Policies prohibiting collaboration between physicians and industry

As the number of restrictions on physicians working with industry continue to grow, and the places where policies prohibit physicians from collaborating with industry expand, close examination of the reasons supporting these policies is necessary.

The current trend of academic medical centers (AMCs), professional organizations, and States that have begun adopting policies that restrict permissible interactions and activities between industry and physicians dawned shortly after a set of recommendations proposed by Brennan and colleagues in 2006. Examples of the proposed policies placed restrictions on faculty, residents, students, and staff, which prohibited gifts, samples, and several other activities.

One of the main reasons AMCs began to adopt these policies was an attempt to avoid financial conflicts of interest that compromise core values of altruism and fiduciary relationships. In their view, profit motives and financial gains unavoidably introduce bias in medical decision-making and violate public trust. However, there is number of reasons why the adoption of such policies by AMCs is problematic.

Accordingly, a recent editorial by Don K. Nakayama, M.D., M.B.A. Chairman of Department of Surgery at Mercer University School of Medicine, In Defense of Industry-Physician Relationships in the American Surgeon, identified the misperceptions and myths that have led some AMCs and organizations to adopt such restrictive policies on industry interactions.  In his editorial, Dr. Nakayama comes to the “defense of industry-physician relationships” by examining the economic, ethical, and legal foundations for conflict of interest restrictions between physicians and pharmaceutical and medical device industries (“industry”).

One of the first problems with restrictive policies between physicians and industry that Dr. Nakayama identifies is that although some of the regulations themselves grew from alleged and some real conflicts of interest (COI) involving both drug and device trials,  “scientific misconduct, fraud, and dishonesty are noteworthy because of their rarity.” In other words, people overreacted by installing restrictive policies for events that are extremely rare. The problem with this approach was that the policymakers did not consider the other consequences created by such policies that could and are in fact now chilling the collaboration between physicians and industry.

Considering “the vast majority of industry sponsored research results in beneficial drugs and devices of immense benefit,” the potential impact restrictive policies could have on research, development, discovery, education, and patients should have been the first consideration when making restrictions on interactions with industry.

While some restrictions such as payment disclosure is reasonable, making “a total purge of all financial conflicts of interest has become the touchstone of medical professionalism.” This approach is unnecessary. As Dr. Nakayama points out, there needs to be more discussion about “an appropriate middle ground that acknowledges the rights of industry, physicians, residents, medical students, patients, and the public to the benefits that reasonable interactions between industry and physicians may provide.”

By ignoring the rights of these groups, “those who propose restricted industry-physician-patient relationships are thus in conflict with those who recognize a beneficial relationship.” This creates a debate on a number of issues, between those who see industry interactions as a violation of their sense of professionalism versus those who “see restrictions as an affront to their right to determine how they will practice medicine and their own definitions of the ethical practice of medicine.”

Medical economics

Proponents of COI regulations frequently assert that doctors should have a selfless or altruistic concern for the welfare of their patients absent a financial motive. As Dr. Nakayama recognizes, this approach completely ignores the economic system the US pharmaceutical and device industries operate under, which recognizes that every level of professional interaction between industry and doctors “are necessary as aspects in a robust capitalist economy.”

In a capitalist system, products are developed to generate profits. In the drug and device industry, the process of developing a product is costly, long, and risky. A single drug requires $800 million and 7-12 years or more to come to market, a good chunk of the 18-year duration of patent protection. Only 8 percent of drugs developed become approved drugs. The only way drug and device companies can generate profits is by allocating their resources to either acquire or develop innovative drugs or devices based upon market demand. Society, through government, has recognized that “such innovation is socially desirable and is worth granting industry patent protection on new drugs and devices.”

To ensure that innovative drugs and devices are effective and safe for the public, government regulations and requirements are complex and rigorous. In fact, even after a product is approved, post-market surveillance is necessary to detect problems that may arise after drug introduction, for which the company remains liable. Consequently, it is precisely because of this balance between high risk, high regulation products that companies “depend on the market for feedback on how to refine their product so that it better fits what doctors and patients need.”

It is also because of this long process of drug development and satisfying regulatory requirements, which limits the period of monopoly pricing power over its product, that companies must allocate resources to bring an approved product to the market through ethically and professionally acceptable marketing and advertising practices. Critics who point to the growing costs of health care claim that profits of the pharmaceutical and medical device sectors are excessive, that the money spent on marketing increases health care costs, and does not primarily serve patient interests.

However, as Dr. Nakayama asserted, “marketing and advertising are not contrary to high quality evidence-based care. They are an integral part of getting any product into the market.” Moreover, those who criticize drug and device companies for advertising easily forget about the numerous hospitals and AMCs who use billboards, commercials, and ads to accomplish the same goals: bring their services to the market.

In addition, by “starting with an unknown drug or device, a company has to overcome established practices of surgeons and physicians.” If the company hopes to recoup any costs for making the product, they have to devote resources to marketing to increase sales and profits, which can be extremely difficult to do when physicians are unfamiliar with their product. Dr. Nakayama gave a perfect example of this: surgeons adopting surgical staples. He explained how this was such a “radical departure of surgical technique, but because of the marketing, advertising, and reinventing the surgery through education, demonstrations and product samples, surgical staples eventually transformed surgery to depend on industry and its surgeon collaborators.

Profit motive in industry

The next argument that critics of industry-physician interactions make is that “any benefit that comes to physicians through industry contact is suspect.” They see profit motives and market incentives in medicine as negative challenges to medical professionalism. However, as Dr. Nakayama acknowledges, “the goals of physicians and industry are remarkably congruent and complimentary.”

Both want effective medications and devices that benefit patients. Physicians want them, industry wants to supply them. Doctors want to learn new treatment modalities; industry wants to educate doctors in those techniques and products. Both parties want effective treatments that maximize benefit, minimize harm to the patients, and minimize legal risks. Doctors want to run profitable practices, companies want to run profitable businesses.

The first major area where physicians and surgeons in practice collaborate with industry is in clinical research and trials. Industry depends upon physician researchers with busy clinical practices to test drugs and device and report results. The physicians expose patients to experimental drugs and procedures in the belief that patients will benefit from participation. Neither industry nor physicians want harm to come to study participants but, human testing is risky. That is why such research is strictly regulated and overseen. As such, because physician collaborators are necessary parts of product research and development, they deserve and receive appropriate compensation from industry.

The next area is the vastly larger venue of marketing and sales of drugs and devices after clinical research studies have shown efficacy and safety. Physicians in practice and their patients are the market. Companies need their representatives to interact with medical providers using professional and ethical practices to get their products to doctors and in patient’s hands because of the short period of patent protection to recoup close to $1 billion in product development and testing.   In the end this is a win win scenario as patients benefit from quicker implementation of new and improved therapies. While past practices were occasionally egregious and excessive (i.e. gifts), current industry guidelines prohibit those practices, and help to maintain the highest level of educational activities and contact with industry.

What critics must realize is that the only time industry can have with clinicians’ in busy practices are mealtimes and conferences. However, critics maintain that such contacts “still are tainted by a sense of obligation among physicians to provide a service in return and thus create unprofessional behavior, a sense of entitlement, and demean the profession.” These critics ignore the fact that when industry talks with clinicians about effective novel therapies that have demonstrated safety and efficacy, if a hospital adds it to their formulary or physician adopts it, “the public benefits.”

It is also important for critics to acknowledge the fact that “physicians have the training and sense of professionalism to want the best for their patients and protect them from harm. They have independent sources of information through journals, practice-based learning activities, and professional organizations to confirm or refute industry claims.

As a result, physicians in practice have their professional integrity and the safety of their patients in mind, and are able to filter the message they get in industry marketing.

The underpinnings of medical professionalism

Another concept that underlies prohibitions of COI is that a physician has a fiduciary relationship with the patient. As Dr. Nakayama explained, fiduciary means “someone who acts for and on the behalf of another in circumstances that give rise to a relationship of trust and confidence. One in a fiduciary relationship acts at all times to the benefit of the other, and does not put his or her interests before those of the beneficiary, and thus cannot have a COI with the interests of the beneficiary.” However, Dr. Nakayama argues that a physician-patient relationship does not establish a fiduciary relationship because they are not available to their patients at all times, and the standard of care which doctors adhere are not defined by the maximal benefit to the patient but reasonable standards of the professional practice.

Doctors adhere to professional standards and codes of ethics that they themselves determine as a right of self-government the public has given physicians. The public is able to “retain an interest in professional behavior by physicians through state boards of medicine and a legal system that protects patients from malpractice through the tort law system.” Those groups that want to restrict physicians contact with industry are essentially taking away the rights of doctors to make their own standards and making interactions with industry crimes enforceable by law.

Consequently, instead of using altruism or fiduciary, Dr. Nakayama recommends the business concept of excellent service. He explained that the “tenants of excellent service are putting interest of customers first, integrity to the company’s mission and values, and honesty and ethical business practices. They are directly translatable into medical terms that describe altruism and professional behavior exactly: putting patients’ interest first, scientific clinical integrity and absence of bias in medical decision-making.”

Force of law

Critics also ignore that physician-industry relationships are protected by the First Amendment of the U.S. Constitution, which guarantees freedom of speech, including the right to market and advertise medical products and drugs. As Dr. Nakayama explained, “it also guarantees freedom of assembly, the right of physicians to meet with industry reps over reasonably priced meals and conferences and to have mutually beneficial contractual relationships with industry to develop new drugs and products. The Copyright and Patent Clause of the First Amendment protects the rights of companies to enjoy monopolistic profits that come to their discoveries under patent protection.”

Dr. Nakayama also acknowledged the fact that industry and professional organizations have themselves developed codes of ethics that guide their interactions. These codes preserve the relationships that are a necessary part of the introduction of necessary drugs to clinical practice, and also minimize and prohibit unethical contacts and activities. Since “part of professionalism is the responsibility to abide by an agreed upon code of ethics without having to resort to the blunt force of law,” there is no need for further restrictions.


In the end, “across-the-board conflicts of interest restrictions risk the unparalleled advances in medical technology that we enjoy today.” The clear problem with such policies is that they prohibit what are overwhelmingly “productive relationships between industry and physicians that provide novel drugs and devices of immense benefit to society.” Moreover, these policies ignore the fact that “physician researchers and inventors are responsible for an overwhelming array of drugs and staggering list of devices that depend upon industry for product development, production, and marketing.”

The reality is, “industry goals are congruent with those of physicians: patient welfare, safety, and running a profitable business.” Moreover, industry has transformed completely the practice of medicine and surgery. “Its success is measured in the increase in longevity of nearly 10 years from 1950 to the present (68.2 to 77.9 years) and years of productive life. The numbers of employed workers over 65 years have doubled from 1977 to 2007.”

As a result, “humankind owes an overwhelming array of live saving medications and surgical devices to the unique American industry-physician partnership.” Since so many benefits come from relationships between industry and physician, “it is difficult to imagine another system that could create the volume of innovation developed and adopted in the US.” Therefore, if the US continues to restrict industry-physician relationships, Dr. Nakayama asserted that “all of us will suffer.” That is why “preservation of industry-physician relationships is vital to maintain medical innovation and progress.”

Thomas Sullivan is founder of Rockpointe who blogs at Policy and Medicine.

Submit a guest post and be heard on social media’s leading physician voice.

View 3 Comments >

Most Popular

Get KevinMD's 5 most popular stories.