Probe Targets Government Scientists' Consulting

Edgar Swindell, who in 1997 was acting director of the HHS ethics division, told the subcommittee he and other ethics officers were under strict orders from then-HHS General Counsel Harriet S. Rabb to assess such requests in purely legal terms, without regard to concerns about ethics or "how this might appear on the front page of The Washington Post." Those ethics rules, while warning about appearances of conflict, allow federal officials to receive "bona fide" awards even from grantee institutions.

"So even though this is the ethics division, you're not supposed to use any ethics," Rep. Joe Barton (R-Tex.) fumed.

"It's not a decision I look back on with fondness or pride," said Swindell, now HHS's associate general counsel for ethics.

Swindell said he has not felt the same pressure to approve marginally acceptable ethics decisions since the arrival of the Bush administration. But he conceded that he helped prepare the now controversial waiver that current HHS Secretary Tommy G. Thompson signed allowing then-Medicare administrator Thomas A. Scully to negotiate outside employment while he was still in his government position. In December Scully joined an Atlanta law firm that represents drug makers, hospitals and other health care businesses.

The FDA's Petricoin and NCI researcher Lance Liotta told the subcommittee they saw no conflict, at least at first, when they requested and received ethics approval to consult for Biospect of South San Francisco, a company developing technologies that may aid disease detection. The two were already part of a federal partnership in which they spend some of their government time collaborating with Bethesda-based Correlogic Systems.

The two scientists did not tell either company they were working for the other because, Liotta said, "there was no overlap in my mind." But Greenwood noted that the two companies' descriptions of their business goals are very similar, and that Correlogic's co-founder complained to the NCI when he found out about the Biospect deal.

Although ethics officials had twice approved the dual arrangements, both scientists terminated their Biospect arrangements last week because, they said, they began to see evidence that Biospect's business plan was evolving in a way that might constitute a conflict of interest for them.

Both Liotta -- who an NIH official said earned as much as $45,000 from the Biospect deal -- and Petricoin were accompanied yesterday by their lawyers.

The subcommittee also focused on the growing number of NIH employees hired under "Title 42," a special provision that boosts their salaries while allowing them to sidestep certain reporting requirements for outside collaborations.

Zerhouni has recently sought to tighten financial reporting requirements for many of those hired under that provision but has argued for the importance of allowing NIH scientists to earn competitive salaries and in some cases to do outside consulting.

Several subcommittee members said they are giving serious consideration to banning all such arrangements.