Patently Conflicted: Medical Schools Have Gotten into the Health Technology Business in a Big Way, but in the Wake of Litigation, Institutions May Surface as Guilty of Conflicts of Interest

By Otrompke, John | University Business, February 2004 | Go to article overview

Patently Conflicted: Medical Schools Have Gotten into the Health Technology Business in a Big Way, but in the Wake of Litigation, Institutions May Surface as Guilty of Conflicts of Interest


Otrompke, John, University Business


On its surface, the ripples of development activity generated by the Bayh-Dole Act seem to know no containment. The 1980 act has spurred technological development and led to massive reinvestments by the country's universities. In the medical field, the policy preceded a wave of new pharmaceuticals development, with almost 400 new therapeutic agents in clinical trials in the field of ontology alone.

The field of healthcare, in fact, is of singular note with regard to the Bayh-Dole Act. Medicine may be the one field wherein the principles of Bayh-Dole hit the wall of controversy--a controversy which has become more pronounced as a number of voluntary standards have emerged which seem to cut against the grain of the federal Law.

It all has to do with conflicts of interest. Recent trends may indicate an inherent contradiction in the Bayh-Dole Act's policies, at least vis-a-vis medical care. For since a number of tragic deaths in the late 1990s, professional medical organizations have been devising conflict-of-interest rules for healthcare-related research, and in March 2003, the federal government followed suit with the publication by the U.S. Department of Health and Human Services (www.dhhs.gov) of a voluntary guidance on the subject. Last fall, the trend came full circle as the Association of American Medical Colleges (www.aamc.org) published its standards for institutional conflicts of interest in biomedical research.

Problem is, there are a lot of dollars attached to the patent interests in that research. According to the most recent license survey by the Association of University Technology Managers (www.autm.net), in the past 10 years, federal government research expenditures at U.S. hospitals and medical research institutions have nearly tripled, rising from just over half a billion dollars in 1991, to $1.47 billion in 2001. Patents filed by these institutions rose from 416 in 1991, to 1,212 in 2001, according to the survey.

American medical schools, some say, seem to have an inherent financial conflict whenever they host clinical trials on technology in which they hold a patent interest.

The Evolution of a New Standard?

Let's step back a bit, for a refresher course on the Bayh-Dole Act itself.

The 1980 Act gives research institutions the right to seek a patent interest in discoveries made with federal funds. Institutions generally proceed to license the technology at a fairly early stage, thereby garnering more investment dollars to conduct clinical trials (eventually, on human subjects), as a drug, device, or discovery gradually makes its way from the level of basic science all the way to the marketplace.

And the law places other requirements on those institutions which choose to patent a discovery funded with federal money, reminds William Tew, assistant provost and assistant dean at Johns Hopkins School of Medicine (MD). "It requires that we seek licensees, that we show preference for small companies; and that we share the income with the inventor, for the inventor's personal use," he says. "Like some other institutions, Johns Hopkins shares 35 percent of the net value with the inventor," he adds.

Still, it is because of this patent interest that some analysts theorize research institutions and their employees have a financial conflict of interest, which gives rise to two concerns in research: 1) the objectivity of the research itself, and 2) especially in the healthcare field, the protection of the human research subjects. Medical advances usually must undergo clinical testing on significant populations of human subjects before the FDA allows them to be marketed, but these clinical trials may be conducted at the patent-owning institution, at another institution, or independently by a "contract research organization" (CRO).

Since the tragic death of Jesse Gelsinger, a healthy teenager who participated in a gene therapy trial and died in 1999, it is the issue of human participant protection which has gotten the most attention.

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Patently Conflicted: Medical Schools Have Gotten into the Health Technology Business in a Big Way, but in the Wake of Litigation, Institutions May Surface as Guilty of Conflicts of Interest
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