Patient Protection in the Era of the Doctorpreneur

Amelia Edwards & Maryse Suppiger
October 25, 2018

Patient Protection in the Era of the Doctorpreneur

The term “doctorpreneur” has been coined by the media to refer to the ambitious group of doctors who are disrupting the healthcare industry with innovation solutions to pervasive problems. Over the years, the medical community has earned its place in the startup world, proving that it’s not just computer scientists and engineers who can innovate in the 21st century. In the past 20 years, the number of joint MD-MBA programs in the United States has grown from just 6 programs to more than 70. Even those without an MBA degree are finding the allure of the business and tech world intriguing and have sidelined their professional medical practices to pursue healthcare business ventures.

The concept of having doctors design health tech solutions for fellow clinicians makes perfect sense on many levels. No one has better insight into the needs of clinicians and patients than medical professionals themselves, as they are the individuals who regularly experience the challenges these solutions seek to overcome. The perspective that doctors hold in regards to the inner workings of the healthcare system is one which even an experienced business professional is unlikely to ever gain.

With this in mind, doctors, such as Dr. M. Christine Stock, Professor of Anesthesiology at Northwestern Feinberg School of Medicine, have publicly voiced their concern with the business and technology industries failing to consult clinicians when designing clinical products. In her open letter to the health-tech industry, Dr. Stock explains that leaving medical professionals out of the IT design process leads to issues with workflow in the clinic. If doctors are innovating for themselves, products are more likely to successfully meet the needs of users, explains Dr. Stock.

Dr. Stock is right. Physicians do need to be intimately involved in the creation of products for a clinical setting. However, while the success of the physician-founded startup is promising, it also introduces new challenges to patient protection. This new frontier introduces greater complexity to questions surrounding physicians involvement with business endeavors, and specifically, how doctors balance corporate financial and advisory roles alongside their role as unbiased care providers.

Fallout from the Memorial Sloan Kettering & Paige.AI Dealings

One of the most recent examples of the frontiers of patient care and technology questionably colliding is investigative journalists’ Charles Ornstein and Katie Thomas recently-broken story detailing Memorial Sloan Kettering’s (MSK) financial relationship to the pathology startup Paige.AI.

Paige.AI uses artificial intelligence to develop disease modules that will enable pathologists to scale and digitally complete tasks ranging from rapid stratification to tumor detection, segmentation, and prediction of treatment response and survival. Their mission is commendable, but trouble began brewing for this startup when the New York Times revealed that the startup had an exclusive deal to use the MSK’s archive of 25 million patient tissue slides, in exchange to 9% equity. Additionally, one executive board member, the Chairman of Pathology, and the head of one of MSK’s research laboratories all have equity in Paige.AI.

Image from Paige.Ai

Prior to entering this agreement, MSK did not seek an independent valuation of their tissue archive, nor did they put the proposal out for competitive bidding before licensing it to a single company. With MSK being ranked as one of the top cancer centers in the world and thus having information on thousands upon thousands of different cancer cases, this fact is incredibly troublesome when considering the competitive advantage given to this singular digital pathology company without proper market competition. Pathologists themselves who work at MSK had issues with the transaction and felt like MSK’s business leaders, and the startup, were improperly profiting from their medical work.

And as if the Paige.AI scandal wasn’t enough controversy for Memorial Sloan Kettering, their former Chief Medical Officer, Dr. José Baselga, just recently resigned from his position at MSK amidst controversy over his financial involvements in various health and drug companies, most notably Roche. Furthermore, Dr. Craig B. Thompson, President of Memorial Sloan Kettering, resigned from two company boards, Merck and Charles River Labs, following the breaking news of his $300K and $285K payments respectively. These additional troublesome instances of improper disclosure broke open a conversation both within MSK and the larger hospital ecosystem about the need to scrutinize investment and public disclosure policies, before allowing their staff to engage with medical business corporations and startups.

The morally-ambiguous mixing of money and medicine is not a novel concept, but one that appears to once again be heightened by the 21st century technology boom. Medical companies, most notably pharmaceutical companies, have paid physicians to prescribe and endorse their medications for decades. For example, Purdue Pharmaceuticals, who is known for pushing OxyContin, pays medical professionals $2,000 per speaking engagement to promote the efficacy of their drugs, specifically opioids. In 2017 alone, Purdue paid medical professionals over $1.9 million in total.

Physician payments extend well beyond pain-management medications. In the A.D.H.D. medication market, pharmaceutical producers such as Shire, pay physicians, like Dr. William Dodsen, a psychiatrist from Denver, $2,000 or more for each individual speaking engagement promoting the efficacy of their medications. Dr. Joseph Biederman, a psychiatrist at Massachusetts General Hospitals and another prominent A.D.H.D. “maven”, has been paid a total of over $1.6 million dollars by multiple A.D.H.D pharmaceutical producers. These numbers are staggering. In the 21st century, Big Pharma will pay just about any price for doctors to write a prescription of their drug. This is why the federal government established laws such as the Sunshine Act, a component of the Affordable Care Act, to try to temper the outrageous conflicts of interest brewing between physicians, pharmaceutical companies, and patients.

This historical legacy leads to a question of grave importance: how can we prevent financial exploitation and negligence toward patient security in the health technology sphere?

The Current CMS Open Payments Data Set

While the payments mentioned are examples of egregious ethical violations of a physician’s duty to unbiasedly provide the best medical care to patients, direct doctor payments are not the same as the inside investments seen in the MSK case and not all doctors are being unethical in their dealings. Patients who are concerned about potential payments made to doctors can access the Open Payments Data developed in 2013 by the Centers for Medicaid and Medicare Services (CMS) to see if someone is paying their physician to endorse a specific drug or medical device. While the ethicacy of physician payments is still questionable in some cases, at least patients have some sort of access to this information, even if it is poorly publicized.

Open Payments Data site allows patients to see which companies are paying their care providers & the amount the payment is worth.

This is not the case, however, for advisory relationships that physicians may have with health technology startups or for many instances where they have been given equity by these companies.

The MSK scandal illuminates the need for CMS to expand the Open Payments Data database of published information and the definition what is required to be reported to the site. Currently, payments which are recorded include: consulting fees, speaking fees, training fees, honoraria, gifts, travel & lodging, food & beverage, education, research, charitable contributions, royalties, compensation for serving as faculty, grants, current or prospective ownership or investment interest, and space rental & facility fees.

Let’s pull out the key element there: current or prospective ownership or investment interest.

So yes, deep within this database there is some record of stock ownership, but the level of reporting and depth provided regarding these stock options merely scratches the surface and is often inconsistent.

The Complete 2017 Program Year Open Payments Dataset, for example, includes 2,360 reported entries for stock ownership by physicians across the country. However. only applicable manufacturers and applicable group purchasing organizations (GPOs) are required to report certain payments and other transfers of value given to physicians and teaching hospitals to Open Payments. This means that many independent practices and private physicians who are not part of a GPO are left out of this data set. Furthermore, if you are a physician who is under a GPO, but does not have any ownership in the GPO you are not required to have data reported regarding transactions.

For example, if we go back to our earlier discussion about Memorial Sloan Kettering, a search of Dr. David Klimstra, the Chairman of the Pathology Department who had equity in Paige.Ai, within the Open Payments Data System, reveals no record of ownership or investment, which we know is inaccurate. This potentially could have occurred if he had been been paid for employment with Paige.Ai via stock options, which would not necessitate reporting, however patients should still have a right to know that this occurred. While a singular example, this brings into question the number of these equity relationships which are being accurately reported, captured, and audited.

Another major red flag is that advisory relationships which do not involve equity transactions also do not fall under reporting requirements, yet these relationship definitely still have a large potential to impact a physician’s medical suggestions. CEO positions and other executive roles in startups additionally are nowhere to be found within this dataset.

Open Payments Data page for Dr. David Klimstra, Founder & Advisor of Paige.AI and Chairman of Pathology at Memorial Sloan Kettering. Open Payments Data uses vague graphs, and makes no mention of Klimstra’s affiliations or the stake he had in Paige.AI. Unclear and incomplete information leaves patient protection at the mercy of questionable financial decisions by healthcare providers.

A New Path Forward for Greater Transparency & Ease of Access

Not only should patients have access to information surrounding the direct payments their doctors are receiving, patients should be entitled to all data around the financial relationships between physicians and any business entity operating within the medical space. All investments and other financial affiliations should be accessible and apparent. CMS says that their Open Payments Data “means different things to different people and audiences” and that it is a great way for patients, consumers, and the public to learn about the relationships between physicians and applicable manufacturers and GPOs. Patients are then encouraged to discuss these relationships with their health care providers.

However, is this Open Payments Data method of disclosure really appropriate for all patients? Physicians and medical leadership should be required to reveal their personal financial ties and potential conflicts of interest in an easy manner that does not require extensive searching and advanced research skills. Many departments in Health and Human Service such as the National Institutes of Health, the Agency for Healthcare Research and Quality, and the Centers for Disease Control have standards and guidelines around presenting information individuals need to make decisions regarding their health in a clear manner. Considering that 1 out of every 6 American adults lacks basic reading skills, it is imperative that all information regarding patient health and safety is easily accessible for all subsets of the population.

Open Payments Data is unnecessarily complex. Even if a patient can find Open Payments Data to begin with, navigating through its vague graphs, figures, and advanced terminology practically requires a college degree. This is not an accessible format for patients who do not have advanced reading and comprehension skills, struggle with computer literacy, and/or who are ESL. Preventing patients who struggle with English reading and comprehension from accessing information regarding their care is a violation of their inherent right to access available information in an appropriate and easy manner so that they can make fully informed health decisions.

Open Payments Data is a step in the right direction towards transparent, honest financial practices in the healthcare community, but it simply is not expansive enough. In the wake of the digital health boom, concerns around medical professionals striking deals within the business world have expanded. We need to adapt programs such as Open Payments Data in response to this. The degrees of separation between the clinical and corporate sides to health have been reduced from very few, to practically none.

Although physician-founded startups introduce new challenges to the healthcare space, it is incredibly exciting to see physicians jump into the health-tech world. At Junto, we have the opportunity to interview physicians and medical professionals who have founded successful startups. We find it necessary to note that we have yet to encounter a physician whose motivation to found or advise a startup seemed morally questionable. Their passion and desire to better lives through sustainable healthcare solutions has always been genuine. Nevertheless, we as a society must be cautious and have safeguards in place to prevent misrepresentation and lack of transparency around health technology development and use.

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