FDA Spygate -- New revelations challenge the New York Times investigation of agency "enemies list," raise more questions about the 'government's most dysfunctional agency'

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U.S. Food and Drug Administration scientists evaluate the safety and effectiveness of new therapeutic technologies and devices including medical therapeutic lasers, fiber-optics and new therapeutic monitoring and bio-sensing systems

Article Highlights

  • The FDA is reeling with accusations of an email surveillance program and dysfunctional regulatory practices.

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  • The case exposed the underbelly of what some critics believe is one of the more dysfunctional regulatory agencies.

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  • It may take the November #election to see what direction the staggering FDA will take.

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The Food and Drug Administration and its Center for Devices and Radiological Health (CDRH) is reeling.  In mid-July, the New York Times accused the FDA of creating a massive email surveillance program designed to net junior scientists and other critics who complained the agency was too quick to approve medical devices that the employees maintained posed unacceptable health risks.

The Times’ story generated national headlines with its sympathetic portrayal of harassed scientists risking their careers to protect the public interest. But new revelations suggest the Times slanted the story by leaving out critical context. It appears that dissident employees are involved in what could be seen as an ambulance chasing shakedown scheme to profit from their allegations. In December 2009, while these “aggrieved” reviewers were publicly lobbying the FDA and Congress to crack down on scanning devices, they had secretly filed a whistleblower lawsuit against these very same manufacturers that if successful could make them multi-millionaires.

The case has exposed the underbelly of what some critics believe is one of the more dysfunctional regulatory agencies in the federal government.

The July New York Times story was a follow up to a 2010 Times report, based on leaked confidential documents supplied by the junior staffers, accusing the agency’s senior officials of ‘brushing aside’ the potential dangers of mammography and colonoscopy devices in a rush to approve a CT scanning device made by General Electric.

The dispute began less publicly in 2006, when a consultant reviewer, Robert Smith, a controversial radiologist formerly at hospitals operated by Yale and Cornell, and several center employees raised concerns that the agency was overlooking safety concerns in approving substandard medical imaging devices for mammograms and colonoscopies. The agency reviewed and rejected their concerns in 2006 and 2008.

Angered when their recommendations were overruled, and just months after quietly filing their whistleblower suit, the dissident group took the matter into their own hands. In early 2010, they began leaking confidential documents to various media outlets, most notably the Times, which came out with its first exposé in March of that year under the headline “Scientists Say FDA ignored Radiation Warnings”.

"But some junior scientists, convinced that current laws make it nearly impossible to block products they deem ineffective or dangerous, took the matter into their own hands." -Jon EntineFDA employees who review confidential trade secrets submitted by drug or device makers are prohibited from discussing any data before a regulatory decision has been made. But some junior scientists, convinced that current laws make it nearly impossible to block products they deem ineffective or dangerous, took the matter into their own hands.

Later that year, responding to appeals by Dr. Smith and by congressmen who the former reviewer had lobbied, the FDA, then under supervision of the Obama administration, again investigated the employees claims and found them wanting.

Concluding that the workers had violated agency confidentiality outlined in the Federal Food, Drug and Cosmetic Act, the FDA’s Office of the Inspector General (OIG) recommended that the agency take ”administrative action” against the leaders for talking to the Times.  Four employees were eventually dismissed. A fifth scientist was suspended, rehired on appeal, and then left the agency last month.

FDA, culture of dysfunction?

The ‘national paper of record’ and many activist groups are now portraying the self-proclaimed whistleblowers as beleaguered heroes and victims of an agency “enemies list” designed to muzzle public minded employees. They hint at a corrosive and corrupt culture inside the FDA that is captured by big business and limits the agency from encouraging dissent.

But now, as the backstory is coming into sharper focus, it appears that culture is far more nuanced. The FDA appears not so much closed as split between various factions, with a minority of junior scientists determined to push an ultra-aggressive regulation strategy even after higher level science reviews consider but reject their input. This grueling internal battle appears to have left the CDRH, the FDA office empowered to oversee innovative medical technology devices, including genetic tests, in disarray.

The latest Times piece coincided with a revised lawsuit filed last month by the dismissed employees pressing claims that the agency had violated their rights to free speech. The story claims that the FDA put spyware in place over the opposition of the inspector general at the Department of Health and Human Services, who, the article claimed, had “found that there was no evidence of a crime, noting that ‘matters of public safety’ can legally be released to the news media.

That appears to be a simplistic characterization of what looks like an internal war inside the agency. The Washington Post has since reported that at some point, the Office of General Counsel (OGC) at FDA became involved and authorized the computer surveillance.

The revelations have rocked the FDA, which has struggled in its ambition to extend its regulatory oversight. It’s been under almost constant fire since FDA Commissioner Margaret Hamburg pledged three years ago to aggressively expand the FDA’s manufacturing standards. Most recently in June, the House Oversight Committee released an in-depth report, detailing a dramatic drop in the production of generic injectable drugs. Since the campaign began, production of generic injectables declined by 30 percent, contributing to a massive shortage.

Hamburg and Jeffrey Shuren, the director of the Center for Devices and Radiological Health, also have stumbled in a ham-handed attempt, announced two years ago, to expand regulatory control over the genetic testing industry, also regulated by CDRH. That decision was a dramatic reversal for the agency, which until then had refrained from regulating laboratory-developed tests (LDTs).

LDTs represent thousands of tests manufactured by many hundreds of laboratories, and that does not even include direct to consumer (DTC) identity and ancestry tests. According to venture capitalists, medical technology startups are going out of business as they await FDA guidance that may take years before they are announced, if they are ever instituted.

The latest FDA black eye highlights an internal battle inside an agency struggling to balance a commitment to science with an intensely politicized decision-making process. As Steve Usdin reports in a superb deconstruction of the scandal in BioCentury, the origin of the dispute seems to reflect internal conflicts that often occur in agencies with many employees holding differing scientific and ideological agendas.

Science is rarely black and white, Usdin notes, and there will always be sha rp disagreements among staffers on any decision. The real issue, Usdin suggests, is the tension between whistleblowers who can play a critical role when there is genuine malfeasance and the possibility of junior scientists, motivated by ideology, money or both, trying to circumvent the legitimate responsibility of senior management to make final decisions.

“If junior staff can always go around senior management when there is disagreement, and successfully use politicians and the media to have decisions overturned, then junior staff are running the organization by default,” he writes.

The controversial Dr. Smith connection

The Times accounts ignored the key and controversial role played by Dr. Smith, the former CDRH reviewer, who has a long and notorious reputation for filing high profile medical device whistleblower suits. From 2006 to 2010, Dr. Smith was the point man for the dissident employees. In 2009, FDA officials took his public-safety concerns to the HHS Office of Inspector General. After two investigations, that office said that senior managers had followed FDA protocol in fairly evaluating the devices.

FDA officials subsequently brought in Kelly, Anderson & Associates Inc. to independently look further into Dr. Smith’s allegations. In a shock to the complaining scientists, the consulting firm found in December 2010 that it was Dr. Smith who “appeared to meet the criteria of creating a hostile work environment,” according to a copy of its report.

While those investigations were unfolding, in December 2009, the five employees and Dr. Smith filed a secret lawsuit against 15 medical device manufacturers, claiming violations under the False Claims Act. According to documentation uncovered by the Wall Street Journal, Dr. Smith, is well known as a “serial whistleblower.” Twice previously, while working at hospitals overseen by Yale and Cornell, he had filed federal whistleblower complaints that are almost identical to the current complaint. Smith would have landed a multi-million dollar payday if they had been successful. Both cases were dismissed although Smith did collect hundreds of thousand dollars from both universities to settle claims that he had been unfairly retaliated against for standing up for public safety.

The current suit seeks fines of up to $11,000 for each time the government was billed for a procedure using one of the devices. Based on the fact the government conducts millions of CAD mammograms per year—just one of the devices in question—the plaintiffs, if victorious, could collect as much as 25% of what could be a multi-billion dollar settlement.

Most legal experts view the current suit as far-fetched, although, as with the prior Smith suits, such high profile cases sometimes end in settlements of what amount to nuisance claims because of the high cost of litigation. The size of their potential legal jackpot may well have been a motivation for the self-proclaimed whistleblowers, who had filed the suit before they were canned, and then upped the ante by breaking government confidentially restrictions and leaking their dissident conclusions to the Times in 2010.

The FDA is sharply constrained from discussing its side of the story while the former employees are having a field day, aided by a compliant Times, activist groups and even some Congressmen. None of this rich detail appeared in either of the two “investigatory” reports by the Times.

Almost incomprehensibly, from a journalistic ethics perspective, the Times bit on the story two years ago without offering any of the personal, political and financial context and conflicts, and then doubled down this summer. Rather than brave dissidents, who defied the corrupt agency to protect the public—the Times’ overly simplistic narrative reinforced again last month—the rebels may be no more than run of the mill ambulance chasers.

The coming genetic screening regulation scandal?

Regardless, the fiasco is one more black eye for the beleaguered FDA. As Steven Grossman of HPS Group has written in his influential blog, FDAMatters.com: “There is no way that FDA can look good if it is seen as approving devices that should not be on the market, squelching internal scientific disagreements, pursuing vendettas against its employees, or interfering with the prerogatives of Congress and the Office of Special Counsel. In the face of all of this—the allegations and FDA unwillingness or inability to respond fully–it is hard not to worry about the agency. It is an institution that badly needs public and congressional support to do its job, especially when its responsibilities are growing and its budget isn’t.”

It’s not yet clear what this public blowup will have on the CDRH’s plan to regulate laboratory genetic tests. Until the summer of 2012, the FDA considered LDTs low risk. It had not enforced applicable in vitro diagnostic regulations because the tests had been developed, validated, and offered within single laboratories, targeted rare diagnoses or conditions and had been used by physicians within an institution and for treating their patients.

But the Wild West of personal genomics, brought on by the introduction of inexpensive saliva-based tests, changed the calculus. The FDA pointed to instances of exaggerated claims, poor controls and fraud, although it’s not clear whether these problems represented marginal businesses that pop up when a new industry suddenly emerges or were endemic. The FDA assumed the worst, and urged far tighter regulations, much to worry of the wider science community, which believed an emboldened FDA would squelch innovation.

The abrupt change in direction by the FDA sparked an uproar, as scientists inside and outside the industry voiced concerns that the agency was too much of a blunderbuss to oversee such a “disruptive,” innovation driven and fast changing industry. Confirming their skepticism, Director Shuren testified at a summer 2010 Congressional hearing that direct-to-consumer (DTC) genetic testing companies did no independent research. That was flat out wrong, and was widely seen as the government’s attempt to support what he called “traditional manufacturers” at the expense of cutting edge newcomers, which would cripple startups.

Over the course of the next year, questions were raised about whether the FDA even had the right to regulate LDTs. The agency heard from petitioners both for and against its Draft Guidance.

Roche, which has a well established in vitro fertillization business and faces the threat that entrepreneurial companies could erode its market share, went so far as to redline the proposed guidance, which if adopted would present even higher barriers to entry for startups—a brazen attempt at promoting “regulatory capture.”

Meanwhile, criticism poured in from more independent stakeholders. A joint letter from the coalition of the American Medical Association, American College of Medical Genetics, American Congress of Obstetricians and Gynecologists, American Society for Reproductive Medicine and the College of American Pathologists scored the FDA, noting that the proposed rules could create a stranglehold on genetic testing by established companies that “could create a barrier to patient access to physician-recommended LDTs.” The costs of these unnecessary regulations, they wrote, are “not insignificant, and would likely be passed to the patient, creating yet another barrier to access.”

The current model, the coalition concluded, works well and doesn’t warrant an extensive federal redo. “By requiring all companion diagnostics to be FDA-approved/cleared,” the joint petitioners wrote, “FDA is effectively ignoring a large number of tests that may perform better than those it clears/approves, and is stifling the innovation that drives development of those tests.”

A host of other organizations were as adamant in their rebuke of the FDA’s recommendations. “The restrictive implementation of national standards as proposed in the guidance document will have significant untoward consequences for transplant centers and patients, both programmatic and financial, and are likely to limit access to life-saving procedures,” wrote a coalition of transplant groups in a joint letter, left unsigned, because the authors feared retribution.

The Association of Public Health Laboratories, which includes the Centers for Disease Control and Prevention, starkly warned that if the FDA guidelines were strictly enforced, public health laboratories would lose their ability to identify and provide laboratory-based surveillance for many common diseases such as measles, pertussis, West Nile virus, TB and various viruses.

Stung by the intense negative reaction, the agency has pretty much hid in the weeds since then and never actually flexed its regulatory muscle. Now in the wake of the surveillance scandal, no one is sure in what direction the staggering agency will go.

Regulatory cliff?

There are some signs that the FDA, along with other federal agencies, may be holding off on near term initiatives, postponing several multi-billion dollar regulations until after the November election. Republicans believe and some Democrats hope that there will be a dramatic expansion in regulation next year if President Obama wins re-election.

What should the FDA do in the medical devices area, which could be the centerpiece for medical innovation for decades to come? Many people in the field believe the government would be best served by regulating with a velvet glove.

“Many consumers are going to want to know this information, and you don’t need a hospital to obtain it,” said Dr. Eric Lander, president and director of the Broad Institute, a genomic research center affiliated with Harvard University and the Massachusetts Institute of Technology.

Some long time skeptics of personal genomic testing, such as James Evans, professor of genetics and medicine at the University of North Carolina, who had previously categorized DTC tests as “relatively useless” and “entertainment” have changed their tune. “I think we’ve now entered an era where these direct-to-consumer offerings are beginning to have real medical relevance,” he said.

Concerns abound about whether the FDA, obsessed by its own dysfunctional decision making process, and pushed by activists (and sloppy reporting by influential media, such as the Times) will overplay its hand, as Margaret Hamburg, Jeffrey Shuren and an activist core within the agency wants. It’s not at all clear whether the agency fully grasps the dimensions of the DNA revolution.

Single Nucleotide Polymorphism (SNP) chip results are now commodities. With analytic software proliferating in the next few years the reality is that the market will probably begin to regulate itself. Services like Promethease, which is a tool to build a report based on your genomic information, will become common enough to provide people open source information. Other startups like openSNP, which allows anyone who has gotten a DTC test to publish their test results, offer anyone the chance to share their information with others. The government may just not be equipped to keep up with new developments in this field.

When viewed across the broad collection of things that our government oversees, it’s difficult to make a case that regulating direct-to-consumer genomic services or imposing new restrictions on LDTs is worth the time and expense and political heat. The concerns seem overheated; the results will not kill you. Far more potentially dangerous information can be Googled or searched on WebMD. And no regulation could stop anyone from looking overseas, to less restrictive shores, if they want to avail themselves of a LDT or DTC device or test.

It may yet take the November election to see in what direction the staggering FDA will head.

Jon Entine, founder of the Genetic Literacy Project, is Senior Fellow at the Center for Health & Risk Communication and the Statistical Assessment Service (STATS) at George Mason University. He has advised non-profit and private companies in the genetics industry, has held stock in companies and is member of Health and Human Services Secretary Kathleen Sebelius’ Carrier Screening Task Force.

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