Testimony
Statement by
Elias A. Zerhouni, M.D. Director National Institutes of Health U.S. Department of Health and Human Services
on
Hearing: NIH Ethics Concerns:
Consulting Arrangements and Outside Awards
before the
Oversight and Investigations Subcommittee
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June 22, 2004
Mr. Chairman and Members of the Subcommittee, I am Elias A.
Zerhouni, Director of the National Institutes of Health (NIH) at
the U.S. Department of Health and Human Services (HHS). I am here
to testify about my proposal to strengthen the ethics system at NIH
by changing our rules, practices, and procedures.
I have reached the conclusion that drastic changes are needed as
the result of an intensive review by NIH of our ethics program,
which included internal fact-finding as well as the external review
of a Blue Ribbon panel. This review was prompted in part in
response to the inquiry of this Subcommittee and the bipartisan
concerns of Chairman Greenwood, Ranking Member Deutsch,
Congresswoman Degette, and the full Committee Chairman, Mr. Barton,
as well as the Committee’s Ranking Member, Mr. Dingell, and
other members of the panel.
The events and arrangements that have been the subject of the
Subcommittee’s oversight and NIH’s reviews were rooted
in a significant alteration of NIH’s ethics rules and
policies that occurred in 1995. These changes were the result of
converging interests. The first was NIH’s desire to
strengthen the research enterprise through the use of innovative
recruitment and retention policies. The second was a
government-wide standardization of ethics policies, which resulted
in a decision by NIH to change its ethics rules to conform to the
new policies.
As we move forward, I regret that the reputation of NIH has been
challenged over ethics concerns and that the conduct of individual
scientists who have devoted their lives to battling disease and
easing the suffering of millions of patients has been questioned. I
believe the NIH and its employees were operating within rules that
allowed or did not specifically address many of the arrangements
that the Subcommittee has questioned, including lecture awards and
consulting with industry. In retrospect, there was not a sufficient
safeguard against the perception of conflict of interest.
As I have testified previously, our public health mission is too
important to have it undermined by any real or perceived conflicts
of interest. It is imperative that Congress and the American
people trust that the decisions made by our scientists are
motivated solely by public health priorities and scientific
opportunities, not personal financial concerns.
The first step in maintaining such trust was the creation of the
NIH Ethics Advisory Committee (NEAC). The NEAC, an internal NIH
committee, is providing a centralized, consistent, and rigorous
review of all consulting arrangements with pharmaceutical and
biotechnology companies, awards valued in excess of $2500, and all
requests from senior NIH officials. Composed of Institute and
Center Directors and scientific leaders, and with the participation
of ethics officials, the Committee provides unprecedented review by
peer scientists of applications for outside activities and awards.
NEAC looks carefully at each request under its jurisdiction so
that, for instance,NIH employees are not consulting on
matters that are related to their official duties or pose other
potential concerns. Only those requests for approval
that have passed muster at the Institute level, by both the
employee’s supervisor and the Institute’s Deputy Ethics
Counselor (DEC), are forwarded to the NEAC for review. Upon
NEAC review, it is only those arrangements that do not pose
conflict of interest concerns that are recommended for approval and
forwarded to the NIH Deputy Ethics Counselor. As a result of the
unprecedented review by peer scientists now applied to the ethics
program, the culture at NIH is already changing.
On May 12, I testified before this subcommittee about four
principles for change in the NIH ethics program:
Enhance public trust in NIH by preventing conflicts of interest
through the restriction of financial relationships that employees
may have with outside organizations;
Increase levels of transparency in the NIH ethics program by
requiring much more internal as well as public disclosure of the
details of financial relationships that employees have with outside
organizations, including consulting arrangements and awards;
Balance NIH’s ability to recruit and retain the best
scientific expertise while expediting the translation of research
advances;
Establish effective monitoring and oversight of employee
activities.
Today I am announcing that NIH, working with the HHS Office of the
Secretary, will seek a major reform of the Agency’s ethics
program by requesting restrictive rules and by seeking to increase
the public availability of information related to outside
activities with industry. As you know, this process cannot
happen overnight. We are aggressively working with the Office
of the Secretary and OGE to make sure that we have in place a set
of rules that ensures the appropriate ethical oversight while
continuing to encourage scientific creativity. The following
framework lays out our attempts to implement the principles
described above.
Principle One: Enhance Public Trust
Prohibited Holdings: We are working
to prohibit the holding of stock in individual biotechnology and
pharmaceutical companies as is done at the Food and Drug
Administration. There, all employees that file either a
public or confidential financial disclosure report are prohibited
from holding stocks in significantly regulated
entities. Non-filers are permitted to hold only
up to $5000 of such stock, which is $10,000 below the current
federal rules for de minimis financial interests.
Awards: We are actively pursuing a two-step
process. First, any NIH employee should be prohibited from
accepting any award unless the award has been pre-screened.
Such a process would include an independent advisory committee that
includes non-government individuals and the NIH DEC, and a
determination by the DEC that the award meets the regulatory
definition of bona fide. Second, even if the
award has been determined to be bona fide, specific awards
to employees still should be reviewed on a case by case basis by
the NEAC, and approved by the NIH DEC to ensure that the acceptance
of the award does not create a real or apparent conflict of
interest for the employee in relation to official duties. As
an additional restriction, NIH will seek to prohibit any official
– including Institute and Center Directors – who are
responsible, either directly or indirectly through subordinates,
for a funding decision affecting the entity offering the award,
from receiving the cash component of an award. It is my
intention that this restriction will not preclude the acceptance of
cash in the case of certain exceptional bona fide awards,
such as the Nobel Prize. The list of pre-screened bona fide
awards would be posted publicly, as will the NIH recipients of such
awards.
Outside Activities with Industry: While we continue to
encourage consultation with industry as part of official duties, I
intend to prohibit senior NIH employees, as well as all employees
involved in extramural funding decisions or Cooperative Research
and Development Agreements, from consulting with industry for
compensation or any other form of remuneration. Other
employees would be permitted to consult only if the arrangement has
been reviewed by the NEAC and approved by the NIH DEC, and certain
restrictions are in place. These are: 1) payment may
not include stock or stock options; 2) annual compensation from all
outside activities with industry must be limited, and no more than
half of that limit may come from any one source; and 3) a cap on
the number of hours annually that an employee can spend on all
outside activities with industry.
Participation on Industry Boards: I seek to prohibit
all NIH employees from membership on corporate boards of the
pharmaceutical and biotechnology industries. In addition,
employees should be allowed to participate in industry scientific
advisory boards as ad-hoc participants only if such participation
has been reviewed by NEAC, and approved by the NIH DEC.
Consulting (includes speaking) with Grantee
Institutions: While we continue to encourage consultation
with grantee institutions as part of official duties, I will seek
to prohibit all NIH employees from consulting with NIH grantee
institutions for compensation or any other form of personal
remuneration.
Consulting (includes speaking) with Non-profits that are not
Grantee Institutions: I seek to prohibit NIH senior
leadership from consulting with these entities.
Clinical Practice: NIH seeks to limit employee annual
compensation for clinical practice.
Principle Two: Increase Transparency
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NIH, working with HHS and OGE, has already increased the number
of senior managers who must publicly disclose their compensated
activities with outside organizations and the amounts
received. This has been increased by 93
positions. We are hopeful that OGE will grant HHS’
recent request to extend public financial disclosure to an
additional 508 positions.
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I will seek authority from OGE for NIH to determine which of its
employees must submit public financial disclosures.
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We are working towards requiring that outside activities with
industry be publicly disclosed. This will include
disclosure to CRADA partners.
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NIH employees will continue to be required to disclose the
amount of compensation earned from outside activities.
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I will review the duties and responsibilities of employees who
currently do not file any financial disclosure reports,
specifically those involved in human subjects work, to increase
the number of employees who file such reports to avoid any
involvement in a real or apparent conflict of interest.
Principle Three: Recruit and Retain Best Scientific Expertise
While Expediting Translation of Research Advances
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I will encourage NIH scientists to continue teaching, speaking
or writing about their research as part of their official
duties.
In order to encourage scientific interactions involving the
exchange of knowledge and the exercise of intellectual leadership
by NIH scientists, NIH will continue to allow certain types of
outside activities – including teaching and lecturing
opportunities and collaborations with the private sector –
but only under clear, rigorous rules meant to eliminate conflicts
of interest.
Principle Four: Establish Effective Monitoring and Oversight
Mechanisms
I will continue to require that supervisors fulfill their
responsibilities in both reviewing proposed outside activities and,
if NEAC ultimately approves the outside activity, in monitoring the
effect that the activity might have on the employee’s
official duties. Before any proposed outside activity is
forwarded to the NEAC for review, supervisors will be asked to
determine whether the activity can and should be undertaken as part
of the employee’s official duties, and if not, whether the
proposed outside activity will cause a conflict, either of interest
or of commitment. In addition, supervisors will be expected
to monitor employees’ compliance to ensure compliance with
the limitation on hours.
NIH will improve its ability to manage and track approved
activities with outside organizations by increasing the
accountability of managers, creating a centralized system,
centralizing review of senior managers and scientists, conducting
random audits of files pertaining to activities with outside
organizations, and continuing the rigorous review by peers
conducted by the NEAC.
NIH will develop and implement a new, more understandable method of
training employees on ethics rules, and we will establish a web
site that displays rules in plain language, updates employees on
regulatory trends and changes and discusses – anonymously
– ongoing cases as examples of best practices or unacceptable
practices.
We are severely restricting the ability of NIH employees to consult
with industry. However, as I have previously testified, the easiest
way to approach this matter would be to ban all consulting with
industry. I do not want to discourage the kind of
intellectual excitement and curiosity that leads our scientists to
want to work with industry. I want to provide an environment
for them in which they have the same kind of professional and
intellectual opportunities as their counterparts in
academia. I want the intramural program to continue to
attract the best and the brightest. With these principles in
mind, I am working to strike a careful balance – whereby
those individuals in key decision-making positions will be
prevented completely from consulting, while stringent limits will
apply to other employees.
Mr. Chairman, Members of the Subcommittee, in summation, I have
described the three core elements of reforming the ethics process
at NIH. Number one, we are applying review of applications for
outside activities by peer scientists. Number two, we are requiring
full disclosure and transparency in the program. And number three,
NIH is working to reduce, restrict, or eliminate the types of
activities about which this Subcommittee has raised concerns.
Thank you for this opportunity to speak before the Subcommittee on
these matters once again. I would be happy to answer any
questions you may have.
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