In the wake of a $10-million payout to a whistleblower, UCLA's School of Medicine is drawing more scrutiny over its financial ties to industry and the possibility that they compromised patient care.
A new study in this month's Journal of the American Medical Assn. raised a red flag generally about university officials such as Eugene Washington, the dean of UCLA's medical school who also serves on the board of healthcare giant Johnson & Johnson. The world's biggest medical-products maker paid Washington more than $260,000 in cash and stock last year as a company director.
"There are real risks here," said Walid Gellad, assistant professor of medicine at the University of Pittsburgh and co-author of the JAMA study. "Are the policies in place enough to govern these potential conflicts among the leadership of academic medical centers?"
Meanwhile, the $10-million, mid-trial settlement this week between the UC system and the former head of orthopedic surgery at UCLA has prompted a consumer group to seek an independent investigation by California Atty. Gen. Kamala Harris or Gov. Jerry Brown.
In a 2012 lawsuit against UCLA and UC regents, Dr. Robert Pedowitz, 54, alleged that they failed to act on his complaints about widespread conflicts of interest among the medical school faculty and that they later retaliated against him for raising those concerns as a whistleblower.
As department chairman, Pedowitz testified, he became concerned about colleagues who had financial ties to medical-device makers or other companies that could unduly influence their care of patients or research into new treatments.
University officials said they thoroughly investigated Pedowitz's claims and found no wrongdoing and no evidence that patient care was jeopardized. UC regents said they agreed to settle to avoid the time and expense of further litigation.
In a statement Friday, UCLA said Washington's work as a J&J director did not compromise the "integrity of operations" at UCLA, and that his outside activities complied with university policies.
"Dr. Washington has absolutely no oversight of purchasing decisions involving devices or supplies," UCLA said. "Dr. Washington's board service provides significant benefits to both UCLA and the wider field of medicine. As the only physician on the board, Dr. Washington provides a frontline perspective on patient care and the needs of doctors."
Such ties between healthcare companies and physicians have drawn increasing attention from government officials and patient advocates. Taking effect this fall is a provision of the federal Affordable Care Act that requires public disclosure of financial relationships between medical companies and doctors.
Consumer Watchdog, a Santa Monica advocacy group that asked for the state investigation, said the troubling nature of Pedowitz's allegations and the large settlement amount warrant further inquiry.
"It is apparent that UCLA's policies governing financial conflicts are either inadequate or unenforced," Jamie Court, president of Consumer Watchdog, wrote in a letter sent to state officials Thursday.
"Are the same failures happening at other hospitals in the UC system? Your independent investigation is needed to ensure that patients are not harmed," he wrote.
Consumer Watchdog said the investigation also should determine whether oversight of UC's relationships with medical companies should be taken away from university administrators such as Washington and given instead to an independent monitor.
A spokesman for the attorney general said Harris is reviewing the consumer group's request. He would not comment further.
Responding to the letter, UCLA said its "current policies and procedures represent best practices that have continued to become stronger and more rigorous in recent years.... We are always looking for ways to improve further."
In an interview last week, the chief compliance officer of the UCLA Health System said Washington encouraged her to investigate Pedowitz's claims fully. Washington testified at Pedowitz's trial, and his handling of the surgeon's allegations came up regularly.
The compliance officer, Marti Arvin, said industry relationships are unavoidable at universities and that patients benefit from that collaboration.
"Having those relationships with industry is a component of allowing us to meet our mission of leading-edge patient care, education and research," Arvin said.
Washington was reelected to J&J's board Thursday. The company said "we see absolutely no financial conflict of interest with Dr. Washington serving on our board."
He wasn't alone among academic medical center officials who served on the boards of major pharmaceutical companies in 2012, the year examined by researchers.
For instance, the dean of USC's School of Pharmacy, R. Pete Vanderveen, serves on the board of Mylan Inc., a major drugmaker based in Canonsburg, Pa.
A spokeswoman for USC said the university has policies in place to manage potential conflicts. But USC said that's "a moot point in this case because the School of Pharmacy has no business relationship with Mylan."
The study found that 41 board members at large drug companies held leadership posts at academic medical centers. Their average compensation for serving as a company director was $312,564.
"These leaders are wearing two very important hats at the same time," said Gellad, the study's co-author. "There are a lot of benefits from academic medical centers having interactions with industry, but we can't ignore the risks."