NIH Is Pressured to Bar Drug Industry Stipends

Times Staff Writer

The National Institutes of Health’s recent proposals for cleaning up conflicts of interest do not reach far enough, the nation’s chief ethics officer has concluded, putting new pressure on the agency to ban all drug industry payments to its scientists.

In a 20-page report, the head of the Office of Government Ethics said that NIH was beset with a “permissive culture” and that firm, across-the-board restrictions were needed to restore public confidence in the nation’s preeminent medical-research agency. A copy of the report, dated July 26, was obtained by the Los Angeles Times.

The report is a setback for the director of NIH, Dr. Elias A. Zerhouni, who in June proposed banning agency directors and certain other top officials from taking industry payments while allowing most NIH scientists to continue to accept consulting deals.


The acceptance of drug company consulting fees by federal researchers at the NIH has raised questions about the ability of the agency to maintain the independence in its scientific inquiries.

Zerhouni’s staff has conferred over the last six weeks with the Office of Government Ethics regarding his proposals, officials said. The office must approve or disapprove any new conflict-of-interest regulations.

The head of the Office of Government Ethics, Marilyn L. Glynn, said in the report that without tougher standards, NIH “could give the appearance that some level of misuse of office is tolerable.”

The time had passed, she said, for trusting NIH leaders to make appropriate changes.

“Ceding authority to NIH officials to direct the NIH ethics program might be a viable arrangement if NIH had a history of adequately addressing the types of problems confronting NIH at this time,” Glynn said. “Unfortunately, the opposite is true.... NIH has had a permissive culture on matters relating to outside compensation for more than a decade.”

Glynn said that recent sampling by her staff had found a “significant number” of outside arrangements involving NIH employees which “were not approved in a timely manner” by NIH management. Many other outside arrangements, she said, “appeared not to have been approved at all.”

The report was addressed to an attorney with the Department of Health and Human Services, and was also sent to Zerhouni’s office. A spokesman at NIH, John Burklow, said agency officials contended that “the strong policies we are developing will address the problems identified and we look forward to working with OGE.”


In the report, Glynn urged Zerhouni and other administration officials to quickly “develop and propose new supplemental standards of conduct specifically to address the kinds of consulting activities that have raised recent concerns.”

Glynn cited paid consulting arrangements between drug companies and NIH scientists, including deals that raised “the appearance of the use of public office for private gain.” Glynn asked Zerhouni to respond by late September to her office’s report. She said a follow-up review would be conducted within the next six months.

On June 22, Zerhouni had described a broad package of reforms during testimony to the House Energy and Commerce subcommittee on oversight and investigations. The panel opened its investigation of the company consulting deals with NIH employees in response to a December 2003 report in The Times which documented hundreds of consulting deals, totaling millions of dollars, between industry and NIH scientists.

One top NIH official cited in the article, Dr. Stephen I. Katz, director of the National Institute of Arthritis and Musculoskeletal and Skin Diseases, participated in several agency discussions regarding the conduct of a clinical study that tested a drug provided by the U.S. subsidiary of a company for which he was a paid consultant. The article also reported that Dr. John I. Gallin, director of the NIH Clinical Center -- the nation’s largest research center for medical research on humans -- failed for two years to disclose ownership of as much as $50,000 worth of stock in a company that had collaborated on clinical studies with the NIH.

In his June 22 testimony, Zerhouni said he would seek a “total ban” on paid consulting with pharmaceutical or biotechnology companies for the directors, deputy directors, scientific directors and clinical-research directors of all of NIH’s 27 research institutes and centers. However, he would allow thousands of other NIH employees -- including the chiefs of laboratories -- to remain eligible to accept industry consulting payments.

Glynn questioned whether the potential for conflicts of interest among those allowed to continue consulting “may be at least as great, if not greater” than those who would be banned from such deals under Zerhouni’s formula.


Researchers exempted by Zerhouni “are more likely to have official duties that directly involve drug companies -- for example, cooperative research and development agreements or other arrangements to use a particular company’s products” -- than do officials who would be banned from consulting by NIH, Glynn said.

“Many of the very consulting activities that have become the subject of public controversy,” she said, have involved researchers who would be allowed by Zerhouni to continue to collect industry fees.

“In fact, from OGE’s perspective, probably the most compelling argument that can be made for any absolute prohibition on consulting with drug companies is that some NIH officials actually are involved in making clinical decisions affecting the health and safety of patients and other [NIH] research subjects, and those subjects need to be confident that decisions about their care are free from any potential influence from extraneous business connections.

“Even those [NIH] researchers who do not perform research on human subjects still may be in a position to study the products of particular drug companies, and it is possible that such research could affect, or create the appearance of affecting, the interests of those companies or their competitors.”

For purposes of banning financial ties to drug companies, Glynn recommended that “the class of senior level officials not be drawn too narrowly. It would be unfortunate if a cornerstone of any [ethics reform] is a set of restrictions that does not even cover many of the NIH positions whose occupants have been the subject of recent controversy.”

Glynn challenged another approach favored by Zerhouni in his public statements this year: “case-by-case” evaluations of most employees’ proposed financial arrangements with outside employers, in lieu of blanket prohibitions. Glynn noted that the case-by-case approach was adopted in 1995, when then-Director Harold E. Varmus rescinded many of NIH’s restrictions against paid consulting for drug companies.


“Subsequent experience has shown,” Glynn said, “that the case-by-case approach has not been adequate to protect the reputation of the agency and its employees.”

Glynn also took aim at Zerhouni’s proposal to limit consulting to 400 hours a year and require that industry fees not exceed 25% of an employee’s federal salary.

“We do not believe that time and compensation ceilings alone, or in combination with inadequate substantive restrictions, are an appropriate solution,” Glynn said. “Indeed, we are concerned that such proposals, if not accompanied by other adequate and effective restrictions, could give the appearance that some level of misuse of office is tolerable.”

Similarly, Glynn questioned Zerhouni’s call for increased disclosure of drug company payments to NIH employees.

“Activities creating the appearance that an employee is using public office for private gain are not cleansed of all taint simply because they are open and notorious,” Glynn said.

She noted that the Office of Government Ethics found significant shortcomings in NIH’s handling of employees’ requests to engage in various outside activities.


The ethics office sampled 155 outside activities, and found that 74 were not approved in advance, as required by existing policy. Of those activities, which were not detailed in the report, Glynn said late approvals were located for 39 of the arrangements. No approvals were found for the remaining 35, she said.

Glynn said it was not clear whether the NIH officials who approved the outside activities had properly evaluated whether the deals would create the appearance of a conflict of interest or the appearance of the use of public office for private gain.

The 155 arrangements sampled by Glynn’s staff were culled from the National Cancer Institute, the National Institute of Allergy and Infectious Diseases, the Clinical Center and the NIH director’s office.

To read previous Times stories on NIH policies, go to