What Does the Blumsohn - Procter and Gamble -Sheffield University Affair Say About the Fitness of the Latest VA Secretary Candidate?

<b>Introduction - New Leadership for the US Department of Veterans Affairs </b><br /><br />After reports of problems with access, manipulation of data about waiting times, and most recently "a corrosive culture," the US Department of Veterans Affairs, the country's large government run health system, has had a massive leadership overhaul.  President Obama's nominee to head the agency is now Robert A McDonald, former CEO of Procter and Gamble.<br /><br />The choice of a former CEO or a large corporation was called "unorthodox" <a href="http://www.bostonglobe.com/news/nation/2014/06/29/bob-mcdonald-former-chief-obama-nominee-lead-veterans-affairs/zVA9EH7PlMNWaTU7Yyp8NP/story.html">by the Boston Globe</a>, but many saw merit in a business leader running the VA.  As reported by the Globe, House Speaker John Boehner said that as a "private sector" leader,  Mr McDonald is the "kind of person who is capable of implementing the kind of dramatic systemic change that is badly needed and long overdue at the VA."  The Chairman of Boeing, also a member of the P&G board, hailed Mr McDonald as the person who "navigated Procter & Gamble through the difficult post-financial-crisis years, where he expanded business in developing markets and made substantial progress improving the efficiency of the company’s internal operations...."<br /><br />On the other hand, a <a href="http://www.washingtonpost.com/politics/federal_government/obamas-choice-for-va-will-find-fixing-it-is-harder-than-selling-soap/2014/07/01/84cf28d6-0139-11e4-b8ff-89afd3fad6bd_story.html">column in the Washington Post</a> suggested that expertise in "selling Tide and Pantene" might not be relevant to fixing the VA. Yet aside from a <a href="http://ringoffireradio.com/2014/07/obama-nominates-former-corporate-exec-as-veteran-affairs-secretary-2/">single article</a> on the Ring of Fire web site, all news coverage and discussion so far has ignored Mr McDonald previous experience in health care leadership, but also that his relevant track record ought to raise questions about his fitness for the VA position.<br /><br /><b>Procter and Gamble and Health Care</b><br /><br />According to Mr McDonald's <a href="http://www.pg.com/en_US/downloads/company/executive_team/bios/pg_executive_bio_bob_mcdonald.pdf">official P&G biograpy</a>, after various roles in various countries, before becoming CEO,  <br /><br /><blockquote class="tr_bq">Bob returned to the U.S. as the <i>Vice Chairman of Global Operations</i> (2004 to 2007) and later P&G’s <i>Chief Operating Officer</i> (2007 to 2009).</blockquote><br /><br />Although not widely known as a pharmaceutical company, P&G actually had a subsidiary that made prescription drugs, which Mr McDonald sold off in 2009 (see this <a href="http://online.wsj.com/news/articles/SB125111032092353427">Wall Street Journal report</a>.)  As we noted <a href="http://hcrenewal.blogspot.com/2014/05/abort-retry-fail-lancet-avoided-much.html">here</a>, its products still include over the counter pharmaceuticals (e.g., Pepto-Bismal, Metamucil, Prilosec OTC).  Also, while Procter & Gamble does not make it very obvious, it has owned MDVIP, a company that employs physicians to provide concierge medical services, since 2010, although as Cincinnati.com just <a href="http://www.cincinnati.com/story/money/business/2014/05/02/pg-sells-concierge-medicine-unit/8622903/">reported</a>, it will soon sell this unit to private equity.  So during Mr McDonald's tenure, his company was to some extent a pharmaceutical company, and a health care provider.<br /><br /><b>The Blumsohn - Procter and Gamble - Sheffield University Case</b><br /><br />Furthermore, on Mr McDonald's watch as Vice Chairman of Global operations and Chief Operating Officer, there was a case involving Procter and Gamble that raised multiple concerns about the ethics of its pharmaceuticals operations.  We first posted about the case in 2005 (<a href="http://hcrenewal.blogspot.com/2005/12/another-challenge-to-integrity-of.html">here</a>).  For all relevant posts, look <a href="http://hcrenewal.blogspot.com/search/label/Actonel">here</a>. In 2009 we <a href="http://hcrenewal.blogspot.com/2009/12/british-medical-journal-interviews-dr.html">described the case</a> thus,<br /><br /><blockquote class="tr_bq">The case involved <i>suppression and manipulation of research</i>, <i>ghost-writing</i>, <i>institutional conflicts of interest, and attempts to silence a whistle blower. </i>It provides lessons about the downsides of letting commercial firms sponsor and hence control human research designed to evaluate the products or services they sell; and of academic medicine becoming dependent on research money from such firms for such research.</blockquote><br />We previously <a href="http://hcrenewal.blogspot.com/2009/09/reappearance-of-ghost-of-seasons-past.html">summarized</a> the case's events<br /><br /><blockquote><ul><li>Dr Aubrey Blumsohn, a senior lecturer at Sheffield University, and Professor Richard Eastell performed a research project on the effects of the drug risedronate (<a href="http://www.actonel.com/index.jsp">Actonel</a>, made by Procter & Gamble Pharmaceuticals [P&G]) under a <a href="http://www.fraudinscience.org/PG/contract.pdf">contract</a> between P&G and the University.</li><li>Although the research contract designated Blumsohn and Eastell as "Investigators" under whose direction the project would be carried out, Blumsohn was not given access to the original data collected by the project.</li><li>Despite numerous requests, (like <a href="http://www.fraudinscience.org/PG/20050525mckay.pdf">this one</a>), P&G <a href="http://www.fraudinscience.org/PG/20030619email.htm">refused access </a>to this data <a href="http://www.fraudinscience.org/PG/attorneyreq.pdf">repeatedly</a>.<br />Blumsohn was concerned that he and Eastell could be accused of scientific fraud if they continued to make presentations and write articles and abstracts without access to the data which they were supposedly writing about.</li><li>Blumsohn became suspicious that some of the analyses done by P&G could be misleading, especially <a href="http://www.fraudinscience.org/PG/20030909audio.htm">related to a graph shown to him that omitted 40% of patient data</a>.</li><li>Blumsohn objected to <a href="http://www.fraudinscience.org/PG/20030424email.htm">P&G arranging for papers and abstracts to be written by a professional writer</a>, but with Blumsohn listed as first author. Blumsohn was concerned that such ghost-written documents were mainly meant to convey "key messages" in support of P&G's commercial interests.</li><li><a href="http://www.fraudinscience.org/PG/20030910audio.htm">Eastell warned Blumsohn </a>not to aggravate P&G, because the company was providing a grant to the University which "is a good source of income."</li><li>After repeated failed attempt to get the data, Blumsohn complained to numerous officials at Sheffield University, including <a href="http://www.fraudinscience.org/PG/20040526eastell.pdf">Eastell</a>, medical school Dean <a href="http://www.fraudinscience.org/PG/20050708weetman.pdf">Tony Weetman</a>, University Vice-Chancellor <a href="http://www.fraudinscience.org/PG/20050814bouche.pdf">Robert Boucher</a>, and the Head of the University's Department of Human Resources, <a href="http://www.fraudinscience.org/PG/20050627boucha.pdf">Ms R Valerio</a>.</li><li>Still unable to get the data, he spoke with news reporters about his case. At this point, Sheffield suspended him, but then <a href="http://www.fraudinscience.org/PG/gag.doc">offered him a severance agreement </a>if he signed a contract binding him not to make any detrimental or derogatory statements about the University and its leaders.</li></ul></blockquote><blockquote>So the case involved suppression and manipulation of research, ghost-writing, institutional conflicts of interest, and attempts to silence a whistle blower. It provides lessons about the downsides of letting commercial firms sponsor and hence control human research designed to evaluate the products or services they sell; and of academic medicine becoming dependent on research money from such firms for such research.</blockquote><br />Although this case occurred in the UK, it involved actions by the US based Procter and Gamble.  While many of the events in the case occurred before 2004, from 2004 to 2009 it became clear that Procter and Gamble was not going to go easy on Dr Blumsohn.  For example, <a href="http://scientific-misconduct.blogspot.com/2007/03/advice-to-p-pharmaceuticals-how-not-to.html">according to Dr Blumsohn</a>, in 2006, P&G released some scientific data relevant to the case, but not complete enough data to be meaningful.  In 2007, there was still shady business going on involving scientific abstract submissions apparently made in Dr Blumsohn's name by P&G operatives.<br /><br />Since Procter and Gamble never made any known attempt to apologize, explain its conduct, or ameliorate Dr Blumsohn's plight during 2004 - 2009, as one of the most senior leaders of Procter and Gamble, seemingly with direct authority over its pharmaceutical operations in the UK during that time period, Mr McDonald ought to be held accountable for the company's misbehavior described above.  To my knowledge, though, no one at P&G, including Mr McDonald, has ever admitted responsibility or been made accountable in any way.   <br /><br /><b>Summary</b><br /><br />Since Mr McDonald recently was an executive of a company that sold prescription and non-prescription pharmaceuticals, and provided direct health care, confirmation as Veterans Affairs secretary could be regarded as a transit through the revolving door, and hence open to question.  Since Mr McDonald got <b><i>$15,928,015</i></b> in total compensation during his last year as CEO (2012-13) (see the company's 2013 proxy statement), and had accumulated 2,247,593 shares of stock or equivalent by 2013, worth approximately <b><i>$179 million</i></b> at today's price of $79.67, his ability to understand the needs of the often poor veterans whom the VA serves is also open to question.  <br /><br />More importantly, while Mr McDonald held high executive positions at Procter and Gamble, the company was involved in a dodgy affair involving conflicts of interest, manipulation of research, and attempted silencing of whistle blowers.  In my humble opinion, given that these events occurred directly on his watch, his fitness to run a huge health care system ought to be in question unless his responsibility for these events is disproved.<br /><br />The widespread huzzahs for Mr McDonald as potential VA leader based mainly on his exalted status as CEO of a big corporation show that many in the US still see corporate CEOs as aristocracy.  True health care reform would hold health care leaders accountable, particularly for upholding the health care mission and putting patients' and the public's health ahead of revenue generation and especially personal profit.<br /><br />ADDENDUM (7 July, 2014) - Link to McDonald's official P&G biography fixed. <br /><br />ADDENDUM (8 July, 2014) - This post has been re-posted <a href="http://www.nakedcapitalism.com/2014/07/obama-va-robert-macdonald-procter-gamble-scandal.html">on Naked Capitalism</a>, and <a href="http://www.openhealthnews.com/story/2014-07-07/robert-mcdonald-fit-be-va-secretary">on Open Health News</a>. 

What Does the Blumsohn - Procter and Gamble -Sheffield University Affair Say About the Fitness of the Latest VA Secretary Candidate?

Introduction - New Leadership for the US Department of Veterans Affairs After reports of problems with access, manipulation of data about waiting times, and most recently "a corrosive culture," the US…

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Big Door Keep Revolving - Our Latest Roundup About the Blurred Lines Between the Health Care Industry and the Government Bodies that are Supposed to Regulate and Make Policy Affecting It

The revolving door continues to turn connecting US government bodies that make health policy or regulate health care and the health care industry.  Sometimes these transitions are obvious, sometimes they are obscure.  The press sometimes makes the revolving door the subject, but more often it is just an aside.<br /><br />The latest roundup of transitions through the door includes, in chronological order of media attention...<br /><br /><b>Former White House Press Secretary to Consultancy Serving Health Care Corporations </b><br /><br />As <a href="http://www.washingtonpost.com/blogs/post-politics/wp/2014/04/06/pelosi-suggests-gibbss-obamacare-comments-due-to-business-ties/">reported</a> by the Washington Post in April, 2014, Robert Gibbs was White House Press Secretary until he departed for the private sector,<br /><br /><blockquote class="tr_bq">Since departing the White House in 2011, Gibbs has taken a path familiar to other former White House officials who use their ties to a president to enrich themselves and establish a new career. </blockquote><br />In particular, he<br /><br /><blockquote class="tr_bq">co-founded <a href="http://www.theinciteagency.com/">The Incite Agency</a>, a consulting and media relations firm that advises Fortune 500 companies, <i>including health-care firms</i>.</blockquote><br />The story was apparently generated after the Democratic House Minority Leader openly criticized someone who served in the Democratic President's White House, so the thrust of the story was about how Mr Gibbs has apparently changed his ideas on Obamacare since his White House days,<br /><br /><br /><blockquote class="tr_bq">House Minority Leader Nancy Pelosi (D-Calif.) suggested Sunday that former top Obama aide Robert Gibbs's <a href="http://www.washingtonpost.com/blogs/post-politics/wp/2014/04/03/top-former-obama-aide-obamacares-employer-mandate-wont-survive/">comment that the employer mandate portion of the Affordable Care Act won't survive</a> <i>might be related to Gibbs's business interests.</i><br /><br />'I don't know who his clients are or what his perspective is,' Pelosi told CNN's '<a href="http://sotu.blogs.cnn.com/">State of the Union</a>.' 'But we are celebrating the fact that we have over seven million who have signed up.'</blockquote><br />The Post also noted,<br /><br /><blockquote class="tr_bq">The speech Gibbs gave this past week in Colorado is consistent with how the Harry Walker Agency bills Gibbs as a potential paid speaker. <a href="http://www.harrywalker.com/speaker/Robert-Gibbs.cfm?Spea_ID=1474">On its Web site</a>, pitches Gibbs by noting that he '<i>played a major role in the daily White House policy debates over the shape of healthcare reform</i>.' It suggests that during such speeches, Gibbs 'articulates the future for the Patient Protection and Affordable Care Act.'<br /><br />The pitch concludes by stating that 'The future of Obamacare -- and how it will affect your business -- is yet to be seen, and <i>few are better prepared than Gibbs to guide you through that conversation</i>.'</blockquote>Again, note that this article seemed to be inspired by Rep Pelosi's direct criticism of a fellow Democrat, not by the revolving door transition per se.   <br /><br /><b>President of Global Government and Scientific Affairs at Natural Products Association to Director of the Division of Dietary Supplements at the FDA then Back to Natural Products Association as CEO</b><br /><br />This round trip through the door was noted rather obliquely in a New York Times <a href="http://well.blogs.nytimes.com/2014/04/30/why-dangerous-supplements-linger-on-shelves/">article</a> in late April, 2014, focused on how slowly the FDA has reacted to apparently dangerous "dietary supplements,"<br /><br /><blockquote class="tr_bq">Before joining the F.D.A. in 2011, Dr. [Daniel] Fabricant was a top executive at an industry trade group, the Natural Products Association.</blockquote><br />The article had previously identified Dr Fabricant as<br /><br /><blockquote class="tr_bq">the director of the division of dietary supplement programs in the agency’s Center for Food Safety and Applied Nutrition.</blockquote><br />But,<br /><br /><blockquote class="tr_bq">The F.D.A. <a href="http://www.nutraingredients-usa.com/Regulation/Fabricant-leaves-FDA-replaces-Shaw-as-head-of-NPA">recently announced</a> that Dr. Fabricant is leaving the agency this month to return to the trade group as its chief executive.</blockquote>While the NY Times article thus mentioned as an aside that a government official with major responsibility for regulating dietary supplements had these relationships with the dietary supplement industry, it did not question whether that relationship had anything to do with slow responses by the FDA to reports of toxic dietary supplements.  <br /><br /><b>Spokesman for the Speaker of the House of Representatives to Spokesman for America's Health Insurance Plans</b><br /><br />USA Today briefly but directly <a href="http://onpolitics.usatoday.com/2014/05/12/brendan-buck-health-insurance-lobby-ahip/">noted</a> this in mid-May, 2014,<br /><br /><blockquote class="tr_bq">House Speaker <i>John Boehner’s spokesman, Brendan Buck, has spent a lot of time over the years helping his boss and congressional Republicans criticize President Obama’s health care law</i>.<br /><br /><i>Now Buck is leaving Capitol Hill to be spokesman for America’s Health Insurance Plans</i>, the trade association that represents thousands of health insurance companies.<br /><br />'Brendan’s experience and skill set will allow him to hit the ground running on Day One,' said Karen Ignagni, president and CEO of AHIP. 'He’s an effective communicator who knows how to tackle complex policy issues and skillfully navigate an ever-changing health care and media environment.'</blockquote><br />What made this interesting seems to be how it represented a change of tune on Mr Buck's part.  Note that many people believe that commercial health insurers will benefit from all the new policy holders that Obamacare sends them, so<br /><br /><blockquote class="tr_bq">As the health insurance  industry’s trade group, AHIP supports the law’s mandate that individuals obtain health insurance. The trade group has praised the Affordable Care Act’s ability to expand insurance coverage.</blockquote><br />But never mind that the man in the government for whom Mr Buck previously worked, <br /><br /><blockquote class="tr_bq">Boehner likes to call Obamacare a 'train wreck.'</blockquote><br /><b>FDA Director of the Office of Medical Policy for the Center for Drug Evaluation and Research to Greenleaf Health Consultancy</b><br /><br />This so far has appeared only in a mid-May, 2014,  <a href="http://www.businesswire.com/news/home/20140519006244/en/FDA-Senior-Official---Dr.-Rachel-Sherman#.U30IqXaGee0">press release</a>.   It describe Dr Sherman's career at the FDA,<br /><br /><blockquote class="tr_bq">During her FDA tenure, Sherman was a driving force for innovation, new programs and policy. Sherman was responsible for spearheading and implementing the Sentinel Initiative, the Critical Path Initiative, biosimilars policy and the new Breakthrough Therapy Designation.<br /><br />As <i>Director of CDER’s Office of Medical Policy and Associate Center Director for Medical Policy Sherman was responsible for developing, coordinating, and implementing medical policy programs and strategic initiatives as well as establishing and chairing CDER's Medical Policy Counsel</i> [sic]. This included overseeing the regulation of prescription drug promotion and advertising. <br /><br />Sherman began her career with FDA in the Division of Antiviral Drug Products at CDER in 1989—first as a medical reviewer and then as a clinical team leader. In 1998, she was appointed Deputy Office Director for the Office of Drug Evaluation I. In 1999, she assumed the duties of Deputy Office Director for the newly established Office of Medical Policy in CDER. </blockquote><br />But now she will be "Principal, Drug and Biological Drug Products" for Greenleaf, described as,<br /><br /><blockquote class="tr_bq">Greenleaf Health is a<i> full service regulatory consulting firm that provides strategic guidance to companies regulated by the FDA</i> and those developing innovative solutions to pressing public health challenges around the globe</blockquote><br />Note that Greenleaf was already well populated with FDA officials who had previously transited the big revolving door,<br /><br /><blockquote class="tr_bq">Patrick Ronan, former FDA Chief of Staff and currently president of Greenleaf; Dr. Daniel Schultz, former Director of the Center for Devices ('CDRH') and Radiological Health and currently Greenleaf's Principal for Medical Devices and Combination Products; Michael Chappell, former Associate Commissioner for Regulatory Affairs, and currently Greenleaf's Principal for Regulatory Compliance; Heather Rosecrans, former Director of CDRH's 510(k) staff and currently Senior Vice President for Medical Devices and Combination Products; Linda Carter, formerly Associate Director of CDER's Office of Evaluation I and currently Vice President of Drug and Biological Drugs; and Taryn Fritz Walpole, former FDA Deputy Chief of Staff, and currently Chief Operating Officer and Senior Vice President for Regulatory Affairs</blockquote><br />So maybe it has become so routine for middle and upper level FDA managers to go to work for consultancies that help industry to deal with the FDA that no journalist found this revolving door transition interesting.<br /><br /><b>Summary</b><br /><br />Again, there appears to be constant traffic among health care corporations and the government bodies that regulate them and make policy that affects them.  The traffic may be so heavy and routine that it no longer appears to be news, unless accompanied by an ironic detail or two.<br /><br />However, as we have said many times before, the constant interchange of health care insiders among government, large health care corporations, and the consultancies, marketing, public relations, lobbying and legal firms which represent them certainly suggests that health care, like many other sectors, seems to be run by an amorphous group of insiders who owe allegiance neither to government nor industry.<br /><br />However, those who work in government are supposed to be working for the people, and those who work on health care within government are supposed to be working for patients' and the public health.  If they are constantly looking over their shoulders at potential private employers who might offer big checks, who indeed are they working for?<br /><br /><br /><div itemprop="articleBody"></div>Attempts to turn government toward private gain and away from being of the people, by the people, and for the people have no doubt been going on since the beginning of government (and since the Constitution was signed, in the case of the US).  However, true health care reform  would require curtailing the severe sorts of conflicts of interest created by the revolving door.<br /><br />Real heath care reform would require multi-year cooling off periods before someone who worked in the commercial world can get a job in a government whose work has direct effect on his or her previous employer or industry sector, and before someone who worked in government whose work had direct effect on a particular economic sector can accept a job for a company in that sector.    <br /><br />

Big Door Keep Revolving - Our Latest Roundup About the Blurred Lines Between the Health Care Industry and the Government Bodies that are Supposed to Regulate and Make Policy Affecting It

The revolving door continues to turn connecting US government bodies that make health policy or regulate health care and the health care industry.  Sometimes these transitions are obvious, sometimes t…

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No Fooling - When a Retired Conservative Politician Warns About Oligarchy...

then things must be getting really bad.<br /><br />Of course, we have been warning about <a href="http://hcrenewal.blogspot.com/search/label/oligarchy">oligarchy</a>, and related issues such as <a href="http://hcrenewal.blogspot.com/search/label/concentration%20of%20power">concentration of power</a>, <a href="http://hcrenewal.blogspot.com/search/label/oligopoly">oligopoly</a>  in health care for a long time.  Basically, we have been warning that health care is increasingly run by a small group of insiders, mostly professional managers/ executives, and their cronies, who often have multiple overlapping leadership positions (e.g., as we <a href="http://hcrenewal.blogspot.com/2014/03/better-late-than-never-jama-article.html">discussed</a> recently, leadership of one health care organization while being member of the board of another), or may interchange positions through the <a href="http://hcrenewal.blogspot.com/search/label/revolving%20doors">revolving door</a>.  It appears that this pattern is merely part of a larger one involving US and even global society.<br /><br />While warnings about the growing threat of oligarchy or plutocracy have mainly come from people (including your loyal Health Care Renewal bloggers) who might be regarded as out of the mainstream, that is changing.<br /><br />We have a striking local example. <br /><br />David Carlin is a former Majority Leader of the Rhode Island Senate.  While he is a Democrat, he could hardly be called a flaming leftist.  He just published an <a href="http://www.providencejournal.com/opinion/commentary/20140401-david-carlin-is-it-oligarchy-in-democracy-out.ece">op-ed</a> in the Providence Journal which opened,<br /><br /><blockquote class="tr_bq">I am not a leftist. Far from it. Not only have I become a conservative in my old age, but I find myself growing more conservative every month.</blockquote><br />He then went on,<br /><br /><blockquote class="tr_bq"> Nonetheless, I think those on the left are correct about one thing, at least. They are right when they warn us that the United States, where the top 1 percent of people own about 40 percent of the nation’s wealth, has a <b><i>dangerous imbalance of wealth</i></b>.<br /><br />Please don’t misunderstand. I am far from agreeing with the leftist notion that the ideal society would be one in which wealth is equally distributed. This is absurd. Nonetheless, <i>this great inequality of wealth is dangerous for America. For it is making the United States <b>less and less a democracy</b> (a form of government in which the people rule) and <b>more and more an oligarchy</b> (a form of government in which a small number of very rich people rule).</i></blockquote><br />He did propose a specific remedy for the problem.  However, he did warn of the consequences in dire terms.<br /><br /><blockquote class="tr_bq">in the United States we have a special problem. For we are and always have been philosophically democratic. We believe that government is legitimate to the degree — and only to the degree — that it is chosen by the people. <i>When we conclude that in reality our government is controlled by the rich and super-rich, not the people, we will experience a <b>great legitimacy crisis</b>; our government will no longer feel legitimate to us, and thus it will not receive the deference that legitimate authority is entitled to. <b>Lawlessness and disorder will follow.</b></i></blockquote><br />That is pretty strong, and when people like Mr Carlin start making such strong warnings, things must be really bad.<br /><br />In my humble opinion, there are already plenty of reasons to have doubts about whether the ostensible authorities in health care are legitimate.  Just to mention some recent examples: we have discussed how the leaders of two major prestigious non-profit health care organizations (look <a href="http://hcrenewal.blogspot.com/2014/02/incoming-president-of-iom-outed-as.html">here</a> and <a href="http://hcrenewal.blogspot.com/2014/03/american-board-of-internal-medicine.html">here</a>) and one major medical school (look <a href="http://hcrenewal.blogspot.com/2014/03/turnabout-is-fair-play-why-university.html">here</a>) were revealed to simultaneously be responsible for the governance of for-profit health care organizations, some of which had clear track records of ethical misadventures which cast doubt on the abilities of these leaders to uphold their organizations' missions.  Two of the three leaders subsequently dropped their outside board memberships, but not their leadership positions, and their previous actions in those positions have not been revisited. <br /><br />In health care, if we do not re-establish leadership which is accountable for putting the health of patients and the public ahead of self-interest, the deluge will not be far behind.  

No Fooling - When a Retired Conservative Politician Warns About Oligarchy...

then things must be getting really bad.Of course, we have been warning about oligarchy, and related issues such as concentration of power, oligopoly  in health care for a long time.  Basically, we hav…

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As the Door Turns - The Ongoing Interchange of Leaders Among Large Health Care Corporations, Those who Represent Them, and Government

The revolving door is the two-way conduit between leadership positions in government and industry that helps to enable health care, and maybe all of society, to be run by a group of insiders who can move easily between large or influential health care organizations and the government bodies that are supposed to regulate, oversee, and enforce laws relevant to them.<br /><br />It has been three months since our last <a href="http://hcrenewal.blogspot.com/2013/12/for-whom-door-revolves-from-for-profit.html">update</a> on the <a href="http://hcrenewal.blogspot.com/search/label/revolving%20doors">revolving door</a> as it applies to health care, so here is our latest effort, according to the chronological order of the initial media coverage.  <br /><br /><b>Foundation Leader with Ties to Eli Lilly and to Former Synthes CEO to the White House</b><br /><br />As <a href="http://www.nytimes.com/2013/12/13/us/politics/new-obama-adviser-brings-corporate-ties.html">reported </a>by the New York Times in December, 2013, new White House senior adviser John D Podesta, who founded and ran the nominally non-profit organization Center for American Progress, had multiple ties to health care corporations and their leaders, e.g., to pharmaceutical maker Eli Lilly,<br /><br /><blockquote class="tr_bq"><i>The pharmaceutical giant Eli Lilly was also a donor because of what it said was the Center for American Progress’s advocacy for patients’ rights</i> — and just as the debate heated up in Washington over potential cuts to the Medicare program that covers Lilly’s most profitable drugs.</blockquote><br />Although, for the record,<br /><br /><blockquote class="tr_bq">Neera Tanden, the president of the Center for American Progress, said in an interview that the group frequently takes positions that conflict with the corporate agendas of its donors, including companies like <i>Eli Lilly</i>. </blockquote><br />Also an important but somewhat less obvious linkage was described thus by the Times,  <br /><br /><blockquote class="tr_bq"> In addition, he earned $90,000 as a <i>consultant to the HJW Foundation of West Chester, Pa,</i> according to an aide working with him on the disclosure report he is preparing. HJW is a nonprofit group <i>run by Hansjörg Wyss, a billionaire businessman</i> and major contributor to the Center for American Progress.</blockquote><br />What the Times did not say about Mr Wyss was that he is the former CEO of Synthes, a Swiss based medical device company, since merged into Johnson and Johnson   As we <a href="http://hcrenewal.blogspot.com/2011/12/it-was-best-of-times-it-was-worst-of.html">wrote</a> in 2011,<br /><br /><blockquote class="tr_bq"> Synthes USA, the American branch of a Swiss based device company, first <i>settled charges that it had been paying surgeons with company stock to use its products </i>in its clinical trials in 2009 (see <a href="http://hcrenewal.blogspot.com/2009/05/synthes-settles-agrees-to-stop-giving.html">this post</a>).  Then prosecutors alleged that these were not really rigorous trials. Instead, for marketing purposes, executives of Synthes subsidiary Norian persuaded surgeons to use its Norian XR product in a case series of spine surgery patients and then publish the results.  <i>Three patients who received the product for this 'off-label' use died</i>.  This scheme was <i>alleged to have been directed by "person no. 7," whom journalists identified as the company CEO, Hansjorg Wyss </i>(see post <a href="http://hcrenewal.blogspot.com/2009/06/synthes-indicted.html">here</a>.)   In an unusual move, the prosecutors indicted four company executives, who then pleaded guilty.  They did not take any further action against Wyss, who turns out to be one of the world's richest men (see post <a href="http://hcrenewal.blogspot.com/2009/12/person-no-7-also-known-as-83rd-richest.html">here</a>).</blockquote><br /><br />However, at the time the former executives were sentenced, one of the executive's attorney's claimed,<br /><br /><br /><blockquote class="tr_bq"><i>Wyss was the undisputed leader of the company. 'He made some of the very critical decisions that put the trials on the ultimate pathway,' Gurney said. 'The culture of an organization is set at the top.'</i></blockquote><br /><b>Former Deputy White House Press Secretary to Global Strategy Group, Whose Clients Include Pfizer, Purdue Pharma, and WellPoint</b><br /><br />As reported by the National Journal in December, 2013,<br /><br /><blockquote class="tr_bq"><b>Bill Burton</b><br />Old gig: Deputy White House press secretary<br />New gig: Formed and ran Priorities USA Action, a super PAC that raked in more than $75 million during the 2012 campaign; recently joined the public affairs firm Global Strategy Group as a managing director. Clients <a href="http://globalstrategygroup.com/about/#our-clients">include</a> GE, Cisco, American Express, Comcast, and Pfizer.</blockquote><br />Other health care clients include health insurance company Empire BCBS, pharmaceutical company Purdue Pharma, and for-profit health insurance company WellPoint <br /><br /><b>Former National Health Information Technology Coordinator to Get Real Health</b><br /><br />As <a href="http://www.govhealthit.com/news/former-national-coordinator-lends-credo-vision-patient-engagement-company">reported</a> by Government HealthIT in February, 2014,<br /><br /><br /><blockquote class="tr_bq">Three months after leaving the federal government, [former National Coordinator for Health Information Technology] Farzad Mostashari, MD, is joining the <i>board of directors at the patient engagement company Get Real Health.</i><br /><br />The big-thinking, bow-tied public health veteran is currently studying accountable care policies full-time at the Brookings Institution, and said he’s joining the Get Real Health board to help it '‘stay’ real as it innovates and serves patients and providers.'<br /><br />The Rockville, Maryland-based company was founded in 2000, starting out as a connected health consulting outfit and then, after working with Microsoft’s HealthVault in 2007, launching its own health technology in 2012, the InstantPHR patient engagement platform.</blockquote><br /><b>From CareScience Inc to National Coordinator for Health Information Technology to Health Evolution Partners</b><br /><br />The <a href="http://www.govhealthit.com/news/former-national-coordinator-lends-credo-vision-patient-engagement-company">article</a> about Dr Mostashari also mentioned in passing a more complicated set of transitions involving an earlier national coordinator for health care information technology.    <br /><br /><blockquote class="tr_bq">Mostashari is not the only former national coordinators to step into the health IT private sector after federal service. <i>David Brailer, MD, the first appointee to the role of the national coordinator for health IT, is now running the San Francisco private equity firm Health Evolution Partners.</i></blockquote><br />But in fact, according to his rather glowing Wikipedia <a href="http://en.wikipedia.org/wiki/David_Brailer">entry</a>, Dr Brailer also came from the commercial health care IT industry,<br /><br /><blockquote class="tr_bq"> In 1992, Brailer left academia and <i>founded a company</i> spun out of his Ph.D. thesis, inventing ways to measure health-care quality. This became <i>CareScience Inc., a Philadelphia software firm</i> that helped hospitals improve efficiency and prevent errors. Under Brailer, CareScience established the nation's first health care Application Service Provider (ASP). Brailer led the company through several financings, strategic partnerships, an initial public offering in 2000, and sale to global software firm Quovadx in 2003.</blockquote><br /><a href="http://en.wikipedia.org/wiki/David_Brailer#cite_note-11"></a><br /><br />Then, in 2004,<br /><br /><blockquote class="tr_bq">Brailer was appointed as the <i>first National Health Information Technology Coordinator,</i> pursuant to an executive order by President George W. Bush on April 27, 2004, which called for widespread deployment of health information technology within 10 years.</blockquote><br />According to his Health Evolution Partners <a href="http://www.healthevolutionpartners.com/david-j-brailer-md-phd/">biography</a>, Dr Brailer is also now a member of the boards of directors of American Optical Services, CenseoHealth, Optimal Radiology, and Walgreen Co.<br /><br /><b>From Aide to Congressman Young to a Lobbying Firm with Health Care Clients Then to Congress</b><br /><br />According to the <a href="http://www.tampabay.com/news/politics/elections/david-jolly-elected-to-represent-pinellas-county-in-congress/2169727">Tampa Bay Times</a>, yesterday Republican David Jolly won a special election to a congressional seat for Florida.  The article noted that Mr Jolly was "once an obscure aide to the late Republican U.S. Rep. C.W. Bill Young and then a Washington lobbyist,..."<br /><br />His past work was described in more detail in a <a href="http://www.republicreport.org/2014/jolly/">post</a> on the Republic Report blog,<br /><br /><blockquote class="tr_bq">David Jolly, the Republican congressional candidate vying for the special election in Florida next week, has not only <i>made a career out of lobbying.</i> Records reviewed by Republic Report show that <i>Jolly’s clients won millions of dollars in taxpayer earmarks from his old boss, the late Rep. C.W. 'Bill' Young (R-FL),</i> an appropriator known for his lavish use of the earmarking process. </blockquote><br />Futhermore,<br /><br /><blockquote class="tr_bq">Two of the firms that hired Jolly as a lobbyist - <i>BayCare Health Systems</i> and Alakai Defense Systmes - won lucrative earmarks from Young while paying Jolly to influence the committee where Young was a senior member.<br /><br />In 2009, BayCare Health Sytems retained Jolly and another former Young staffer named Douglas Gregory.  Later that year, Young <i>secured a $1 million earmark for BayCare Health Systems</i> for 'facilities and improvements.'</blockquote><br /><b>Summary </b><br /><br />Note that the revolving door does not seem to discriminate according to political party or ideology.  The cases above involved both Republicans and Democrats. But the revolving door does discriminate against the not well connected, because it seems to provided preferred posts in the upper echelons of government for industry insiders, and preferred posts in the upper echelons of industry for government insiders. <br /><br />As we have said many times before, the constant interchange of health care insiders among government, large health care corporations, and the lobbying and legal firms which represent them certainly suggests that health care, like many other sectors, seems to be run by an amorphous group of insiders who owe allegiance neither to government nor industry.<br /><br />However, those who work in government are supposed to be working for the people, and those who work on health care within government are supposed to be working for patients' and the public health.  If they are constantly looking over their shoulders at potential private employers who might offer big checks, who indeed are they working for? <br /><div itemprop="articleBody"></div>Attempts to turn government toward private gain and away from being of the people, by the people, and for the people have no doubt been going on since the beginning of government (and since the Constitution was signed, in the case of the US).  However, true health care reform  would require curtailing the severe sorts of conflicts of interest created by the revolving door.<br /><br />Real heath care reform would require  multiyear cooling off periods before someone who worked in the commercial world can get a job in a government whose work has direct effect on his or her previous employer or industry sector, and before someone who worked in government whose work had direct effect on a particular economic sector can accept a job for a company in that sector.    <br />

As the Door Turns - The Ongoing Interchange of Leaders Among Large Health Care Corporations, Those who Represent Them, and Government

The revolving door is the two-way conduit between leadership positions in government and industry that helps to enable health care, and maybe all of society, to be run by a group of insiders who can m…

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For Whom the Door Revolves - from For-Profit Contract Research Organization Leadership to Surgeon General?

The new nominee to be US Surgeon General is Dr Vivek Murthy, as <a href="http://www.boston.com/lifestyle/health/blogs/white-coat-notes/2013/11/14/obama-nominating-vivek-murthy-harvard-and-brigham-and-women-surgeon-general/eo6mit1nNtLpUxE6VrizLJ/blog.html">announced</a> in the Boston Globe White Coat Notes blog in November.  A Boston Globe <a href="http://www.bostonglobe.com/metro/2013/11/15/murthy-obama-choice-for-surgeon-general-who-likes-practice-outside-hospital-walls/KwrWaarq2lkrDMy1vXLNEP/story.html">article</a> a few days described not only his "healthy lifestyle" which included ingestion of "unflavored almond milk, raw carrots, and high-protein grains," as well as the practice of yoga, but how he has<br /><br /><blockquote class="tr_bq">strived to use his medical degree to help patients beyond the hospital walls through <i>starting health care companies</i> and nonprofits. His supporters hope that his record stands out....</blockquote><br />While the US Surgeon General has little power, occupants of the office have tried to use it as a bully pulpit, often for public health issues.  For example, <a href="http://www.surgeongeneral.gov/about/previous/biokoop.html">Dr C Everett Koop</a> was known for his campaign against smoking, and his advocacy for public health measures to combat HIV.   Most previous Surgeons General came from academic, public health, and/or practice backgrounds (Dr Koop was Physician-in-Chief of the Childrens Hospital in Philadelphia; his successor, Dr Antonia Caremello was in academic pediatrics, private practice, and at the NIH; then Dr M Jocelyn Elders also came from academic pediatrics, etc.)<br /><br />Dr Murthy superficially seems to come from this tradition.  The Globe article noted his "professional life as a Brigham and Women's Hospital [a prestigious Harvard teaching institution] physician." <br /><br />However, Dr Murthy was also described by the official statement nominating him to be surgeon general as "Co-Founder and Chairman of the Board of TrialNetworks, formerly known as Epernicus, since 2007."  The Globe called it a "software start-up company in Needham ... to help drug developers efficiently collect information from clinical trials."<br /><br />But wait, an <a href="http://www.usatoday.com/story/opinion/2013/12/03/obama-health-care-surgeon-general-murthy-column/3863603/">op-ed</a> in early December in USA Today called him a "self described passionate entrepreneur" and "a part-time physician and a full-time businessman."  In fact, the TrialNetworks web-site describes a company that<br /><br /><blockquote class="tr_bq">provides sponsors and CROs the industry's only <a href="http://www.trialnetworks.com/platform/overview">Clinical Trial Optimization System</a>. Using this modern and intuitive cloud-based technology, customers such as Merck & Co. and Infinity Pharmaceuticals are able to transform the quality and efficiency of clinical operations at each stage of a trial from feasibility through closeout. Companies ranging from biotechs to Top-10 pharmas have implemented the TrialNetworks platform for use in Phase I-IV trials by more than 25,000 site staff in 60 countries.</blockquote>Thus, TrialNetworks is a form of for-profit contract research organization in that it is apparently paid by drug and biotechnology companies to help them do clinical trials and other clinical research.<br /><br />Its website includes <a href="http://www.trialnetworks.com/customers/overview">customer testimonials</a> from  Merck, Biogen Idec, Infinity Pharmaceuticals, and Ariad Pharma.<br /><br />So apparently Dr Murthy, if approved, may be the first US Surgeon General to come through the revolving door from a leadership position in a company that is a variant on the for profit contract research organization theme, an organization that supports clinical research by the pharmaceutical industry, and has major pharmaceutical and biotechnology corporate clients.  As we have discussed, most clinical research is now sponsored, and effectively run by for-profit drug, biotechnology and device companies, and is devoted to efforts by these companies to assess their own products, often ostensibly as required for regulatory approval, but often influenced by marketing considerations.  Unfortunately, the domination of clinical research by those with vested interests in having the research turn out in favor of their own products has resulted in many examples of <a href="http://hcrenewal.blogspot.com/search/label/manipulating%20clinical%20research">manipulation of the research</a>, and <a href="http://hcrenewal.blogspot.com/search/label/suppression%20of%20medical%20research">suppression </a>when that manipulation has failed to produce the desired results. <br /><br />So the obvious concern about Dr Murthy would be whether he would use his bully pulpit only to support patients' and the public's health,  or would his prior experience in a leadership position in commercially sponsored pharmaceutical research influence him in favor of that industry's priorities?<br /><br />As we have discussed, US health care is now dominated by for-profit corporations, and these organization can command the effort of multi-million or billion dollar marketing and public relations divisions to sell their products and the policy positions they favor.  These organizations hardly are in need of more bully pulpits.  Yet it seems that this new appointment will further increase the influence in government of big health care business, rather than that of health care professionals, patients, and the people in general. <br /><br />Sadly, it seems that Dr Murthy's nomination is just the latest example of how leadership of health care in government and in the corporate world now overlaps, and how the role of "pure" health care practitioners and health care academics in government has waned.  As we <a href="http://hcrenewal.blogspot.com/2013/10/former-fda-commissioner-cms.html">previously noted,</a>  the system in which government and big corporations largely overlap in terms of their leadership and presumably goals is called <a href="http://hcrenewal.blogspot.com/search/label/corporatism">corporatism</a>.  One can argue that such systems end up being run primarily for the benefit of corporate and government insiders.<br /><br /> Until we dispel the fog of corporatism that has spread over the government that was once supposed to be of the people, by the people, and for the people, expect no real health care reform, and expect continuing rising costs, declining access, and worsening patient care. Obviously, true health care reform would start with the government and its officials putting patients' and the public's health first, way ahead of the financial comfort of corporate leaders.<br /><br />I would note that neither the currently controversial and now operational Affordable Care Act, nor any of its opponents schemes for alternatives addresses this issue. <br /><br />by Roy M. Poses MD for Health Care Renewal  <br /><br /><br />

For Whom the Door Revolves - from For-Profit Contract Research Organization Leadership to Surgeon General?

The new nominee to be US Surgeon General is Dr Vivek Murthy, as announced in the Boston Globe White Coat Notes blog in November.  A Boston Globe article a few days described not only his "healthy life…

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Former FDA Commissioner, CMS Administrator McClellan adds Johnson and Johnson Board Membership to Positions with General Atlantic LLC, Capital Royalty, Castlight Health, and AvivReit

Our latest example of the interchangeability of top insiders within corporate health care and the government agencies that are supposed to regulate corporate health care comes via an <a href="http://www.investor.jnj.com/releaseDetail.cfm?ReleaseID=796836&year=2013">announcement</a> from Johnson and Johnson,<br /><br /><blockquote class="tr_bq"><i>Johnson & Johnson</i> (NYSE: JNJ) announced today that Mark B. McClellan, M.D., Ph.D., Senior Fellow in Economic Studies, and Director of the Initiative on Value and Innovation in Health Care, Brookings Institution, will <i>join the Board of Directors</i> on October 15, 2013.  Dr. McClellan will serve on the Regulatory, Compliance & Government Affairs Committee and the Science, Technology & Sustainability Committee of the Board.<br /><br /><i>As former commissioner of the U.S. Food and Drug Administration (FDA) from 2002 to 2004, and as the former administrator of the Centers for Medicare & Medicaid Services for the U.S. Department of Health and Human Services from 2004 to 2006</i>, Dr. McClellan has more than two decades of public service and academic research experience. From 2001 to 2002, he served as a member of the President's Council of Economic Advisers and senior director for health care policy at the White House. During President William J. Clinton's administration, Dr. McClellan held the position of deputy assistant secretary of the Treasury for economic policy.</blockquote><br />So Dr McClellan has gone from running the US Food and Drug Administration, the primary government regulator of the pharmaceutical industry, to stewardship of one of the biggest pharmaceutical (and biotechnology and device) companies.<br /><br />Not noted in that announcement was that Dr McClellan has been collecting positions in health care corporations since at least 2009.  The examples I found included in chronological order:<br /><br /><u>2009 - General Atlantic LLC</u><br /><br />This appears to be a private equity firm which <a href="http://www.generalatlantic.com/about-us/a-proud-legacy/">claims</a> to be a "leading global investment firm." <br /><br />From a 2010 a Mergers & Acquisitions <a href="http://www.themiddlemarket.com/news/General-Atlantic-Adds-Healthcare-Vet-201877-1.html">article</a>,<br /><br /><blockquote class="tr_bq">A year ago, <i>the firm hired Dr Mark McClellan</i>, previously a commissioner of the Food & Drug Administration, <i>to its healthcare practice as a special advisor</i>.</blockquote><br />According to the firm's <a href="http://www.generalatlantic.com/people/special-advisors/">current website</a>, he is still a special advisor.   <br /><br /><u>2010 - Capital Royalty LP</u><br /><br />In a 2010 <a href="http://www.capitalroyalty.com/news/item/firm-news/capital-royalty-establishes-strategic-advisory-committee/">press release</a>, this apparently private equity firm claimed to be<br /><br /><blockquote class="tr_bq">a market pioneer and innovator in healthcare investing with a focus on intellectual property investments in FDA-approved biopharmaceutical assets</blockquote><br />In that release, it announced the creation of a Strategic Advisory Committee that included Dr Mark McClellan.  He <a href="http://www.capitalroyalty.com/about-us/strategic-advisory-committee/dr.-mark-mcclellan-md-phd/">still sits</a> on that committee.  <br /><br /><u>2012 - Castlight Health</u><br /><br />In a 2012 <a href="http://www.castlighthealth.com/2012/mark-mcclellan-joins-castlight-health%E2%80%99s-advisory-board/">press release</a>, this firm claimed to be <br /><br /><blockquote class="tr_bq">developer of a personalized health care shopping portal offering unbiased information about health care cost and quality</blockquote><br />That press release announced the addition of Dr McClellan to the firm's Advisory Board, <a href="http://www.castlighthealth.com/company/advisory-board/">on which</a> he still sits.  <br /><br /><u>2013 - AvivReit</u><br /><br />This firm "specializes in the ownership and triple-net leasing of post-acute and long-term care skilled nursing facilities (SNFs)" per its <a href="http://www.avivreit.com/about-aviv/">website</a>. <br /><br />Dr McClellan is currently on its <a href="http://ir.avivreit.com/od.aspx?iid=4328838">board of directors</a>.  He apparently was appointed in 2013. <br /><br />Notably, I did not see anything in any of these firms' announcements about Dr McClellan or their biographies of him that noted his board or advisory committee positions with other firms.<br /><br /><b>Summary</b><br /><br />Dr Mark McClellan rose through the ranks in the US executive branch ending with positions as FDA commissioner and administrator of the Center for Medicare and Medicaid Services (CMS) within the Department of Health and Human Services (DHHS).  He served under two presidents, Clinton and George W Bush.  Within 3 years of exiting DHHS, he picked up his first important commercial position, at General Atlantic LLC, and then added other positions with Capital Royalty, Castlight Health, AvivReit, and now the biggest of all, Johnson and Johnson.  Meanwhile he apparently continues at the Brookings Institution.  He must be one very busy man.<br /><br />This case could be lumped with those of another former FDA commissioner and Secretary of Health and Human Services who ended up as a Director of Medtronic (see <a href="http://hcrenewal.blogspot.com/2011/10/former-us-secretary-of-health-and-human.html">this post</a>),  another Secretary of DHHS who ended up on the boards of multiple health care corporations (see <a href="http://hcrenewal.blogspot.com/2011/06/embedded-networks-of-influence-in.html">this post</a>), a director of the National Institutes of Health (NIH) who became a Sanofi executive, etc, etc (see <a href="http://hcrenewal.blogspot.com/2010/12/former-nih-director-spins-trhough.html">this post</a>). <br /><br />While some might argue whether his acquisition of a leading advisory position with a private equity firm three years after he left DHHS technically constituted a spin through the <a href="http://hcrenewal.blogspot.com/search/label/revolving%20doors">revolving door</a>, Dr McClellan's cumulative acquisition of four more such positions within the following four years certainly demonstrates how our corporate dominated health care system and the government agencies which are supposed to be regulating it to assure the health and safety of patients, and the maintenance of the public health seem to be run by an interchangeable cast of insiders.  We have asked before whether we can trust federal regulators to put patients' and the public's health first when they know they could easily become  candidates for lucrative private positions in the companies they regulate, or which are affected by their regulations, presumably assuming they have not done too much during their time in government to offend the leaders of such companies. <br /><br />We have noted that the system in which government and big corporations largely overlap in terms of their leadership and presumably goals is called <a href="http://hcrenewal.blogspot.com/search/label/corporatism">corporatism</a>.  One can argue that such systems end up being run primarily for the benefit of corporate and government insiders.<br /><br /> Until we dispel the fog of corporatism that has spread over the government that was once supposed to be of the people, by the people, and for the people, expect no real health care reform, and expect continuing rising costs, declining access, and worsening patient care. Obviously, true health care reform would start with the government and its officials putting patients' and the public's health first, way ahead of the financial comfort of corporate leaders.<br /><br />I would note that neither the currently controversial and now operational Affordable Care Act, nor any of its opponents schemes for alternatives addresses this issue. <br /><br />by Roy M. Poses MD for Health Care Renewal  <br /><br />

Former FDA Commissioner, CMS Administrator McClellan adds Johnson and Johnson Board Membership to Positions with General Atlantic LLC, Capital Royalty, Castlight Health, and AvivReit

Our latest example of the interchangeability of top insiders within corporate health care and the government agencies that are supposed to regulate corporate health care comes via an announcement from…

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Round and Round Spins the Revolving Door, Unimpeded by "Obamacare," Nor By Those Protesting "Obamacare"

On this day of government dysfunction in the US, it is time for our latest installment on the "<a href="http://hcrenewal.blogspot.com/search/label/revolving%20doors">revolving door</a>," the interchange of insiders among government legislative offices that affect health policy and agencies that implement it, and large health care corporations and the lobbyists and attorneys who represent them.  While we have been discussing this issue since March, 2011 (look <a href="http://hcrenewal.blogspot.com/2011/03/those-big-doors-keep-revolving.html">here</a>),  it got major media attention in the form of a New York Times <a href="http://www.nytimes.com/2013/09/18/us/politics/reaping-profit-after-assisting-on-health-law.html?pagewanted=all">article</a> two weeks ago.<br /><br />We have accumulated several other relevant stories since late August, 2013, which we will group by the type of government offices and agencies affected, and within them, by the date the story first came out..<br /><br /><b>Regulatory and Law Enforcement Agencies</b><br /><br /><u>Health Care Antitrust Leader at the Federal Trade Commission to Arnold & Porter</u> <br /><br /> From the MainJustice.com <a href="http://www.mainjustice.com/2013/09/09/ftc-senior-antitrust-attorney-joins-arnold-porter/">site</a>,<br /><br /><blockquote class="tr_bq">Peter J Levitas, a former senior antiturst attorney at the Federal Trade Commission, is joining Arnold & Porter LLP in Washington, D.C....<br /><br />Levitas has spent the past four years as deputy director of the FTC's Bureau of Competition and oversaw investigations and litigation for mergers and conduct cases in numerous industries.  </blockquote><br />So,<br /><br /><blockquote class="tr_bq">Levitas joins the firm's antitrust practice with experience3 addressing complex merger and conduct investigations, particularly in the healthcare, pharmaceutical and technology industries.</blockquote><br /><u>Leader of Health Care Fraud Enforcement for US Attorney New Jersey Office to Lowenstein Sandler </u><br /><br />From the ComplianceWeek.com <a href="http://www.complianceweek.com/former-health-care-fraud-chief-rejoins-lowenstein-sandler/article/311549/">site</a>,<br /><br /><blockquote class="tr_bq">Maureen Ruane, a former health care fraud chief at the U.S. Attorney's Office for the District of New Jersey, has rejoined the law firm Lowenstein Sandler to lead its new health care litigation, investigations and compliance practice.<br /><br />The new practice will help the firm's healthcare and life science clients strengthen their regulatory and compliance programs, as well as defend corporate and individual clients who become the subjects or targets of government investigations or enforcement actions.  <br /><br />Prior to rejoining Lowenstein Sandler, Ruane most recently served for more than three years as the Chief of the Health Care & Government Fraud Unit at the U.S. Attorney's Office for the District of New Jersey.</blockquote><br /><b>Health Policy Implementation</b><br /><br /><u>Counsel for Department of Health and Human Services to Sidley Austin</u><br /><br /><a href="http://www.nytimes.com/2013/09/18/us/politics/reaping-profit-after-assisting-on-health-law.html?pagewanted=all">Per</a> the NY Times,  <br /><br /><blockquote class="tr_bq">Dr. [Dora] Hughes, a former Obama administration official, has something Washington lawyers and lobbying shops covet: an insider’s understanding of the new health care law. After nearly four years as counselor to Health and Human Services Secretary Kathleen Sebelius, she left government last year to work for Sidley Austin, which represents insurers, pharmaceutical companies, device makers and others affected by the law. </blockquote><br />Previously,<br /><br /><blockquote class="tr_bq">she  began a decade ago, first as a health policy adviser to Senator Edward M. Kennedy, and later to Mr. Obama, then a senator. </blockquote><br /><u>Deputy Assistant Secretary of Department of Health and Human Services to Glover Park Group</u><br /><br />Also from the NY Times,<br /><br /><blockquote class="tr_bq"> Elizabeth Engel, who oversaw health legislation and served as a liaison to Congress when she was a deputy assistant health secretary under Ms. Sebelius, is now advising health care clients for the Glover Park Group. </blockquote><br /><u>White House to Avenue Solutions</u><br /><br /><a href="http://www.nytimes.com/2013/09/18/us/politics/reaping-profit-after-assisting-on-health-law.html">From</a> the NY Times,<br /><br /><blockquote class="tr_bq">Yvette Fontenot, a mother of three who began her Washington career in 1997, analyzing Medicare for the Office of Management and Budget. Ms. Fontenot worked on the health bill as a Finance Committee aide and later moved to the White House. Four months ago she joined Avenue Solutions, a boutique lobbying shop. </blockquote><br /><u>White House "Health Czar" and Deputy Chief of Staff to Consonance Capital, and CVS</u><br /><br />While we <a href="http://hcrenewal.blogspot.com/2013/08/the-door-revolves-again-former-white.html">noted</a> this in August, 2013, the NY Times reported in September as part of its larger article,  <br /><br /><blockquote class="tr_bq">   <a href="http://m.healthcarefinancenews.com/news/aca-architect-returns-private-equity">Nancy-Ann DeParle</a>, Mr. Obama’s former 'health czar' and later his deputy chief of staff, now guides health care investments as a partner in a new private equity firm, Consonance Capital, with colleagues from her pre-White House days. </blockquote><br />Actually, as we <a href="http://hcrenewal.blogspot.com/2009/03/meet-new-boss-same-as-old-boss-health.html">discussed</a> in 2009, Ms DeParle has been oscillating back and forth through the revolving door for a while.  She  was the administrator of the Health Care Financing Administration in the Department of Health and Human Services under President Clinton from 1997-2000.  She left to become managing director of a private equity firm, CCMP Capital.  She also served on the boards of directors of Boston Scientific, Cerner, and Medco.  Then she went back to the executive branch as noted by the the Times above.<br /><br />Furthermore, as reported by AP, <a href="http://news.providencejournal.com/breaking-news/2013/09/cvs-caremark-board-adds-former-white-house-adviser.html">via</a> the Providence Journal,<br /><br /><blockquote class="tr_bq">Drugstore chain CVS Caremark has added to its board of directors a former top adviser to President Barack Obama on the health care overhaul.<br /><br />The Woonsocket, R.I., company said Wednesday after markets closed that Nancy-Ann M. DeParle, 56, will be an independent director who serves on the board's audit committee.</blockquote><br /><u>White House to health care venture capital</u><br /><br />Also from the NY Times story,<br /><br /><blockquote class="tr_bq">Bob Kocher, a doctor, management consultant and former member of Mr. Obama’s economics team, is a California venture capitalist, helping finance health start-ups. </blockquote><br /><b>Legislative Offices</b><br /><br /><u>Senate Finance Committee Staff, then Department of Health and Human Services Staff to Avenue Solutions</u><br /><br />As <a href="http://thehill.com/business-a-lobbying/318577-architects-of-obamacare-reap-windfall-as-washington-lobbyists">reported </a>by The Hill bog,<br /><br /><blockquote class="tr_bq">The firm Avenue Solutions, for instance, recently hired Yvette Fontenot, a former staffer for both the Senate Finance Committee, which wrote ObamaCare’s tax-related provisions, and HHS's Office of Health Reform, which is assisting the implementation.<br /><br />Since her hire in April, the four-woman firm has picked up Health Care Service Corp. as a client, and Fontenot is now lobbying for the Blue Cross Blue Shield Association</blockquote><br /><u>Congress to Alston & Bird </u><br /><br />In the same report,<br /><br /><blockquote class="tr_bq">Former Rep. Earl Pomeroy (D-N.D.) joined Alston & Bird in 2011 after dealing with healthcare and tax issues as a member of the House Ways and Means Committee.<br /><br />Now Pomeroy and his one-time chief of staff, Bob Siggins, are lobbying on ObamaCare for clients such as clients such as Vision Service Plan, the National Coordinating Committee for Multiemployer Plans and Medicare — a health insurance provider.</blockquote><br /><u>Health Counsel for Senate Finance Committee from WellPoint, Now to Johnson & Johnson</u><br /><br />Note that we touched on part of this story back in 2010<a href="http://hcrenewal.blogspot.com/2010/04/pay-for-hypocrisy-for-health-insurance.html"> here</a>.  Now <a href="http://www.nytimes.com/2013/09/18/us/politics/reaping-profit-after-assisting-on-health-law.html?pagewanted=all">from</a> the New York Times,  <br /><br /><blockquote class="tr_bq"><div itemprop="articleBody">Liz Fowler, a onetime executive with WellPoint, the insurer, helped draft the legislation as the chief health counsel for the Senate Finance Committee and later joined the administration. Now she runs global health policy for Johnson & Johnson, the medical equipment and pharmaceutical giant, which strongly backed the health bill and stands to benefit from it. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">Ms. Fowler is not a registered lobbyist, but she does provide in-house advice on the bill — work that has drawn criticism from publications like the British newspaper <a href="http://www.theguardian.com/commentisfree/2012/dec/05/obamacare-fowler-lobbyist-industry1">The Guardian</a> and the Web sites <a href="http://www.salon.com/topic/liz_fowler/">Salon</a> and <a href="http://www.huffingtonpost.com/bill-moyers/watch-washingtons-revolvi_b_2316245.html">The Huffington Post</a>, where the journalist Bill Moyers singled out Ms. Fowler, asserting that 'when push comes to shove, corporate interests will have the upper hand.'</div></blockquote><div itemprop="articleBody"><br /></div><div itemprop="articleBody"><b>Summary</b></div><div itemprop="articleBody"><br /></div><div itemprop="articleBody"> It's enough to make one's head spin: all that traffic through the revolving door reported just in the last five weeks.</div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">As we have said many times before, the constant interchange of health care insiders among government offices, lobbying and legal firms, and large health care corporations certainly suggests that health care, like many other sectors, seems to be run by an amorphous group of insiders who owe allegiance neither to government nor industry.  The NY Times tried to explain this in a benign way,</div><div itemprop="articleBody"><br /></div><blockquote class="tr_bq"><div itemprop="articleBody">Yet the progression from government to the private sector is also predictable, a window into the peculiar rhythms of life in the capital. Young aides, often fresh out of college or graduate school, acquire highly specialized knowledge but eventually settle down, build lives and long for jobs that pay more and let them see their children at night. </div></blockquote><div itemprop="articleBody"><br /></div><div itemprop="articleBody">While the private sector may offer good pay, is it just for these poeples' skills and expertise?  Or are these offers only for those who while in government service evinced friendship to private vested interests?  Do government workers who think longingly of higher pay and shorter hours wonder what it would take to please those that might offer such opportunities?</div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">Yet those who work in government are supposed to be working for the people, and those who work on health care within government are supposed to be working for patients' and the public health.  If they are constantly looking over their shoulders at potential private employers who might offer big checks, who indeed are they working for?</div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">Attempts to turn government toward private gain and away from being of the people, by the people, and for the people have no doubt been going on since the beginning of government (and since the Constitution was signed, in the case of the US).  However, true health care reform  would require curtailing the severe sorts of conflicts of interest created by the revolving door.  This might require both improving pay and working conditions for government regulators, law enforcers, and legislative staffers; and specific laws to prevent immediate transitions from being a regulator, law enforcer, or legislator to handling corporate responses to or defenses against such regulation and enforcement. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">That bit does not seem to be part of the current Affordable Care Act, yet it was hardly to enact such restrictions on conflict of interest that certain members of Congress have shut down the government.   </div><div itemprop="articleBody"><br /></div>

Round and Round Spins the Revolving Door, Unimpeded by "Obamacare," Nor By Those Protesting "Obamacare"

On this day of government dysfunction in the US, it is time for our latest installment on the "revolving door," the interchange of insiders among government legislative offices that affect health poli…

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The Door Revolves Again: the Former White House Health Reform Czar Goes to Private Equity Firm Looking for Investments Created by Health Reform

Round and round it goes, and when it will stop, nobody knows.<br /><br /><b>Background: The Former Health Care Reform Czar's Past Career </b><br /><br />It appears that Ms Nancy DeParle, formerly a White House Deputy Chief of Staff, and before then, from 2009 - 2011, the Director of the White House Office of Health Care Reform, has gone through the revolving door again.<br /><br />We raised concerns about Ms DeParle's strong ties to the commercial side of health care at the time she was put in charge of getting health care reform legislation passed (look <a href="http://hcrenewal.blogspot.com/2009/03/meet-new-boss-same-as-old-boss-health.html">here</a>.)  Specifically, her background for shepherding this legislation included being on the boards of directors of three large health care corporations, Boston Scientific, a medical device company, Cerner, a vendor of health care information technology, and Medco, and pharmacy benefits company.   She had previously been on the boards of DaVita, a commercial kidney dialysis care delivery company, and Triad Hospitals, a for-profit hospital system.  At the time, I wondered whether this set of relationships with multiple  health care corporations would lead to "health care reform" that was more about the interests of big health care corporations and their top executives than about us, the people.<br /><br />As it turned out, there is a case to be made that a lot of the health care reform legislation that eventually passed was in the interests of big corporations.  It enabled for-profit <a href="http://hcrenewal.blogspot.com/search/label/health%20insurance">health care insurance</a> companies to continue to dominate the insurance market, and created no "public option" that could have competed with them.  It fostered the development of "accountable care organizations," (ACOs), and thus fostered a wave of <a href="http://hcrenewal.blogspot.com/search/label/concentration%20of%20power">consolidation </a>in the hospital market favoring ever larger hospital systems, including for-profit ones, and the rise of the <a href="http://hcrenewal.blogspot.com/search/label/corporate%20physician">corporate physician</a>.  It pushed the use of commercial health care information technology without requiring these devices' effects on patients to be rigorously assessed, and with no obvious concerns about the <a href="http://hcrenewal.blogspot.com/search/label/healthcare%20IT%20dangers">risks</a> posed by these systems.  It did nothing to stop concentration of power in health care, nothing to support small private practices, small non-profit hospitals, or non-profit health insurance.  While it required more disclosure of <a href="http://hcrenewal.blogspot.com/search/label/conflicts%20of%20interest">conflicts of interest</a> affecting physicians, it did nothing to reduce them, or to combat <a href="http://hcrenewal.blogspot.com/search/label/deception">deception</a> in health care <a href="http://hcrenewal.blogspot.com/search/label/marketing">marketing</a> and <a href="http://hcrenewal.blogspot.com/search/label/public%20relations">public relations</a>, or to reduce <a href="http://hcrenewal.blogspot.com/search/label/manipulating%20clinical%20research">manipulation</a> or <a href="http://hcrenewal.blogspot.com/search/label/suppression%20of%20medical%20research">suppression</a> of clinical research to serve commercial vested interests, or even to combat blatant <a href="http://hcrenewal.blogspot.com/search/label/health%20care%20corruption">health care corruption</a>. <br /><br /><b>A Brief Stop at a Think Tank</b> <br /><br />At any event, Ms DeParle left the government early this year.  She did not immediately go back to the commercial world, however.  Instead, as <a href="http://thehill.com/blogs/blog-briefing-room/news/276789-obama-policy-deputy-nancy-ann-deparle-to-exit-for-brookings-post">reported</a> by The Hill, she went to a think tank.<br /><br /><blockquote class="tr_bq"><div class="p1">Nancy-Ann DeParle, a White House deputy chief of staff and the president's point person on his signature health care law, is leaving the West Wing to <i>join the Brookings Institution</i>. </div><div class="p1"><br /></div><div class="p2">Brookings president Strobe Talbott announced in a post on Twitter that the longtime Obama staffer would work as a <i>guest scholar</i> for the think tank.</div></blockquote><div class="p2"><br /></div><div class="p2"><b>Through the Revolving Door to Private Equity </b></div><br /><br />That position did not last long, however.  A few days ago, a Wall Street Journal blog <a href="http://blogs.wsj.com/privateequity/2013/08/07/obamas-health-czar-joins-consonance-capital/">announced</a> she was moving again,<br /><br /><blockquote class="tr_bq">As <i>health care-focused private equity firms</i> navigate the nuances of the Affordable Care Act, one such shop, Consonance Capital, has decided to go straight to the source, hiring Nancy-Ann DeParle, the former director of the White House Office of Health Reform.</blockquote><br />So now she will be with private equity, and in particular, with a private equity firm specializing in, of course, health care:<br /><br /><blockquote class="tr_bq">Consonance has been out targeting between $350 million and $450 million for its debut fund.<br /><br />The fundraising effort appears to have gained traction in recent months. LBO Wire reported in February that the firm had raised $30.3 million for Consonance Private Equity PV LP.  According to a person familiar with the fundraising, the vehicle has gathered as much as $200 million so far from investors including Ohio Public Employees Retirement System, Travelers Insurance and LGT Group.<br /><br />The fund is earmarked for <i>buyouts and recapitalizations of health-care providers, payors, pharmaceutical and specialty distributors and device manufacturers</i> with between $20 million and $150 million in annual revenue.</blockquote><br />Finally, it seems Ms DeParle will be suited to this new employment opportunity since she knows so much about how the new supposed health care reform will create investment opportunities,<br /><br /><blockquote class="tr_bq"> Ms. DeParle said the <i>changing regulatory environment will give rise to a host of new investment opportunities.</i> 'There’s a lot that’s changing in health care,' said Ms. DeParle. 'There will be millions of new customers for hospitals and health care providers, much stronger demand for health care services....'</blockquote><br /><b>Summary </b><br /><br />So to recapitulate, Ms DeParle came from roles as a steward of multiple large health care corporations to lead the health care reform efforts of the executive branch.  In that capacity, she helped to create and enact legislation that she would later say created many "new investment opportunities."  Now, as the legislation is going into operation, she has spun over to private equity to take advantage of these opportunities.<br /><br />This seems to be a great example of why the revolving door is bad for government, health care, and the American public.  People in responsible government positions, in which they are supposed to represent all the people, may be constantly thinking about impressing those who might employ them in the private sector when they leave government service.  What better way to impress these potential employers than to take actions which may later improve these companies'  commercial prospects, whatever effect they may have on us, the people?<br /><br />I am no political scientist, but in my humble opinion, there should be multi year cooling off periods before someone who worked in the commercial world can get a job in a government agency whose work has direct effect on his or her previous employer or industry sector, and before someone who worked in a government agency whose work had direct effect on a particular economic sector can accept a job for a company in that sector.  Now that would be a real reform. 

The Door Revolves Again: the Former White House Health Reform Czar Goes to Private Equity Firm Looking for Investments Created by Health Reform

Round and round it goes, and when it will stop, nobody knows.Background: The Former Health Care Reform Czar's Past Career It appears that Ms Nancy DeParle, formerly a White House Deputy Chief of Staff…

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Health Care Revolving Door Roundup

Increasingly, the regulatory and law enforcement functions of the US government in the health care sphere seem to be blending with the management of large health care organizations.  One mechanism for this is the "revolving door," the constant interchange of personnel between government agencies and corporate management.  <br /><br /><br />Here is a list of some of this year's interesting cases of people transiting the revolving door between US government agencies that are supposed to regulate health care organizations or enforce the relevant laws and the organizations subject to these regulations and laws.   Note that this list may not be complete.  It is difficult to keep track of these transitions.  <br /><br /><b>Leader of Health Care Fraud Section of Philadelphia US Attorney's Office to Teva Pharmaceuticals</b><br /><br /><a href="http://www.mainjustice.com/2013/03/03/former-health-care-fraud-chief-in-philly-joins-teva-pharmaceuticals/">Via</a> MainJustice.org in March, 2013,<br /><br /><blockquote class="tr_bq">John Pease, who l<i>ed the government and health care fraud section in the U.S. Attorney's Office in Philadelphia</i>, has left the Justice Department for a job with a pharmaceutical company.<br /><br />Pease, 45, is a <i>new senior counsel at Teva Pharmaceuticals, where he oversees government investigations of the company for the Americas.</i>  'I was just ready to try something different,' Pease said in an interview.</blockquote><br /><b> Leader of US Department of Justice Fraud Section in Charge of Health Care Issues to Law Firm as Defender of Companies and Senior Executives</b><br /><br />The initial notice again was <a href="http://www.mainjustice.com/2013/03/25/health-care-fraud-unit-chief-sheldon-joins-quinn-emanuel/">via</a> MainJustice.org in March, 2013<br /><br /><blockquote class="tr_bq">Sam Sheldon, the <i>deputy chief in the Criminal Division's Fraud Section who oversaw health care fraud prosecutions</i>, is leaving the Justice Department to <i>join Quinn Emanuel Urquhart & Sullivan LLP.</i></blockquote><br /><br />Mr Sheldon's new job was made clear on the firm's <a href="http://www.quinnemanuel.com/attorneys/sheldon-sam-s.aspx">website</a>,<br /><br /><blockquote class="tr_bq">Sam Sheldon is head of the firm’s Health Care Practice Group.  He is a <i>trial lawyer who represents companies and senior executives in litigation before the United States federal government including Department of Justice and Department of Health and Human Services, and other law enforcement and regulatory agencies.</i></blockquote><br /><b>FDA Deputy Commissioner for Global Regulatory Operations and Policy to Mylan</b><br /><br />This <a href="http://www.reuters.com/article/2013/04/30/us-mylan-fda-idUSBRE93T12D20130430">story,</a> in April, actually made it (briefly) to Reuters,<br /><br /><blockquote class="tr_bq"> <span id="articleText"><span class="focusParagraph"><span class="articleLocatio</span>n">Generic drugmaker <i>Mylan Inc</i> said on Tuesday it <i>hired Deborah Autor, deputy commissioner for global regulatory operations and policy at the U.S. Food and Drug Administration, to help oversee its global regulatory strategy.</i></span></span></span></blockquote><br /><b>Leader of Health Care Fraud Enforcement of Philadelphia US Attorney's Office to Law Firm as Industry Defender</b><br /><br /><a href="http://www.bloomberg.com/news/2013-08-07/morrison-foerster-vinson-elkins-cravath-business-of-law.html">From Bloomberg</a>, in August, 2013,<br /><br /><blockquote class="tr_bq">Marilyn May, a <i>False Claims Act litigator at the U.S. Justice Department, joined Arnold & Porter<a href="http://topics.bloomberg.com/arnold-%26-porter/"></a> LLP’s Washington office as litigation counsel with a focus on healthcare, pharmaceutical and medical device industry defense work. </i><br /><br /> May was the <i>head of healthcare fraud enforcement in the U.S. Attorney’s Office in the Eastern District of Pennsylvania. </i>She coordinated healthcare fraud cases and investigations as well as handled False Claims Act cases involving pharmaceutical and medical device companies, hospitals, nursing homes and other healthcare providers, the firm said. </blockquote><br />The law firm's <a href="http://www.arnoldporter.com/professionals.cfm?action=view&id=6531">website</a> states,<br /><br /><blockquote class="tr_bq"> Her litigation practice focuses on <i>pharmaceutical, medical device and healthcare defense matters.</i></blockquote><br /><br /><b>Summary</b><br /><br />In each of these cases, a person with responsibility for regulation of and/or law enforcement for health care organizations went through the revolving door to either work for health care corporations subject to such regulation and/or law enforcement, or work for legal firms that specialize in defending such corporations and their leaders in regulatory and law enforcement actions.<br /><br />As far as I know, none of these instances was the least bit illegal.  However, like previous examples of the revolving door, they raise the concern that people in government regulation or law enforcement who think that they may have future lucrative job prospects helping health care organizations attenuate regulation and law enforcement may not be the most enthusiastic, aggressive, or persistent regulators or law enforcers.  Why would one want to upset one's future employer?<br /><br />While these cases of the revolving door are legal, they are clearly conflicts of interest in the sense that the prospect of such future employment likely may increase the risk of compromising a government official's devotion to serving the public and enforcing the law, if not in the legal sense.  In some particular case, the revolving door may actually lead to corruption according to the Transparency International definition, abuse of entrusted power for private gain, if not according to the legal definition.  Thus the continuing occurrence of government officials blithely transiting the revolving door no doubt was a reason that more than 40% of the public consider the US health care sector to be corrupt (see <a href="http://hcrenewal.blogspot.com/2013/07/43-believe-that-us-health-care-corrupt.html">this post</a>.)<br /><br />True health care reform would require curtailing the severe sorts of conflicts of interest created by the revolving door.  This might require both improving pay and working conditions for government regulators and law enforcers, and specific laws to prevent immediate transitions from being a regulator/ law enforcer to handling corporate responses to or defenses of such regulation and enforcement. <br /><br />Of course, I can already hear the protests of those people who decry paying more for government or increasing government regulation.  I can at least hope that the protests are not from those who personally profit from the current seemingly corrupt system.   <br /><br /><br />

Health Care Revolving Door Roundup

Increasingly, the regulatory and law enforcement functions of the US government in the health care sphere seem to be blending with the management of large health care organizations.  One mechanism for…

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Another Revolving Door Variant: From Academia with Millions in Medtronic Royalties, to the White House, to the Health Care Service Corp

The revolving door spins, and where it will stop, nobody knows... <br /><br />In October, 2010, we noted questions about how Dr Stephen Ondra got to be a <a href="https://www.va.gov/opa/bios/docs/ondra.pdf">Senior Policy Adviser for the US Department of Veterans Affairs</a>. A veteran who was a neurosurgery professor at Northwestern University, Dr Ondra had received millions of dollars in royalties from device manufacturer Medtronic, whose CEO supported his appointment to the government position  (see this <a href="http://hcrenewal.blogspot.com/2010/10/toxic-and-dangerous-watchdog-vs.html">post</a>).  As soon as he was appointed, he publicly opposed a nominee for US Surgeon General who had been critical of the medical device industry, and its financial ties to doctors. <br /><br />After going to Washington, Dr Ondra apparently also served in the Executive Office of the President, in the White House, but <a href="http://triblocal.com/lake-forest/community/stories/2012/04/northwestern-memorial-hospital-names-stephen-l-ondra-chief-medical-officer/">returned</a> to Northwestern University in 2012.  However, he did not stay there for long.<br /><br />This month, a <a href="http://www.forbes.com/sites/brucejapsen/2013/02/07/obama-advisor-ondra-hired-as-top-doc-at-blue-cross-plan/">post</a> on Forbes indicated he is moving on again, and back to the corporate side of health care. <br /><br /><blockquote class="tr_bq"><i>the nation’s fourth-largest health insurance company is naming a key former health advisor to President Obama as its top doctor.</i><br /><br /><i>Dr. Stephen Ondra, will become senior vice president and chief medical officer at Health Care Service Corp</i>., the Chicago-based parent company of Blue Cross plans in Illinois, Texas, Oklahoma and New Mexico. The plan has more than 13 million health plan members and is looking to grow even more, announcing last year a proposed partnership with the Blue Cross plan in Montana.</blockquote><br />Health Care Service Corp is a mutual insurance company, that is, a company owned by its policy-holders rather than stock holders.  However, that does apparently not make it any more ascetic than a typical for-profit insurance company, at least in terms of generosity towards its top hired executives.  As Crain's Chicago Business <a href="http://www.chicagobusiness.com/article/20120515/NEWS03/120519922/blue-cross-parents-ceo-pay-climbs-to-12-9-million">reported</a> in 2012, <br /><br /><blockquote class="tr_bq">New federal regulations intended to force health insurers to spend less on administration didn't keep the parent of Blue Cross & Blue Shield of Illinois from <i>paying CEO Patricia Hemingway Hall more than <b>$12.9 million</b> in 2011, a 61 percent raise.</i><br /><br />The Health Care Service Corp. chief executive's total compensation last year dwarfed the $8 million she received in 2010, according to a filing with the Illinois Department of Insurance. <i>The 2011 increase was fueled by an $11.8 million bonus, which was 69 percent above her 2010 bonus of $7 million.</i><br /><br />Ms. Hall wasn't alone in getting a big raise at Health Care Service, whose insurance business booked net income of more than $1 billion in 2011, for the second straight year.<br /><br />The 10 highest-paid executives at the Chicago-based mutual company — which operates Blue Cross plans in Illinois and three other states — <i>earned a collective $41.7 million, 65 percent more than the $25.3 million they were paid in 2010.</i></blockquote><br /> If Dr Ondra's new position puts him among the latter group of executives, he too stands to make millions a year.  <br /><br />So to recap Dr Ondra's career so far, in 2010 he was a medical school professor who had earned millions in royalties from Medtronic.  He then went to top leadership positions in the US Veterans Department and Executive Office of the President.  He returned briefly to Northwestern University, only to leave again for a top executive position in for-profit insurance company Health Care Service Corp, where he is likely to make millions more.<br /><br />Thus Dr Ondra is our latest interesting example of the "<a href="http://hcrenewal.blogspot.com/search/label/revolving%20doors">revolving door</a>" phenomenon in health care.  He started as an erstwhile academic physician but with a very major financial relationship with a medical device company.  He then went through the door the first time into the US government, and then a second time from the government to a for-profit insurance company, with just a brief stop-over in academia.<br /><br />By the way, it appears that all of this is quite legal.  It does again raise questions about whether health care leaders in government with previous relationships with industry might still feel undue sympathy to the interests of industry, as might government leaders who can expect future jobs in industry. <br /><br />Moreover, this case, like previous cases we have discussed,  indicates how leadership in academic health care, corporate health care, and the government tend to blend together.  Leaders of one type of organization have more and more in common with leaders of the other types of organizations than they do with their lesser ranked colleagues, and certainly than with other health care constituencies.  So the more the revolving door revolves, the more we wonder about the <a href="http://hcrenewal.blogspot.com/search/label/corporatism">corporatism</a> of health care, about how health care seems to be increasingly run by an amorphous group of academic/ corporate/ government leaders whose loyalties may be more to each other than to academic and professional values, patients' and the public's health, and government of, by and for the people.<br /><br /><br />

Another Revolving Door Variant: From Academia with Millions in Medtronic Royalties, to the White House, to the Health Care Service Corp

The revolving door spins, and where it will stop, nobody knows... In October, 2010, we noted questions about how Dr Stephen Ondra got to be a Senior Policy Adviser for the US Department of Veterans Af…

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How the "Revolving Door" and Other Aspects of Corporatism Benefited Amgen Just After its Settlement and Guilty Plea

At least here in these United States, our health care corporatism is bipartisan.  Here we present a sorry story of how a company that should have been shamed by dishonest behavior that likely harmed patients instead apparently was awarded special treatment through its cozy relationships with top government leaders <br />  <br /><b>Accusations of Kickbacks and Deceptive Marketing of Aranesp  </b><br /><br />Last month, biotechnology giant pleaded guilty to a charge of misbranding and settled civil charges with the US government for $762 million (look <a href="http://hcrenewal.blogspot.com/2012/12/amgen-settles-pleads-guilty-to.html">here</a>).  Soon after, New York Times <a href="http://www.nytimes.com/2012/12/20/business/amgen-workers-helped-us-in-aranesp-marketing-inquiry.html">article</a> described the unethical practices the company was alleged to have performed.  It opened with a vivid anecdote:<br /><br /><blockquote class="tr_bq">'I hope no one is taping this,' the Amgen<a class="meta-org" href="http://topics.nytimes.com/top/news/business/companies/amgen_inc/index.html?inline=nyt-org" title="More information about Amgen Inc"></a> manager remarked at a company sales meeting in 2005.<br /><br />The manager then <i>boasted of how she had given a $10,000 unrestricted grant</i> to a pet project of a doctor who was an adviser to the local  Medicare contractor. <i>In turn, she said, the doctor would help persuade the contractor to provide reimbursement for an unapproved use of Amgen’s anemia drug, Aranesp.</i>  </blockquote><br />Since that account appeared to be of a quid pro quo, it did sound like some a kickback or bribery.  In addition, <br /><br /><blockquote class="tr_bq">Amgen is also <i>accused of offering kickbacks to doctors and clinics to induce them to use its drugs</i>. These reportedly came as cash, rebates, free samples, educational and research grants, dinners and travel, and other inducements.   </blockquote><br />Of course, since this was the usual sort of settlement we see of health care corporate wrongdoing, in which the reason the company is paying what appears to be a large fine remains ambiguous,<br /><br /><br /><blockquote class="tr_bq"><div itemprop="articleBody">Except for those in the criminal count, <i>Amgen denied the other accusations, though it did issue a statement on Wednesday acknowledging the settlement</i>. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">'The government raised important concerns in the criminal prosecution,' Cynthia M. Patton, chief compliance officer at Amgen, said in the statement. 'Amgen acknowledges that <i>mistakes were made</i>, and we did not live up to our standards.'</div></blockquote><div itemprop="articleBody"><br />"Mistakes were made," what a handy phrase to avoid acknowledging that a real person or person made those mistakes.  Why government prosecutors did not leverage instances in which the mistakes were made by an identifiable person, for example, the manager in the anecdote above, to find out who ultimately authorized and directed the kickbacks and deceptive marketing, and then seek to indict them is a mystery.  The US Department of Justice now seems to be disinclined to ever pursue top  health care corporate executives who may have done wrong, while they exuberantly pursue fines from the companies they direct, fines which have almost no personal impact on those who authorized, directed or implemented the bad behavior.<br />   <br />The Times article also included a telling allegation that behind this apparent misbehavior was a changed corporate culture that put short-term revenue ahead of all other considerations.  </div><div itemprop="articleBody"><br /></div><blockquote class="tr_bq"><div itemprop="articleBody">the corporate culture changed starting around 2000. That was when new management came in and Aranesp was approved, setting up a fierce marketing battle with Johnson & Johnson and its rival anemia drug, Procrit. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody"><b><i>'It was more important to make your numbers than to follow the rules,' </i></b>said [former Amgen sales representative and now whistle-blower Jill] ...Osiecki, who was based in Milwaukee and sold Aranesp. </div></blockquote><div itemprop="articleBody"><br /></div><div itemprop="articleBody">We have discussed how the "make your numbers" culture seems to have resulted from an over-generalization of the prevalent belief in business schools that "maximizing shareholder value," which usually seems to mean maximizing short-term revenue and/or doing whatever it takes to boost stock prices in the short-term (look <a href="http://hcrenewal.blogspot.com/2012/04/health-care-dysfunction-explained-by.html">here</a>).  In companies which make potentially beneficial but also potentially hazardous drugs, the risks of "make your numbers" are obvious.</div><div itemprop="articleBody"><br /></div><div itemprop="articleBody"><b>Shameful Consequences for Patients  </b></div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">These were disconcerting revelations.  They showed that some unidentified employees, probably including top leaders of a major health care corporation seemed to use kickbacks and lies to deceptively market a drug just to "make their numbers," and thus most likely score healthy bonuses.  Yet this drug is clearly dangerous.  The <a href="http://www.accessdata.fda.gov/drugsatfda_docs/label/2011/103951Orig1s5173_103951Orig1s5258lbl.pdf">official Aranesp label</a> states (in a black box warning, in capital letters):<br /><br /><blockquote class="tr_bq"> ESAs INCREASE THE RISK OF DEATH, MYOCARDIAL INFARCTION, STROKE, VENOUS THROMBOEMBOLISM, THROMBOSIS OF VASCULAR ACCESS AND TUMOR PROGRESSION OR RECURRENCE</blockquote><br />Thus deceptive and unethical marketing practices likely lead to overuse of the drug, and overuse of the drug likely lead to sick (via myocardial infarction [heart attack], stroke, venous thromboembolism or thrombosis of vascular access [drug clots], or tumor progression) or dead patients. <br /><br />One would think that the consequences of the particular bad behavior alleged in this case would have lead to more zealous prosecution and to the pursuit of actual people who authorized, directed or implemented the bad behavior.  However, it did not.<br /><br /><br />One would also think that the nature and consequences of this bad behavior would harm the reputation of the company and its leadership.  Instead, it appears that soon after the settlement was announced, top US elected leaders were fawning over this company and its leadership, and rushing to legislate special treatment for it.<br /><br /><b>Special Treatment from Legislators </b><br /><br />Yet soon after these disconcerting revelations that should have shamed Amgen and its leadership, it appears that the company benefited from legislation narrowly crafted mainly just for to suit its interests, and with the aid of allies from both parties within the US government.  That story was again just <a href="http://www.nytimes.com/2013/01/20/us/medicare-pricing-delay-is-political-win-for-amgen-drug-maker.html">reported </a>by the New York Times.  The basics are:</div><div itemprop="articleBody"><br /></div><blockquote class="tr_bq"><div itemprop="articleBody">Just two weeks after pleading guilty in a major federal fraud case, <i>Amgen, the world’s largest biotechnology firm, scored a largely unnoticed coup on Capitol Hill: Lawmakers inserted a paragraph into the "fiscal cliff"  bill that did not mention the company by name but strongly favored one of its drugs. </i></div><div itemprop="articleBody">  </div><div itemprop="articleBody">The language buried in Section 632 of the law<a href="http://www.gpo.gov/fdsys/pkg/BILLS-112hr8eas/pdf/BILLS-112hr8eas.pdf" title="American Taxpayer Relief Act"> </a><i>delays a set of Medicare price restraints on a class of drugs that includes Sensipar, a lucrative Amgen pill used by kidney dialysis patients.</i> </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">The provision gives Amgen <i>an additional two years to sell Sensipar without government controls.</i> The news was so welcome that the company’s chief executive quickly relayed it to investment analysts.  But<i> it is projected to cost Medicare up to $500 million over that period.[That would almost make up for the fine the company had to pay for illegal marketing and to settle kickback charges - Ed]</i></div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">Amgen, which has a small army of 74 lobbyists<a href="http://www.opensecrets.org/lobby/clientlbs.php?id=D000000391&year=2012" title="Amgen’s lobbyists as of 2012"> </a>in the capital, was the only company to argue aggressively for the delay, according to several Congressional aides of both parties. </div></blockquote><div itemprop="articleBody"><br /></div><div itemprop="articleBody">But the Times article noted that it was not just the size of its army of lobbyists that did it.  </div><div itemprop="articleBody"><br /></div><blockquote class="tr_bq"><div itemprop="articleBody"> <i>Amgen has deep financial and political ties to lawmakers like Senate Minority Leader Mitch McConnell, Republican of Kentucky, and Senators Max Baucus, Democrat of Montana, and Orrin G Hatch, Republican of Utah, who hold heavy sway over Medicare payment policy as the leaders of the Finance Committee. </i></div></blockquote><div itemprop="articleBody"><br /></div><div itemprop="articleBody">In particular, Amgen</div><div itemprop="articleBody"><br /></div><blockquote class="tr_bq"><div itemprop="articleBody">has a deep bench of <i>Washington lobbyists that includes Jeff Forbes, the former chief of staff to Mr. Baucus; Hunter Bates, the former chief of staff for Mr. McConnell; and Tony Podesta, whose fast-growing lobbying firm has unusually close ties to the White House</i>. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody"><i>Amgen’s employees and political action committee have distributed nearly $5 million in contributions to political candidates and committees</i> since 2007, including $67,750<a href="http://www.opensecrets.org/politicians/contrib.php?cycle=2012&cid=N00004643&type=C"> </a>to Mr. Baucus, the Finance Committee chairman, and $59,000 to Mr. Hatch, the committee’s ranking Republican. They gave an additional $73,000 to Mr. McConnell, some of it at a fund-raising event for him that it helped sponsor in December while the debate over the fiscal legislation was under way. More than $141,000 has also gone from Amgen employees to President Obama’s campaigns. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">What distinguishes the company’s efforts in Washington is the diversity and intensity of its public policy campaigns. <i>Amgen and its foundation have directed hundreds of thousands of dollars in charitable contributions to influential groups like the Congressional Black Caucus and to lesser-known groups like the Utah Families Foundation, which was founded by Mr. Hatch</i> and brings the senator positive coverage in his state’s news media. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody"><i>Amgen has sent large donations to Glacier PAC, sponsored by Mr. Baucus in Montana, and OrrinPAc, a political action committee controlled by Mr. Hatch in Utah. </i></div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">And when Mr. Hatch faced a rare primary challenge last year, a nonprofit group calling itself Freedom Path<a href="http://images.nictusa.com/cgi-bin/fecimg/?C00492504" title="Freedom Path FEC filings"></a> sponsored advertisements in Utah that attacked his opponent, an effort that tax records released in November show was financed in large part by the Pharmaceutical Research and Manufacturers of America<a href="http://www.phrma.org/" title="PhRMA’s Web site"></a>, a trade group that includes Amgen. </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">In some cases, <i>the company’s former employees have found important posts inside the Capitol. They include Dan Todd, one of Mr. Hatch’s top Finance Committee staff members on health and Medicare policy, who worked as a health policy analyst for Amgen’s government affairs office from 2005 to 2009</i>. <i>Mr. Todd, who joined Mr. Hatch’s staff in 2011, was directly involved in negotiating the dialysis components of the fiscal bill, and he met with 'all the stakeholders,</i>' Mr. Hatch’s spokeswoman said, not disputing when asked that this included Amgen lobbyists.</div></blockquote><div itemprop="articleBody"><br />In addition, a NY Times <a href="http://www.nytimes.com/2013/01/23/opinion/amgen-gets-a-gift-from-congress.html">editorial</a> today pointed out that Mitch McConnell, the Senate Minority Leader, (Republican - Kentucky) who "exerted great influence over the fiscal negotiations and praised the Medicare provisions" presumably including the specific provision that helped Amgen, also has "political and financial ties to Amgen."  Furthermore, Senator McConnell's willingness to use taxpayer's money to pay Amgen more seemed to contradict his "public statements [which] usually emphasize the need to cut federal spending on entitlement programs, <a href="http://www.lanereport.com/17882/2013/01/entitlement-spending-fix-will-require-medicare-eligibility-age-hike-means-testing-and-cpi-formula-change-mcconnell-says/?utm_source=Faster%20Lane%20Newsletter&utm_medium=Email&utm_campaign=jan-21-2013" target="_blank">as they did in Lexington Friday</a>," as <a href="http://www.weku.fm/post/mcconnell-helped-amgen-delay-price-limits-dialysis-drug">reported</a> by WEKU (the National Public Radio Station at Eastern Kentucky University ).   <br /><br /><br /></div><div itemprop="articleBody"><b>Can We Reform Health Care in the Corporatist States of America?  </b><br /><br /> In summary, Amgen seems to have leveraged its use of former legislative aides affiliated with both political parties as lobbyists, and its presumed influence over former employees who are currently legislative aides, that is, to people who have transited <a href="http://hcrenewal.blogspot.com/search/label/revolving%20doors">revolving doors</a> in both directions, to influence policy in its corporate favor.  It has also leveraged its contributions directly to politicians, to political action committees (PACs), and to non-profit advocacy groups to influence policy in its direction for this purpose.  All this leverage apparently resulted in continuing government favoritism to a company the government had just convicted of a crime, and to a company whose actions likely led to sick and dead patients.  Furthermore, legislators who publicly deplore excess government spending and enlarging government deficits supported spending more taxpayer money to favor a particular company that they ought to have shunned.  <br /><br /><br />The New York Times <a href="http://www.nytimes.com/2013/01/23/opinion/amgen-gets-a-gift-from-congress.html">editorial</a> deplored this case first as<br /><br /><blockquote class="tr_bq">a disheartening example of how intense lobbying and financial contributions can distort the legislative process in Washington</blockquote></div><div itemprop="articleBody"><br />and second as<br /><br /><blockquote class="tr_bq">a classic example of the power of special interests to shape legislation and shows how hard it may be to carry out the reforms needed to cut health care costs. </blockquote><br />But it was really much worse than that.   This case certainly shows the ongoing coziness between big health care organizations and government (this time, mainly legislative) leaders, facilitated by the apparently very common "<a href="http://hcrenewal.blogspot.com/search/label/revolving%20doors">revolving door</a>" interchange of influential people between corporate management and government.  Note that this coziness has now become bipartisan.  However, this was not merely expensive favoritism.  It was hypocritical expensive favoritism that benefited a corporation that ought to have been shamed and shunned for behavior that did not merely cost the government money, but likely harmed patients, sometimes even fatally.  </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody"></div><div itemprop="articleBody">President Theodore Roosevelt <a href="http://www.theodoreroosevelt.org/TR%20Web%20Book/TR_CD_to_HTML364.html">condemned</a> malefactors of great wealth.  Our current political leaders in both parties seem to put their ties to corporate insiders who work for executives of great wealth ahead of any consideration of what might be good for patients, public health, or the citizenry at large.  </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">So the US now seems to be run by a soft, informal version of <a href="http://hcrenewal.blogspot.com/search/label/corporatism">corporatism</a>, the system in which government and big corporations overlap and jointly rule the people.  Since these days big corporations are run largely without accountability by increasingly rich executives, this ends up meaning government by the oligarchs, for the oligarchs, and of the oligarchs.  President Lincoln and President Theodore Roosevelt might be rolling in their graves.  </div><div itemprop="articleBody"><br /></div><div itemprop="articleBody">To meaningfully reform health care, it seems like we need to meaningfully reform our entire political system, and both make leaders of health care organizations accountable, and make government again of the people, by the people, and for the people.  </div>

How the "Revolving Door" and Other Aspects of Corporatism Benefited Amgen Just After its Settlement and Guilty Plea

At least here in these United States, our health care corporatism is bipartisan.  Here we present a sorry story of how a company that should have been shamed by dishonest behavior that likely harmed p…

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