3 posts tagged “business”

By GARDINER HARRIS
The New York Times
Published: April 28, 2008

Drug and medical device companies should be banned from offering free food, gifts, travel and ghost-writing services to doctors, staff members and students in all 129 of the nation’s medical colleges, an influential college association has concluded.

The proposed ban is the result of a two-year effort by the group, the Association of American Medical Colleges, to create a model policy governing interactions between the schools and industry. While schools can ignore the association’s advice, most follow its recommendations.

Rob Restuccia, executive director of the Prescription Project, a nonprofit group dedicated to eliminating conflicts of interest in medicine, said the report would transform medical education.

“Most medical schools do not have strong conflict-of-interest policies, and this report will change that,” Mr. Restuccia said.

The rules would apply only to medical schools, but they could have enormous influence across medicine, said Dr. David Rothman, president of the Institute on Medicine as a Profession at Columbia University.

“We’re hoping the example set by academic medical colleges will be contagious,” Dr. Rothman said.

Drug companies spend billions wooing doctors — more than they spend on research or consumer advertising. Medical schools, packed with prominent professors and impressionable trainees, are particularly attractive marketing targets.

So companies have for decades provided faculty and students free food and gifts, offered lucrative consulting arrangements to top-notch teachers and even ghost-wrote research papers for busy professors.

“Such forms of industry involvement tend to establish reciprocal relationships that can inject bias, distort decision-making and create the perception among colleagues, students, trainees and the public that practitioners are being ‘bought’ or ‘bribed’ by industry,” the report said.

A group of influential doctors decried these practices in a 2006 article in The Journal of the American Medical Association, and said that medical schools should ban them. In the article’s wake, the medical college association created a task force.

With Dr. Roy Vagelos, a former Merck chief executive, serving as the task force’s chairman and the chief executives of Pfizer, Eli Lilly, Amgen and Medtronic on the roster, some who advocate for greater restrictions on industry influence in medicine predicted that the report would be weak.

They were wrong.

In addition to the gift, food and travel bans, the report recommended that medical schools should “strongly discourage participation by their faculty in industry-sponsored speakers’ bureaus,” in which doctors are paid to promote drug and device benefits.

It recommended that schools set up centralized systems for accepting free drug samples or “alternative ways to manage pharmaceutical sample distribution that do not carry the risks to professionalism with which current practices are associated.” It suggested that schools audit independently accredited medical education seminars given by faculty “for the presence of inappropriate influence.” And it said the rules should apply to faculty even when off-duty or away from school.

Speakers’ bureaus and drug samples are pillars of the industry’s marketing operations, and many medical school professors have resisted efforts to restrict them. Only a handful of medical schools presently bar faculty members from serving on speakers’ bureaus, so if this recommendation is widely adopted, it could transform the relationship between medical school faculty and industry, and it could change substantially the way medical education is routinely delivered.

Indeed, the chief executives of Pfizer and Eli Lilly dissented from the report’s recommendation regarding speakers’ bureaus.

“We continue to believe that these types of programs, which are subject to clear regulations regarding their content, can be worthwhile educational activities,” wrote Jeffrey B. Kindler of Pfizer and Sidney Taurel of Lilly.

David Beier, an Amgen senior vice president, wrote a letter that endorsed the report’s recommendations but disagreed with some of its text “because we have a different view about the accuracy concerning representations about the motives of the participants in industry-academic interactions.”

Ken Johnson of the Pharmaceutical Research and Manufacturers of America, said his group would review the report.

“Providing physicians — and medical students — with timely, accurate information about the medicines they prescribe clearly benefits patients and advances healthcare throughout the United States,” Mr. Johnson said.

Dr. Robert J. Alpern, dean of the Yale School of Medicine, said that the university presently had no limits on participation in company speakers’ bureaus, but that because of the medical college association’s report he was thinking of taking them on.

“I don’t have a problem with doctors making $3,000 or $5,000 a year on the side,” he said, “but it’s a totally different thing when it’s $80,000.” Even more distasteful, Dr. Alpern said, is that the slides used in many of these presentations are created by drug makers, not the speakers.

“That’s like ghost-talking,” Dr. Alpern said.

Dr. Arthur S. Levine, dean of the University of Pittsburgh School of Medicine, said that when he graduated from medical school in 1964, Eli Lilly gave him his first doctor’s bag, and Roche gave him an Omega watch for being valedictorian. He still has the watch.

But this year’s graduating class of doctors at Pittsburgh will not be allowed to accept any of these gifts, and the daily pizza lunches brought by drug companies are gone, he said.

Julie Gottlieb, assistant dean of policy coordination for Johns Hopkins University School of Medicine, said Hopkins had adopted some of the association’s recommendations and was considering others.

“This report is bound to influence our deliberations,” she said.

Dr. Vagelos, formerly of Merck, said that the report’s recommendations were certain to face resistance among faculty who liked the present system.

“The outcome of this for the industry is that those companies that are strong in science will always be welcome at medical colleges and others won’t,” Dr. Vagelos said.

By JEWEL GOPWANI
FREE PRESS BUSINESS WRITER
March 5, 2008

American Axle & Manufacturing Inc. and the UAW agreed to resume contract talks at noon on Thursday, the company said in a statement this morning.

This would be the first time that the two sides have scheduled formal talks since 3,600 UAW-represented American Axle workers went on strike Feb. 26 protesting the company's proposed reductions for wages and benefits.

American Axle has said it needs concessions to compete with its rivals, which include in-house axle operations at automakers.

Well, those "concessions" should not involve halving your workers' pay and benefits!

By AOIFE WHITE
27 Feb 2008

BRUSSELS, Belgium (AP) — The European Union's longest-running fight with Microsoft Corp. neared an end Wednesday as regulators imposed a record $1.3 billion fine on the world's largest software company for failing to fully comply with a 2004 antitrust order.

Microsoft has not decided whether to appeal the penalty, which amounts to a fraction of the $14.07 billion it earned in fiscal 2007. In all, the company has been fined just under $2.4 billion by European antitrust regulators over the years.

Barring an appeal, the fine shuts the door on an investigation into Microsoft's behavior that was triggered by a 1998 complaint by Sun Microsystems Inc. It alleged Microsoft was refusing to supply information that servers need to work with its market-dominating Windows operating system.

Microsoft eventually made the information available to rivals, but the EU said it charged "unreasonable prices" until last October.

EU Competition Commissioner Neelie Kroes said Microsoft now appears to have finally complied with the 2004 EU antitrust order. But she warned that the company was not yet in the clear because the EU last month launched new probes into its Office software and Windows' Internet browser.  

She also was skeptical over Microsoft's announcement last week that it was further expanding its efforts to make its software work better with rival technologies. A news release, she said, "does not necessarily equal a change in business practice."

"Talk is cheap. Flouting the rules is expensive," she said.

Wednesday's penalty far outweighs the next biggest fine — $613 million imposed on Microsoft for using its role as the world's leading supplier of desktop software to elbow into new markets for workgroup servers and media players.

Fines — which can hit as much as 10 percent of company's global yearly revenue — are paid into the EU budget which pays out farm subsidies and research grants. The European Commission claims antitrust fines ultimately help reduce the financial burden on European taxpayers.

Microsoft earned $14.07 billion on $51.12 billion in worldwide sales during its last fiscal year that ended June 30.

"We could have gone as high as €1.5 billion," Kroes said, referring to an amount equal to about $2.2 billion. "The maximum amount is higher than what we did at the end of the day."

Microsoft's actions stifled innovation, hurting millions of people who use computers in offices around the world, she said, calling the fine "a reasonable response to a series of quite unreasonable actions."

The software titan fought hard against the EU's 2004 decision that ordered it to share interoperability information with rivals and sell a version of Windows without media software, taking an appeal to an EU court that it lost last September.

It was fined again in July 2006 — $357 million — for failing to obey that order.

The EU alleged that Microsoft withheld crucial interoperability information to squeeze into a new market and damage rivals that make programs for workgroup servers that help office computers connect to each other and to printers and faxes.

The company delayed complying with the EU order for three years, the EU said, only making changes on Oct. 22 to the patent licenses it charges companies that need data to help them make software that works with Microsoft.

Microsoft had initially set a royalty rate of 3.87 percent of a licensee's product revenues for patents and demanded that companies looking for communication information — which it said was highly secret — pay 2.98 percent of their products' revenues.

The EU complained last March that these rates were unfair. Under threat of fines, Microsoft two months later reduced the patent rate to 0.7 percent and the information license to 0.5 percent — but only in Europe, leaving the worldwide rates unchanged.

The EU's Court of First Instance ruling that upheld regulators' views changed the company's mind again in October when it offered a new license for interoperability information for a flat fee of $14,900 and an optional worldwide patent license for a reduced royalty of 0.4 percent.