Dermatology’s Academic Medical-Industrial Complex


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Source: Counterpunch

The health care system has been increasingly corporatized since the 1980s, soon accompanied by the growth of investor-owned corporate health care across many parts of the system. This invariably led to more opportunities for conflicts of interest between industry and segments of the profession. More recently, those conflicted ties have further grown by the rise of private equity investment in various parts of health care among Wall Street brokers and investors, invariably with the primary intent to maximize financial returns.

Here, a six-year study is reported of the conflicts of interest (COIs) of key opinion leaders in dermatology, their ties to the pharmaceutical industry, and implications of how coopted this specialty has become. A list of the board members of the American Academy of Dermatology (AAD) was compiled from the society’s website. Their names were entered into the CMS Open Payments database, which includes general payments ranging from consulting fees, speakers’ honoraria, and other honoraria for food and beverage. All compensation data were collected from 2014 to 2020, as permitted by Physician Payments Sunshine Act of 2010.

As of April 1, 2021, there were 30 officers and directors of the AAD. Seven were employed by academic institutions that do not allow them to receive general payments from industry, while the other academic institutions do not have this policy. These conflicts of interest were identified among the remaining 23:

+ 14 of the 23 (61 percent) made in excess of 3 times the mean for U. S. dermatologists, pocketing $12,873,000 (mean $919,500) in general payments from 2014 to 2020;

+ 6 of the 23 (26 percent) received in total of $9,900,000 in general payments (mean $1,650,000) or 47 times the mean of all U. S. dermatologists;

+ Research payments for the 14 individuals who made more than $100,000 fro industry-supported research funding between 2014 and 2021 amounted to $16,322,000 (mean $1,165,000);

+ The president-elect of the AAD is the chief medical officer of the largest private equity dermatology company, while at least one other AAD Board member has close ties to private equity.

A further breakdown between academic-based dermatologists and their non-academic counterparts yielded these findings:

+ Eight of the 18 academic dermatologists received $8,955,000 (mean $1,119,000) in general payments;

+ Four of 12 non-academic dermatologists collected less than $100,000 over the study period; of those, three were Mohs or procedural specialists and one was a cosmetic dermatologist; the remaining eight received $7,565,000 in general payments (mean $945,000).

These financial entanglements of the leaders of the American Academy of Dermatology (AAD) are more than troubling. They seem to be more focused on the business of dermatology than on the services that the specialty provides to patients and communities. They are leading the specialty towards a more procedural future, delivered mainly by group practices, together with cosmetic and PhRMA funded research. The AAD’s ties to the largest PE dermatology company in the country disrupts and voids the physicians’ fiduciary obligations to their patients and society.

Worrisome as these findings are, the growth of private equity (PE) in health care brings even more serious concerns. PE firms have sought out lucrative markets across health care that maximize returns to investors at the expense of patients. In each case, quality and outcomes of care suffer as prices become unaffordable. Between 2012 and 2018, 184 dermatology practices in 30 states were acquired by PE firms, which were then pressured to see more patients, perform more procedures, and increase revenues. 1 The typical pattern that follows acquisition of so-called platform practices is to build up the number of physicians in the practice, gain more negotiating power with payers, and then selling the expanded practice three to five years later. This has occurred in other specialties, such as obstetrics-gynecology 2 and ophthalmology 3.

Unfortunately, the case of dermatology is a marker for long-standing and growing COIs with industry throughout the medical profession. As another worrisome example, a recent article revealed extensive COIs with the National Academy of Sciences itself, which has taken in millions of dollars each year from major drug-makers without disclosure. 4

Self-regulation by the medical profession of these kinds of conflicts of interest by has been ineffective despite periodic lofty words by some of its organizations intended to correct the problem. Dr. Jerome Kassirer, long a leader in academic medicine and also a former editor of the New England Journal of Medicine, proposed these four principles upon which to base regulatory reforms in his important 2005 book, On the Take: How Medicine’s Complicity with Big Business Can Endanger Your Health:

1. Financial considerations must never be allowed to compromise physicians’ decisions about the care of individual patients or the safety of subjects involved in medical research.

2. Because the integrity of scientific knowledge directly affects patient care, physicians’ medical information must be free of bias generated by financial entanglements.

3. The profession must be accountable for insuring that undue commercial influence does not make the cost of care so high that it excludes many from receiving it.

4. We must aspire to the ideal of eliminating financial entanglements, but if physicians cannot or will not, we must have clear and enforceable methods that protect patients and complete disclosure about the conflicts.” 5

As the profit-driven ties continue to grow between physicians, their organizations and industry, we need to harken back to the traditional values of these early leaders of the medical profession: 

Medicine is at heart a moral enterprise and those who practice it are de facto members of a moral community. We can accept or repudiate that fact, but we cannot ignore it or absolve ourselves of the moral consequences of our choice. We are not a guild, business, trade union, or a political party. If the care of the sick is increasingly  treated as a commodity, an investment opportunity, a bureaucrat’s power trip, or a political trading chip, the profession bears part of the responsibility.6

—Edmund Pellegrino, M.D., physician, ethicist, moral philosopher, founder and director for many years of Georgetown University’s Center for the Advanced Study of Ethics.

References.

1) Meyer, H. Concerns grow as private equity buys up dermatology practices. Modern Healthcare, July 24, 2017.

2) Bruch, JD, Borsa, A, sopng, Z et al. Expansion of private equity investment in women’s health care. JAMA Internal Medicine, August 24, 2020.

3) O’Donnell, EM, Lelli, GJ, Bhidya, S et al. The growth of private equity investment in health care: Perspectives from ophthalmology. Health Affairs 39 (6), June 2020.

4) Jewett, C. National Academies’ report took Pharma-friendly stance after millions in gifts from drug-makers. Kaiser Health News, August 12, 2021.

5) Kassirer, JP. On the Take: How Medicine’s Complicity with Big Business Can Endanger Your Health. Oxford: New York: Oxford University Press, 2005, p. 61.

6) Pellegrino, ED. The medical profession as a moral community. Bull NY Acad Med 66 (3): 222, 1990.

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