Whistle-Blowers Paid to Keep Quiet About Clinic : Medicine: UCI officials say confidentiality clauses with $900,000 in settlements needed to protect integrity of fertility center probes.

On a day when UCI officials vigorously denied ever trying to hide the truth about improprieties in its famed fertility clinic, the university acknowledged Thursday that it paid about $900,000 to three whistle-blowers in settlements that required them to keep quiet about the clinic.

University officials confirmed late Thursday that they had reached separate financial settlements with three whistle-blowers--one for slightly less than $500,000, the others for about $300,000 and $100,000. The university said the confidentiality clauses were needed to protect the integrity of investigations into the Center for Reproductive Health and to protect patient confidentiality.

A lawyer for Dr. Ricardo Asch, the center director who has been accused by the university of wrongdoing, described the settlements as “hush money” to hide the real story of what happened at the fertility clinic.

In the first detailed interviews given since the scandal broke nearly three weeks ago, UCI administrators said Thursday that they looked into “vague, unsubstantiated” allegations of egg misuse as early as 1992 but did not receive enough information to launch a formal inquiry until September.

Administrators expressed frustration at criticism that they have dragged their feet in acting upon allegations of egg stealing, financial improprieties and other misdeeds at the fertility clinic.

“At no time did we try to suppress the truth,” Executive Vice Chancellor Sidney Golub said. “At no time did we try to avoid investigation of this tough issue.”

But university officials confirmed Thursday that they had reached separate financial settlements with three whistle-blowers that include confidentiality clauses preventing the employees from disclosing information about the fertility center.

Ronald G. Brower, the criminal defense attorney for Asch, said he is disturbed that the university is paying “hundreds of thousands of dollars” to potential witnesses in possible civil and criminal cases involving his client.

“Lawyers and lay people have a term for this: It’s called hush money,” Brower said.

Said Golub earlier: “We have hushed up nothing.”

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UCI’s statements follow a landslide of reports in the news media about allegations against the clinic’s doctors, as well as concerns expressed on and off campus that UCI was in no hurry to investigate complaints about the physicians.

Asch and his two partners are accused of transplanting eggs without permission, conducting human research without patients’ consent and pocketing money owed to the university. Asch also has been accused of prescribing a fertility drug not approved by the U.S. government.

In a scathing legal complaint filed May 25, the university accused the doctors--Asch, Jose P. Balmaceda and Sergio Stone--of blocking their probes into the charges. The three physicians deny any wrongdoing.

For the first time Thursday, university officials acknowledged that they do not know how many women’s eggs might have been misappropriated, but they said they had specifically asked the doctors for up to six patient files that could reveal misconduct.

In addition, administrators released documents in which they concede their system for monitoring human research broke down in the case of the fertility clinic.

Letters released by UCI on Thursday show the university has been under intense scrutiny by federal investigators since January because of the alleged research misconduct. The federal Office for Protection From Research Risks has the authority to pull more than $14 million in research funding from UCI.

Federal investigators at one point urged that a monitor appointed to proctor research at the center oversee all clinical care there, saying the three doctors “can’t differentiate” between research subjects and private patients, university officials said Thursday.

Documents also show that the university alerted the state Board of Pharmacy in August and the U.S. Food and Drug Administration in April of its findings that a clinician at the fertility center had illegally imported and dispensed an unapproved fertility drug, HMG Massone.

According to the letters, the clinician gave the drug to at least nine patients from January, 1993, through February, 1994, and “probably directed a shipment of the drug on one occasion via Federal Express to Florida.”

Though the name of the doctor was excised by the university before the documents were released, officials confirmed that it was Asch and that the other doctors at the clinic were not implicated. UCI administrators alleged that the drug, similar to an FDA-approved drug called Pergonal--which they emphasized does not harm patients--was shipped through the mail from Argentina.

Commenting on what the university has termed the “most disturbing” allegations that eggs were stolen, Golub conceded that UCI auditors first heard vague reports of possible mishandling of eggs while investigating the center’s finances after a weekend theft in 1992.

During an interview with a clinic employee suspected of stealing the $4,600, the woman told auditors that there were “problems with the eggs” but refused to be more specific, Golub said.

“They asked her who, what, when, where and how, and she wouldn’t say,” Golub said.

The employee, an administrative assistant, no longer works for the university.

Golub said auditors questioned clinic employees and others about the handling of eggs but were unable to substantiate any problem.

“In late 1992, early 1993, [the auditors] asked the doctors, and they were told it wasn’t true,” Golub said.

Rumors of egg misuse resurfaced in the spring of 1994, as the university auditors were investigating a whistle-blower’s complaint that center director Asch had improperly imported and prescribed HMG Massone and that the doctors were involved in financial improprieties, Golub said. Again, he said, “internal audit dutifully follows up and obtains no specific information that could be investigated.”

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The allegations about problems with the eggs were raised yet again in a July 18, 1994, letter from a second whistle-blower. But Golub said the letter made only “vague” references to problems with the eggs and that the employee actually was reporting to UCI information that she had gleaned from interviews with auditors.

Michael Maroko, attorney for the second whistle-blower, Debra Krahel, a former senior administrator at UCI, confirmed Thursday that his client had reached an “amicable” settlement with the university.

It was not until September, 1994, when university officials received a letter from an attorney representing the three whistle-blowers detailing allegations of egg stealing and other wrongdoing, that UCI had enough information to appoint a clinical panel of three doctors to investigate the charges, Golub said.

Last fall, the panel--including Stanley Korenman of UCLA, Mary C. Martin of UC San Francisco and Maureen Bocian of UC Irvine-- found “credible evidence” that a misappropriation of donor eggs had occurred in at least two cases involving UC Irvine patients. The two women who received those eggs have since given birth.

“What happened is serious--in some respects, very serious,” Korenman, associate dean for ethics at the UCLA School of Medicine, said Thursday. “It strikes at the heart of the doctor-patient relationship on several levels and could have a major, nationwide impact.”

The panel looked into the September whistle-blowers’ letter that alleged the university had known for 3 1/2 years about improprieties involving eggs but had done nothing. It found that contention was “absolutely not” true, Golub said.

The clinical panelists offered to meet with the fertility clinic physicians and key patients in a “non-threatening” environment to discuss concerns over egg handling, Golub said.

In a “telling” response, Golub said, “that offer was denied.”

He said the doctors told the panelists they blamed nurses and secretaries for any problems.

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Brower, Asch’s attorney, said Thursday that the doctor believes any foul-ups were “deliberate or unintentional mistakes” by clinic staff.

“The record-keeping, involving the classification, transfer, implantation and freezing of the . . . embryos is purely a function of the staff exclusive of the physicians,” he said. “The doctor gets the catheter that has the embryos in it, that’s it.”

According to the university’s lawsuit, the clinical panel could reach no definitive conclusion on mishandling of eggs, because Asch and his partners refused to provide the patient charts and records needed.

Golub elaborated on that charge Thursday, saying physicians stonewalled the university by refusing to provide most relevant patient and clinic records since February, 1994, when the first whistle-blower came forward.

“UCI is the provider of care,” he said. “There should be no question that records can be shared among the providers of care.”

The doctors’ attorneys say their clients have cooperated, as much as they could, since the beginning of the university’s inquiries.

“We provided all documents related to the clinical research that had been identified,” said Balamceda’s attorney, Patrick Moore of Irvine. “We expressed a sincere willingness to cooperate with the investigation. What we didn’t agree to do is to provide documents that would have constituted a violation [of patient confidentiality] and were irrelevant” to the investigation.

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Despite the clinical panel’s finding of “plausible evidence” of egg misappropriation early this year, Golub said, the university waited to report the doctors to the Medical Board of California until a few weeks ago because the university did not want to compromise its capacity to “get to the truth.”

The board’s executive director, Dixon Arnett, has questioned that delay, saying the board could have used its subpoena powers to secure patient records earlier.

The Center for Reproductive Health is now the focus of at least seven investigations.

Brower said he and his client, Asch, plan to meet with the UCI police and the district attorney next week to discuss allegations that someone is attempting to blackmail Asch. Golub said Thursday that university administrators were unaware of any blackmail complaint until another of Asch’s attorneys called a press conference about it last week.

MEDICAL CHECKUP: An expert panel found indications of improprieties. A28

DRUG DISCLOSURE: UCI papers show delay in notifying FDA of drug’s use. A30