healthy4u: Northwestern University

The Mystery of the Northwestern Settlement - the Plot Thickens

A few weeks ago, we wrote about this curious case. How the Case Stood Northwester University, a prominent research university, settled charges it had mismanaged US government grant funds.  While it did not admit guilt, and specifically exonerated the faculty leader on whose watch the mismanagement allegedly occurred, the settlement and most of its coverage strongly suggested wrongdoing by the faculty member in charge of the scientific conduct of the grants, Professor Charles L Bennett.  While the alleged financial mismanagement was of funds in the mere millions, a relatively small amount as federal fraud cases go, and there were no allegations of anything harmful to patients, or of any research misconduct, the investigation involved multiple federal agencies, including the Federal Bureau of Investigation.  The settlement of charges of financial mismanagement, not research misconduct,  included unfavorable references to Dr Bennett, who as Principal Investigator should have been in charge of the scientific conduct of the grants, but not of their financial management.  Much bigger cases of alleged fraud, involving hundreds of millions of dollars, and potentially harm to patients due to overuse of dangerous drugs or devices, have not involved the FBI, and not included any disparagement of individuals who could have authorized, directed, or implemented the alleged misbehavior. None of the initial press coverage noted the peculiarity of these aspects of the case, nor provided any explanations for them.       Days later, the Cancer Letter published a long article in this case, which is now <a href="http://www.cancerletter.com/articles/20130809">available without a subscription</a>.  This article includes even more curiosities that raise even more questions. Dr Bennett Found Irregularities, Sangoleye Pleaded Guilty, Nobody Noticed In the original media coverage, Dr Bennett was accused based on complaints by a whistle blower.  For example, in an <a href="http://www.suntimes.com/news/21623742-418/northwestern-to-pay-nearly-3-million-to-settle-cancer-research-fraud-suit.html">article</a> in the Chicago Sun-Times, <blockquote class="tr_bq"> A whistleblower suit filed under seal in 2009 by former Lurie Cancer Center worker Melissa Theis first alleged the wrongdoing by Bennett. </blockquote> However, the story in the Cancer Letter suggests Dr Bennett had tried to blow the whistle himself.  First, <blockquote class="tr_bq">Bennett said the allegations that he spent NCI money on dinners and vacations were inaccurate. He said he had encountered administrative irregularities at Northwestern and reported them to compliance officials.</blockquote> In addition, 'I reported administrative issues by Northwestern University with my grants to the university compliance officer in 2006, just prior to my long-term bout with cancer that was diagnosed there,' Bennett said to The Cancer Letter. 'I have never had a single administrative discussion about the matter with anyone.' Specifically, <blockquote class="tr_bq">Bennett’s statement about lax administration of grants at Northwestern appears to be bolstered by an aspect of the scandal that has escaped media attention even as multiple news stories in Chicago and national outlets focused on the settlement. The Cancer Letter has learned that days before the settlement with Northwestern was announced, a former research administrator at the Division of Hematology and Oncology at the university’s medical school pled guilty to felony charges stemming from administration of Bennett’s NCI grants. According to documents filed in the U.S. District Court for the Northern District of Illinois, Feyifunmi Sangoleye, the rogue administrator, set up an elaborate scheme to divert $86,000 to her personal accounts.The proceeds financed a wedding and a honeymoon in Europe, court documents say.</blockquote> The article later included more detail, <blockquote class="tr_bq">Bennett said that he saw irregularities in the actions of the research administrator who handled his Research for Adverse Drug Events and Reports and that he has alerted the administration of the Division of Hematology and Oncology. That same administrator, Sangoleye, pled guilty to larceny and theft, admitting to having embezzled NCI funds from Bennett’s program into a checking account created in the name of a fictitious contractor. According to court documents, Sangoleye created a vendor code for a fictitious entity she called ATSDATA. Then she created 10 false invoices from that entity and paid them with Northwestern’s checks. The checks were sent to the ATSDATA post office box, which Sangoleye had rented, and placed into a bank account she created. Between June 29, 2007, and July 29, 2008, ATSDATA received eight Northwestern checks that added up to $86,000. 'Sangoleye converted the proceeds of the ATSDATA checks to her own use and to the use of another' individual, the plea agreement states. 'I knew nothing about ATSDATA,' Bennett said in response to questions from The Cancer Letter. 'The administrator told me that ATSDATA was the billing address for the University of Illinois Survey Research Laboratory, a formal subcontractor. I did not know that the Survey Research Lab had any particular billing name. I have documented this to Jonathan Licht [chief of Northwestern’s Division of Hematology/Oncology] in 2008.'</blockquote>So in summary, Dr Bennett, who was responsible for the scientific integrity but not the financial management of his grants, reported financial irregularities to Northwestern managers.  These reports lead to a guilty plea by a former Northwestern manager who admitted embezzling money.  However, this guilty plea was anechoic.  It did not appear in any media accounts.  The settlement negotiated between Northwestern University and the government did not acknowledge it.    According to the Cancer Letter, Northwestern managers did not want to discuss the crimes of Sangoleye when the Cancer Letter brought it up, <blockquote class="tr_bq"> Northwestern officials declined to discuss Sangoleye, saying only that she had been employed by the university as a research administrator from February 2006 through August 2009.</blockquote> The Cancer Letter suggested why the university might have had an interest in keeping the Sangoleye crimes and its settlement of the allegations about Dr Bennett apart. <blockquote class="tr_bq">Legal experts say that the final plea agreement between Sangoleye and the government would have weakened Northwestern’s position in negotiating the settlement. The final version of the plea agreement with Sangoleye was filed on July 25, just five days prior to the announcement of the government’s $3 million settlement with Northwestern.</blockquote>Northwestern University might have had an interest in keeping the Sangoleye criminal case and its civil case separate.  However, the government did not obviously have such an interest. Why did the government not address Sangoleye's crimes in the settlement it made with Northwestern University? The Ambiguities of the Named Whistle Blower's Work As we noted in our <a href="http://hcrenewal.blogspot.com/2013/08/the-mystery-of-northwestern-settlement.html">earlier post</a> on this case, the role of the named whistle blower, Melissa Theis, was unclear, especially vis a vis Dr Bennett.  Although Dr Bennett as Principal Investigator of some of the grants involved ought not to have had any direct control of the financial management of the grants, Ms Theis apparently worked in some financial management capacity.  Yet Ms Theis apparently blew the whistle on the university, and on Dr Bennett for alleged financial, not research mismanagement. The Cancer Letter raised new doubts about Ms Theis' role, <blockquote class="tr_bq">Several observers were surprised to see that the relator, Theis, was never employed by the cancer center. According to her 2009 suit, Theis came to Northwestern as a temp two years earlier, in 2007, serving as a purchasing coordinator for the Division of Hematology and Oncology. The division, which is separate from the cancer center, administered all but one of the grants in question, the NIH database shows. After a year, in 2008, Theis was hired as a fulltime employee of the Northwestern Medical Faculty Foundation. The foundation, which runs the medical practice, is also separate from the cancer center. She left Northwestern in October 2008. 'Theis specifically noted that invoices were submitted for consultants and services that were never included in the initial grant budget,' the complaint states. 'Invoices were submitted for consultants and services that were significantly in excess of the amount budgeted for the grant, and many of the consultants and vendors failed to provide detailed information about the actual services rendered.'</blockquote> Again, in the usual practice, such invoices might have been requested by a grant investigator, but the requests would have to have been vetted and then the invoices would have to have been generated by managers, not scientists or physicians.  Who really administered these grants, and why did the settlement minimize the responsibility of university managers while apparently blaming scientists for bad financial management? Dr Bennett's Supporters and Enemies In our <a href="http://hcrenewal.blogspot.com/2013/08/the-mystery-of-northwestern-settlement.html">first post</a> on this case, we had contrasted how the settlement and media coverage of it appeared to heap blame upon Dr Bennett alone, while not attaching any responsibility to his academic supervisor on one hand, or any university managers on the other.  We noted that Dr Bennett, after having been a consultant for Amgen,  had become known as a "pharmascold," a skeptic of pharmaceutical industry practices, and the author of research that suggested one Amgen product was more hazardous than had been previously thought.  His supervisor, on the other hand, had multiple ongoing financial ties to the pharmaceutical industry. The Cancer Letter suggested others were trying to connect related dots. First, in general, <blockquote class="tr_bq">Making enemies is an exhaustively studied side effect of probing the safety of cancer drugs, and during much of the period in question, Bennett was producing more than his standard quota of foes.</blockquote> In particular, <blockquote class="tr_bq">Now, researchers who worked with Bennett on the ESA issues are puzzled by his legal problems. 'Charlie has been an important voice in raising concerns regarding the use of erythropoietin in patients with cancer,' said Anthony Blau, co-director, Institute for Stem Cell and Regenerative Medicine at the University of Washington. 'In particular, his 2008 metaanalysis, published in JAMA, heightened awareness of the issue and helped to reduce the indiscriminate use of erythropoietin in cancer patients.' Blau is a co-author on the <a href="http://jama.jamanetwork.com/article.aspx?articleid=181533">JAMA paper</a> [as noted in our <a href="http://hcrenewal.blogspot.com/2013/08/the-mystery-of-northwestern-settlement.html">previous post</a>.] 'This doesn’t really fit in his picture,' said Michael Henke, a radiation oncologist in Freiburg, Germany, who was the first to stumble across potential problems stemming from overuse of ESAs. 'You might recall, we got in contact in 2003 when our group communicated potential dismal effects of erythropoietin on cancer patients—a story not really appreciated these days because of economic interests,'  Henke said referring to the pioneering paper in The Lancet. Henke was the senior author on the JAMA paper. 'However, Dr. Bennett and we consistently gathered additional data that were finally reported as a meta-analysis in 2008. Consequently, erythropoietin prescriptions dramatically decreased, eventually prolonging or even saving lives of cancer patients.' 'While collaborating, I did learn him as extraordinarily active, alert-eyed colleague who strictly adhered to serious scientific conduct and to the wellbeing of patients.' Henke confesses to wondering whether the many powerful enemies Bennett made in the pharmaceutical and biotechnology industries have struck back. 'We shouldn’t feed paranoia,' Henke said.  'However, given the exclusively positive experience when collaborating with his group, makes me wonder whether this litigation might follow some very particular other issues.'</blockquote> Did Dr Bennett's transformation from a consultant to to a fierce scientific skeptic of the pharmaceutical industry influence the handling of this case, and its media coverage? Summary The coverage by the Cancer Letter underscores our previous concerns, so I will simply repeat the summary from my last post. The settlement by Northwestern University, which was mainly about allegations made against Dr Charles L Bennett, who was not a party to the settlement, was very different that the vast majority of the <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">march of legal settlements</a> whose continuation we have frequently discussed. The settlement and its media coverage raised important questions whose answers would be important to the assessment of  our current regulatory and legal response to misbehavior by and within large health care organizations.  Health Care Renewal is about raising such issues by commenting on public information, media reports, and research.  I hope those with capacity to investigate will consider these questions.  Inquiring minds want to know. <div class="separator" style="clear: both; text-align: center;"></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhTN3CIxmIM6GicEB51I-Ob3VrzUm8FD4oH4c689NVpFCg9z4d7CjFHCs-xail6Kkz-rNhZ1TwUo05OfwWOZClh2E-YeFEGZin13pIgwRIAyHLGtb2uOYm3pXbLJoImDMJf99kwTf2E3Rn7/s1600/SherlockHolmes(RMP082013).jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="196" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhTN3CIxmIM6GicEB51I-Ob3VrzUm8FD4oH4c689NVpFCg9z4d7CjFHCs-xail6Kkz-rNhZ1TwUo05OfwWOZClh2E-YeFEGZin13pIgwRIAyHLGtb2uOYm3pXbLJoImDMJf99kwTf2E3Rn7/s200/SherlockHolmes(RMP082013).jpg" width="200" /></a></div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiaaBoxJHP1a-4vKQJ-K2QCLeGONuSncMwrZHXm7QlxGpToMSQWfUA8Ynap9x8URrARsYJvEwIE4wUL38ETuPSGQAODJIraz8M9hHw7lu_7KrAzT5KfEXQDC6dkNt7kKVIZcW3iFPoSAwIc/s1600/SherlockHolmes(RMP082013).jpg" imageanchor="1"> </a></div>ADDENDUM (27 August, 2013) - See also <a href="http://brodyhooked.blogspot.com/2013/08/the-fate-of-scientist-who-reveals-drug.html">comments</a> by Dr Howard Brody on the Hooked: Ethics, Medicine and Pharma blog. Roy M. Poses MD in Health Care Renewal

The Mystery of the Northwestern Settlement - the Plot Thickens

A few weeks ago, we wrote about this curious case.How the Case Stood Northwester University, a prominent research university, settled charges it had mismanaged US government grant funds. While it did…

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20 Aug 2013

The Mystery of the Northwestern Settlement

Watson, quick, the game's afoot.  We have discussed a large number of <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">legal settlements</a> by large health care organizations that serve as markers of misbehavior and often lack of leaderships' responsibility for same.  These settlements often follow a common pattern.  Yet this week a settlement appeared that was quite different, and hence raised some important questions. The Basics of the Settlement I will summarize the settlement as <a href="http://online.wsj.com/article/SB10001424127887324170004578638351789022658.html">described</a> by the Wall Street Journal.  The basic points were: <blockquote class="tr_bq">Northwestern University agreed to pay nearly $3 million to settle claims that a former cancer researcher fraudulently used federal grant money for personal expenses, including food, hotels and airfare for family trips between 2003 and 2010. The settlement in the civil suit was unsealed Tuesday by the U.S. Attorney for the Northern District of Illinois, which investigated claims brought by a whistle blower under the False Claims Act.</blockquote> The settlement seemed to be more about the researcher, Dr Charles L Bennett, than Northwestern, <blockquote class="tr_bq">At the time of the alleged fraud, Dr. Bennett was the principal investigator on research funded by the National Institutes of Health, studying adverse drug events, multiple myeloma, a blood disorder known as thrombotic thrombocytopenic purpura, and quality of care for cancer patients. <a href="http://www.blogger.com/null" name="U902207295947GR"></a> According to the settlement agreement, he allegedly billed federal grants for family trips, meals and hotels for himself and friends, and for 'consulting fees' for unqualified friends and family. Northwestern also allegedly improperly subcontracted, at Dr. Bennett's request, with various universities for services that were paid for by the NIH grants. <a href="http://www.blogger.com/null" name="U902207295947OO"></a> 'Allowing researchers to use federal grant money to pay for personal travel, hotels, and meals and to hire unqualified friends and relatives as 'consultants' violates the public trust and federal law,' U.S. Attorney Gary S. Shapiro said in a statement.</blockquote> Meanwhile, <blockquote class="tr_bq"> Northwestern, which is in Evanston, Ill., cooperated with the investigators and didn't admit to any wrongdoing, according to a statement by the university.</blockquote> The settlement was the result of the actions of a purported whistle-blower, <blockquote class="tr_bq">The whistleblower, Melissa Theis, worked as a purchasing coordinator in the Feinberg school's department of hematology and oncology, processing invoices when she 'noticed some red flags,' according to her attorney, Linda Wyetzner, of the Evanston firm Behn & Wyetzner Chartered. <a href="http://www.blogger.com/null" name="U902207295947A3G"></a>The federal False Claims Act allows private citizens who allege government programs are being defrauded to file actions on behalf of the government and receive a portion, usually 15% to 30%, of any recovered damages. Ms. Theis will get $498,100 in settlement proceeds, according to the agreement.</blockquote> The settlement resulted from the efforts of multiple federal agencies, <blockquote class="tr_bq"> The allegations were investigated by the NIH, Federal Bureau of Investigation, U.S. Department of Health and Human Services Office of Inspector General and the U.S. attorney's office.</blockquote> Curious Aspects and the Questions They Raise So here is yet another settlement by a large health care organization, in this case, the prestigious academic medical center of a well known university.  This one, however, does not follow the usual pattern, and includes some quite curious aspects. Media Attention vs Severity The settlement so far has generated articles in the WSJ (above), the Chicago Tribune, the Chicago Sun-Times, Crains Chicago Business, Medscape, Modern Healthcare, UPI, Bloomberg, other local Chicago and university publications, and local outlets in South Carolina, the state in which Dr Bennett currently works.   The amount of the grants that Dr Bennett allegedly misused was $8 million, according to the University Herald. There are no allegations that any activities of Dr Bennett or the university affected the quality of clinical research, clinical teaching, or patient care. Contrast that substantial media attention to that generated by another recent settlement we just discussed, that of Pfizer misbranding of Rapamune (look <a href="http://hcrenewal.blogspot.com/2013/07/pfizers-umpteenth-settlement-for-491.html">here</a>.)  This involved the excess promotion of a relatively dangerous drug that likely resulted in harm to many patients.  The over-promotion may have caused up to 90% of the drug's $200 million yearly sales.  The settlement itself was for $491 million.  Yet while it got more coverage, mainly from local media outlets which covered it because the settlement will result in payments to individual states, only four big national outlets have covered it so far, again the Wall Street Journal, and  the New York Times, Reuters and Businessweek. Why did a relatively small settlement of alleged financial misbehavior without clinical implications get nearly as much attention as a settlement fifty times bigger that involved actions that likely harmed patients? Intensity of the Government Response Dr Bennett's alleged misuse of grant funds required investigation by four different federal agencies, including the FBI.  Pfizer's misbranding of a dangerous drug seemingly was handled only by one, and the FBI was not obviously involved.  In fact, the FBI rarely has rarely been mentioned in the media coverage of most of the <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">legal settlements</a> we have discussed. Why did again a case of relatively small alleged financial misbehavior require such massive federal resources when much bigger cases which had implications for clinical care, policy, or research seemed to command lesser resources? Naming and Shaming The settlement did not involve any admission of any wrongdoing by Northwestern. In contrast, nearly all the news coverage of this settlement emphasized the role of Dr Charles L Bennett.  The coverage seemed to be following the lead of the Department of Justice <a href="http://www.justice.gov/usao/iln/pr/chicago/2013/pr0730_01.html">press release</a>, which included, <blockquote class="tr_bq"> Northwestern allegedly allowed one of its researchers, Dr. Charles L. Bennett, to submit false claims under research grants from the National Institutes of Health. The settlement covers improper claims that Dr. Bennett submitted for reimbursement from the federal grants for professional and consulting services, subcontracts, food, hotels, travel and other expenses that benefited Dr. Bennett, his friends, and family from Jan. 1, 2003, through Aug. 31, 2010.</blockquote> Yet Dr Bennett appeared not to be a party in this settlement, and it was unclear whether he had a direct opportunity to respond to it.  The Wall Street Journal did note that after it was announced, <blockquote class="tr_bq"> James M. Becker, an attorney for Dr. Bennett, said, 'We deny the allegations.…We are actively engaged in discussions to resolve the allegations.'</blockquote> We have discussed numerous <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">legal settlements</a> by large health care organizations, often involving hundreds of millions or even billions of dollars, sometimes involving guilty pleas by the companies involved or their subsidiaries.  Almost never do these settlements name or involve in any way persons who authorized, directed, or implemented the misbehavior.  In fact, we have commented again and again about the <a href="http://hcrenewal.blogspot.com/search/label/impunity">impunity</a> of health care organizational managers and executives.  For example, the recent $491 million Pfizer settlement did not name or punish any individuals.  Furthermore, Pfizer's $2.3 billion settlement for deceptive marketing of a drug later pulled from the market (Bextra) did not name much less penalize any responsible individuals (look <a href="http://hcrenewal.blogspot.com/2009/09/pfour-legal-settlements-for-pfizer-why.html">here</a>.)  Also, GlaxoSmithKline's $3 billion settlement of numerous unethical practices did not name much less penalize any responsible individuals (look <a href="http://hcrenewal.blogspot.com/2012/07/giant-gsk-settlement-provides-reminder.html">here</a>). So why was naming and shaming Dr Charles L Bennett such an important part of the relatively small Northwestern settlement, when much larger settlements, many involving unethical behavior that could have harmed patients or distorted medical research, and some of which involved corporate guilty pleas to criminal charges did not involve naming and shaming any responsible person?       How Accountable was Dr Bennett? As in the Wall Street Journal version, the settlement implies that Dr Bennett was the person most responsible.  The Chicago Sun-Times <a href="http://www.suntimes.com/news/21623742-418/northwestern-to-pay-nearly-3-million-to-settle-cancer-research-fraud-suit.html">put it</a> this way, <blockquote class="tr_bq"> Dr. Charles L. Bennett allegedly took his wife on personal trips, then illegally billed the flights, hotels and meals to the National Institutes of Health, claiming it was part of his cancer-fighting work. And he allegedly submitted phony bills for his work over a seven-year period beginning in 2003.</blockquote> Here I will have to interject a bit of information about how federal grants work.  As I learned when I was a young faculty member, and as I confirmed with several other experienced researchers who have run and reviewed federal grants, these grants are made to institutions.  In the current case, the grant apparently went to Northwestern University.  The institution that receives the grant is responsible for making all payments and disbursements related to that grant.  The grant's Principal Investigator is responsible for the scientific conduct of the grant, but NOT payments, disbursements, business management or accounting.  The Principal Investigator can request that payments be made for various things, including travel expenses and consulting work.  But the Principal Investigator cannot directly authorize or make these payments.  They are authorized, signed, and made by institutional administrators, usually in grants and contracts offices or the equivalent, and usually only after copious paperwork to justify the payments. So Dr Bennett may have requested reimbursement for travel expenses, or requested the university to hire a consultant.  But university managers must have made those payments, unless the university's grants administration mechanism had completely broken down.  Note that given the usual ways grants are administered, it would appear that Ms Theis, the ostensible whistle-blower, who will receive nearly one half of a million dollars from this settlement, actually may have had more direct responsibility for making the payments in question than did Dr Bennett. Presumably, that is why the settlement was made by Northwestern. Why then did the settlement, the DOJ press release, and the media coverage so emphasize Dr Bennett's responsibility, and so minimize the role of the university?   Was Anyone Else Accountable? The DOJ press release, and all the media articles on the case,  save one, mention only Dr Bennett as the person at fault.  Crain's Chicago Healthcare Daily, however, <a href="http://www.chicagobusiness.com/article/20130801/NEWS03/130809990/northwestern-fraud-settlement-includes-key-researcher">suggested</a> someone else was responsible, <blockquote class="tr_bq">Northwestern University's nearly $3 million settlement of fraud claims by the federal government protects the director of the school's cancer center, who allegedly failed to supervise a researcher who used grant money to cover personal expenses over a seven-year period. Dr. Steven Rosen, director of the <a href="http://cancer.northwestern.edu/home/index.cfm" target="new"">Robert H. Lurie Comprehensive Center for Cancer,</a> and Dr. Charles L. Bennett, a researcher who is no longer with the center, were both named in a whistleblower complaint unsealed on Tuesday, <a href="http://www.chicagobusiness.com/article/20130730/NEWS03/130739982/northwestern-to-pay-u-s-3-million-to-settle-fraud-claims">when the settlement was announced.</a> Dr. Bennett used federal grant money for family trips and fraudulent consulting fees for his brother and cousin from 2003-10, the government alleges. Dr. Rosen 'failed to exercise appropriate responsibility,' Randall Samborn, a spokesman for the U.S. Attorney's office said. 'It was a supervisory function that he didn't adequately fulfill.' When the settlement was announced, Mr. Samborn said the agreement did not cover either doctor. On Wednesday, he corrected himself, saying that settlement covered Dr. Rosen, but not Dr. Bennett.</blockquote> As I noted above, the way federal grants work, it was the university, and its managers and leaders, who were responsible for making all payments on this and other federal grants. Why did the government press release and the media coverage emphasize Dr Bennett's alleged role, while ignoring any possible responsibility of anyone else, especially his supervisor? Backgrounds of the Principles Dr Bennett and Dr Rosen, who seemingly were treated so differently in this settlement, travel in very different circles. Most media articles described Dr Bennett as a prolific researcher and medical academic.  Although some described his areas of interest in hematology and oncology, only Medscape <a href="http://www.medscape.com/viewarticle/808784">described</a> one particular project of his.   <blockquote class="tr_bq">Dr. Bennett's research efforts included a 2008 study on which he was the first author (JAMA. <a href="http://jama.jamanetwork.com/article.aspx?articleid=181533" target="_blank">2008;299:914-924</a>). The study was the first meta-analysis to identify an increased mortality risk in cancer patients associated with erythropoiesis-stimulating agents.(1)</blockquote> In fact, as we discussed <a href="http://hcrenewal.blogspot.com/2012/12/amgen-settles-pleads-guilty-to.html">here,</a>  Dr Bennett was the first author of a meta-analysis that was the first to show that epoetins increased the rates of adverse effects and death for cancer patients.  This evidence lead to reduced use of some very expensive drugs made by Johnson and Johnson and Amgen, and hence reduced revenues for both companies. The JAMA article noted that at the time he wrote it, Dr Bennett had financial relationships with Amgen.  He and a coauthor "reported serving as consultants to AMGEN and Dr Bennett reported he has received grant support from AMGEN previously." Note that Amgen pleaded guilty to misbranding its epoetin, Aranesp, and therefore paid fine and a civil settlement totaling $762 million.  Given the data on this drug class' adverse events, as shown by Dr Bennett and others, it is likely that the misbranding lead to patients being harmed by the drug without receiving any benefits (look <a href="http://hcrenewal.blogspot.com/2012/12/amgen-settles-pleads-guilty-to.html">here</a>.)  After writing that article, Dr Bennett became known as a strong skeptic of the pharmaceutical industry.  Just before the JAMA article was published, he coauthored an editorial which wondered if conflicts of interest would ever prove to be acceptable once sufficient research was done.(2)  In that article, he disclosed consulting for, and receiving honoraria and research grants from Amgen.  In 2010, he published research showing the effects of conflicts of interest on reporting of possible adverse effects based on basic science research about epoetins.(3)  By then he apparently no longer had financial relationships with Amgen.  In 2011, he reported a survey of major cases of pharmaceutical fraud resulting in legal actions.(4) Dr Bennett became known for skepticism about the practices of pharmaceutical companies, and for publishing about the harms of specific drugs, despite his previous financial relationships with Amgen.  However, Dr Rosen apparently has continued to work closely with industry.  His <a href="http://fsmweb.northwestern.edu/faculty/disclosure_profile_display.cfm?xid=15275">faculty disclosure page</a> revealed  the following industry relationships <blockquote class="tr_bq">Consulting / Related Activities Faculty member engaged in activities such as speaking, advising, consulting, or providing educational programs for the following companies or other for-profit entities: <ul><li>Allos Therapeutics, Inc. </li><li>Carden Jennings Publishing Co., Ltd. </li><li>Cerner Corporation </li><li>Dava Oncology, LP </li><li>Elorac, Inc. </li><li>Envision Communications </li><li>Health Practices Consulting - unverified entity </li><li>Plexus Communications </li><li>Prostrakan, Inc. </li><li>Seattle Genetics, Inc. </li><li>Studio ER Congressi (Triumph Group, Inc.) </li><li>The Medal Group Corp. </li></ul>In addition, faculty member received compensation for medical record consultation and/or expert witness testimony. Ownership or Investment Interests Faculty member had an ownership or investment interest in the following companies: <ul><li>AuraSense, LLC </li><li>Nanosphere, Inc. </li></ul>Royalty Payments and Inventor Share Faculty member has the right to receive payments or may receive future financial benefits for inventions or discoveries related to the following companies or other entities:</blockquote><blockquote></blockquote><ul><li><blockquote>Nanosphere, Inc. </blockquote></li></ul>We have seen various important effects of <a href="http://hcrenewal.blogspot.com/search/label/conflicts%20of%20interest">individual</a> and <a href="http://hcrenewal.blogspot.com/search/label/institutional%20conflicts%20of%20interest">institutional</a> conflicts of interest in health care.  We have seen <a href="http://hcrenewal.blogspot.com/search/label/corporatism">corporatism</a> and <a href="http://hcrenewal.blogspot.com/search/label/regulatory%20capture">regulatory capture</a> affecting government and its dealings in health care.   Did Dr Bennett's break with a powerful industry make it easier to set him up as the villain in this story? Summary    The settlement by Northwestern University, which was mainly about allegations made against Dr Charles L Bennett, who was not a party to the settlement, was very different that the vast majority of the <a href="http://hcrenewal.blogspot.com/search/label/legal%20settlements">march of legal settlements</a> whose continuation we have frequently discussed. The settlement and its media coverage raised important questions whose answers would be important to the assessment of  our current regulatory and legal response to misbehavior by and within large health care organizations.  Health Care Renewal is about raising such issues by commenting on public information, media reports, and research.  I hope those with capacity to investigate will consider these questions.  Inquiring minds want to know. Roy M. Poses MD in Health Care Renewal  References 1.  Bennett CI, Silver SM, Djulbegovic B et al.  Venous thromboembolism and mortality associated with recombinant erythropoietin and darbepoetin adminstration for the treatment of cancer-associated anemia.  JAMA 2008; 299: 914-924. 2.  Djulbegovic B, Angolotta C, Knox KE, Bennett CI. The sound and the fury: financial conflicts of interest in oncology.  J Clin Oncol 2007; 25:3567-3568.  Link <a href="http://jco.ascopubs.org/content/25/24/3567.full7">here</a>  3.  Bennett CI, Lai SY, Henke M et al.  Association between pharmaceutical support and basic science research on erythropoiesis-stimulating agents.  Arch Intern Med 2010; 170: 1490-1498.  Link <a href="http://archinte.jamanetwork.com/article.aspx?articleid=225937">here</a>. 4.  Qureshi Z, Sartor O, Xirasagar S, Liu Y, Bennett CI.  Pharmaceutical fraud and abuse in the United States, 1996-2010.  Arch Intern Med 2011; 171: 1503-1506.  Link <a href="http://archinte.jamanetwork.com/article.aspx?articleid=1105899">here</a>.

The Mystery of the Northwestern Settlement

Watson, quick, the game's afoot. We have discussed a large number of legal settlements by large health care organizations that serve as markers of misbehavior and often lack of leaderships' responsib…

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05 Aug 2013

On the Interconnectedness of the Leadership of Health Care Organizations: the Abbott Laboratories Case

We just <a href="http://hcrenewal.blogspot.com/2010/12/abbott-laboratories-and-pig-roasts.html">posted</a> about some misbehavior by Abbott Laboratories: a physician Abbott paid as a "key opinion leader" to help market its cardiac stents was accused of inserting stents in many patients who had no need for them; Abbott settled for over $400 million a lawsuit alleging the company defrauded Medicare and Medicaid; and it settled an unrelated suit for over $40 million alleging the company paid kickbacks to physicians for prescribing its drugs.  I thus thought it would be interesting to see how well paid are the corporate leaders who presided over these activities, and who are the board members who were supposed to be providing stewardship of this company. According to the company's <a href="http://www.abbottinvestor.com/phoenix.zhtml?c=94004&p=irol-sec">2010 proxy statement</a>, the five highest-paid executives were: Miles D White, Chairman of the Board and CEO - $26,213,966 total compensation Thomans C Freyman, Executive Vice President, Finance, and CFO - $9,561,227 Olivier Bohuon, Executive Vice President, Abbott Pharmaceutica Group - $5,232,589 Laura J Schumacher, Executive Vice President, General Counsel, and Secretary - $5,724,060 James V Mazzo, Senior Vice President, Abbott Medical Optics - $10,394,085 Now, let us turn to the company's board of directors.  Note that I looked for board members who also held leadership positions in other health care organizations whose interests may not be aligned with the corporation.  I also looked for those who held leadership positions in the discredited financial services corporation who helped usher in the global financial collapse.  (I  used similar methodolgy <a href="http://hcrenewal.blogspot.com/2010/12/boards-who-ought-to-be-accountable-for.html">here</a>.) Abbott currently has 12 board members, including <ul><li>Robert J Alpert MD - Ensign Professor of Medicine, Professor of Internal Medicine, and Dean of the Yale School of Medicine.  He also "serves as a Director on the Board of Yale-New Haven Hospital."</li><li>Roxanne S Austin - President and Chief Executive Officer, Move Networks Inc, and President, Austin Investment Advisors</li><li>William M Daley -"Vice Chairman and Head of the Office of Corporate Responsibility and Chairman of the Midwest, JP Morgan Chase & Co."  He is the board of directors of  "Loyola University of Chicago and Northwestern University."</li><li>W James Farrell - Retired Chairman and Chief Executive Officer of Illinois Tool Works Inc</li><li>H Laurence Fuller - Retired Co-Chairman of BP Amoco, former chief executive officer of Amoco</li><li>William A Osborne - Retired Chairman and Chief Executive Officer of Northern Trust Corporation and the Northern Trust Company.  He is "Chairman of the Board of Trustees of Northwestern University."</li><li>Rt Honorable Lord Owen - Chairman of Europe Steel Ltd</li><li>Roy S Roberts - Managing Director, Reliant Equity Investors.</li><li>Samuel C Scott III - Retired Chairman,  President and Chief Executive Officer of Corn Products International.  He "currently serves on the board of directors of Bank of New York Mellon Corporation."  He also is on the board of "Northwestern Healthcare."</li><li>William D Smithburg - Retired Chairman, President and Chief Executive Officer of Quaker Oats Company.  He is on the "board of trustees of Northwestern University."</li><li>Glenn F Tilton - Chairman, President and Chief Executive Officer of UAL Corporation and United Airlines Inc.  He is on the "board of directors of Northwestern Memorial Hospital."</li><li>Miles D White - Chairman of the Board and Chief Executive Officer, Abbott Laboratories, "is on the board of trustees of "Northwestern University."  </li></ul> Of Abbott's 12 directors, seven have leadership positions at teaching hospitals, academic medical centers, medical schools or their parent universities (Northwestern University, its medical school and teaching hospitals, in particular, are stewarded by six Abbott directors).  Two have leadership positions in  financial services corporations that were implicated in the global financial collapse.  (Note that JP Morgan Chase staffers helped to invent some of the kinds of financial derivatives widely viewed as causative of the collapse, but the firm itself did not fail. [See Tett G. <a href="http://books.simonandschuster.com/Fool%27s-Gold/Gillian-Tett/9781439100134">Fool's Gold</a>.]  Through TARP, the US government took preferred equity stakes in both JP Morgan Chase and Bank of New York Mellon.  [See Ritholtz B.  <a href="http://bailoutnation.net/">Bailout Nation</a>. p. 222])  Two more are leaders of financial services firms.  All but one are current or former high-level hired executives (seven are or were CEOs), or chairpersons or co-chair persons of corporations (the one exception is a dean of a medical school.)  Note how similar our findings were here to those found after our perusal of the boards of Genzyme and Medtronic (see post <a href="http://hcrenewal.blogspot.com/2010/12/boards-who-ought-to-be-accountable-for.html">here</a>).   So we find again that executives of health care organizations who preside over various questionable activities not only rarely pay any penalty, but usually become extremely wealthy in the process. We also find how interconnected is the leadership of health care.  The boards and leadership of drug and device companies overlap with the boards and leadership of medical schools, teaching hospitals, and their parent universities.  Yet, as we have noted before, there are obvious conflicts.  In particular, teaching hospitals and medical schools are supposed to provide unbiased teaching, including about issues relevant to drug and device corporations, such as choice of diagnostic strategies and treatments, and relevant health policy.  They are supposed to perform unbiased research, including research that evaluates drugs and devices.  They are supposed to provide the best possible patient care at a reasonable cost, which relates to choices of and prices paid for drugs and devices.  On the other hand, drug and device companies are supposed to put making a profit for their share-holders first.  The directors of such companies, like the directors of all for-profit corporations, are supposed to show an unyielding loyalty to their companies' financial health and profits, although contemporary corporate directors have been accused of acting more like cronies of the hired management.  (See this <a href="http://hcrenewal.blogspot.com/2010/01/one-small-step-towards-reducing.html">post</a>.) Also, we note that the vast majority of people chosen as stewards of a given health care organization are current or former top hired executives of other corporations.  The board members, that is, stewards of health care organizations, to whom the top hired executives reports, are usually not people with large ownership interests in the organizations (in the case of public, for-profit corporations.)  For the most part, they also do not seem to be people with clearly demonstrated devotion to the values of health care, in particular, putting the care of individual patients first, and advancing health care teaching and research.  Instead, they seem to be people with the perspective of hired executives, who may be prone to putting the interests of hired executives, rather than patients, doctors, teachers, scientists or the public at large, first. So here is another admittedly limited case study of the board of directors, that is, the ostensible stewards of a health care corporation, selected this time because of its history of ethical missteps, which showed  - that the leadership of health care organizations is incredibly interrelated, interlocked, incestuous.  Again, it appears that top leaders of various health care organizations may be more familiar with and identify more with each other, and with other hired executives and managers, than with their organizations, their organizations' missions, and their organizations' professionals, staff, students, clients, and patients. So to repeat- I strongly believe that there needs to be much more investigation, academic, journalistic, and perhaps legal, of the identity, nature, and culture of the leaders of health care, and their relationships. A few bloggers cannot do it all. Obviously, the <a href="http://hcrenewal.blogspot.com/search/label/anechoic%20effect">anechoic effect</a> mitigates against medical and health care academics looking into their own leaders. However, failing to understand who is leading our march to the brink of health care failure ought not to be something such academics would want on their conscience. Finally, and obviously, health care organizations need leaders that uphold the core values of health care, and focus on and are accountable for the mission, not on secondary responsibilities that conflict with these values and their mission, and not on self-enrichment. Leaders ought to be rewarded reasonably, but not lavishly, for doing what ultimately improves patient care, or when applicable, good education and good research. If we do not fix the severe problems affecting the leadership and governance of health care, and do not increase accountability, integrity and transparency of health care leadership and governance, we will be as much to blame as the leaders when the system collapses.

On the Interconnectedness of the Leadership of Health Care Organizations: the Abbott Laboratories Case

We just posted about some misbehavior by Abbott Laboratories: a physician Abbott paid as a "key opinion leader" to help market its cardiac stents was accused of inserting stents in many patients who h…

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10 Dec 2010

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