When a Key Opinion Leader Questions the Hand That Fed Him: from "Master Teacher to Someone Who Didn't Know What He Was Doing"

We just posted an update on the ongoing cozy relationship with medical device companies, in particular, those that make prosthetic hip and knee joints, and some orthopedic surgeons.  Some surgeons, including many prominent academic leaders and practitioners, have been paid huge amounts, and have often failed to make more than the most minimal disclosure to their patients, or to the audiences of their talks or the readers of their ostensibly scholarly articles.  Deferred prosecution agreements with device companies shed light on these payments, but did not curtail them.  Yet the surgeons and the companies who paid them defended the payments as legitimate consulting agreements, and royalties for worthy innovations. 

Now the New York Times has reported on a dispute between a well-paid consultant and an artificial joint manufacturer that provides new insights into these financial relationships. To summarize,

IT was a long, fruitful medical marriage that is fast becoming an angry public divorce, one that offers a rare look at a clash between a top-shelf consultant and his corporate patron over patient safety.

For years, Dr. Richard A. Berger designed surgical tools and artificial joints for Zimmer Holdings, trained hundreds of doctors to use its products and talked it up wherever he went. In return, Zimmer, an orthopedic implant maker, helped enrich Dr. Berger, portraying him as a master surgeon and paying him more than $8 million over a decade.

Those days are gone. Dr. Berger started complaining to Zimmer a while back that one of its artificial-knee models was failing prematurely, and he went public recently with a study that he says proves it. Zimmer told him that the problem was not the artificial knee, but his technique, and pointed to data overseas indicating that the knee was safe.

Last year, Zimmer did not give Dr. Berger a new contract. The company says it routinely rotates consultants.

'I trained hundreds of doctors for them and made them tens of millions,' Dr. Berger said in interview here, in which he also lambasted Zimmer executives as dissembling, out-of-touch bureaucrats. 'So was this just a coincidence? Maybe it was. Maybe it wasn’t.'

In more detail, here is how Dr Berger's relationship with Zimmer began:

The surgeon, a tall, balding man with a boyish manner, was finishing his fellowship at the Rush University Medical Center in Chicago at the time, one of the country’s top centers for joint replacement. The center has had long ties to Zimmer, whose headquarters is about two hours away, in Warsaw, Ind., and the young surgeon quickly came to the company’s attention.

'Rich has a very clever set of hands, and because of that he is enabled with the ability to innovate surgical techniques,' said Roy Crowninshield, who was Zimmer’s chief scientific officer.

Dr. Berger’s skills matched Zimmer’s marketing strategy. To distinguish itself from competitors, the device maker had started promoting minimally invasive surgery, a technique that uses smaller incisions than traditional surgery. Zimmer trained doctors in the procedure, using its device.

Soon, Dr. Berger, who was then pioneering a type of small-incision surgery that allowed patients to leave the hospital on the day of surgery, became a linchpin of Zimmer’s efforts. In 2002, he was prominently featured in a press release about Zimmer’s plans to build a training facility for minimally invasive surgery.

'We are clearly excited about Dr. Berger’s data,' J. Raymond Elliott, the company’s chairman and chief executive at the time, stated in the release.

Over the next few years, the physician estimates, he helped train hundreds of surgeons on Zimmer’s behalf.

And in more detail, here is how things went wrong: 

As he tells it, his relationship with Zimmer frayed over a version of a widely used Zimmer knee, known as the NexGen. The model at issue, called the NexGen CR-Flex, is designed to provide a greater range of motion than the standard NexGen.

Most surgeons implant an artificial knee using a cement-like adhesive to bond the thigh bone to the portion of the device that bends. But some specialists, like Dr. Berger, try to avoid adhesives because the cement can break down and cause device failure. So Zimmer also sells an uncemented version of the CR-Flex that relies instead on the bone naturally fusing with the implant.

Dr. Berger says that he gave the device, which is supposed to last about 15 years, to about 125 patients in 2005, the first full year he used it. But by early 2006, some X-rays showed lines where the implant met the thigh bone, an indication that the device was loose and had not fused completely. Patients could walk, but they were reporting pain, apparently a result of the loose joint.

He says he soon brought the problem to the attention of Zimmer officials, including the company’s new top scientist, Cheryl R. Blanchard. Zimmer executives pointed to the success of the NexGen, but the company did not have separate test data on the uncemented flexible model because the F.D.A. had not required the company to study it in patients before selling it.

Later, as more patients complained about the device and Dr. Berger had to replace some of them, he spoke to Ms. Blanchard again, he said. This time, he said, she and other Zimmer officials suggested that his technique was the problem because no other surgeon had complained.

'Suddenly, I went from someone who was their master teacher to someone who didn’t know what he was doing,' he said.

BY 2007, Dr. Berger, although still a Zimmer consultant, had stopped using the device and had learned, he said, that several other surgeons had also experienced problems with it. But unlike Dr. Dorr, the physician who sent out the alert about Zimmer, Dr. Berger said he initially had hoped to avoid a public showdown with the company. So he followed a more traditional route by performing a study with another Rush surgeon, Dr. Craig J. Della Valle, who was also having to replace the Zimmer knee.

Dr. Berger and Dr. Della Valle first presented their study at a medical meeting last fall and again this year at a national meeting of the American Association of Orthopedic Surgeons. They found that the uncemented Zimmer knee failed early in about 9 percent of some 100 patients studied. Also, the knee exhibited signs of looseness in about half of all patients and has since been replaced in some of them, Dr. Berger said.

But Zimmer was unswayed. In a filing with the Securities and Exchange Commission, Zimmer made note of the study but also pointed to the knee’s very positive results in a large database of orthopedic patients in Australia. Officials there confirmed the low failure rate. The company also said that the cement-free CR Flex accounted for only a small fraction — about 2 percent — of its overall knee sales.

The most striking lesson of this case is that Dr Berger was only valued as a consultant as long as his work completely followed the marketing party line.  As soon as he questioned the company's product, or the executives who were promoting it, he became "someone who didn't know what he was doing."  Of course, a truly valued consultant should be respected, if not sought for honest advice, whether or not it fit  preconceived notions or marketing strategies.  Thus, how Dr Berger was finally treated suggested he really was hired to market product.  "Consultant" was just a pretty title.. 

We  (and many others) have discussed (e.g., here) how pharmaceutical, biotechnology, and device companies cultivate "key opinion leaders" who really are nothing more than salespeople with fancy academic titles or well-known practices.  The case of Dr Berger suggests that apparently distinguished academics and practitioners hired as "consultants" by such companies ought to be regarded as salespeople until proven otherwise.  Physicians who are wooed by company marketers to take on such consulting roles, often with praise for their ability to "innovate," "excite," or become a "master teacher," may want to consider whether those flattering them merely want to hire another high-profile part-time salesperson.  They may further may want to think about how they would look should this relationship be revealed for what it really is.  If something goes wrong, they should think about what it would be like to deal with "dissembling, out-of-touch bureaucrats."  Sometimes there is a price to pay for taking all that money.

I hope that Dr Berger will consider donating the $8 million he made to the cause of more honest teaching and research about orthopedic devices. 

Meanwhile, patients and physicians should be extremely skeptical about the pronouncements of paid consultants and key opinion leaders who work for corporations marketing health care goods and services.  We all should demand at least that those paid by such vested interests reveal such financial arrangements in detail if they expect us to listen to their spiels, take their advice, and particularly be subject to their decisions.  

Post Title → When a Key Opinion Leader Questions the Hand That Fed Him: from "Master Teacher to Someone Who Didn't Know What He Was Doing"

What Me Worry? - Leaders Prosper Despite Questions About Their Organizations' Ethics and Performance

There were two examples in the recent news about how the leaders of health care organizations seem to prosper no matter what questions are raised about their organizations' ethics or performance.

WellPoint

It seemed that anger over a rate increase by a subsidiary of the huge insurance company/ managed care organization WellPoint was one reason for the revival of efforts in the US to enact some sort of health care reform legislation.  In our comment on this controversy, we noted that questions about the ethics of WellPoint's actions have appeared again and again.  Wellpoint...

• settled a RICO (racketeer influenced corrupt organization) law-suit in California over its alleged systematic attempts to withhold payments from physicians (see post here).
• subsidiary New York Empire Blue Cross and Blue Shield misplaced a computer disc containing confidential information on 75,000 policy-holders (see story here).
• California Anthem Blue Cross subsidiary cancelled individual insurance policies after their owners made large claims (a practices sometimes called rescission).  The company was ordered to pay a million dollar fine in early 2007 for this (see post here).  A state agency charged that some of these cancellations by another WellPoint subsidiary were improper (see post here).  WellPoint was alleged to have pushed physicians to look for patients' medical problems that would allow rescission (see post here).  It turned out that California never collected the 2007 fine noted above, allegedly because the state agency feared that WellPoint had become too powerful to take on (see post here). But in 2008, WellPoint agreed to pay more fines for its rescission practices (see post here).  In 2009, WellPoint executives were defiant about their continued intention to make rescission in hearings before the US congress (see post here).
• California Blue Cross subsidiary allegedly attempted to get physicians to sign contracts whose confidentiality provisions would have prevented them from consulting lawyers about the contract (see post here).
• formerly acclaimed CFO was fired for unclear reasons, and then allegations from numerous women of what now might be called Tiger Woods-like activities surfaced (see post here).
• announced that its investment portfolio was hardly immune from the losses prevalent in late 2008 (see post here).
• was sanctioned by the US government in early 2009 for erroneously denying coverage to senior patients who subscribed to its Medicare drug plans (see post here).
• settled charges that it had used a questionable data-base (builty by Ingenix, a subsidiary of ostensible WellPoint competitor UnitedHealth) to determine fees paid to physicians for out-of-network care (see post here). 
• violated state law more than 700 times over a three-year period by failing to pay medical claims on time and misrepresenting policy provisions to customers, according to the California health insurance commissioner (see post here).

But a few days ago, according to the Indianapolis Star:

Large stock awards helped boost total compensation to top executives at WellPoint by 51 percent to 75 percent last year over 2008.

The big jumps in take-home pay are detailed in the Indianapolis health insurer's annual proxy report to shareholders filed Friday.

Angela Braly, who is chair of the board, president and chief executive, saw her 2009 total compensation rise 51 percent, to $13.1 million. That compares with $8.67 million in 2008 and $14.8 million in 2007.

Braly's salary of $1.14 million barely budged from 2008, but she earned a $6.2 million stock award, almost triple the award she got in 2008.

Total compensation to other top executives:

Wayne DeVeydt, chief financial officer, $7.25 million, up 75 percent from 2008.

Ken Goulet, executive vice president, $4.43 million, up 62 percent.

Dijuana Lewis, executive vice president, $4.46 million, up 64.5 percent.

So whatever top WellPoint executives are paid for, it is not insuring that the company avoids ethical questions about its conduct, or controls health care costs or mdoerates premiums, for that matter. 

Boston Scientific, and Zimmer Holdings

We just commented on the generous compensation given the new and former CEOs of Boston Scientific, despite a series of ethical questions about that company's conduct, culminating in a guilty plea by the company to charges that it concealed information about important and potentially dangerous defects in its products.

A few days ago, I found a reminder, buried in an article in the Minneapolis Star-Tribune about a dispute between Boston Scientific and St Jude Medical, that current Boston Scientific CEO Ray Elliott has a track record of collecting generous compensation despite ethical questions about the companies he has lead.

Elliott is certainly familiar with the potential ethical minefield surrounding the relationships between sales reps and doctors. He was CEO at orthopedic devicemaker Zimmer Holdings Inc., which paid (along with four other companies) $311 million in 2007 to settle a Department of Justice investigation into the consulting fees paid to doctors.

As we discussed back in 2007, Zimmer Holdings Inc was one of four medical device companies which submitted to deferred prosecution agreements in response to charges that the companies implemented criminal conspiracies to violate federal anti-kickback laws. We posted several times about one aspect of this settlement, the mandate that the companies make public the payments (often huge) to orthopedic surgeons, academic institutions, and medical associations. (See posts here, here, here, here, here.) At the time, I did not think to look into what happened to the leadership of these companies thereafter.

According to the 2008 proxy statement by Zimmer Holdings, Ray Elliott conveniently retired in 2007, just before the deferred prosecution agreement was announced. Since he had been President of Zimmer since 1997 and CEO since 2001, according to the 2007 proxy statement, he appeared to have been in the top leadership of the corporation during the time the actions were performed that resulted in the deferred prosecution agreement. Nonetheless, again according to the 2008 statement, for the part of 2007 during which he served as CEO, his total compensation was $7,987,158. For 2006, his total compensation was $11,998,121. In 2007, the present value of his two pension plans were $269,764 and $5,302,050. In 2007, he owned 1,235,859 shares of stock (now worth $72,952,757 at the current price of $59.03 /share), and had the right to acquire 1,169,987 more within 60 days.

And of course, as we posted earlier, Boston Scientific paid him over $30 million for working part of 2009.

So Mr Elliott prospered mightily from his leadership of ethically challenged Zimmer Holdings, and was then further rewarded by ethically challenged Boston Scientific.

Summary

We have commented again and again that while numerous health care organizations have been charged with unethical, and sometimes illegal behavior, the people who oversaw, directed, or implemented the behavior almost never have had to suffer any negative consequences.  Now we see that while some large health care organizations have been subject to penalties for unethical and illegal behavior, the leaders of these organizations have been compensated so well as to make them rich, rich beyond the dreams of most people.  So the problem is not merely that captaining an organization onto the ethical rocks costs one nothing, but that it can make one very rich.

Clearly we see examples of both profoundly perverse incentives and a complete lack of accountability and responsibility affecting the leadership of major health care organizations.  Is it any wonder that these organizations continue to act unethically, and that the costs of the goods and services they provide rise continuously?

If we truly want health care that is accessible, of high quality, at a fair price, and more importantly, if we want health care that is honest and focused on patients, we need to provide health care leaders with clear, rational incentives in these directions, and make them fully accountable for their actions, and the courses of their organizations under their leadership.

Post Title → What Me Worry? - Leaders Prosper Despite Questions About Their Organizations' Ethics and Performance

Now You See Them, Now You Don't: 2007 Lists of Payments Made by Orthopedic Device Companies Vanish Into Cyberspace

Starting last year, we posted (here, here, here, and here) about the payments, often huge, that five manufacturers of prosthetic joints (Biomet, DePuy Orthopaedics (a unit of Johnson & Johnson), Stryker Orthopedics,a unit of Stryker Inc, Zimmer Holdings, and Smith & Nephew) revealed they made to orthopedic surgeons and various academic and other organizations. We also noted that some of the leadership of the major orthopedic societies have received substantial amounts from these companies, as have the societies themselves.

The information we used in those posts about the payments came from lists posted on the internet by the five companies. The lists were posted under deferred prosecution agreements a US Attorney made with four companies (Biomet, DePuy Orthopedics, Smith & Nephew, and Zimmer Holdings) and an agreement allowing federal supervision of Stryker Orthopedics. The companies were charged with violating anti-kickback laws by paying orthopedic surgeons as "consultants" to use their products. The lists on which I based the above posts contained data from nearly all of 2007.

I recently had occasion to revisit this question, and decided to take another look at these lists. But lo and behold, when I used the links from my earlier posts (Biomet, DePuy, Smith & Nephew, Stryker, and Zimmer), I found that two of them now went to lists of data pertaining only to the early part of 2008. No 2007 data was available from the Biomet and Smith & Nephew lists. Furthermore, perusal of those companies' web-sites did not reveal any obvious way to access the 2007 data. [See addendum below. By 12 May, 2008, three days after this was posted, the Smith & Nephew list included all 2007 data, and the Biomet list included all 2007 data, but appears to have truncated its 2008 data alphabetically after "Wo...."]

When I reviewed the 2007 lists, I was struck by how many doctors, academic institutions, and other not-for-profit organizations were on the lists, and how much money some of them received. The potential for payments of hundreds of thousands or millions of dollars to influence the thinking and actions of these people and organizations was obvious. Many of the orthopedic surgeons involved were prominent practitioners or academics. The likelihood that their practice, teaching or research might have been influenced by financial entanglements of this magnitude was obvious. Similarly, the likelihood that large payments to academic institutions or professional societies might influence their actions and policies was also obvious.

But, two of these lists are now lost in cyberspace. So those wishing to use them to inform their thinking about the people and organizations involved are out of luck. Whether by the end of the year the 2008 lists will essentially provide the same information as the 2007 lists is unknown. Even if they do, the loss of the 2007 lists will make it difficult to determine whether the financial relationships revealed in 2008 were new or not. Furthermore, erasing the 2007 data would obviously reduce the perceived overall magnitude of some of the financial relationships. In summary, erasing the 2007 data off the internet suggests that the companies want to provide as little transparency about their payments to orthopedic surgeons, academic institutions, and professional societies as possible, and that the companies want to minimize perceptions of the magnitude and duration about these financial relationships.

We are only making slow progress in making the web of financial entanglements that pervades health care more transparent.

ADDENDUM (12 May, 2008) - As noted in the comments, the 2007 information from Biomet was apparently recently added to the list available on the web. It now begins after item 168, thus apparently truncating the 2008 data for recipients starting with names beginning with alphabetically after "Wo...." Also, Smith & Nephew has also loaded its 2007 information, apparently completely.

Post Title → Now You See Them, Now You Don't: 2007 Lists of Payments Made by Orthopedic Device Companies Vanish Into Cyberspace

Who Will Monitor the Monitors?

We have discussed deferred prosecution agreements involving a number of notable US health care organizations, e.g, a hospital (Roger Williams Medical Center), health care university (University of Medicine and Dentistry of New Jersey), not-for-profit health care insurer (Blue Cross Blue Shield of Rhode Island), pharmaceutical company (Bristol-Myers-Squibb), and multiple medical device companies (Biomet, DePuy, Smith and Nephew, and Zimmer).

Deferred prosecution agreements may be made between federal prosecutors and corporations, including not-for-profit corporations. I am not a lawyer, but my best interpretation is that pursuant to these agreements, usually the corporation involved agrees to specific compliance measures, often including the appointment of a "monitor," and in return, the prosecutor agrees not to prosecute the corporation for crimes it was alleged to have committed as long as it continues the compliance measures.

The Washington Post reported that such agreements, which have become a more frequently used tool in the US against white-collar crime, are generating more controversy. According to the Post,

The number of corporate monitors has risen more than sevenfold since 2001, researchers said, a move that reflects a shift from lodging criminal indictments against businesses for fear they will collapse and cost employees their jobs. Instead, the government has taken a different path: forcing companies to submit to outside oversight at their own expense as a condition of settling fraud and corruption cases. Major companies from AOL and Bristol-Myers Squibb to Merrill Lynch have yielded to such oversight after recent financial scandals.

The arrangements all but give prosecutors a seat in the corporate boardroom. The arrangements are spelled out in contracts and vary depending on the company and its problems. Generally, though, monitors enjoy wide latitude to interview employees, sift through business contracts, uncover legal violations and mandate that companies change their ways. In recent years the overseers have made recommendations to hire and fire workers, enlisted high-priced accountants and consultants to review corporate operations, and blown the whistle to prosecutors if the company fails to respond to their concerns. The monitors typically send private reports to update prosecutors several times a year -- and send their bills to the companies.

The controversy seems to be about who gets appointed to be the monitors.

A consulting firm led by former U.S. attorney general John D. Ashcroft recently won an assignment, valued at more than $25 million, to ensure that a medical equipment maker [Zimmer, and see coverage in the NY Times here] stops paying kickbacks to doctors who use its products. Other former government officials with ties to the Bush administration have secured similar deals, which are paid using corporate funds and entail few, if any, checks on spending.

One particular example was the monitor for Bristol-Myers-Squibb,

The deals now drawing sharp outside criticism involve [New Jersey District US Attorney Christopher J] Christie, a GOP fundraiser who has served as New Jersey's top federal prosecutor since 2001.

One of the steps that Bristol-Myers Squibb took to resolve accounting charges was an endowment to create a job "dedicated to the teaching of business ethics and corporate governance" at Seton Hall University's law school, Christie's alma mater. That came on top of more than $300 million in criminal penalties and millions more in fees that the drugmaker paid to corporate monitor Frederick Lacey, a retired federal judge and New Jersey U.S. attorney under President Richard M. Nixon. Lacey played a role in the ouster of Bristol's chief executive two years ago. He did not return calls placed to his law office.

So,

The chairmen of the House and Senate Judiciary committees last week demanded that Justice Department leaders provide a list of all such deals and the fees they have generated. The Project on Government Oversight watchdog group has questioned whether the agreements reward 'cronies' who share political affiliations or backgrounds with the U.S. attorneys handing out the deals.

The arrangements raise alarms about 'potential favoritism and political interference that can undermine our judicial system,' said Rep. Frank Pallone Jr . (D-N.J.). Pallone has been critical of U.S. Attorney Christopher J. Christie, the New Jersey prosecutor who chose Ashcroft and a possible GOP gubernatorial candidate in the state.

Concerns were also raised by Republicans,

Richard C. Breeden, a former Republican chairman of the Securities and Exchange Commission, engineered a nearly complete overhaul at WorldCom after its top executives faced criminal charges in one of the largest fraud schemes in the nation's history. After being appointed by a federal judge from a different political party, Breeden and his team helped reshape WorldCom from its board of directors to its executive ranks, before guiding the telecommunications company, which emerged from bankruptcy protection as MCI, into a 2006 merger with Verizon.

'People should be very careful to make sure that monitorships do not become political plums,' said Breeden, who stressed that he was not speaking about specific cases. 'The key is the person who is monitor has to have a very good understanding of the business they're dealing in.'

The rising number of deferred prosecution agreements involving health care corporations has been at least an indicator that white collar crime involving large health care organizations is getting more attention.

I am certainly no expert in the legal issues involved, but it does seem that whether deferred prosecution agreements are good deterrents of misconduct by corporate executives, particularly in health care, deserves discussion.

However, there has been precious little discussion of these agreements in the health care context. Searching Medline for the term "deferred prosecution" yielded a single article, on the prosecution of driving while intoxicated, but absolutely nothing on white collar health care crime. I suspect that the best collection of discussion of deferred prosecution agreements in health care is right here in our Health Care Renewal archives.

So we end with another example of the anechoic effect. Misconduct by the leaders of health care organizations in general remains a taboo topic. As long as we are afraid to even discuss it, we will come no closer to a solution.

ADDENDUM (18 January, 2008) - See also comments by Joe Paduda in the Managed Care Matters blog, and by Matthew Holt in the Health Care Blog.

Post Title → Who Will Monitor the Monitors?

More About Surgeons Who Received Large Payments from Joint Implant Manufacturers

The story about artificial joint manufacturers' payments to orthopedic surgeons and others just keeps bubbling along. We have previously posted (here, here, here, here, and here) about the payments, often huge, that five manufacturers of prosthetic joints (Biomet, DePuy Orthopaedics (a unit of Johnson & Johnson), Stryker Orthopedics,a unit of Stryker Inc, Zimmer Holdings, and Smith & Nephew) just revealed they made to orthopedic surgeons and various academic and other organizations. The lists are here: Biomet, DePuy, Smith & Nephew, Stryker, and Zimmer.

A few intrepid reporters have pursued this story by looking for local surgeons on the lists. First, Bill Toland in the Pittsburgh Post-Gazette found some recipients of the companies' largesse, and what he learned from one was typical,

In Pittsburgh, Dr. James D'Antonio, of Greater Pittsburgh Orthopaedic Associates, has received $850,000 to $875,000 through the first 10 months of 2007 from Stryker. On his extensive resume is the development of a new alignment system for artificial knee joints, femoral research, and two decades of experience in knee and hip replacements, performing them at several regional hospitals.

Most of the money received this year, more than $600,000, was for royalties on intellectual properties he helped to develop.

'I could do a lot more surgery if I didn't do this for Stryker,' Dr. D'Antonio said in a phone interview. He also said that he's not beholden to Stryker's products because of the fees he collects.

'I use other implants,' he said. 'I don't hesitate to use other companies for a minute,' if they carry a product he feels is better suited for a surgery.

Toland recorded several other denials that the payments influenced which artificial joints the recipients chose to implant in patients, for example,

Zimmer, the largest of the joint manufacturers, paid out the most to Pittsburgh doctors, $1.16 million through Oct. 31.

Together, the nonprofit clinic and health provider AMD3 and its founder, Dr. Anthony M. DiGioia III, received at least $437,000 from Zimmer.

'As an independent physician, I am not rewarded by either the hospital or the implant company for using any specific products,' Dr. DiGioia said. He is not 'obligated or rewarded to use any of Zimmer's products.'

This week, Lindy Washburn of the North Jersey Media group looked into the situation in her area. Again, she found several surgeons who received large payments. They turned out to be involved with the design of particular devices,

Michael A. Kelly, chairman of the Department of Orthopedic Surgery at Hackensack University Medical Center, and Mark Hartzband, director of its Total Joint Replacement Service, were among the highest-paid consultants nationwide at Zimmer Inc. They also were the highest- paid New Jersey consultants to any orthopedic company.

Both were involved with the development of Zimmer's "female knee."

Zimmer paid Kelly, who is president of the American Knee Society, $1,043,028. It paid Hartzband $995,739, along with $20,619 to his Hartzband Joint Replacement Institute in Paramus.

Kelly and Hartzband, for example, both were listed as members of the design team for Zimmer's "female knee," introduced last year. They were involved in the clinical trials that led to federal approval for the device, and travel around the world to lecture and demonstrate surgical techniques. Hartzband also was a pioneer in minimally invasive hip replacement surgery, which Zimmer introduced in 2003.

HUMC, where the two operate, uses joints from three different companies, including Zimmer. Kelly, as chief of the department, plays a role in choosing the suppliers and is required to disclose any conflicts of interest, said Robert Garrett, the hospital's executive vice president and chief operating officer.

Hartzband, as a private practitioner, is not required to make such a disclosure, and Garrett said he was unaware of the amount Hartzband received.

Neither surgeon responded to messages left at their offices.

"Our policy has always been to get competitive bids on a product and get the best-quality products," Garrett said. "I don't have any reason to believe there's any kind of kickback involved. Dr. Kelly has always acted on behalf of patients and what's best for the patients -- the fact that we have three vendors is testament to that."

Then, John Dorschner of the Miami Herald reported from South Florida. Not surprisingly, he found one local doctor who received large payments, which again turned out to be related to his involvement in the development of a specific device.

A well-known Miami doctor who did Heat Coach Pat Riley's hip replacement surgery has received nearly $600,000 this year in fees from a company that makes artificial hips, according to documents published in connection with a federal kickback investigation.

Carlos Lavernia, medical director of the Orthopaedic Institute at Mercy Hospital, received $586,863 through Oct. 31 from Zimmer, an Indiana company that makes hip and knee replacements.

Lavernia received the most fees of doctors in South Florida, based on lists that revealed the fees of hundreds of doctors nationwide.

Lavernia said he has done nothing wrong. Zimmer is paying him royalties for a hip and knee implant system he designed. He is not paid royalties on devices he implants himself or any implants bought by Mercy, he told The Miami Herald in an e-mail. He said he uses products of all manufacturers, depending on what's best for the patient.

Lavernia told The Miami Herald he is 'currently in the process of developing a patient disclosure letter,' discussing his relationship with Zimmer.

Lavernia and Zimmer are closely connected.

He has given speeches at Zimmer's corporate headquarters in Warsaw, Ind. One of the talks he gave urged surgeons to better understand insurance reimbursement rates for implants so that they can get paid better.

According to a Zimmer press release, Lavernia co-authored a research paper that reported major advantages for Zimmer's Quad-Sparing Knee Replacement Procedure.

Mercy spokeswoman Rey said the hospital had no comment because it was a matter between Zimmer and Lavernia.

All these news reports suggest that the doctors who received the largest payments from the manufacturers of artificial hips and knees were involved in the design of specific products, and often received payments in the forms of royalties, presumably based on licensing agreements for patents they held. Apparently, most such agreements do not pay royalties for devices the surgeons personally implanted, and perhaps for any devices implanted at their hospital.

So far, discussion in the media of possible conflicts of interests caused by the device manufacturers' payments to surgeons has centered on concerns about whether surgeons who got payments from particular companies were more likely to to choose those companies' products for their patients. Some surgeons have denied conscious bias, and it appears that some of their royalty agreements were structured so that they were not paid directly for implants they themselves chose, or were chosen at their hospital.

However, an important issue that has so far not been discussed is the extent that the surgeons who received payments may have influenced other surgeons to use the products of the companies who paid them. It appears that many of the surgeons who got large payments were very well known, and some held prestigious academic posts. Some were in positions to influence trainees (medical students, interns, residents, and fellows) through their teaching. Some could influence the broader community of orthopedic surgeons by speaking and writing. There were examples above of payment recipients touring internationally to speak and teach about the joint implants they had designed, touring nationally to speak about reimbursement for joint implants, and authoring journal articles reporting research on the implants for which they received royalties. Whether the payment recipients revealed to their audiences the magnitude of the payments they were getting, or whether the payments were based on the number of devices the companies sold, which presumably is usually how patent royalties are paid, are all unknown.

The Miami Herald article stated, "for years, there have been unconfirmed rumors and rumblings about device companies paying doctors fees, sometimes for consulting, speaking or doing research on particular devices." This suggests that it was not exactly common knowledge that prominent orthopedic surgeons who taught or wrote about joint implants and related topics were being paid generous royalties by the companies who made the implants for each device sold.

Thus, it appears that surgeons who may have been paid royalties every time a specific device was sold may have had opportunities to influence the surgeons who made decisions about which devices to use. The surgeons who were paid royalties may not have let these decision-makers know their financial stake in the companies selling more devices.

We suspect that all the extent and magnitude of conflicts of interest generated by the the device manufacturers' payments have yet to be revealed.

Post Title → More About Surgeons Who Received Large Payments from Joint Implant Manufacturers

The AAOS "Patient Discussion Guide" Regarding Disclosure of Payments to Orthopedic Surgeons

We have previously posted ( here, here, and here) about the payments, often huge, that five manufacturers of prosthetic joints ((Biomet, DePuy Orthopaedics (a unit of Johnson & Johnson), Stryker Orthopedics,a unit of Stryker Inc, Zimmer Holdings, and Smith & Nephew) just revealed they made to orthopedic surgeons and various academic and other organizations. The lists are here: Biomet, DePuy, Smith & Nephew, Stryker, and Zimmer.

We analyzed a letter by President James H. Beaty MD of the American Academy of Orthopedic Surgeons and the American Association of Orthopedic Surgeons (AAOS), and suggested that it was more remarkable for what it did not say than what it did say. We noted that the presence among the leadership of AAOS of many individuals who had received payments, some large, from artificial joint manufacturers may have lead to its lack of clarity.

The AAOS also produced a "Patient Discussion Guide" which was "intended to provide you [orthopedic surgeons] with important facts and information to facilitate discussions with your patients, and to help you answer any questions that you may receive from your patients concerning a settlement announced by the Department of Justice with five medical device manufacturers of artificial hips and knees."

In my humble opinion, the guide, designed in an "FAQ" format, was equally unclear, but did seem to try to minimize the effects of disclosures of payments made to physicians. Let me go through it, question by question.

First, it posed the question, "why is this financial information posted on the websites of these five companies." After giving some dry facts about the settlement, this appeared in bold type,

It’s important to remember that the appearance of a physician’s name on any disclosure filing referenced above indicates only that he or she has received compensation from the manufacturer. It is not an indication that any doctor on the list has broken the law or violated professional standards.

It then asked, "why would a doctor ever take money from implant manufacturers?" The answer included,

The relationships between physicians and device manufacturers have led to many significant developments that have benefited millions of patients.

This was followed by a listing of some examples of such "significant developments." The answer did not contemplate the possibility that there could be a down-side to an orthopedic surgeon being paid by the manufacturer of artificial joints.

Then, "what different kinds of financial relationships do doctors have with implant manufacturers?" The answer in full was,

First, it’s important to understand that not all physicians have financial relationships with implant manufacturers. In fact, we believe that a majority of orthopaedic surgeons do not.

For those doctors who have relationships with implant manufacturers, there are a number of different types of relationships with implant manufacturers that result in compensation, including providing consulting advice, conducting research, developing new products and educating fellow orthopaedic surgeons and the public.

These arrangements have led to a number of important breakthroughs and developments that have helped millions of patients.

Again, the guide included more words about the limited prevalence of the payments and their possible good effects than about the question itself.

The next question was "If these relationships are commonplace, what did these implant manufacturers do that was wrong and that led to the settlements?" The guide noted,

The U.S. Attorney that led the investigation was concerned that some of the payments made by the implant manufacturers to a limited number of physicians were improper.

However, it never really answered the question, and certainly did not suggest that anyone or any organization, manufacturers, orthopedic surgeons, or others, did anything wrong.

The guide did assert that the AAOS just adopted, that is, in 2007, new "Standards of Professionalism on Orthopaedist-Industry Conflicts of Interest that require orthopaedic surgeon members to identify and disclose potential conflicts of interest to their patients, the public, and colleagues." However, it neglected to note that these standards are not yet in effect.

Finally, the guide got to the crucial question, "have you personally taken money from implant manufacturers," but then refused to answer it directly,

Recognizing that the facts, circumstances and contractual provisions governing the relationships between certain member-physicians and medical device manufacturers, are unique and confidential, the AAOS cannot provide members with individualized counsel on how to respond....

It then just advised doctors "to be truthful and factually accurate," and cite the need, according to the new Standards of Professionalism, to disclose conflicts.

So, to be charitable, the Guide, like the letter written by the President of the AAOS, was more notable for what it did not say than what it did say. In particular, it failed to say anything negative about artificial hip manufacturing companies paying orthopedic surgeons, but did defend "relationships" among doctors and these corporations, while trying to minimize their prevalence. The Guide avoided any discussion of how financial relationships among orthopedic surgeons and device manufacturers could have any negative effect on patients. The Guide failed to discuss any effects these relationships could have on orthopedic surgeons' teaching, research, or health care policy.

As we noted before, some of this lack of clarity might have to do with the relationships between individual leaders of the AAOS and the artificial joint manufacturers.

After an opportunity to further peruse the lists of payments made by the five manufacturers, (Biomet, DePuy, Smith & Nephew, Stryker, and Zimmer), I found that the AAOS itself has been paid quite handsomely itself (so far in 2007) by:

• DePuy, $225,000-250,000
• Smith & Nephew, $25,001 - 50,000
• Stryker, $150,000 - 175,000
• Zimmer, $434,480

Thus, the AAOS received from $834,481 to $909,480 from four artificial joint manufacturers so far in 2007.

Also, note that the related American Orthopedic Association received payments by:

• Biomet, $25,000-49,999
• DePuy, $50,000-75,000
• Zimmer, $200,000

Furthermore, the related Orthopedic Research and Education Foundation received payments by:

• DePuy, $375,000-400,000
• Stryker, $25,000-50,000
• Smith & Nephew, $75,001 - $100,000

So it is not surprising that the AAOS collective response to the release of the lists of payments lacked clarity and failed to address most of the major issues. Not only are some of the top leaders of the organization recipients of payments from the same companies whose disclosures created the controversy in the first place, but also the organization, and some related organizations, get substantial funding from these same companies.

This illustrates the pervasiveness of conflicts of interest affecting medical organizations and their leadership. The fear is that such organizations, rather than being a bulwark of physicians' professionalism, have become just more cogs in the medical - academic - industrial complex.

Post Title → The AAOS "Patient Discussion Guide" Regarding Disclosure of Payments to Orthopedic Surgeons

The AAOS Responds to Disclosure of Payments to Orthopedic Surgeons

We have previously posted ( here, here, and here) about the payments, often huge, that five manufacturers of prosthetic joints ((Biomet, DePuy Orthopaedics (a unit of Johnson & Johnson), Stryker Orthopedics,a unit of Stryker Inc, Zimmer Holdings, and Smith & Nephew) just revealed they made to orthopedic surgeons and various academic and other organizations. The lists are here: Biomet, DePuy, Smith & Nephew, Stryker, and Zimmer.

The American Academy of Orthopedic Surgeons and the American Association of Orthopedic Surgeons (AAOS) have responded, first with a letter by President James H. Beaty MD. Dr Beaty's main points were:

• Disclosure is important, up to a point. "AAOS supports appropriate financial disclosures to patients regarding relationships between orthopedic surgeons and implant manufacturers."
• There are good aspects to relationships between doctors and device manufacturers. "Many of our AAOS colleagues choose to work in partnership with implant manufacturers to provide consulting advice, conduct research, and educate orthopaedic surgeons and the public. A number of AAOS members are engaged in developing new medical devices to better serve patient needs."
• It is not necessarily bad for physicians to receive money from commercial firms. "The appearance of a physician's name on any disclosure filing referenced above indicates only that he or she has received compensation from the implant manufacturer."
• More detailed disclosure might be good. "Financial disclosures that display only the name of the physician and the aggregate dollar amount received without any explanation of the nature of the relationship and without educational context may be confusing and misleading to the public and patients."
• In the future, AAOS members should better understand these issues. The letter alluded to a "webinair" on the subject to be conducted in November. It also alluded to a new patient discussion guide (found here). (I may discuss that guide further in another post.)

In my humble opinion, the letter was most remarkable for what it did not say.

Although it sought to justify why orthopedic surgeons should work with manufacturers, it did not explain why these relationships should include payments by the manufacturers to the physicians.

It did not discuss whether disclosures of these financial relationships were made in the time up to the release of the lists by the companies. It did not discuss disclosure to learners in the context of teaching, to readers of articles or attendees of talks, or to subjects in research trials. It did not criticize surgeons who had not disclosed prior to release of the lists.

Although the letter suggested that more detailed disclosure might be better than that which has taken place so far, it did not suggest that doctors who have received money should make such detailed disclosure, or criticize doctors who have not made such detailed disclosure in the past.

Finally, the letter did not advocate that doctors who receive payments from device manufacturers or other commercial firms actively disclose these payments going forward.

All in all, Dr Beaty's letter seemed to avoid more issues than it addressed. It was not exactly a ringing call for greater transparency, much less a condemnation of the opacity of past practices.

I could not help but notice that the letter was written on AAOS letterhead which listed current officers and board members. Ironically, several of these people appeared on the companies' payment disclosure lists. These include:

• Dr Joseph Zuckerman, Second Vice-President, who was listed as the "individual provider" for the Musculoskeletal Research Center, which received $1-25,000 from Smith & Nephew (see list here.)
• Dr William L Healy, Treasurer, received $25,001-$50,000 from DePuy (see here)
• Dr Richard F Kyle, Past President, received $25,001-50,000 from Smith & Nephew (here) and $715,163 from Zimmer (here)
• Dr Joseph C McCarthy, Chair, Board of Specialty Societies, received $475,000-500,000 from Stryker (here)
• Dr William Robb III, Secretary, Board of Specialty Societies, received $75,000-100,000 from Smith & Nephew (here)
• Dr Kevin J Bozic, Member at Large, received $2750 from Zimmer (here)
• Dr Christopher D Harner, who was listed as rendering services for the University of Pittsburgh Department of Orthopedic Surgery, which received $100,000-124,999 from Biomet (here)

As we have noted before, " people who have conflicts of interest often find giving clear advice (or opinions) particularly difficult."

That is yet another argument for avoidance of the sorts of conflicts copiously disclosed in the lists of payments made by device manufacturers.

Post Title → The AAOS Responds to Disclosure of Payments to Orthopedic Surgeons

A Few Answers, and Many More Questions About Device Manufacturers' Payments to Orthopedic Surgeons

With a big of digging, I have found some more media coverage of the story that began with deferred prosecution agreements a US Attorney made with four makers of orthopedic devices (Biomet, DePuy Orthopaedics (a unit of Johnson & Johnson), Zimmer Holdings, and Smith & Nephew), and an agreement allowing federal supervision of Stryker Orthopedics (a unit of Stryker Inc). The companies were charged with violating anti-kickback laws by paying orthopedic surgeons as "consultants" to use their products. The companies have all posted on their web-sites lists of physicians and physicians groups receiving such "consulting" payments this year. (The links: Biomet, DePuy, Smith & Nephew, Stryker, and Zimmer.) We posted about the initial coverage of these lists here.

There has been subsequent media coverage of these lists. David Voreacos reported for Bloomberg, first on the general context:

The five biggest makers of hip- and knee-implant devices disclosed the names of 1,805 medical consultants they paid this year, including 46 doctors or organizations that got $1 million or more.

The companies posted the names on their Web sites yesterday under Sept. 27 agreements with U.S. prosecutors to settle claims that they paid kickbacks to surgeons who used their products.

Biomet, a Warsaw, Indiana-based company taken private this year, hired 241 consultants, including three who made more than $1 million.

Johnson & Johnson's Depuy Orthopaedics Inc. paid more than $1 million to 10 consultants. Depuy ... listed 469 consultants.

Stryker, of Kalamazoo, Michigan, paid 201 consultants, including six who got more than $1 million.

Zimmer Holdings Inc. paid more than $1 million this year to 21 consultants. Zimmer paid 603 consultants.

The companies supply 95 percent of hips and knees used annually in 700,000 replacement surgeries in the U.S.

The hip and knee industry will generate about $9.7 billion in worldwide sales in 2007....

U.S. Attorney Christopher Christie said on Sept. 27 that the industry 'routinely violated the anti-kickback statute by paying physicians for the purpose of exclusively using their products.' He said 'a significant minority' of doctors got kickbacks for using company products.

Bloomberg noted some of the companies' responses, which were not terribly informative, e.g.from Biomet:

'Without consultant intellectual property, it would be impossible for us to deliver the products that we do,' [Biomet spokesman Bill] Kolter said.

From Smith&Nephew,

'Some of them have certain intellectual property that is part of the product, and some of the payments become royalty payments,' said David Shapiro, a spokesman for Smith & Nephew of London. 'Some of them are for training other doctors. Obviously, royalty payments are going to be larger than just compensating somebody for a couple of days of training.'

From Stryker,

'The services that physicians rendered in helping develop products and educate people about those products are valuable,' Stryker Chief Financial Officer Dean Bergy said.

From Zimmer,

'We are not elaborating beyond what we've posted, and what we've posted is pursuant to the deferred prosecution agreement,' Zimmer spokesman Brad Bishop said. Zimmer paid 603 consultants.

Bloomberg also reported on some particularly noteworthy payments, e.g., by DePuy which

paid between $6.675 million and $7 million each to Drs. Richard Scott and Thomas Thornhill of Brigham and Women's Hospital in Boston. Scott and Thornhill said they get royalty payments for the licensing of a total knee replacement prosthesis in 1986 and a hip replacement prosthesis in 1991. They said almost 2 million of the knee devices have been implanted.

'Neither of us keep any of the money we receive from consulting,' they said in a statement. 'Any money we have received from consulting is donated to charity.'

Depuy spokeswoman Sarah Colamarino said surgeons typically don't get royalty payments when he or other doctors implant a device for which that surgeon gets royalty payments [sic]. Scott and Thornhill said they get no royalties for implants by surgeons at Brigham and Women's Hospital.

Note that the surgeons did not state what charity received their "consulting" payments, what proportion of the money they received were royalties, and whether they kept these royalties, as opposed to "consulting" payments. Also note that the response by the DePuy spokeswoman as printed made no sense. The news article did not rule out that Thronton and Scott kept the bulk of the money paid by DePuy in 2007, conceivably more than $6,000,000 a piece.

Bloomberg also investigated a single large payment by Stryker,

Stryker paid more than $3 million to Dr. Anthony Hedley of the Arizona Institute for Bone & Joint Disorders in Phoenix. He referred a call to Yin Becker, a company vice president who didn't return a call.

The Bloomberg reporters attempt at investigation obviously did not get very far. The reporter had no more luck investigating a large payment by Zimmer,

The company paid $5.5 million to Dr. W. Norman Scott of New York, who wrote 'Dr. Scott's Knee Book' and was the doctor for the New York Knicks in the National Basketball Association for 27 years. Scott didn't immediately return a call for comment.

If nothing else, Bloomberg's reporting confirms that some orthopedic device companies paid out exceedingly large amounts to individual orthopedic surgeons. Some proportions of these payments were ascribed to consulting, educational activities, or royalties or licensing payments for patents or intellectual property. Some of the surgeons who received payments are very well known and influential.

The extent that the recipients were influenced by the often fabulous payments they received from the device companies remains unknown. Whether the recipients of these payments made any significant disclosures of these financial relationships is also an open question. The concerns are that some surgeons may have failed to disclose these financial relationships:

• to patients for whom they made decisions about use of device
• when teaching about the diagnosis, prognosis, or treatment of conditions for which these devices may be used
• when writing or speaking on related topics

This story is a huge reminder about how conflicts of interest pervade current health care. It further illustrates that the size of some of the financial relationships that constitute such conflicts may be far larger than anyone previously thought.

As noted before, some people are concerned by how physicians may be influenced by gifts of pens, coffee mugs, and pizza lunches. If we should be concerned about coffee mugs, how much more should we be concerned by multi-million dollar royalties or consulting payments?

Note that the Bloomberg article apparently was the basis for a blog posting on GoozNews by Merrill Goozner. I took down a previous blog posting which covered some of the news reported above, because it was based on the erroneous assumption that Goozner himself had made the enquiries to physicians who received the payments reported in the Bloomberg article.

Post Title → A Few Answers, and Many More Questions About Device Manufacturers' Payments to Orthopedic Surgeons