Dr. Scott Gottlieb:
Wall Street Biotech Insider Gets No. 2 Job at the FDA
ALICIA MUNDY / Seattle Times 24aug2005
Only a month ago, Dr. Scott Gottlieb was a Wall Street insider, promoting hot biotech stocks to investors.
"[He]
further impedes the independence of the FDA" |
Now Gottlieb holds the No. 2 job at the Food and Drug Administration (FDA), the federal agency that approves new drugs, oversees their safety and affects the fortunes of companies he once touted.
Wall Street likes the appointment of Gottlieb, 33, who believes in faster drug approval and fewer news-release warnings to the public about potential side effects of drugs.
But some medical experts are shocked by his July 29 appointment, coming at a time when the public is increasingly concerned about the safety of popular medicines. In addition, the federal government has just begun scrutinizing the growing financial ties between Wall Street firms and doctors researching new drugs.
Gottlieb's new job "further impedes the independence of the FDA," said Dr. Jerome Kassirer, former editor of The New England Journal of Medicine. "Gottlieb has an orientation which belies the goal of the FDA."
"I've never heard of anything like this," said Merrill Goozner, a director at the liberal Center for Science in the Public Interest.
"If he's had dealings regarding companies whose products are up for review at the agency, it strikes me as a potential conflict of interest. You want a barrier between the regulated and the regulators. It's fundamental," Goozner said.
A half-dozen current or former officials at the FDA say they do not know of anyone from Wall Street moving directly into such a high-level job at the agency.
Until last month, Gottlieb was editor of a popular biotechnology investor newsletter, Forbes / Gottlieb Medical Technology Investor. Forbes touted Gottlieb's stock-picking success on its Web site in mid-May:
"Special Offer: In the last few months, Dr. Scott Gottlieb recommended two cancer cure stocks to subscribers that have already climbed 38%. Click here for the latest report from Forbes / Gottlieb Medical Technology Investor, 'Three Biotech Stocks To Buy Now.' "
Now, as one of three deputy commissioners, Gottlieb will help oversee such major policies as the FDA's fast-track approval process for drug and biotech products, a priority for many Wall Street funds and the pharmaceutical industry.
Gottlieb said he has cut his ties to Wall Street and discontinued his newsletter. He doesn't see a conflict between that work and his new role as a high-ranking regulator.
"What I learned while working on Wall Street has informed almost everything that I have done since, but especially my work in the government," he responded in an e-mail to questions from The Seattle Times. (The FDA would not allow the Times to interview Gottlieb or provide answers to questions about his background. The FDA has not released his financial-disclosure forms.)
"[It] has helped me appreciate where regulatory policy can be improved upon to help enable medical innovation and to turn scientific breakthroughs into practical medical solutions that can help patients."
Gottlieb was an analyst for a Wall Street investment firm before going to Mt. Sinai School of Medicine in New York. He earned a medical degree in 1999, then did an internal-medicine residency. From 2003 until a few weeks ago, he saw patients during weekend shifts two or three times a month at Stamford Hospital in Stamford, Conn., he said.
Since becoming a physician, he has worn many hats. From 2000 to 2002, Gottlieb wrote the Gilder Biotech Report, an investment newsletter, reporting on potential FDA decisions, drug and biotech developments. He also worked as a staff writer for the British Medical Journal.
In 2003, he was a full-time resident scholar working on FDA policy issues at Washington, D.C.'s most formidable conservative think tank, the American Enterprise Institute (AEI).
Along the way, he became a leading proponent of doctors increasing their income by selling their understanding of drugs and the federal regulatory process to stock analysts and investment firms — "Moving your Career from Main Street to Wall Street," as Gottlieb wrote in an investment column in the American Medical Association newsletter.
He joined the Food and Drug Administration in March 2003 as a senior adviser on policy and soon made an impression. Later that year, the SG Cowen brokerage house sent a report to subscribers, "A Recap of What's Gone Right at the FDA," that praised Gottlieb and other new FDA officials under then-Commissioner Dr. Mark McClellan for working to streamline the drug-approval process.
"Should McClellan's team succeed in getting their strategies adopted into the framework of the approval process, the team's impact on FDA policy could last well beyond the current administration."
Gottlieb moved with McClellan, brother of White House spokesman Scott McClellan, to the federal Centers for Medicare & Medicaid Services in June 2004 and left that October.
He then returned as a full-time scholar at the AEI and started the Forbes / Gottlieb Medical Technology Report.
Gottlieb, a Bush administration appointee making about $140,000, comes to the FDA with an agenda. In addition to advocating faster drug approvals, he has complained the FDA sends out too many "shotgun warnings" on any particular drug's emerging side effects, which he said may cause patients to overreact.
He wants the warnings to be sent to doctors first, and without "overstating a product's risk."
He also has urged that the FDA change longstanding policy and release data on experimental drugs at different stages of the research, from animal tests to final patient studies.
Releasing more data at each stage would help investors put money behind promising drugs and products earlier and would better protect patients in the clinical trials, he has explained.
Three years ago, Gottlieb wrote about an issue that was spotlighted last month in a Seattle Times investigation — the practice of doctors leaking details of ongoing drug research to investment firms, which can then profit from the information by selling or buying stocks.
The Times found 26 cases in which doctors leaked confidential and critical details of their ongoing drug research to Wall Street firms. The report has led to a Securities and Exchange Commission investigation.
"Traders will go to great lengths to get market signals from medical researchers," Gottlieb wrote in Barron's, an investor publication, "and the tight lid the FDA keeps on clinical-trials data has spawned a thriving niche of boutique investment-research firms that link money managers with medical experts capable of giving investors a wink and a nod."
Gottlieb is against such leaks. But he did not call for better enforcement of confidentiality agreements that should preclude such behavior. He instead urged that the FDA open up its drug-approval process to investors and the public.
"Bizarre FDA rules allow companies to hide clinical information practically in perpetuity. Something needs to change," he wrote in the Gilder Biotech newsletter in 2002.
"The FDA could and should release data contained in a company's (FDA) filings at each stage in the process. ... Why shouldn't markets know what bureaucrats and insiders do?"
Kassirer, the former editor of The New England Journal of Medicine, said early release of clinical-trial information "strikes me as potentially good for investors but bad for the validity of clinical research."
"Releasing data early could result in premature and erroneous conclusions about the drug or device being tested, premature ending of clinical trials and even inappropriate enrollment of patients," he said.
The FDA would not comment on Gottlieb's ideas on changing policy to allow for earlier release of clinical trial information, except to note that the articles were written before Gottlieb joined the agency.
He also has consulted for, and written positively about, a major matchmaking firm that links doctors with Wall Street investors, the Gerson Lehrman Group in New York.
He has known founder Mark Gerson for several years, and both are part of the conservative establishment in D.C. With his pro-market views "Scott is popular with some people at the White House," said Robert Goldberg of the Manhattan Institute, a conservative think tank. He is a friend of both men.
Gottlieb highlighted Gerson's firm in investment columns he wrote for the AMA newsletter, and encouraged doctors to join Gerson's network and others. Not only can doctors increase their income, but they can help Wall Street investors decide which new technologies to put their money behind, he wrote.
Gottlieb said by e-mail that he was not paid to recruit physicians for Gerson's group. He added he had recommended a handful of policy-makers to Gerson Lehrman and was paid for probably fewer than eight hours of work.
Gottlieb said he also did a little work for the SG Cowen brokerage house but has not taken part in any conference calls between drug researchers and investors discussing ongoing clinical research.
When the FDA announced Gottlieb's hiring last month, it noted Gottlieb had been a practicing physician, a scholar at AEI and correspondent for the British Medical Journal. The agency did not mention Gottlieb's stints as editor of the two popular biotech investment newsletters or his work with Wall Street firms.
**************
Dr. Scott Gottlieb
FDA deputy commissioner for policy
Age: 33
Salary: About $140,000
1994: Bachelor's degree in economics, Wesleyan University
1994-1995: Alex. Brown & Sons, investment bank
1995-1999: Mount Sinai Medical School, New York
1996-2001: Wrote for The Journal of the American Medical Association
1997-2005: Staff writer, British Medical Journal
2000-2002: Author, Gilder Biotech Report
2003-2005: Medical internist, Stamford (Conn.) Hospital
2003: Resident scholar on medical policy, American Enterprise Institute
March 2003-May 2004: Senior adviser, then director of medical-policy development, FDA
June-October 2004: Senior adviser, Centers for Medicare & Medicaid Services
Late 2004-July 2005: Resident scholar on FDA and Medicare policies, American Enterprise Institute
Late 2004-July 2005: Author, Forbes/Gottlieb Medical Technology Report
Late 2004-July 2005: Private consultant/speaker to investment firms and the pharmaceutical industry
Source: AEI and Dr. Scott Gottlieb
**************
source: http://seattletimes.nwsource.com/html/nationworld/2002450292_gottlieb24.html 12sep2006
The Scott Gottlieb Example
The Carpetbagger Report 26sep2005
Since former FEMA Director Mike Brown's background came to public light, there's been considerable discussion about cronyism in the Bush administration — the only people who seem to get jobs are those who are reliable political allies, and they're given jobs whether they deserve them or not.
Since the Brown example, critics have not hurt for examples. David Safavian and Julie Myers made headlines shortly thereafter for the same reason.
Time magazine moves the ball forward this week — asking "How many more Mike Browns are out there?" — explaining that cronyism dominates the executive branch at nearly every level.
The Office of Personnel Management's Plum Book, published at the start of each presidential Administration, shows that there are more than 3,000 positions a President can fill without consideration for civil service rules. And Bush has gone further than most Presidents to put political stalwarts in some of the most important government jobs you've never heard of, and to give them genuine power over the bureaucracy. "These folks are really good at using the instruments of government to promxote the President's political agenda," says Paul Light, a professor of public service at New York University and a well-known expert on the machinery of government. "And I think that takes you well into the gray zone where few Presidents have dared to go in the past. It's the coordination and centralization that's important here."
It's an important point. Every president is going to fill sought-after vacancies with political allies and generous contributors. Bush not only does it more than his predecessors, he also, apparently, sees this as integral to how the executive branch should function. Loyalty above competence, allegiance to ideology over commitment to public service. We've all heard the phrase "it's not what you know; it's who you know," but with the Bush White House, it's reached a ridiculous level.
If Bush were simply filling ambassadorial posts with high-donor "Rangers," I doubt anyone would be terribly surprised or outraged. But the real scandal here is the specific jobs, with important public responsibilities, being filled with those who have little or no qualifications in their field.
Mike Brown, unfortunately, was just the beginning. Meet Scott Gottlieb.
Internal e-mail messages obtained by Time show that scientists' drug-safety decisions at the Food and Drug Administration (FDA) are being second-guessed by a 33-year-old doctor turned stock picker.
The FDA's deputy commissioner for medical and scientific affairs is not exactly some random bureaucrat. When Gottlieb was given the job, he was burdened with the responsibility of reviewing accuracy in medical research on, as Time put it, "everything from new vaccines and dietary supplements to animal feed and hair dye." It's the kind of job in which Americans need to rely that a qualified specialist, free of influences from politics and special interests, has their best interests in mind.
And while the 33-year-old Gottlieb does have a medical degree, his bio raises a few eyebrows considering his high-ranking post.
What the bio omits is that his most recent job was as editor of a popular Wall Street newsletter, the Forbes/Gottlieb Medical Technology Investor, in which he offered such tips as "Three Biotech Stocks to Buy Now." In declaring Gottlieb a "noted authority" who had written more than 300 policy and medical articles, the biography neglects the fact that many of those articles criticized the FDA for being too slow to approve new drugs and too quick to issue warning letters when it suspects ones already on the market might be unsafe. […]
[Donald Kennedy, Jimmy Carter-era FDA Commissioner, a former Stanford University president and now executive editor-in-chief of the journal Science said] Gottlieb breaks the mold of appointees at that level who are generally career FDA scientists or experts well known in their field. "The appointment comes out of nowhere. I've never seen anything like that," says Kennedy.
OK, so there are questions about Gottlieb's qualifications. But has he proven himself on the job?
Behind the scenes, however, Gottlieb has shown an interest in precisely those kinds of [scientific and medical] deliberations. One instance took place on Sept. 15, when the FDA decided to stop the trial of a drug for multiple sclerosis during which three people had developed an unusual disorder in which their bodies eliminated their blood platelets and one died of intracerebral bleeding as a result. In an e-mail obtained by Time, Gottlieb speculated that the complication might have been the result of the disease and not the drug. "Just seems like an overreaction to place a clinical hold" on the trial, he wrote. An FDA scientist rejected his analysis and replied that the complication "seems very clearly a drug-related event." Two days prior, when word broke that the FDA had sent a "non-approvable" letter to Pfizer Inc., formally rejecting its Oporia drug for osteoporosis, senior officials at the FDA's Center for Drug Evaluation and Research received copies of an e-mail from Gottlieb expressing his surprise that what he thought would be a routine approval had been turned down. Gottlieb asked for an explanation.
The administration is filled with Scott Gottliebs, in offices most people have never heard of, running the executive branch (usually) free of intense public scrutiny.
So, for every high-profile controversy over a Bush nomination (Ashcroft, Rumsfeld, Rice, Gonzales), remember there are many more mundane presidential appointments that may be doing just as much damage, if not more.
source: http://www.thecarpetbaggerreport.com/archives/5358.html 12sep2006
Adviser Soapbox:
Prostate Drug Promise Vs. FDA Rigidity
Dr. Scott Gottlieb, Forbes/Gottlieb Medical Technology Investor s18feb2005
NEW YORK - Encouraging news that a new cancer vaccine may be saving the lives of patients with prostate cancer seems too hard to ignore, even for the U.S. Food and Drug Administration. The drug agency has kept the medical product off the market for more than two years, arguing that the proof of its value wasn't convincing, even as evidence continued to accumulate that the new product was saving lives.
The treatment, developed by Seattle-based biotech company Dendreon (nasdaq: DNDN - news - people ), works by priming the body's immune system to recognize special markers on the surface of prostate cancer cells and harnessing the body's natural immune cells to seek out the cancer and destroy it.
When the company first submitted its evidence to the FDA almost three years ago, asking for permission to sell it, the FDA said no. When the agency looked at all of the patients enrolled in the company's trial, the vaccine didn't show an overwhelming benefit in the short-term study of more than 100 prostate cancer patients. But when Dendreon looked at a smaller subgroup of the patients in the trial, those with a certain less aggressive form of prostate cancer, the results looked great. The FDA, however, does not allow "retrospective" analysis, which is statistically impure and can lead to cooked results. So Dendreon was asked to do a new trial, studying the vaccine just in patients who had the less aggressive form of the cancer. There was evidence that the vaccine worked for certain patients, but the FDA wanted more convincing data.
Special Offer: Forbes and former FDA policymaker Dr. Scott Gottlieb recently partnered to create a must-read biotech stock advisory. Click here for Forbes/Gottlieb Medical Technology Investors' special report, "An Insiders Guide To Profiting From FDA Actions." It turns out, however, that when Dendreon continued to follow the patients in the original study for another two-and-a-half years, the results continued to get better--for all the patients, not just those with the less aggressive cancer. Thursday evening, Dendreon announced that 34% of those who received Provenge in that original trial were still alive after three years, compared with 11% of those who took a placebo. The median survival, meaning the time by which half the patients had died, was 25.9 months for those who received Provenge, compared with 21.4 months for those who took the dummy vaccine.
That 4.5-month increase in survival is almost double the 2.5-month benefit shown in clinical trials of Taxotere, a drug that is the next best thing for patients like those in the Provenge trial whose cancer has spread beyond the prostate gland and is no longer being controlled by hormonal therapy.
Dendreon's vaccine product seems on track to win approval, the question now is whether the FDA will wait for the company to finish the trial it has underway or approve the product based on the mounting strength of the results of that original trial. If the FDA sticks to its rules, it will wait for the new study to finish, and patients will pay a significant price: denied access to a largely safe product that looks to be a real advance in cancer care. Dendreon has said it will wait for the results of its ongoing trial before filing for approval with the FDA.
The problem is that at the Food and Drug Administration, creativity is not a virtue. The Agency prides itself on developing fixed approaches to regulatory problems, striving to set clear requirements on how it reviews and approves new drugs and applying these criteria consistently across its different divisions and through the review of different products in different diseases. That really stings new medical technologies like cancer vaccines, which require a different regulatory approach. One of the big problems is that patients who get the vaccines in clinical trials are less likely to benefit from these products because regulatory rules compel companies to test them on the sickest patients.
The vaccines work by stimulating the immune system to begin fighting off the cancer on its own. Since most of the patients receiving these vaccines are already on death's doorstep, their depleted immune systems are hard pressed to respond to the treatments. As a result, the trials are unlikely to yield the statistically favorable results preferred by the FDA. That was one issue in the case of Dendreon. Initially, in a shorter-term trial, the vaccine only seemed to work well in the patients with less aggressive cancer who weren't as sick. It is for this group that Dendreon is now undertaking its new study.
The larger problem is that inside the FDA the regulatory framework always lags the creation of new technology. FDA knows how to evaluate the safety of cholesterol lowering drugs and antihistamines. After seeing scores of these products, they have the regulatory routine down pat. When it comes to completely novel products like immune-boosting vaccines, the agency stumbles, forcing square pegs into round holes as it tries to adapt familiar regulatory models to technologies it doesn't fully understand. In the case of cancer vaccines, that might mean more markers of vaccine response like scientific tools that can measure whether the vaccine is generating an immune response that can serve as a proxy for effectiveness.
It could also mean differently designed clinical trials. Instead of the traditional three phases of clinical trials, maybe cancer vaccines should be tested in clinical trials where the vaccine is given to small groups of people based on characteristics that help predict whether they will respond to the treatment. When one of these small groups does respond to the vaccine, it can be tested again in just that group, with the hope that researchers can glean even more characteristics that unearth what kinds of patients are most likely to respond. While promising, this kind of clinical trial design, called enriched trials, is still not well understood. A little scientific work can help hammer it out as a new model.
Finally, it could mean a greater reliance inside the FDA on mathematical tools for using data about new drugs that is not "randomized" or randomly compared to a placebo, but derived from large populations of patients all being given the same treatment. This kind of "dirty data" involves a mathematical science called Bayesian statistics that allows statisticians to glean strong conclusions off large, population data, just like economists do. This is another science that is poorly developed inside FDA.
A way out of this box was a large part of the vision behind the "Critical Path" initiative announced by the FDA last year. That policy encompassed many things, but above all else it was about engaging the broader scientific community in an effort to develop better methods for evaluating the safety and effectiveness of new medical products. Right now, the medical products keep getting better and more advanced, and yet too often, the FDA's processes and procedures for evaluating them are stuck in 1972.
This is a problem for Congress to ponder as well--especially the next time legislators have the itch to dump more money into that sinkhole off Maryland's Rockville Pike, also known as the National Institute of Health. We can create all the nifty new technologies massive taxpayer spending can buy, from the best nanotechnology particles to innovative cancer vaccines. But all this effort to create wildly better products is for naught if they all eventually bump up against an FDA that's ill prepared evaluate them.
Many other biotech companies are working on similar cancer immune therapies, including Medarex (nasdaq: MDRX - news - people ), Antigenics (nasdaq: AGEN - news - people ), Cell Genesys (nasdaq: CEGE - news - people ), Geron (nasdaq: GERN - news - people ), Corixa (nasdaq: CRXA - news - people ), Vical (nasdaq: VICL - news - people ), Progenics Pharmaceuticals ( PGNX) , AVI BioPharma (nasdaq: AVII - news - people ) and Biomira (nasdaq: BIOM - news - people ). So long as the FDA stands as an obstacle to bringing new medical products to the market, we ought to make sure the agency is infused with the thinking and the resources to advance alongside the science it's charged with regulating.
Scott Gottlieb, a physician and fellow at the American Enterprise Institute, is editor of the Forbes/Gottlieb Medical Technology Investor. Dr. Gottlieb is a former senior official at the U.S. Food and Drug Administration and may own stock in some of the companies mentioned in this column or consult with firms that advise them. Click here for more analysis, or to subscribe to Forbes/Gottlieb Medical Technology Investor.
source: http://www.forbes.com/business/healthcare/2005/02/18/cz_sg_0218soapbox_inl.html 12sep2006
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