Conflicts of Interest and Related Change in Medical Research

The significant increase in private industry drug studies has spawned three other changes in medical research: medical company contributions to nonprofit foundations associated with for-profit medical practices, ghost writing in medical research, and the celebrity medical expert.

Contributions to physicians' nonprofit foundations. Physicians in private practice have begun to establish tax-exempt charities to engage in medical research or education, and drug and medical device companies are making significant contributions to these nonprofit organizations. While the nonprofit organizations are separate entities, they are closely linked to physicians? medical practices. Typically, medical companies contribute funds to the nonprofit organizations to support medical research and educational programs.

To the extent these contributions are actually used for the foundation?s charitable purpose (research and education), there would appear to be no problem. To the extent, however, these funds are used to subsidize or offset expenses of the medical practice (e.g., using fellowship funds to underwrite medical practice salary expenses), significant tax and conflict of interest issues and problems are created.