…is a plan to end industry influence over medical refresher courses. Presently, drug and device makers provide about half of the funding for such courses so that doctors can often take them for free. Even as they have acknowledged the need for other limits, many medical societies and schools have defended subsidies for education as necessary.

“As science progresses, it’s going to get harder and harder to get doctors to keep pace,” said Dr. Jack Lewin, chief executive of the American College of Cardiology. “I think industry has some responsibility toward education.”

By contrast, the American Psychiatric Association recently announced that it would phase out industry funding for medical refresher courses at its conventions.

The institute acknowledged that many doctors depend on industry funding for refresher medical courses but said that “the current system of funding is unacceptable and should not continue.” The report recommended that a different funding system be created within two years.

That would be the National Academy of Sciences Institute of Medicine, which has added its voice to the condemnation of widespread conflict of interest in America’s medical schools and in the practice of medicine generally. Its just-issued report on industry corruption of research and care is, says the New York Times, “scolding… damning… a stinging indictment.”

But as to the creation of that new funding system for continuing education courses about which Jack Lewin’s so worried… Let’s see… How do people usually fund their education?

Well, if they’re poor, you know, they get scholarships and take out loans and pay some out of pocket… They take part-time jobs while they’re in school…

Which is all well and good. But how in the world are they supposed to pay when their average salary is $300,000? This is what’s worrying Jack Lewin… It’s getting harder and harder for doctors to keep pace with new information, and how in hell are they going to afford these courses????

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Update: I’ve made this point many times on University Diaries. If you kids keep misbehaving…

Much of the IOM report echoes recommendations from the Association of American Medical Colleges, which also supports Grassley’s proposed database. But not all schools have followed that group’s advice. “We give a pretty clear warning,” says panel chair Bernard Lo, a bioethicist at the University of California, San Francisco. “If the [institutions] don’t get their act together, they’re really inviting the legislators to step in.

I’m a huge admirer of the SIUC newspaper, The Daily Egyptian. It’s not only well-written, it’s gutsy and ethical and knows exactly what SIUC has become.

… Board of Trustees Chairman Roger Tedrick has indirectly benefited from millions of dollars worth of construction contracts SIU has awarded — contracts that he voted to approve. Tedrick helped nearly 40 companies on university contracts find insurance to cover the work they would be doing. Tedrick voted “yes” on 20 of them — each of which weighed in at more than $250,000 — then found insurance for the successful bidder.

Between 2002 and 2006, Tedrick donated $26,000 to the Blagojevich campaign. Tedrick was appointed to the BOT in February of 2004.

… The Southern Illinoisan reported Sunday that SIU President Glenn Poshard’s son Dennis Poshard and Dennis’s company have received contracts from the university and from organizations affiliated with the university for $138,000.

Dennis Poshard’s company received a contract from his friend and neighbor, College of Business Dean Dennis Cradit, to make a promotional video for the college.

… President Poshard serves southern Illinois as a politician who understands the downstate area, but he shouldn’t be running the university like a patronage political machine.

… Now that SIU has Chicago’s attention, the Daily Egyptian appeals to Gov. Pat Quinn to stir up the university’s governing board. SIU is still rife with Blagojevich politics. There’s no telling how deep corruption could run at this university….

That last point’s the most important one. We know who the hacks are and how they think. The corruption almost certainly runs deeper than we know.

There’s a bright side to this. The Egyptian is well-positioned to win some serious journalism prizes. Unlike student journalists at clean schools, they’ve got a lot of dirt to write about.

Vermont’s attorney general has had enough of “direct cash payments to doctors and nurses and others in Vermont who are prescribing the [cash paying] companies’ drugs.”

The AG is “is shocked that the industry spends so much money on marketing in a state of 600,000 residents… ‘If we’re seeing millions of dollars in cash payments here, then what happens in New York State or California or Florida?’ he said. ‘We’re talking about incredibly large amounts of money.'”

All so your four-year-old can get the most expensive anti-psychotic.

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Ken Libertoff, who works for a Vermont mental health advocacy group, says it’s time to “shine sunlight on an old Vermont basement.”

A proposed law would, among other things, make the names of practitioners accepting major goodies from drug firms public.

The president of the Vermont Senate extends the basement metaphor: “I think we will look back at this era of drugging our kids as a dark moment in medical treatment.”

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In a comment Eliot Spitzer should have thought of, a Vermont psychiatrist who gets money from pharma to prescribe the latest pills says:

It’s a financial interaction between two parties. … And frankly, I don’t think it is anyone else’s business.

… updates us on the good ol’ boys and their tricks at Northwest Florida State College.

Quick version: Same old same old. Public universities as ATMs for politicians, businessmen, and on-campus cronies of same.

Only new thing is these boys are going to jail.

UD also thanks Dennis for this update.

Some UD background here.

… and related matters.

The Obama administration’s bank- rescue efforts will probably fail because the programs have been designed to help Wall Street rather than create a viable financial system, Nobel Prize-winning economist Joseph Stiglitz said.

“All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview yesterday. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.”

The Troubled Asset Relief Program, or TARP, isn’t large enough to recapitalize the banking system, and the administration hasn’t been direct in addressing that shortfall, he said. Stiglitz said there are conflicts of interest at the White House because some of Obama’s advisers have close ties to Wall Street.

“We don’t have enough money, they don’t want to go back to Congress, and they don’t want to do it in an open way and they don’t want to get control” of the banks, a set of constraints that will guarantee failure, Stiglitz said.

… Stiglitz was also concerned about the links between White House advisers and Wall Street. Hedge fund D.E. Shaw & Co. paid National Economic Council Director Lawrence Summers, a managing director of the firm, more than $5 million in salary and other compensation in the 16 months before he joined the administration. Treasury Secretary Timothy Geithner was president of the New York Federal Reserve Bank.

“America has had a revolving door. People go from Wall Street to Treasury and back to Wall Street,” he said. “Even if there is no quid pro quo, that is not the issue. The issue is the mindset.”…

Maybe if Wall Street gives him five million dollars Stiglitz will stop saying these things.

The scrappy, much-maligned firm has gone straight for the heart of evil by taking on the great and powerful goldmansachs666.com, a blog unfriendly to GS.

Here we are in the midst of the worst credit crisis in memory and the bank was forced to take bailout money from the government shortly after it was forced to change its structure from an investment bank to a bank holding company.

Really, Lloyd? Fighting Goldmansachs666.com is where you want to put your money right now?

… How long Morgan will last in this legal battle with Goldman Sachs will likely depend on the generosity and effectiveness of his lawyers. But how long Goldman will last may well depend on the level of populist rage that fueled the very existence of Morgan’s site in the first place.

First, make that our money.

And second, UD finds this populist rage thing very interesting. Evidence accumulates that many Americans have had enough of the massive greed of our recent markets and marketeers.

But what can do we do? They’ve got the government as sewed up as they’ve got the banks. As Ben Stein reminds us in today’s New York Times, “Wall Street knows how to get its hooks into government. This is how the world works. Money talks.”

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Thanks for the tip, RJO.

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Update: When GS decides to go after satire too, they should keep an eye on this author’s projected book:

The Takeover: Goldman Sachs and the Leveraged Buyout of America

No single company has ever had the prolonged hold on the American political establishment that has been achieved by Goldman Sachs. Of the last four Goldman CEOs, two have been chief economic advisor to the president (Rubin and Friedman), two have been Treasury Secretary (Rubin and Paulson), and one has been a governor and a senator (Corzine). But the firm’s unparalleled influence has extended for decades from former Deputy Treasury John Whitehead thru Bush 43 White House Chief of Staff Josh Bolton to current Treasury Secretary Tim Geithner’s chief of staff plus the guy who runs the TARP program plus there are rumors that new White House public liaison official Kal Penn’s movie Harold and Kumar Go to White Castle was actually backed with Goldman money. During this period in which Goldman rode the government like a pony, U.S. policy has not only thrown off the regulatory shackles that freed them to make money by the boatload, the USG has intervened directly and regularly to the benefit of Goldman from the Tequila Crisis “bail-in” to the AIG “bail out.” How can this have happened? Why has the media rolled over and let Goldman scratch them on the belly throughout? … Why is the government still full of them and others from even less reputable financial institutions (which, to Goldman’s credit, is virtually all others)? Why are we still drinking the Kool Aid that somehow these people have special powers after all we have been through? This book will provide answers. (Unless Goldman pays the author more to shut up. In which case, this one, I volunteer to write…well, to be lucratively co-opted out of writing.)

Frank Rich, New York Times:

… Lawrence Summers, the president’s chief economic adviser, made $5.2 million in 2008 from a hedge fund, D. E. Shaw, for a one-day-a-week job. He also earned $2.7 million in speaking fees from the likes of Citigroup and Goldman Sachs. Those institutions are not merely the beneficiaries of taxpayers’ bailouts since the crash. They also benefited during the boom from government favors: the Wall Street deregulation that both Summers and Robert Rubin, his mentor and predecessor as Treasury secretary, championed in the Clinton administration. This dynamic duo’s innovative gift to their country was banks “too big to fail.”

Some spoilsports raise the conflict-of-interest question about Summers: Can he be a fair broker of the bailout when he so recently received lavish compensation from some of its present and, no doubt, future players? This question can be answered only when every transaction in the new “public-private investment plan” to buy the banks’ toxic assets is made transparent. We need verification that this deal is not, as the economist Joseph Stiglitz has warned, a Rube Goldberg contraption contrived to facilitate “huge transfers of wealth to the financial markets” from taxpayers.

But perhaps I’ve become numb to the perennial and bipartisan revolving-door incestuousness of Washington and Wall Street. I was less shocked by the White House’s disclosure of Summers’s recent paydays than by a bit of reporting that appeared deep down in the Times follow-up article on that initial news. The reporter Louise Story wrote that Summers had done consulting work for another hedge fund, Taconic Capital Advisors, from 2004 to 2006, while still president of Harvard.

That the highly paid leader of arguably America’s most esteemed educational institution (disclosure: I went there) would simultaneously freelance as a hedge-fund guy might stand as a symbol for the values of our time. At the start of his stormy and short-lived presidency, Summers picked a fight with Cornel West for allegedly neglecting his professorial duties by taking on such extracurricular tasks as cutting a spoken-word CD. Yet Summers saw no conflict with moonlighting in the money racket while running the entire university. The students didn’t even get a CD for his efforts — and Harvard’s deflated endowment, now in a daunting liquidity crisis, didn’t exactly benefit either.

Summers’s dual portfolio in Cambridge has already led to one potential intermingling of private business and public policy in his new White House post. He tried — and, mercifully, failed — to install the co-founder of Taconic in the job of running the TARP bailouts. But again, Summers’s potential conflicts of interest seem less telling than the conflict of values that his Harvard double-résumé exemplifies…

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Ben Stein, New York Times

… I read that Lawrence H. Summers — wonderful guy, fine economist, former Harvard president, high-ranking economic adviser to Mr. Obama — was paid about $5 million last year by a large hedge fund, D. E. Shaw.

… If anyone thinks that a man who has had a taste of honey from Wall Street on that scale will ever really crack the whip on Wall Street, he’s dreaming. Wall Street knows how to get its hooks into government. This is how the world works. Money talks.

An honest appraisal of conflict of interest, and a suggestion for one thing that might mitigate it.

First point: Conflict of interest is virtually unavoidable, for social and psychological reasons. The author recalls his dealings, as a young researcher, with a medical device manufacturer.

As we developed content, I soon found myself advocating the use of studies that featured the manufacturer’s product as the best illustrations. My experiences at the pleasant luncheon and in the scientific discussions made me feel as if the other consultants and I had a kind of social duty to reciprocate both the kindness and the investment made by the sponsor in the slide set. Accordingly, I spoke out about the importance of using some of the sponsor’s studies as examples.

At the time, I failed to recognize that this sense of duty might be in conflict with an intention to create an unbiased presentation about the risks and benefits of [their product]. It turns out that I am not alone. In a study of medical residents, 61% were confident that drug company promotions did not influence their practice, but only 16% were equally confident that their colleagues were not influenced by those same drug company promotions.

How is this possible? Self-interest simply distorts the way we render judgments about ourselves. As Katz and colleagues describe the problem, “When a gift or gesture of any size is bestowed, it imposes on the recipient a sense of indebtedness. The obligation to directly reciprocate, whether or not the recipient is directly conscious of it, tends to influence behavior. . . . Feelings of obligation are not related to the size of the gift.” Precisely my experience.

Other interesting social science insights have emerged from the field of behavioral economics. For instance, Ariely conducted a series of experiments in which study participants were rewarded financially for the number of correct answers on tests. The experiments were designed so that cheating was possible. On the basis of the results of these experiments, Ariely concluded that many individuals cheat when they have a chance, but only by a small amount; they know that they are overclaiming the number of correct answers; but this low-level cheating does not cause them to view themselves as dishonest. When I recently used a university envelope to mail a letter to my daughter, I too did not view myself as dishonest, perhaps because I used my own postage stamp.

Two: However small, gifts influence behavior.

These minor dilemmas fail to cross key moral boundaries with the result that they are not experienced as a conscious and deliberate choice between the size of the reward and the potential cost to credibility or reputation. The frequently expressed view that industry gifts or consulting fees are too small to influence behavior simply misses the point that, regardless of their size, they influence behavior, and a self-serving bias distorts the way that individuals perceive themselves. As a result, industry gifts, fees, or funding have become culturally acceptable even though service in a profession does not itself provide immunity from potential conflicts of interest or from the appearance of conflicts of interest.

Point Three: We ought to be ashamed.

Recent high-profile failures to disclose financial relationships with industry have been major embarrassments to the profession. Several professors who promoted the use of atypical antipsychotics for bipolar illness in children had received hundreds of thousands of dollars that went unreported to their institutions. The new guidelines from the
Association of American Medical Colleges on the efforts to manage the relationships between academic scientists and industry sponsors emphasize transparency. Senators Chuck Grassley (R, Iowa) and Herb Kohl (D, Wisconsin) have introduced the Sunshine Act, which would require the public posting of information about all industry payments or transfers of value worth $100 or more. This act, if passed, will help ensure the transparency that the profession on its own has not yet been able muster.

The author concludes:

The bias of conflict of interest is a behavioral phenomenon. Under the assumption of an accurate report, the design of the trial, the conduct of the study, and the interpretation of the results are perhaps the best measures that clinicians, researchers, and other readers have to assess the possibility of such a bias among their scientific colleagues and themselves.

It’s a fine irony that the worst conflict of interest offenders come from the psychiatrists who are supposed to be experts in these sorts of human motivations.

The article is from JAMA. You need to subscribe or pay $15 to read it in full.

UD thanks Bill.

I mean, minus Bernie and Ezra …

…The [fraud] charge [against Merkin] highlights the dangers charities face if they overlook governance practices and conflicts of interest, like investing with businesses run by board members. Deep losses incurred by charities invested through Merkin reveal how several boards fell down on their job.

Yeshiva University invested $110 million, or 8% of its endowment, with Merkin’s Ascot Partners LP, which had the bulk of its assets invested in Madoff. Both Madoff and Merkin served on boards at the university, Merkin as chairman of the board’s investment committee.

“No member of a nonprofit board should benefit in a financial way from serving a charity,” said Marian Stern, a nonprofit consultant and adjunct assistant professor at the George Heyman Jr. Center for Philanthropy and Fundraising at New York University. …

Non-profit is one of those words … It’s like Maria… the most beautiful sound I’ve ever heard… all the beautiful sounds of the world in a single word… non-profit…

Yet we’ll never get anywhere, mes enfants, until we take a cold eye even to that most beautiful of words. And not only when multiply-billioned megaliths like Harvard continue to present themselves as non-profit pebbles. When advocacy organizations are over-indebted to corporations, they also should receive scrutiny.

… In a letter sent today to the National Alliance for Mental Illness, based in Arlington, Virginia, [Senator Charles] Grassley asked the nonprofit group to disclose any financial backing from drug companies or from foundations created by the industry.

The Iowa Republican, in a series of hearings and investigations, has focused on financial ties between the drug industry, doctors and academic institutions. His efforts have led New York-based Pfizer Inc. to begin disclosing consulting payments to U.S. doctors, and Harvard Medical School in Boston to reexamine its conflict-of-interest policies. Now Grassley is expanding his inquiries to nonprofit groups.

“I have come to understand that money from the pharmaceutical industry shapes the practices of nonprofit organizations which purport to be independent in their viewpoints and actions,” Grassley wrote in his letter.

Officials at the National Alliance for Mental Illness didn’t return calls for comment.

The group identifies itself as the largest grassroots organization in the U.S. for people with mental illness and their families. The group came under scrutiny in 1999, when the magazine Mother Jones reported that 18 drug companies gave the group $11.7 million from 1996 to mid-1999. The article reported that at one point an executive of Indianapolis-based Eli Lilly & Co. worked out of the nonprofit group’s headquarters…

A writer at PsychCentral provides some detail:

… The problem with the National Alliance for Mental Illness and Mental Health America (formerly known as the National Mental Health Association), among others, is their simple lack of transparency about their funding sources. NAMI, for instance, doesn’t break out its donations by source. If it did, I suspect we’d see that somewhere between 30 to 50 percent of its donations come from pharmaceutical companies, affiliated companies, or individual employees and management from within pharma. For other nonprofits, I would expect similar percentages.

The long-held secret of these national non-profits doing important advocacy and policy work in mental health is simply this — without the pharmaceutical monies they receive, they probably wouldn’t exist today. They are dependent upon them and some of them would rather you not know how dependent upon them they really are.

Does such money buy influence? Well, with NAMI, the answer appears to be an unequivocal “Yes.” NAMI has long pushed that severe mental illness — like depression, schizophrenia and bipolar disorders — are pure neurobiological medical diseases (or as they call them, “biologically based brain disorders”).

The primary treatment method pushed by NAMI national? Medications, of course. For instance, in their consumer article about depression, 84 percent of the article is devoted to medications and only 10 percent mentions psychotherapy. ..

… before Brown University finally removes you as chair of psychiatry?

This compromised.

… Martin B. Keller, is a highly acclaimed psychiatrist and chair of the psychiatry department at Brown University who has extensive ties to the drug industry. In 1998, when the Rhode Island attorney-general’s office forced Keller to forfeit hundreds of thousands of dollars in state grant money to settle a financial fraud inquiry, it came to light that Keller had received more than half a million dollars from drug companies that year, most of it from the same firms whose drugs he had touted in journals and at medical conferences. According to the Boston Globe, Keller’s financial ties were so numerous that they prompted the National Institute of Mental Health to review its conflict-of-interest rules. The most recent publicly available data shows that as of June 2003, Keller had been consulting for at least 17 major drug firms, including Merck, Bristol-Myers, Eli Lilly and Pfizer, while also working under a $25 million research grant from Wyeth-Ayerst.

But this was written in 2005. Maybe there’s more.

Anyway. Brown finally removed him. Dean Edward Wing writes:

I am pleased to announce the appointment of Steven A. Rasmussen, MD, as interim chair of the Department of Psychiatry and Human Behavior…

UD thanks Barney for the item, which she doesn’t yet see on official Brown pages. But I guess it’ll show up here pretty soon.

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Update: Alison Bass has more information.

… of a book about misleading health statistics.

Another problem — increasingly — is conflict of interest. As pharmaceutical companies fund more of their own trials, the studies may be designed to yield the sunniest results possible. Allowing a new drug to shadow-box against a placebo, for instance, promises more marketable results than pitting it against a competing drug that’s already on the market. Publicizing only surrogate outcomes without mentioning whether the patient benefits in any substantive way is another common drug company dodge. So is burying — or at least minimizing — side effects or other shortcomings…

… a brief engagement.

Lawrence Summers, director of President Barack Obama’s National Economic Council, earned more than $2.7 million in speaking fees from companies such as Bank of America Corp., Ciitigroup Inc. and Goldman Sachs Group Inc. that later received taxpayer funds in the economic bailout.

The hedge fund D.E. Shaw & Co. also paid Summers more than $5 million in salary and other compensation in the past 16 months, according to a financial disclosure form released by the White House today. Summers served as a managing director at the New York-based firm until December, according to the report.

Summers, a Treasury secretary under former President Bill Clinton, spoke to Citigroup, Goldman and Lehman Brothers Holdings Inc. audiences twice last year. Lehman, which went bankrupt in September, paid Summers $67,500 for an engagement on July 30, the filing showed…

A man stands up to give a speech. Did he write it himself? Probably not. How original is it? Let’s figure not very. How long did he speak? Forty minutes? Probably not even that. Is he especially beautiful, compelling, charismatic?

Is the outfit paying him in a position to give a guest speaker almost $70,000?

… Ah fuck it. I’m sure the expenditure makes… made… terrific sense for Lehman. Let’s look to the future: Isn’t it a good feeling to know that the man in whom the nation has vested our economic future knows how to turn a a few words into a check for $67,500 made out to himself?

… leadership for stifling free speech.

… [T]he administration informed the ethics committee that if [Senator Grassley’s] aide spoke, no administrator would be allowed to partake in the [conflicts of interest] panel. As students at Tufts, it is crucial for us all to recognize the administration’s misstep. While it is understandable that Tufts wants to avoid any conflict regarding the investigation, it seems unreasonable that the topic could not be avoided for the educational purposes the event could provide.

The symposium is intended to provide the audience with multiple views and stances on the medical issues of today. Mr. Thacker has firsthand knowledge and experience about a subject that would have provided a unique and fresh viewpoint at the conference. His voice differs from the professionals of Harvard or Tufts, allowing for some diversity and debate at the symposium itself.

Possibly most outspoken on the issue is ethics committee co-chair Sheldon Krimsky, who removed himself from the issue and the organization of the event when the decision was passed. We praise Krimsky for standing behind his belief and the purpose of the ethics committee as a whole…

Background here.

… Hofstra University … saw a board member, 1960 graduate Bernard Madoff, arrested for fraud. It … escaped financial consequences. The school … has a ban on investing with board members.

“Not a cent,” said Stuart Vincent, Hofstra’s assistant vice president for university relations. “There is a policy on our board that none of our trustees are allowed to do business with the university. It wasn’t just happenstance.”

Other nonprofits weren’t so lucky. Board members such as Madoff and those who channeled money to him made nonprofits casualties of both bad investments and faulty board policies.

Madoff was treasurer of the board of trustees at Yeshiva University, which lost more than $14 million after fellow board member J. Ezra Merkin, chair of the board’s investment committee, funneled money to him…