NIH to Curb Its Scientists’ Deals With Drug Firms

The National Institutes of Health will drastically tighten policies that have allowed hundreds of consulting deals between drug companies and scientists at the nation’s leading center for public health research, its director told a congressional panel Tuesday.

Announcing a sweeping set of reforms, NIH Director Elias A. Zerhouni also said that he would demand public disclosure of any future industry payments to agency employees.

He said that, in hindsight, he should have acted sooner to crack down on the private deals that have created potential conflicts of interest between scientists’ duties at NIH and their financial ties to industry.

“I have reached the regrettable conclusion that some NIH employees may have violated these [existing] rules and that the agency’s ethics system does not adequately guard against these violations,” Zerhouni told the House Energy and Commerce subcommittee on oversight and investigations.

The NIH is the nation’s premier agency for medical research, spending $27.9 billion this year.

Zerhouni said that as congressional investigators continued to sift through potential conflicts of interest in recent weeks -- including the discovery of at least 100 deals that had not been properly reported -- he reached a “tipping point” regarding reform at NIH. He vowed that he and his staff would “move diligently to completely change the system of ethics at NIH.”

“You have my pledge: Any employees who violated the rules will be subject to appropriate penalties,” he said. “It’s very painful to me that the actions of a few may have tainted the good work of thousands of scientists who have not participated in any of these actions and who work daily at NIH to solve the mysteries of disease and to advance treatments and cures for these diseases.”

Zerhouni said that while not all of the changes could be made overnight, he was “working aggressively” with the office of Health and Human Services Secretary Tommy G. Thompson and with the Office of Government Ethics to implement his proposals.

The announced reforms were greeted warmly by Democrats and Republicans on the subcommittee. The panel opened its investigation of company consulting deals with NIH employees in response to a Dec. 7, 2003, report in the Los Angeles Times.

The article noted that until late 1995, top NIH officials were prohibited from accepting consulting fees and stock options from drug companies, but that restriction was lifted by the then-director of NIH, Dr. Harold E. Varmus. Based in part on documents obtained over five years under the Freedom of Information Act, The Times identified hundreds of consulting payments, totaling millions of dollars, to senior NIH scientists. Two of the scientists had pledged to abstain from matters affecting their clients, but nonetheless participated in decisions involving company products used in NIH studies on patients.

In addition, the article reported that 94% of the highest-paid employees at NIH were not required to publicly disclose payments from outside employers, including drug companies.

Zerhouni described these reforms to the subcommittee:

* Scores of senior officials -- including the directors, deputy directors, scientific directors and clinical-research directors of all of NIH’s 27 research institutes and centers -- would be subject to a “total ban” on paid consulting with pharmaceutical or biotechnology companies. These employees also would be banned from taking consulting or speaking fees from nonprofit institutions.

* Other employees, including laboratory chiefs, would be allowed to continue accepting industry consulting fees. However, those scientists could no longer collect unlimited sums; they would be barred from taking fees totaling more than 25% of their federal salary. The employees would be limited to no more than 400 hours a year of outside income-generating activity -- equivalent to roughly one hour per workday.

* All NIH employees would be prohibited from receiving company stock or stock options as compensation from industry.

* More than 5,000 NIH employees would be prohibited from holding any stock in a drug company. This prohibition, Zerhouni said, is modeled after an ethics policy in place at the Food and Drug Administration.

* All NIH employees would be banned from serving on the boards of directors of companies in the drug industry.

* All employees would be banned from accepting any form of remuneration from universities or other entities that receive research-grant funding from NIH.

* Employees at NIH would not be allowed to accept any award unless it were first “pre-screened” for legitimacy by agency ethics officials. This reform is a response to congressional criticism of awards made by recipients of NIH grants to the then-director of the National Cancer Institute, Dr. Richard D. Klausner.

Asked Tuesday by Rep. Greg Walden (R-Ore.) whether arrangements entered into by six NIH officials showcased in December by The Times would be permissible under his announced reforms, Zerhouni said that the deals of “three or four” of the employees would be prohibited.

Zerhouni referred indirectly to several officials whose consulting payments would no longer be approved, including Dr. Stephen I. Katz, director of the National Institute of Arthritis and Musculoskeletal and Skin Diseases, and Dr. John I. Gallin, director of the NIH Clinical Center, the nation’s largest site of medical research on humans.

The announcement of the revised practices came seven months after leaders in the House of Representatives wrote to Zerhouni and asked him to divulge all drug company payments to NIH employees.

After at first citing the advice of government lawyers and the restrictions of the federal Privacy Act, NIH officials in recent weeks have provided Congress with a more extensive accounting of industry payments received by employees from 1999 through 2003.

However, while waiting for NIH to hand over the data, the House leaders also asked for similar information from 20 large drug companies. That inquiry resulted in the discovery of roughly 100 industry consulting deals that had not been properly vetted or reported to NIH, according to the senior Democrat on the House Energy and Commerce Committee, John D. Dingell of Michigan.

“What else is out there?” Dingell asked.

Said Joe Barton (R-Texas), chairman of the Energy and Commerce Committee: “It appears that there may be a substantial number of NIH scientists who engaged in outside activities, such as drug company consulting, in stealth -- without any notice to, or approval by, NIH. If our suspicions are confirmed, these unapproved, compensated activities would represent a very serious breach of NIH policies, federal ethics regulations, and possibly, in a few cases, criminal laws.”

The chairman of the oversight and investigations subcommittee, James C. Greenwood (R-Pa.), saluted Zerhouni’s tougher approach to conflicts of interest.

“Dr. Zerhouni is offering a number of substantial restrictions that will curb some of the kinds of cases that are of the greatest concern,” Greenwood said.

The chairman said that he envisions at least one more hearing -- the fourth this year -- to examine conflicts of interest at NIH.

Zerhouni, who in public remarks in December had sought to minimize the gravity of ethics problems at NIH, was contrite and conciliatory while announcing the package of reforms. Accompanied at the witness table by Alex Azar II, the general counsel of the Department of Health and Human Services, Zerhouni said the Bush administration was determined to achieve a “major reform” of ethics policies at NIH.

Rep. Diana DeGette (D-Colo.) warned Zerhouni that, although his announced reforms sounded like prudent steps, “the devil is in the details.”

“These conflicts of interest deserve scrutiny and must be resolved,” DeGette said. “The ethos of this organization must change.... These [NIH] scientists also should remember that their work is the hope for many Americans who are ill or who are taking care of a family member with an illness. Their scientific work, for some Americans, is the difference between life or death. A conflict of interest or even the appearance of a conflict of interest could have devastating effects.”

Times researcher Janet Lundblad in Los Angeles contributed to this report.