Published 10/1/2008
Mary Ann Porucznik

Orthopaedists and industry: Working together—at arm’s length

One year later, uncertainty continues

This time last year, the orthopaedic industry was struggling to respond to the terms of a settlement reached by the US Attorney’s office for New Jersey (Department of Justice, DOJ) with five major orthopaedic hip and knee manufacturers. The settlements appear to have permanently altered the relationships between orthopaedic surgeons and industry. They continue to have a ripple effect in education funding, research, clinical care, and humanitarian efforts.

Under the settlements, the companies agreed to the implementation of several requirements designed to increase transparency in the relationships between industry and orthopaedic surgeons. Federal monitors were appointed to ensure compliance. As a result, a “new environment” is emerging, one whose parameters are still being defined.

Transparency and disclosure
Key elements of the new environment are transparency and disclosure. The DOJ settlement required that the five companies—Biomet Inc.; DePuy Orthopaedics, Inc.; Smith & Nephew, Inc.; Stryker Orthopaedics, Inc.; and Zimmer, Inc.—to disclose the names of each consultant and the amount he or she was paid by the company, and to update that information on a quarterly basis.

The companies have complied, listing the individual or corporate name, location (city, state), and payments, including in-kind payments. Indeed, at least one company has taken disclosure a step further. Stryker Orthopaedics has developed a “Meet our consultants” Web page, which enables consumers to access more detailed information regarding the company’s relationship with an orthopaedic surgeon, including a listing of his or her “key contributions and innovations” and a resumé.

Prior to the DOJ settlement announcement, the AAOS had updated its disclosure policy to promote transparency. The Academy established an online, association-wide disclosure database (www.aaos.org/disclosure) to provide members with an opportunity to report and regularly update information on their relationships with industry. Although this database does not include detailed financial information, as the five companies were required to provide under the terms of the DOJ settlement agreements, the AAOS disclosure database serves as a convenient central repository of all relevant commercial relationships for fellows involved in AAOS governance, Continuing Medical Education (CME) faculty, authors of enduring materials, and participants in guidelines development.

In addition, the AAOS has developed materials that members can use in disclosing information to patients. A model patient disclosure letter and patient discussion guide can be accessed here.

Eliminating influence
The new environment also aims to ensure that relationships with industry do not affect patient care decisions. Even before the settlements were announced, the AAOS had implemented several educational efforts to ensure that fellows understood and complied with the AAOS Standards of Professionalism (SOPs) on Orthopaedist-Industry Conflicts of Interest, which had been adopted by the fellowship in April 2007 after 2 years of extensive study. AAOS educational efforts regarding these SOPs included two Webinars, a symposium at the 2008 Annual Meeting, and a special section on the AAOS Web site on relationships with industry (

Recognizing that “gifts,” however small, may predispose a healthcare provider to using the products or services of a particular company, the Association of American Medical Colleges (AAMC) has taken a strong stance. In June 2008, an AAMC task force on industry funding of medical education urged all medical schools and teaching hospitals to adopt policies that prohibit drug industry gifts and services to physicians, faculty, residents, and students, and to curtail the involvement of industry in CME activities. Several medical schools have already adopted policies that parallel the recommendations. Likewise, the American Medical Association’s Council on Ethical and Judicial Affairs issued a report on the relationship between physicians and industry that was extensively discussed, although it was eventually tabled by the AMA House of Delegates in June 2008.

For its part, industry is also taking steps to eliminate influence and promote disclosure. For example, earlier this year, Zimmer updated and revised its corporate compliance model to “aggressively reduce” conflicts of interest. Under the new model, the company will no longer offer gifts to healthcare professionals; will require all medical consultants to participate in annual ethics training programs and to disclose compensation arrangements to patients, employers, and hospitals; and will use an outside third-party to oversee and disburse educational and charitable contributions.

Adapting for the future
As announced in the September 2008 issue of AAOS Now, the AAOS has established the Center for Orthopaedic Advancement (COA), a new not-for-profit entity. Members of the COA governance structure will be free of any current potential conflicts of interest. The COA will solicit and receive funds from industry, receive and review grant requests from orthopaedic organizations, and distribute funding through grants to the education programs meeting defined criteria.

“It is up to us to remain flexible and to adapt to the changes,” said AAOS President Tony Rankin, MD. “We must continue to adhere to the highest ethical standards, so as not to deflect attention away from the good work that orthopaedic surgeons do.”

Additional changes in the working relationships between orthopaedic surgeons and industry may be legislated at either the federal or state level. The “Physician Payments Sunshine Act,” introduced by Sens. Herb Kohl and Chuck Grassley, would amend Title XI of the Social Security Act to “provide for transparency” in the relationship between physicians and manufacturers of drugs, devices, or medical supplies for which payment is made under Medicare, Medicaid, or the State Children’s Health Insurance Program.

The bill would require all drug and device manufacturers to disclose annual payments of physicians of $500 or more. These disclosures will be posted on a quarterly basis on the Department of Health and Human Services (HHS) Web site. The required disclosure would include the physician’s name, the value and date of the payment or gift, its purpose, and what, if anything was received in exchange. The bill also includes civil monetary penalties for noncompliance. Similar measures have already been enacted in six states, most recently in Massachusetts.

In addition, the Institute of Medicine Committee on Conflict of Interest in Medical Research, Education, and Practice is currently preparing a consensus report that will examine and describe conflicts of interest involving health care professionals and industry in different contexts. The Medicare Payment Advisory Commission (MedPAC) has held two sessions on public reporting of physician/industry financial relationships and may soon release its recommendations.

The impact is being felt
According to Gene R. Wurth, JD, MBA, president and chief executive officer for the Orthopaedic Research and Education Foundation (OREF), the DOJ settlement has had an impact on industry support for funding research. Although the OREF has sufficient resources to meet its commitments through 2008, “we are going to see the impact in 2009,” said Mr. Wurth.

Whether grants in 2009 will be reduced depends not only on re-establishing industry funding levels, but also on increasing individual and corporate donations and building the endowment. The current downtrend in the market, and the resultant negative impact on the endowment, increases the importance of individual donations, he noted.

Even the AAOS playground build is feeling the pinch. Much of the more than $200,000 required to build the playground—an annual one-day event that takes place on the day before the AAOS Annual Meeting opens and is a gift to the host city—usually comes from industry sponsors. But funding for the 2009 build in Las Vegas is behind schedule, reported Frank B. Kelly, MD, chair of the AAOS Communications Cabinet. “We’ll build it,” he told the Cabinet recently, “but we are looking for more individual donations and more creative local funding.”

Mary Ann Porucznik is managing editor of AAOS Now. She can be reached at porucznik@aaos.org