Monday, January 4, 2010

Should Doctors Serve on Drug Company Boards?

There has been plenty of media coverage of Partner's new rule limiting the amount of money faculty can make by joining a company's board of directors. I am one of those peons who has never been a member of such a high falutin' club and I really don't know what happens at a board meeting.

I did a little research about Pfizer's board of directors on their website. I chose Pfizer because Dr Dennis Ausiello, who is the chief of medicine at Massachusetts General Hospital, is one of two doctors on Pfizer's board, and I met Dr. Ausiello at the ACRE meeting at Brigham and Woman's Hospital last July. He struck me as a very smart and reasonable person. In the New York Times article, he was quoted as saying that "I’m very proud of my board work. I’m not there to make money. I certainly think I should be compensated fairly and symmetrically with my fellow board members, but if my institutions rule otherwise, as they have, I will continue to serve on the board."

The Times said that Ausiello made $220,000 from Pfizer last year. This seems like an enormous amount of money to me. It's hard to believe that he doesn't do this at least partially for the money.

Under Partner's new rules, you can't make "more" than $500/hour, amounting to $5000 for a typical day's work for a board member. I have two thoughts when I hear this figure. First, it's still quite a lot of money. Second, how much are they making per hour now? On Pfizer's website they say they have four board meetings per year. At 10 hours per meeting, that's 40 hours. I guess Dr. Ausiello was paid $220,000 divided by 40, or $5,500/hour. What on earth was he doing for Pfizer that made him worth that much money?!

Regarding the issue of conflict of interest, I'm willing to bet that Dr. Ausiello is scrupulous about not prescribing too many Pfizer drugs because of his position. But I'd lay the same bet that he never says anything bad about a Pfizer product. If he's reading this blog, I invite him to prove me wrong.


There may be some unique benefit to patients when doctors sit on a drug company's board. If this is true, I say go ahead and pay them the going rate. But if their participation is just so much window dressing for a company that seeks the prestige of an ivy league doctor, then such faculty shouldn't be allowed on the board at all, whether they are paid or do it for free.

18 comments:

Anonymous said...

It would be educational to see a social network analysis of hospital system/pharmaceutical company/insurance industry directorships - that is if the web of connections wasn't so tight as to undecipherable! Personally, at $5,500/hr. I'd be happy to be invited in to take a look around for myself.

insider said...

My question is "How much did he know about the Bextra/Celebrex issues - and when?"

Gallucci-Neto said...

I'm waiting for Dr Dennis Ausiello reply...

charliebuck123 said...

NEWS - Drs earn money for practising medicine. One cannot separate clinical purity from the reality of earning a living. This does not mean the right decisions for patients need to be compromised by such concerns. How much is appropriate to earn becomes a purely subjective call. I'd bet there is significantly more value having physician input to influence how companies develop medicines, than there is risk to patients from those physicians deciding to prescribe a given company's treatment inappropriately. It is more likely they'd act more rigorously to demonstrate independence from any influence driven by inolvement with that given company.

Daniel Carlat said...

Charliebuck123, I certainly agree that docs earn money for practicing medicine and that they (we) are entitled to a fair wage for whatever side jobs we choose to do. The question here is how serving on a board affects a doctor's central mission, which is the care of patients. Earning money to ensure drug companies profit will sometimes enhance patient care, but other times may harm patients by providing an incentive to ignore negative side effects.

Anonymous said...

Dr. Ausiello, as well as any other doctor at Partners, could do as much board work for as many different companies as he likes....and simply donate the money to a worthy charity. That way we get the oft touted "benefit" of industry/academic collaboration without any problems with conflicts of interest.

My bet is that most doctors will turn their nose up at such an idea. The obvious reason being that the loot they get is the main impetus for industry collaboration.

SteveM said...

Unfortunately, most BOD's in the U.S. are stooges for management. You think Ausiello preps for meetings by carefully reading and annotating Pfizer balance sheets, financial and operating information? (Which he should of course to earn that fat fee. With fiduciary responsibility supposedly being so important...)

Nope, it's the Woody Allen thing. 80% of elite Academic success is just showing up. I mean psychiatrists publish ghost-written professional articles for crying out loud. Given that, what kind of intellectual energy do you think they would invest in corporate oversight?

Ausiello is most probably a medical "face" at those meetings. He just shows up. Maybe tosses in some "word on the street" guidance about what's selling and then he goes home fat and happy.

Psychiatry is becoming so warped as a discipline, Ausiello on the Pfizer board is probably harmless. Because drinking the psycho-pharm-centric bath-water of Big Pharma is already normative among its practitioners. Pfizer doesn't need Ausiello to surreptitiously preach to the converted.

Anonymous said...

If "drinking the psycho-pharm-centric bath-water of Big Pharma is already normative among its practitioners"...how does a patient know whether his or her psychiatrist has pure intentions?

Roy M. Poses MD said...

Note that we have been talking about the issue of academic medical leaders sitting on health care corporate boards since 2006. See our most recent post on the Partners Healthcare policy here:
http://hcrenewal.blogspot.com/2010/01/one-small-step-towards-reducing.html

I suspect that the reason for the apparently extravagant going rate for board members at big corporations, which seems to be in the low- to mid-six-figures, is that most board members of large corporations are current or retired "C-level" leaders of other corporations, who are used to seven-, eight-, and nine-figure annual compensation.

Insider, it might be worth asking Dr Aussiello about the series of settlements, some huge, that Pfizer has made recently of charges of misbehavior. For a discussion of some of the recent examples, see:
http://hcrenewal.blogspot.com/2009/09/pfour-legal-settlements-for-pfizer-why.html

insider said...

Roy Poses - I agree re settlements!

Professional Patient. said...

Dr. Aussiello has to have some bias. It is human nature to have some bias towards a company that is giving him so much money.

Mersilkee
Iamdying.net

SteveM said...

Again, this is a non-issue. American corporate boards are rubber stamps for management.

Remember Bill Clinton crony Vernon Jordan? He served on maybe 8 boards simultaneously. Made over half million a year flitting from meeting to meeting. No way he could actually invest the time necessary to offer constructive oversight for that many organizations.

Board memberships are prima-donna make work positions. Jordan is the model. Pfizer R&D and strategic planning staffs determine where Pfizer will go. They live Pfizer every day. Ausiello's inputs are probably marginal.

The oily business process is not in putting an M.D. on a corporate board, it's the impotent corporate boards in general that get tons of bucks shoveled at them for just showing up.

Ausiello's fat and happy serving on the Pfizer board, but there are other more egregious avenues leading to medical practice perdition.

Billy Rubin said...

Excellent post as always, Dan. I agree that $5K per day for, say, five to ten days "work" for a corporate board is still quite a chunk of cash. That said, since serving on a BOD applies to a very small number of docs, Partners' policy on speaker's fees seemed to me to be the big story, as this part of the "payola" culture affects so many more docs, and Harvard taking a stand on it will surely influence other institutions going forward. My blog post about it is here should you wish to peruse: http://www.billyrubinsblog.org/2010/01/harvard-on-consultant-pay-step-in-right.html

SteveM said...

Re: Dr. Poses, "I suspect that the reason for the apparently extravagant going rate for board members at big corporations..."

No suspicion is necessary. Because the back scratching is blatant. The board members that are making 200 large for 4 quarterly meetings are the same guys that sit on the compensation committees that dole out the $10M bonuses to senior management.

It's all inside baseball. Only at the Harvard klugscheißer level where Ausiello lives, everybody hits a home run...

Anonymous said...

The IRS is taking a closer look at the types and amounts of executive compensation at colleges and universities. See

http://tinyurl.com/yd5grwo

and the story in The Harvard Crimson:

http://tinyurl.com/yahyda2

Anonymous said...

Do you suggest that engineers or construction workers sit on such boards rather than MD’s?

Your BLOG is focused on who makes what and why rather than medical break through news in psychiatry. Shame on you!!! Are you that jealous that they make more than you?

And of course you want to make a buck by publishing this dirty laundry. What makes you different than those in your blogs?

Anonymous said...

Dear Anonymous,
Dr. Carlat never claimed that his blog was about breakthroughs in psychiatry. Quite on the contrary, Dr. Carlat is known for exposing how the drug industry has tarnished his own profession. I would expect nothing less of his blog. And I would want nothing less. And I have never interpreted this as jealousy on his part. I have interpreted it as Dr. Carlat being an ethical person who, because of his experiences, had a watershed moment in his life that turned him into an activist. I greatly appreciate this. If you want psychiatric "breakthrough" news, go elsewhere. There is no shame whatsoever in the content of this blog. On the other hand, I suspect you, Anonymous, are probably married to a psychiatrist who makes money from drug companies. Either that, or you are one yourself. Either way, is it really that upsetting to you that a psychiatrist should call-out his own profession for doing what he (and MANY MANY others) believes is ethically wrong? If so, I would be very curious to learn why. I won't expect to be enlightened, however, since whatever is driving your fury probably involves pharmaceutical money and that isn't something you're likely to reveal to us.

Oh by the way, Anonymous, there hasn't been an actual "breakthrough" in psychiatry in a very long time. And it's unlikely that there will be any time soon. So you are looking for a blog that will have new posts every decade or so... and even those will be marginally valuable.

Anonymous said...

It would be educational to see a social network analysis of hospital system/pharmaceutical company/insurance industry directorships - that is if the web of connections wasn't so tight as to undecipherable! Personally, at $5,500/hr. I'd be happy to be invited in to take a look around for myself.
medicine