Doctor paid millions… This is a statement we have seen in newspapers across the country about the difference in what a Wisconsin doctor was required by his university to disclose (which met all the standards of the university), and the payments he received in royalties, which were much higher than the $20,000 disclosure requirement.
At the heart of this story though, is a tale of judicial intrigue, that one would normally expect to find in a John Grisham novel.
This is not a case of a doctor gone wrong but of: (i) a trial lawyer who refused to be part of a settlement complaining it was too low; (ii) being rejected by the Justice Department for being a copycat complaint and later attempting to revive a whistle blower case by suing the physicians involved; and (iii) using complaints to Congress to discredit potential witnesses and bolster his case.
This is also a tale of a pair of U.S. Senators from different political parties competing for recognition and articles in major newspapers, by sending letters to physicians, institutions, and manufacturers.
First the facts:
- Doctor Zdeblick, M.D., Chief of Orthopedic Surgery at the University of Wisconsin, according to records published by Senator Grassley, received over to $19 million in royalty payments from Medtronic for products he holds patents for during the last five years (2003-2007). The products include the Medtronic Z Plate, which according to Dr. Zdeblick, can replace a broken segment of the spine and allow people who are partially paralyzed to walk, and the Novus LT Cage, which allows surgeons to fuse bones in the lower spine better than traditional surgery.
- Doctor Zdeblick, reported every year, of his relationship with industry according to the form provided by the University of Wisconsin with categories of greater than $5,000, $10,000, and $20,000.
- According to Doctor Zdeblick and the university, he currently discloses to his patients that he receives royalties and consulting fees in writing. He gives patients a form that explains he that he does consulting and product design.
- According to Doctor Zdeblick and the university, he receives no royalties from his inventions for those that are purchased from University of Wisconsin.
- Senator Grassley sent a letter (January 12, 2009, which was shared with the press) to the President of University of Wisconsin outlining what Medtronic had reported paying Dr. Zdeblick, in royalties and consulting fees and a graph showing the difference between what he was required to report and what he actually received. Along with quotes from a journal article from Dr. Zdeblick, in which Dr. Zdeblick stated that: “The individual decision to perform surgery on a patient, and which implant to place in that patient, should not receive any royalty for that implant and not have substantial >5% ownership interest in the implant company.” “Under an appropriate conflict of interest plan, any investigator who has substantial financial ties to an industrial sponsor must disclose those ties to individual patients.” The Senator requested the number of implants on specific Medtronic devices since January 2006, and if there had been patient disclosure and a copy of each disclosure form.
- As a result of a whistle blower complaint and articles in The New York Times and The Wall Street Journal, Senator Kohl (Wisconsin), sent a letter to Medtronic (September 30, 2008) with this request: I am also aware that your company provided a considerable volume of internal documents to the Office of Senator Charles Grassley (R-IA), who is a co-sponsor of the Sunshine Act, and whose staff also is investigating these matters. My staff informs me that at meetings with your firm last year, the Committee's oversight staff asked Medtronic officials and lawyers to provide us with copies of some or all of the documentation provided to Senator Grassley, but that request was not substantively followed up by your representatives.
- A follow-up whistle blower suit (September 2008) was filed by former Medtronic attorney, Ami P. Kelly, of which the allegations were discussed in a 2002 lawsuit, and was settled for $40 million dollars with Medtronic. The attorney wants the case reopened and is requesting additional settlement payments. (Whistle blowers can make up to 30% of the settled claims (Forbes 3-14-05)). Her claims included that Medtronic’s Spine Unit, based in Memphis,TN, paid for physicians' tabs at a strip club. This was reported as news in the press, but a search revealed a 2006 article in The New York Times also made the same allegations (NY Times January 24, 2006). Medtronic filed a letter to The Wall Street Journal outlining the Qui Tam connection and the changes that have been made at the company since the 2006 settlement.
- An unusual whistle blower suit was filed in U.S. District Court of Massachusetts, against 140+ physicians, group practices, and others who worked with Medtronic by former Medtronic employees Jacqueline Kay Poeteet (Travel Department 1995-2003), and Bobbie Vaden (Accounting Department 1991-2007). As outlined in the This Week in Orthopedics, Dr. Zdeblick was not named as a defendant but his role as a witness for Medtronic is in the original Medtronic Settlement and outlined in the lawsuit. Dr. Zdeblick is mentioned by name five times in the suit. By moving the venue from Memphis to Boston, the attorneys are positioning their case so that the U.S.government will join them.
- Senator Grassley asked Medtronic for its record of payments from 2003-2007 made to spine physicians (September 27 2007) since the $40 million dollar settlement for previous years. The investigation was initiated at the pleading of Andrew Carr, J.D., attorney for Jacqueline Poeteet from MemphisTennessee who stated “he alerted members of Congress to what he sees as inadequate investigation of his client’s claims by the Justice Department.”
- A $40 million settlement between the government and Medtronic was challenged in U.S. Court by Andrew Carr, and his client, Medtronic’s former Travel Manager, Jacquelyn J. Poteet. Mr. Carr was warned by the Justice Department that his client’s status in the case “might be challenged” which was precisely what happened. Federal officials sought dismissal of “Ms Poteet’s suit, because it essential made the same accusations as the first whistle blower’s lawsuit.
- The Government settled for $40 million in the Medtronic Spine Case (July 18, 2006), and two of the four Qui Tam lawsuits were dismissed by the Justice Department as copycat cases.
- Some sealed documents from the Qui Tam lawsuit against Medtronic were unsealed (January 2006) and revealed the extent of payments to doctors. In a February 2006 article in The Milwaukee Journal, it outlined the results of unsealed documents as it pertained to Dr. Zdeblick’s relationship with Medtronic .
There are several interesting subplots to this investigation:
- Attorneys working for whistle blowers in false claims acts cases have significant influence on what Congress, specifically Senators Grassley and Kohl, investigate.
- These false claims (Qui Tam) attorneys have a vested interest in promoting “transparency of payments to healthcare providers to help bolster their cases.”
- Despite having this information for over one year, Senator Grassley chose, as his first physician and institution to complain about the conflicts of interest policies in the Medtronic investigation, the University of Wisconsin, which also happens to be the same state as the co-sponsor Senator Kohl of the Physician Payment Sunshine Act. Senator Kohl is conducting a similar investigation of Medtronic and spine surgeons and even complained that Medtronic was more cooperative with Grassley than himself.
Some of the practices described in the Qui Tam cases are deplorable, but Medtronic was prosecuted and settled for $40 million in 2006. They paid for their sins.
In the interest of reviving their cases, attorneys for whistle blowers, are successfully using Congress and the media to advance their cause. This includes discrediting key defense witnesses by getting unfavorable articles about them discussed in the media.
For physician inventors like Dr. Zdeblick being “outed” in the national press may be discouraging for young investigators who in the future may not go through the hassel of (out of fear) new patented products which would have help thousands of patients with those devices.
Universities are bins of jealousy, these types of stories help to build contempt among the faculty and discourage medical students from participating in academic medicine. If money and prestige are not there, the young doctors will simple go into private practice to avoid having to put up with the “politics.”
Are we not better off when patients no longer suffer from their ailments due to the thousands of inventions that U.S. physicians have helped to create? Is it not better for the innovation to happen here than in China and India where our economy will see no benefit at all from the innovation?
Though universities like Wisconsin do not necessarily have the best reporting structures, as Dr. Zdeblick stated: “If people think that to do that (manage conflicts), that you need to put the exact amount, I’m fine with that.”
References
Senator Grassley Letter to President, University of Wisconsin 1-12-09
Letter to CEO, Medtronic 9-20-2007
Senator Kohl Letter to CEO, Medtronic 9-30-08
Forbes: The Dark Side of Whistle Blowing
Articles on Letter from Senator Grassley to University of Wisconsin President
Wisconsin State Journal: UW Hospital surgeon properly received millions from medical company
Milwaukee Journal Sentinel Medical device maker paid UW surgeon $19 million
Wall Street Journal Blog Medtronic Pays Surgeon ‘$20,000 or More’ — Much, Much More
Wall Street Journal: Medtronic Paid Researcher More Than $20,000 — Much More
News Inferno: Medtronic Paid Researcher $19 Million to Develop, Promote Infuse Bone Graft, Other Products
Older Reference Articles
This Week in Orthopedics: Physicians Targeted by Whistle Blowers (July 31 2008)
US District Court of
Massachusetts
: Poeteet and Vaden vs Defendants (July 2008)
Medtronic: Letter to Wall Street Journal (October 2008)
New York Times: Medtronic Again Questioned Over Payments to Physicians is Subject to Senators Probe (September 27, 2007)
Whistle Blower Suit Says Device Maker Generously Rewards Doctors (January 24, 2006)
Forbes: The Dark Side of Whistle Blowing (March 14, 2005)
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