Office of Government
Ethics and Dept. of Health and Human Services restrict NIH Outside Income
Tight Rules Address Concerns About Conflicts
of Interest
By Rick Weiss
Washington Post Staff Writer
Wednesday, February 2, 2005; Page A01
All of the more than 18,000 employees of the
National Institutes of Health will be subject to stringent new
restrictions on stock holdings, outside consulting, and other forms of
income from drug companies and similar sources under new regulations to
take effect this week, NIH officials announced yesterday.
The new rules, issued by the Department of Health and Human Services
and the Office of Government Ethics, end more than a year of internal and
congressional investigations into allegations of conflicts of interest
involving NIH scientists and administrators.
Under the system, employees may not be
paid to consult, speak, write or teach for any drug or biotech company,
medical device maker, health provider or insurer, or trade or professional
group. Thousands of employees will have to divest themselves of all stocks
held in drug, biotech and related companies, with the exception of
diversified mutual funds. And even the lowest-ranking employees with no
control over purse strings or policies will be subject to new limits of
$15,000 on health-related stock holdings.
As of a few months ago, about 100 agency scientists were involved in
collaborations that would be banned under the new policy, an NIH official
said. Many others stand to be affected by the other restrictions.
 The
rules are stricter than those proposed last year by NIH Director Elias A.
Zerhouni -- a reflection both of Congress's dissatisfaction with the
changes the agency initially proposed and of Zerhouni's own blossoming
recognition last year that the problem was bigger than he had thought.
In the end, Zerhouni said at a news briefing on the agency's
Bethesda campus, it made sense to simply draw "a bright line" that will
effectively isolate NIH scientists and other employees from outside
economic interests.
"We needed to absolutely achieve the number one goal I've stated
many times before: preserving the public trust . . . with no taint of
conflict of interest or the appearance of conflict of interest," he said.
"That's why people entrust us with their tax dollars."
The 96-page "interim final rule" (summarized at
www.nih.gov/about/ethics/020105COIsummary.pdf) will take effect when
it is published in the Federal Register. Officials expect that to happen
in the next few days.
Although Zerhouni had sought to impose rules that would expire in a
year, the new regulation will remain in force indefinitely -- unless HHS
officials and others agree to change it.
The changes codify the reversal of a trend toward liberalized links
between NIH researchers and drug and biotechnology companies that began in
1995, when government ethics officers criticized NIH for having
restrictions on outside consulting that were stricter than those at other
agencies. Then-NIH Director Harold Varmus responded by loosening the
restrictions, saying the changes would speed the translation of basic
medical advances to the marketplace.
In December 2003, the Los Angeles Times reported that some NIH
scientists had arranged lucrative side deals that, though apparently
legal, raised concerns about conflict of interest. A congressional
investigation ultimately found that additional NIH researchers -- "a few
dozen," Zerhouni said -- had not informed the agency of their arrangements
with drug and biotech companies, as required.
In perhaps the most egregious example, a researcher at the National
Institute of Mental Health was paid $517,000 in fees, honoraria and
expenses as a consultant for the drug giant Pfizer Inc. over five years
without disclosing that income to the agency, congressional investigators
said.
That and other cases are still under investigation, Zerhouni said.
NIH employees have reacted with mixed feelings to the events of
recent months, with some saying it was about time the agency cracked down
on an embarrassing abuse and others complaining that NIH leadership was
too quick to abandon the vast majority of employees who have done nothing
wrong.
The announcement that restrictions would be even broader and deeper
than expected strengthened that sense of injustice in some.
"The vast majority of people, who have played totally by the rules
for a long time, are now being told, 'Nothing goes,' " one longtime
employee said, speaking on the condition of anonymity out of fear of being
labeled a critic of HHS or Zerhouni. "A lot of people are saying, 'Why not
punish the bad guys and stick up for the good guys instead of changing the
rules for everybody?' "
Zerhouni acknowledged that "the vast majority of scientists, more
than 5,000 of them on this campus, have served selflessly." He said,
however, that "we owe it to them to come up with regulations to protect
their reputations."
He also reiterated his concern that the new restrictions might hurt
efforts to recruit the best scientists, who can earn at least as much with
far fewer restraints at other research institutions.
Ultimately, he said, "it was more important for an agency that funds
grants and gives advice to hold itself to a different standard than the
rest of the world," Zerhouni said. "If at all necessary, we will revisit
these regulations later on."
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