however, said he knew nothing about it. During the time the incidents occurred, it was not illegal to transfer human tissue without consent.

The case had major repercussions for how fertility clinics operate:

The scandal allegedly involving Asch, Balmaceda and another doctor, Sergio Stone, rocked the field of reproductive medicine, and doctors say they still feel its effects.

'Reproductive medicine is very new. It's come a long way and we've made tremendous progress, but because of scientific advances, it's very high-profile,' said Dr. Jani Jensen, a Mayo Clinic reproductive endocrinologist in Rochester, Minn. 'Whenever there are publicized incidents like this that involve ethical issues, it's sometimes difficult to engender the public's trust.'

Dr. Howard Zacur, director of the Division of Reproductive Endocrinology and Infertility at the Johns Hopkins Fertility Center in Baltimore, Md., said patients still want reassurance their eggs and embryos will be protected from these types of incidents.

It is now against the law in California to take eggs from a woman without her consent.

Note that the disconnect between problematic quality of care at UCI and the generous compensation afforded its top leaders continued through 2010, as this post discussed.

Aside from its colorfulness, there are other reasons to recall the story of the stolen ova and the subsequent troubles at UCI.  First, the list of problems over 15 years discussed in our series of posts suggests an institution whose leadership culture is seriously disturbed.  I cannot view the institution from a distance and figure out what the fundamental problems are with its leadership and governance, but there must be some.  (Note that per a 2006 post, an internal report did fault lack of accountability, leadership by people with no medical background, absence of clear reporting lines, and the overlooking of whistleblowers, but these are just descriptions of bad management and governance, not explanations of them.  Furthermore, it is not clear whether there have been any fundamental changes in leadership or governance since then.  If there readers know there is more to this, please let me know in the comments section below.)

Second, this case illustrates how the anechoic effect has decreased recognition that the problems at UCI may be part of more systemic problems.  Despite the number of problems that occurred, their vividness, and their coverage in local media, the troubles at UCI have not gotten national media attention, nor as far as I can tell, have they ever been discussed in the medical, health care, health services research, or health policy literature.  (I have tried multiple Google scholar searches using the institution's name, and keywords including "scandal," and the names of some of the physicians most prominently named in our series of posts, and have found nothing relevant.)  The 15 year history has produced almost no echoes, and hence now has become as striking a black hole in the annals of bad health care leadership and governance as was the case of the fall of the Allegheny Health Education and Research Foundation (AHERF). 

Certain issues that we discuss on Health Care Renewal have become less anechoic, in particular, conflicts of interest caused by academic physicians financial ties to the drug, biotechnology and device industries.  However, the larger issues of mismanagement by lavishly compensated, and hence perversely incentivized executives remains relatively anechoic.  I am not sure how big a scandal it will take to remove the taboo from discussing it.