Tuesday, 2 October 2018

Memorial Sloan Kettering’s Chief

 Memorial Sloan


Memorial Sloan Kettering’s Chief Executive Resigns From Merck’s Board of Directors

Dr. Craig B. Thompson, the chief executive of Memorial Sloan Kettering Cancer Center,
said Tuesday that he would resign his seats on the boards of drugmaker Merck and
another public company, the newest fallout from a widening institutional reckoning over
relationships between cancer center leaders and for-profit health care companies.

Dr. Thompson has served on the board of Merck, the maker of the blockbuster cancer
drug Keytruda, since 2008. He has been on the board of Charles Laboratories, a
a publicly-traded company that assists research in early drug development, since 2013.

Dr. Thompson, 65, received $300,000 in compensation from Merck in 2017, consistent with
company financial filings. He was paid $70,000 in cash by Charles in 2017, plus $215,050 in stock.

The compensation for the 2 corporate boards is additionally to what he's paid as chief
an executive at Memorial Sloan Kettering, the nonprofit the institution that's one among the nation’s
leading cancer centers. In 2016, he received $6.7 million in total compensation from the
hospital and related organizations, consistent with the foremost recent tax income Service
filings.

The resignations are effective immediately. A spokesman for the hospital said the
compensation Dr. Thompson received from both companies this the year would be deferred
until he is 72.

“I believe this is the right decision for Memorial Sloan Kettering and will allow me to
redouble my focus on M.S.K. priorities: quality patient care, faculty, scientists and staff,”
Dr. Thompson said during a memo sent to the hospital staff. He has been the chief executive
of the hospital since 2010.

The move followed two tense meetings at the hospital on Monday, spurred by articles by
The New York Times and ProPublica, about insider deals among hospital officials and
undisclosed industry relationships.

At one meeting with hospital staff, Dr. Thompson apologized for his handling of staff
reaction to the issues outlined in the articles, and acknowledged that he had not
adequately reined in the industry relationships of the hospital’s former chief medical
officer, Dr. José Baselga, who has since resigned.

At another meeting, reserved for medical staff members, some doctors said they were
interested in calling a no-confidence to choose the hospital’s top leaders, and asked what
steps they needed to require to try to that, consistent with several participants within the meeting.

In an interview Tuesday, Dr. Nadeem R. Abu-Rustum, the president of the medical staff,
said a small number of doctors had wanted a no-confidence vote in the hospital’s
leadership, but were now satisfied by Dr. Thompson’s decision.

“These same colleagues are not interested in moving forward with a vote of no confidence,” Dr. Abu-Rustum said. “The steps that have been made and taken since the meeting by our leadership has addressed the most important concerns to the medical staff and the associate medical staff and really represents real progress.”

In addition to resigning his board positions, Dr. Thompson also said Tuesday that Memorial Sloan Kettering would give physicians a greater voice in its operations and would conduct an analysis to understand what had gone wrong at the hospital in recent weeks “so that we ensure our path forward is expertly guided by what we learn.”

Over the past month, articles within the Times and ProPublica has outlined leaders’ ties to
for-profit companies, including an exclusive deal the hospital made with a man-made intelligence start-up to license images of 25 million tissue slides. The company was founded by Memorial Sloan Kettering insiders, including a member of the chief board, the chair of the pathology department and therefore the head of a search lab.

After members of the pathology lab objected to the deal, the head of the department
announced he would divest his stake.

Another article detailed how a hospital vice-chairman held an almost $1.4 million stake during a
the newly public company as compensation for representing Memorial Sloan Kettering on its
board. The hospital said last week that a replacement policy would prohibit compensation in such
situations which the vice-chairman would turn over his stake to the hospital.

Dr. Thompson’s decision to go away two boards doesn't affect the eight other Memorial
Sloan Kettering officials who serve on the boards of out of doors companies. A task force that
was created within the wake of the crisis over conflicts of interest is considering a policy that
would prohibit executives from holding such roles, hospital leaders have said.

Dr. Thompson also holds an equity stake in Agios Pharmaceuticals, a cancer start-up he
founded based on research he conducted at the University of Pennsylvania before
joining Memorial Sloan Kettering. Dr. Thompson settled lawsuits several years ago that
were filed by Penn and an affiliated research facility, which contended that he hid
research to start out Agios and didn't share the earnings with Penn or the research
institute. Dr. Thompson disputed the allegations.

Dr. Thompson’s seat on the Merck board was brought up at Monday’s staff meeting.

Douglas A. Warner III, chairman of the hospital’s board of directors, said that when Dr.

Thompson received Memorial Sloan Kettering, the hospital board viewed his position at
Merck as a “good thing.” On Monday, Mr. Warner said, “We got to step back from that now and ask ourselves whether that continues to be appropriate, whether it’s appropriate within the future.”

Merck said in a statement that “Dr. Thompson’s expertise, perspective and dedication to
patient care has contributed greatly to Merck’s mission. His contributions demonstrate
why it is so important to have leaders from the medical the community represented on the
board.” A spokeswoman for Charles Laboratories referred inquiries to Memorial Sloan
Kettering.

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