Friday Rant: Supplier Claims and Contrived Product Endoresments

The Wall Street Journal reported in June that "Medical device maker Medtronic Inc. says it paid nearly $800,000 over the past three years to a former Army surgeon [Timothy R. Kuklo] accused of fabricating a study that reported positive results for one of the company's key spine products". The study itself was "based on 'falsified information' and that Dr. Kuklo forged the signatures of purported co-authors." In addition to the Army's allegation of falsification, "Dr Kuklo listed his affiliation with Walter Reed Army Medical Center" while shopping the study to medical journals in 2007 despite the fact that "he left the Army hospital in August 2006 and joined the faculty of Washington University in St. Louis."

"Medtronic has said that consulting arrangements with surgeons are critical to the development of new products." On it's face, this practice seems necessary and appropriate. But when "consultants" are incented by their clients to report favorable results, rather than objectively study, test and evaluate new offerings, the process is bound to go awry. There must also exist a clear system of checks and balances when individuals and institutions are paid to conduct such analysis. Dr. Kuklo was obviously hired by Medtronic as a salesman to his fellow surgeons.

We can be thankful that this incident of apparent collusion between Medtronic and Dr Kuklo to fabricate findings -- and exploit injured soldiers in the bargain -- has been revealed (Its [Medtronic’s] payments to surgeons who use its spine products are under investigation by the Justice Department following accusations by several former employees that the doctors were being induced to use the products). But what about the untold number of falsely contrived and reported studies that continue to influence the market?

This seems to ultimately be an issue of a new type of supplier visibility and risk. Given the stratospheric advances in information technology that are integral to modern business, there's no question that automated processes could be developed to unmask and greatly reduce the temptation to perpetuate fraudulent product research -- but who will buy them?

- William Busch