Insider trading versus medical professionalism

Insider trading versus medical professionalism

Editorial Lawmakers in the USA are calling for federal investigations of allegations that medical researchers are sharing confidential clinical trial ...

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Lawmakers in the USA are calling for federal investigations of allegations that medical researchers are sharing confidential clinical trial data with investment analysts, who then use that information to beat the market. In an investigative report published last month, reporters for The Seattle Times identified 26 cases in which doctors allegedly leaked information about unreleased drug-research findings to investment analysts. The confidential information would have allowed a select few investors to buy or sell stock days, and even months, before the research results were released to the public. The leaks, the paper said, may have violated not only confidentiality agreements the researchers signed with trial sponsors, but also insider trading laws. In a response to the paper’s report, Senator Charles Grassley, a Republican from Iowa and head of Senate Finance Committee, has called for an investigation by the US Department of Justice and the US Securities and Exchange Commission. In recent years it has become common for US doctors to work as consultants to brokerages, hedge funds, and investment research groups. Some serve on the advisory boards of investment firms, but many sign up with “matchmaker” firms that link investment analysts with experts in a wide variety of fields. Doctors typically earn US$200–1000 an hour for their time. By one estimate, more than 75 000 US doctors have signed up to work as consultants, roughly one in ten, although the proportion is likely to be higher among academic researchers, whose expertise is more highly valued. It is not surprising that investors would want to “pick the brains” of medical experts. Health care comprises roughly 15% of the US economy: there are fortunes to be made—and lost. Before investing, it makes sense to talk to doctors who have the scientific background and clinical experience to judge which new drugs and medical devices are likely to succeed and which are not. Doctors who serve as consultants say they do not provide confidential information but just pass on what is generally known in the field. And officials from “matchmaker” firms say they require experts who want to be consultants to promise they will not violate any confidentiality agreements they have already signed. But researchers have access to a vast amount of confidential information: they have, of course, their own Vol 366 September 3, 2005

research, about which they are likely to have signed confidentiality agreements; but they also chat about ongoing research with colleagues at work and at conferences; they assess protocols from other research groups for granting agencies; and they participate in peer review of confidential manuscripts for journals. To let slip confidential information in a meeting with analysts would be very easy. Indeed, one analyst boasted to The Seattle Times how easy it was to pry information out of researchers. This analyst claimed to have studied elicitation techniques used by police and intelligence interrogators. “We get them to talk about the weather, or the Mariners [the Seattle baseball team], then you pop in your one innocent question you want to know about”, he is reported to have said. “Then you switch back to whatever it was you were talking about before. When the doctor hangs up, he thinks he’s had a nice conversation about the weather or the Mariners.” In fact, simply refusing to answer a question can often give the answer the questioner is seeking. Researchers who decide to be consultants to investment firms and investment analysts are clearly treading a fine line. Those that choose to be consultants must at the very least fully disclose their consultancies to their institutions and the sponsors of their research and when they present, discuss, or publish their data. Medical research institutions should also examine their regulations and decide whether they should allow such relationships and whether stricter regulation is necessary. At the very least, full disclosure should be required and mechanisms must be in place to determine if the relationships present a conflict of interest with a researcher’s scientific work. We would hope that medical researchers consider carefully whether consulting for investment firms is in the best interests of science and medicine. Yes, it can be argued that helping investors make informed decisions helps bring funds to promising research. But as science and business appear to become more inextricably linked, the assertion that the primary goal of scientific research is to find the truth becomes less convincing in the eyes of the public. Researchers tempted to become consultants for investment firms should ask themselves whether the fees are worth that price; we suggest they are not. ■ The Lancet

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Insider trading versus medical professionalism