[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]




                               BEFORE THE


                                 OF THE

                        HOUSE OF REPRESENTATIVES


                             FIRST SESSION


                             MARCH 26, 2009


                           Serial No. 111-22

      Printed for the use of the Committee on Energy and Commerce



  67-819                  WASHINGTON : 2012
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 


                 HENRY A. WAXMAN, California, Chairman
JOHN D. DINGELL, Michigan              JOE BARTON, Texas
  Chairman Emeritus                      Ranking Member
EDWARD J. MARKEY, Massachusetts        RALPH M. HALL, Texas
RICK BOUCHER, Virginia                 FRED UPTON, Michigan
FRANK PALLONE, Jr., New Jersey         CLIFF STEARNS, Florida
BART GORDON, Tennessee                 NATHAN DEAL, Georgia
BOBBY L. RUSH, Illinois                ED WHITFIELD, Kentucky
ANNA G. ESHOO, California              JOHN SHIMKUS, Illinois
BART STUPAK, Michigan                  JOHN B. SHADEGG, Arizona
ELIOT L. ENGEL, New York               ROY BLUNT, Missouri
GENE GREEN, Texas                      STEVE BUYER, Indiana
DIANA DeGETTE, Colorado                GEORGE RADANOVICH, California
  Vice Chairman                        JOSEPH R. PITTS, Pennsylvania
LOIS CAPPS, California                 MARY BONO MACK, California
MIKE DOYLE, Pennsylvania               GREG WALDEN, Oregon
JANE HARMAN, California                LEE TERRY, Nebraska
TOM ALLEN, Maine                       MIKE ROGERS, Michigan
JAN SCHAKOWSKY, Illinois               SUE WILKINS MYRICK, North Carolina
HILDA L. SOLIS, California             JOHN SULLIVAN, Oklahoma
CHARLES A. GONZALEZ, Texas             TIM MURPHY, Pennsylvania 
JAY INSLEE, Washington                 MICHAEL C. BURGESS, Texas
TAMMY BALDWIN, Wisconsin               MARSHA BLACKBURN, Tennessee     
MIKE ROSS, Arkansas                    PHIL GINGREY, Georgia     
ANTHONY D. WEINER, New York            STEVE SCALISE, Louisiana     
JIM MATHESON, Utah                     PARKER GRIFFITH, Alabama     
G.K. BUTTERFIELD, North Carolina       ROBERT E. LATTA, Ohio     
CHARLIE MELANCON, Louisiana                 
JOHN BARROW, Georgia                        
BARON P. HILL, Indiana                      
DORIS O. MATSUI, California                 
DONNA CHRISTENSEN, Virgin Islands           
KATHY CASTOR, Florida                       
JOHN P. SARBANES, Maryland                  
CHRISTOPHER MURPHY, Connecticut             
ZACHARY T. SPACE, Ohio                     
JERRY McNERNEY, California                 
BETTY SUTTON, Ohio                         
BRUCE BRALEY, Iowa                         
PETER WELCH, Vermont                                                      


              Subcommittee on Oversight and Investigations

                    BART STUPAK, Michigan, Chairman
BRUCE L. BRALEY, Iowa                GREG WALDEN, Oregon
  Vice Chairman                        Ranking Member
EDWARD J. MARKEY, Massachusetts      ED WHITFIELD, Kentucky
DIANA DeGETTE, Colorado              MIKE FERGUSON, New Jersey
MIKE DOYLE, Pennsylvania             TIM MURPHY, Pennsylvania
JAN SCHAKOWSKY, Illinois             MICHAEL C. BURGESS, Texas
MIKE ROSS, Arkansas
JOHN D. DINGELL, Michigan (ex officio)

                            C O N T E N T S

Hon. Bart Stupak, a Representative in Congress from the State of 
  Michigan, opening statement....................................     1
    Prepared statement...........................................     4
Hon. Greg Walden, a Representative in Congress from the State of 
  Oregon, opening statement......................................     6
    Prepared statement...........................................     8
Hon. Diana DeGette, a Representative in Congress from the State 
  of Colorado, opening statement.................................    10
Hon. Michael C. Burgess, a Representative in Congress from the 
  State of Texas, opening statement..............................    11
Hon. Donna M. Christensen, a Representative in Congress from the 
  Virgin Islands, opening statement..............................    12
Hon. Gene Green, a Representative in Congress from the State of 
  Texas, opening statement.......................................    13
Hon. Edward J. Markey, a Representative in Congress from the 
  Commonwealth of Massachusetts, opening statement...............    13
Hon. Joe Barton, a Representative in Congress from the State of 
  Texas, opening statement.......................................    14
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, prepared statement..............................   115


Gregory Kutz, Managing Director, Forensic Audits and Special 
  Investigations, Government Accountability Office...............    17
    Prepared statement...........................................    19
Joanne Less, Director, Good Clinical Practice Program, Food and 
  Drug Administration............................................    40
    Prepared statement...........................................    43
Jerry Menikoff, M.D., Director, Office for Human Research 
  Protections, Department of Health and Human Services...........    59
    Prepared statement...........................................    61
Daniel Dueber, Chief Executive Officer, Coast IRB, LLC...........    76
    Prepared statement...........................................    78

                           Submitted Material

Subcommittee exhibit binder......................................   117



                        THURSDAY, MARCH 26, 2009

                  House of Representatives,
      Subcommittee on Oversight and Investigations,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:03 a.m., in 
Room 2123 of the Rayburn House Office Building, Hon. Bart 
Stupak (chairman) presiding.
    Members present: Representatives Stupak, Markey, DeGette, 
Christensen, Green, Waxman (ex officio), Walden, Burgess, 
Gingrey, Barton (ex officio), and Blunt.
    Staff present: Karen Lightfoot, Communications Director, 
Senior Policy Advisor; David Rapallo, General Counsel; Theodore 
Chuang, Chief Oversight Counsel; Dave Leviss, Deputy Chief 
Investigative Counsel; Scott Schloegel, Investigator, Oversight 
& Investigations; Stacia Cardille, Counsel; Erik Jones, 
Counsel; Ali Golden, Investigator; Jennifer Owens, Special 
Assistant; Caren Auchman, Communications Associate; Paul Jung, 
Public Health Service Detailee; Kenneth Marty, Detailee; Karen 
Christian, Counsel; Alan Slobodin, Chief Counsel; and Peter 
Kielty, Legislative Analyst.


    Mr. Stupak. This meeting will come to order. Today we have 
a hearing entitled Institutional Review Boards that Oversee 
Experimental Human Testing for Profit. The chair and ranking 
member and chairman emeritus will be recognized for 5 minutes 
for opening statements. All other members of the subcommittee 
will be recognized for 3-minute opening statements. I will 
begin. Experimental medical testing on human beings has a 
troubling history. From the atrocities perpetrated by the Nazis 
in World War II to the famous Tuskegee study in the 1970s when 
subjects were denied treatment for syphilis, we have learned 
that we need strong controls in place to protect the health and 
safety of people who participate in medical experiments.
    Under current federal law, medical testing of human 
subjects that is federally funded or relates to federally 
regulated drugs or medical devices cannot proceed without the 
approval of an Institutional Review Board, a panel of doctors, 
scientists, and non-scientists charged with ensuring the health 
and safety of the people participating in the study. Our 
committee began investigating IRBs in 2007. We learned that 
Copernicus IRB allowed the study of an antibiotic Ketek to 
continue without examining reports of fraud it had received. As 
part of our continued investigation, we asked the Government 
Accountability Office, GAO, to conduct undercover testing of 
the IRB review process. We wanted to know whether IRBs are 
rubberstamping research studies, whether clinical researchers 
are IRB shopping or choosing IRBs based on how quickly and how 
inexpensively they approve studies, and whether government 
oversight of IRBs is adequate.
    Today we will hear the results of GAO's investigation, and 
they are not reassuring. GAO will explain how Coast IRB, a for-
profit company, approved a fictitious study led by a fictitious 
doctor and submitted by a fictitious company. It called for a 
full liter of a fictitious product, in fact, the same amount in 
this bottle here, to be poured into a woman's abdomen cavity 
after surgery supposedly to help healing. GAO's fake protocol 
was based on an actual high risk study for a product that the 
FDA ultimately withdrew from the market because of deaths and 
infections among patients. Besides Coast IRB, GAO also sent its 
fictitious study to two other IRBs that they both rejected our 
proposal out of hand.
    Here are some of the things that two other IRBs said after 
reviewing the fake GAO study. The experimental design was the 
most complicated thing that I have ever seen. During a surgery, 
a major operation on a patient, a mystery guy walks in and 
dumps the solution in the body. Where is the safety for the 
patient? It appeared that people were just going to go out and 
start injecting. We realized it was a terrible risk for the 
patient. It is the worse thing I have ever seen. But Coast IRB 
approved the protocol unanimously 7 to nothing.
    The doctor with primary responsibility for reviewing the 
study told other board members that the protocol looks fine, 
and that the substance to be injected in the abdominal cavity 
was probably very safe. Nobody at Coast IRB ever reviewed any 
of the data cited in the proposal to support those claims. If 
they had, they would have discovered it did not exist. A doctor 
who reviewed the study did raise a question about if the 
study's claim was accurate and that the substance had been 
approved previously by the FDA, but no one ever followed up 
with the FDA to answer this question, and in an e-mail to the 
rest of the board members, the doctor stated it would not have 
made any difference, that he would have approved the study 
anyway and that the lack of FDA approval won't affect my 
    The board chair told us she relied on this recommendation 
and voted to approve the study even though she did not read the 
full protocol. Why was this review so shoddy? The evidence 
suggests that Coast was more concerned with its financial 
bottom line than protecting the lives of patients. According to 
Coast's CEO, who will testify today, Coast had a practice of 
voting on research protocols within 48 hours of the board 
receiving them. One of the testimonials that Coast sent to 
prospective customers reads thank you very much. You guys are 
the quickest IRB I ever worked with, and I have done this 7 
years. Coast even sent a coupon offering to give free IRB 
review so researchers could coast through your next study.
    After this committee wrote to Coast IRB requesting 
documents associated with their approval of this fictitious 
study, Coast officials took pride in that they were able to 
discover the study was bogus, but this was 5 months after they 
approved it. Coast CEO, Mr. Dueber, told our staff within 
seconds they were able to determine that this was not an actual 
medical device, and within 4 to 5 hours they determined that 
this was a sham. Had any of the staff done the research before 
they approved our bogus protocol 5 months ago, Coast IRB would 
not be testifying today. GAO's investigation also exposed other 
problems with the IRB system. GAO was able to create a 
fictitious IRB that it registered with the U.S. Department of 
Health and Human Services, HHS, with no questions asked.
    The president of this fake IRB was this dog, Trooper, who 
is, sadly, now deceased. Trooper didn't know anything about 
protecting human testing, but for a three-legged dog he sure 
could catch a Frisbee. GAO created a fake web site for 
Trooper's IRB called Maryland House. It received real inquiries 
from real researchers and actually had one research protocol 
submitted for review. When asked why it selected GAO's fake IRB 
and Trooper to conduct its study, a research coordinator stated 
that it was because of the low price and the quick turnaround 
    GAO's findings raise serious questions, not only about 
specific IRBs involved in this investigation, but with the 
entire system for approving experimental testing on human 
beings. As a society, we have a moral obligation to ensure that 
human testing is done in the most responsible and ethical 
manner. I look forward to the testimony today, and I hope we 
can discuss ways for both government and industry to fulfill 
its obligation. That concludes my opening statement.
    [The prepared statement of Mr. Stupak follows:]

    Mr. Stupak. I next go to the ranking member, my friend, Mr. 
Walden, for his opening statement, please.


    Mr. Walden. Thank you, Mr. Chairman, for convening this 
hearing. It is another example of the kind of investigative 
work that is possible when we work together in a bipartisan 
manner as we most always do. The subject of this hearing, the 
oversight of human subjects in clinical trials by Institutional 
Review Boards or IRBs, grew out of a drug safety investigation 
in the last Congress. Working together we identified what we 
thought might be problems in IRB oversight of clinical trials. 
We made a joint request to the Government Accountability 
Office, the GAO, to take a closer look into what was going on. 
Now we are here today to learn about the results of that 
    As we meet today, literally millions of Americans are 
engaged in clinical trials taking place in more than 350,000 
locations across America. Right now people who have volunteered 
for these trials are walking into a doctor's office or a 
hospital or some other setting, and they are taking 
experimental medicines or allowing new devices to be used on 
their bodies so that scientists and doctors can determine 
whether and how a new treatment will work. Without their 
willingness to volunteer for a trial, all of us would not 
benefit from the new drugs or devices to treat illness and 
disease. But they volunteer believing that an independent 
government-sanctioned process is reviewing the protocols and 
products to maximize their safety.
    And I have to tell you that after reading the report of the 
GAO that explains how easy it was for the undercover 
investigators to fake their backgrounds and get approval for 
human trials and create their own fake IRB something is 
horribly wrong. Mr. Dueber, I have read your testimony for 
today, and I find it to be the most pathetic example of trying 
to spin your way out of taking responsibility for a serious 
approval error I have ever seen. The fact that your board 
unanimously approved this fake company to turn fake tests using 
a witches' brew recipe for a gel that doesn't exist, I find to 
be outrageous. Two other IRBs rightfully rejected the 
application saying the plan was awful, a piece of junk, and the 
riskiest thing I have ever seen on this board.
    So why did your company unanimously approve it? And would 
you want your family members to participate in a trial using 
this gel? No, rather than discuss how your board reached 
unanimous approval and said the gel is probably very safe and 
that a risk assessment is not required, you chose to attack the 
investigators and even called this oversight effort tyranny. 
Well, sir, your approach is misguided. It reminds me of the old 
ruse used by parents on their children to draw their attention 
away going, look, bright shiny object. I don't care how many 
bright, shiny objects you tell us to look at, your PR firm and 
your lawyers, to draw attention away from the real issue, your 
company still has to answer for this decision that would have 
allowed patients to spend 5 months taking a fake and 
potentially lethal product from a fake company with a fake 
    And to HHS, what in the devil is going on in your agency 
that allows you to think you can ignore the law and regulations 
regarding adequacy of IRBs and simply enter whatever is e-
mailed your way and put the U.S. Government stamp of approval 
on an IRB? You have three federal employees signing up 300 new 
IRBs a month, according to the GAO, and the leadership of this 
agency says it is not important to follow the federal rules 
regarding a test of adequacy? Nobody picked up on names like 
Phake Medical Devices, April Phuls, Timothy Wittless, and Alan 
Ruse, or the town of Chetesville, Arizona? This didn't raise a 
flag? And yet you give out the HHS stamp of approval. It is 
unbelievable. Moreover, it could be lethal.
    Is it any wonder the GAO says this system is vulnerable to 
manipulation? I understand that more than 10 years after the 
Inspector General's report, FDA recently announced a final rule 
with respect to the IRB registry system that will go into 
effect this summer. I am curious whether our witnesses believe 
this new rule will address any of the problems we will hear 
about today. It is our solemn duty to ensure that those who 
participate in clinical trials can have confidence that their 
safety is in trustworthy hands and that government 
certification means something. We want to encourage 
participation and support of clinical trials by protecting the 
integrity of these studies and strengthening the public trust. 
Thank you again, Mr. Chairman, for convening this hearing. I 
look forward to today's testimony, and I yield back my time.
    [The prepared statement of Mr. Walden follows:]

    Mr. Stupak. Thank you, Mr. Walden. Ms. DeGette, for an 
opening statement, 3 minutes, please.


    Ms. DeGette. Thank you, Mr. Chairman. Chairman, patient 
safety and research situations for this committee is really 
like food safety. One thing you can be sure of is that a crisis 
is looming just around the corner. In 1999, a young man named 
Jesse Gelsinger died while participating in a gene therapy 
trial at the University of Pennsylvania. An FDA investigation 
concluded the scientist involved in the trial, including the 
lead researcher, who had a potential financial interest in the 
results of the trial, broke several rules of ethical conduct 
including inadequate informed consent procedures. In 2006 the 
antibiotic, Ketek, caused liver failure and death in patients 
who used it. An investigation showed that investigators had 
given fraudulent data to the FDA to gain approval of Ketek.
    A whistleblower who learned of the fraud contacted the 
Institutional Review Board that was responsible for approval of 
the Ketek clinical trial, but the IRB allegedly did nothing to 
report the fraud and stop the use of Ketek. And now here we are 
again today. Research is the key to innovation and discovery 
including curing deadly diseases, but as this whole panel 
agrees, the research must be conducted ethically so that 
participants understand the risk and make informed decisions 
about volunteering. That is why we need to upgrade our entire 
patient protection system in this country.
    Mr. Chairman, I have introduced legislation in the last 6 
sessions of Congress, the Protection for Participants in 
Research Act, and it reforms federal regulation and oversight 
of research on human participants by making federal regulations 
applicable to all research that is in or affects interstate 
commerce, that strengthens the education and monitoring of 
Institutional Review Boards, that harmonizes FDA regulations 
and the common rule, the two major sets of federal regulations 
governing research participant protection, that strengthens 
protection against conflicts of interest by investigators or 
IRB members, that improves monitoring of research risks and 
reporting of adverse events and unanticipated problems.
    We have reintroduced this legislation this session of 
Congress, and I would urge every member of this subcommittee on 
both sides of the aisle to look at the bill and think seriously 
about co-sponsoring it. The last session of Congress, we came 
close to passing the legislation on the suspension calendar 
because I think one thing we can all agree on in a bipartisan 
way is that we need to encourage medical experimentation but we 
need to do it in a way that both protects the patient and gives 
them informed consent about what they are getting into. Mr. 
Chairman, I don't want to be here for 13 hearings like we have 
been on food safety. I want to get this done. We have been 
working on it a number of years. We know the problem. We know 
the solutions. And I am looking forward to working with 
everybody on this committee to improving research so that we 
can have a robust system but at the same time protect the 
participants. Thank you, Mr. Chairman.
    Mr. Stupak. Thank you. Mr. Burgess for opening statement, 


    Mr. Burgess. Thank you, Mr. Chairman. In a surprise move, I 
am going to agree with the other side of the dais about the 
number of hearings, not wanting to have the numbers of hearings 
we have had on other areas before we do something. You know, 
today's economic environment, there is a lot of investigative 
activity that we could focus on, and we continue, continue, to 
have FDA-related hearings. I mean this is the Committee on 
Oversight and Investigations, not the committee to investigate 
the FDA. But I believe this subcommittee has some jurisdiction 
on what has happened with the financial services in this 
country, and we have had no hearings on that. Secretary 
Geithner might enjoy a visit to our committee and I would enjoy 
having the opportunity to question him. So the extent that this 
subcommittee has jurisdiction over the troubled asset relief 
program, I believe we ought to be involved.
    The Department of Energy, we had two hearings in this 
subcommittee last Congress on the security of our national 
labs. I recall us having questions for the head of the Lawrence 
Livermore laboratory. Well, it turns out now he is just right 
down the street at the Department of Energy. When are we going 
to go have Secretary Chu in to provide answers to that 
questions that we couldn't get answered last fall? Instead, we 
are having yet another hearing on the Food and Drug 
Administration, an agency that we all know is in desperate 
shape, is broken. The morale of its workers is precariously 
low. We acknowledge it. We are part of the cause. It is a 20th 
century agency operating in a 21st century world, a world that 
is global, commercial, and innovative with regards to food, 
drugs, and medical devices, but it is regulated by an agency 
that is underfunded, understaffed, under supported, and what 
meager funds we do provide them, they have got to expend 
preparing for the next congressional hearing.
    Now these issues relating to the Institutional Review 
Boards are serious. Any human subject testing should be 
carefully overseen by the federal government to prevent abuses. 
The types of products that were being discussed in the issues 
before us today are products that I would have used in my--
might have used in my former life, so I understand the 
seriousness of this issue, but I can also remember back right 
before I started medical school hearing about the experiments 
going on in Tuskegee, Alabama, with the former Department of 
Health, Education, and Welfare and their involvement. That is 
why the government now has the common rule to govern 17 
different departments and agencies within the federal 
government on human testing and why the Food and Drugs 
Administration has similar regulations governing human subject 
testing for medical devices and drugs.
    There must be ongoing scrutiny of the internal review 
boards. We must make certain the science is unfettered and 
rigorous and the Office of Human Research Protection needs to 
have the appropriate oversight. We need to make certain that we 
don't politicize the process, that conflicts of interest are 
being avoided, and all adverse events are thoroughly evaluated 
and that there is a clear avoidance of the IRB shopping where 
an Institutional Review Board will be removed from one 
institution to another because the results were not favorable. 
I am particularly concerned about the interaction of the common 
rule with the Food and Drug Administration regulations 
governing the investigational new drug applications. We all now 
the failures of the IRB and Ketek. Their failure was the 
impetus behind the GAO report being presented to us today 
regarding the review and oversight of the Institutional Review 
    But this is a problem that can be fixed. Let us fix it and 
move on to the next thing. We should hold a hearing on the 
entire approval process at the FDA. The IRBs, certainly they 
need to be investigated, the registration system, but what 
about the 510K exception for new drugs and the alleged 
revolving door where FDA employees go straight to the drug 
companies and then come back. We owe it to the American people. 
We owe it to the scientific community to fix the FDA and fix it 
right. Let us get on with that task. I yield back.
    Mr. Stupak. I thank the gentleman. I would also note this 
week you addressed to a letter to us on wanting to do hearings 
on medical devices with the FDA, and that is something that we 
are looking at closely so just so the record is clear, we will 
probably have more FDA hearings unfortunately. Ms. Christensen 
for opening statement, please.


    Mrs. Christensen. Thank you, Mr. Chairman. This is a very 
important hearing, and I thank you, Chairman Stupak and Ranking 
Member Walden for holding it. Because of the differences we 
have seen in response to medications and other treatments by 
African Americans, we, including the National Medical 
Association who I see in the audience, have been encouraging 
individuals and providers in our communities to become involved 
in clinical trials. I even participated in one briefly before 
coming to Congress. But in our community the specter of 
Tuskegee still looms large in our minds, and then there have 
been more recent incidents. I recall joining with other members 
of the House to stop the testing of pesticides in children, 
mostly African American poor children, just a few years ago.
    So if we though that this was an aberration or that 
Tuskegee could not happen again, obviously as we try to 
convince our communities the GAO report tells us that we were 
badly mistaken. The IRB process is supposed to ensure the 
health and safety of individuals in clinical trials. We, who 
have apparently misplaced our trust in the system are outraged 
at the failures that are documented in the GAO report. This 
system needs to be fixed, and I for one cannot in good 
conscience encourage another person to participate in a 
clinical trial until it is. Thank you, Mr. Chairman. I yield 
    Mr. Stupak. Thank you, Ms. Christensen. Mr. Gingrey, 
opening statement, please.
    Mr. Gingrey. Mr. Chairman, thank you. Today this committee 
has an opportunity to make sure that Institutional Review 
Boards are taking every possible step to ensure the safety of 
those who agree to participate in biomedical research. 
Biomedical research and clinical trials are critical to 
developing and perfecting the next generation of life saving 
medicine and devices. Without question, the potential benefits 
must outweigh the potential risks to participants. However, 
these individuals must also be made fully aware of the 
potential risks when they agree to participate. Mr. Chairman, I 
look forward to listening to the testimony, and I would like to 
reserve the balance of my time for questions, and I yield back.
    Mr. Stupak. Thank you, Mr. Gingrey. Mr. Green for opening 
statement, please.


    Mr. Green. Thank you, Mr. Chairman. I thank you for having 
this hearing today on the Institutional Review Boards, the 
IRBs, and the federal government's oversight of these boards. 
IRBs were created to protect individuals from harm or death 
during an experiment and ensure individuals give informed 
consent to the researchers. IRBs are in place to minimize the 
risks to the subjects, that the risks of the study are 
reasonable in anticipation of the benefits. Protection for 
subjects during experimental research are vital. Unfortunately, 
we have two painful incidents in our past to remind us just how 
necessary these protections are, the formaldehyde distribution 
in 1960 and the Tuskegee study in 1974. Both of these incidents 
serve as painful reminders of the wrongdoing of researchers at 
the expense of the health and well-being of the subjects.
    Most recent, we have the Ketek incident, which the IRB 
failed to investigate a whistleblower's allegations during 
continuing review of the application. I was on this 
subcommittee when we investigated Ketek and the flawed review 
process that enabled the drug to come to market. Several deaths 
have occurred during studies that received IRB approval. In 
recent years, many called for reforms to the IRB system. IRB 
regulations were created in the 1970's and have not been 
reformed in recent years. Currently, HHS and the Office of 
Human Research Protection has the jurisdiction over IRBs for 
studies with federal funding. FDA has jurisdiction over testing 
for medical devices and drugs.
    HHS requires IRBs but the FDA does not. However, the FDA is 
developing an IRB process. There are also independent IRBs not 
affiliated with any institution operating in the U.S. These 
IRBs are associated with the industry. The GAO and HHS have 
issued several reports documenting problems with the current 
IRB process. In 1998, GAO issued several recommendations for 
IRB reform, and to date none of these recommendations have been 
adopted by HHS or FDA. I am looking forward to the testimony of 
the witnesses, particularly GAO, so we can see if our oversight 
of IRBs is adequate and whether reforms of the system need to 
be made. And I yield back my time.
    Mr. Stupak. Thank you, Mr. Green. Member of the 
subcommittee, Mr. Markey, for opening statement, please.


    Mr. Markey. Thank you, Mr. Chairman, very much. While 
legitimate research is vital, human experimentation must be 
conducted under the highest ethical standards. This is a very 
important issue to me. In November of 1986, as chairman of the 
Energy and Commerce Subcommittee on Energy and Power, I 
released a report describing radiation experimentations on 
human subjects by American scientists between the 1940's and 
the 1970's. The people tested in these experiments were used as 
nuclear human guinea pigs to determine the effects of exposing 
humans to nuclear radiation. Most of those experiments provided 
little or no medical benefit to the patients. In many cases 
informed consent was not granted, yet, these individuals were 
asked to ingest, inhale, or be injected with radioactive 
materials, materials whose safety was not yet determined.
    These scientists recklessly endangered human lives and much 
of their work was kept hidden from the public until the 1980's 
and 1990's. The good news is that although when I released my 
report in 1986 the Reagan and then Bush administrations refused 
to respond to it. President Clinton, in 1994, upon my urging 
established the Presidential Advisory Committee on Human 
Radiation Experiments, which issued this report which led to 
the strengthening of regulations for research with human 
    We are here today to discuss IRBs. IRB is supposed to stand 
for Institutional Review Board. Unfortunately, with some 
experiments, IRB stands for irresponsible, reckless behavior. 
Unscrupulous IRBs have followed lax review procedures and 
unethical practices when assessing the safety of clinical trial 
experiments. As a result, participants have been put at risk of 
injury or worse, death. Without proper review from IRBs, the 
scientific integrity of clinical research work has been 
compromised. This can lead to faulty evidence regarding the 
safety of drugs and devices, and can further endanger the 
safety of the public at large if these products gain approval 
by the FDA.
    When it comes to protecting the safety of consumers, we 
must have the highest standards. In February of 2007 when I 
called on the FDA through several of my letters and a hearing 
by this subcommittee, and, again, Mr. Chairman, you have been a 
real leader on this, to answer questions regarding the safety 
of the antibiotic Ketek, the FDA approved Ketek partly based on 
fraudulent studies of its safety. Later, we found that Ketek is 
linked to severe liver damage and death. In this case, the IRB 
responsible for approving the clinical trials of Ketek ignored 
warnings from a whistleblower.
    Mr. Chairman, you have really been a policeman, a watchdog, 
on this issue. This hearing is another in the long process that 
you have conducted, and I want to congratulate you for that. I 
yield back the balance of my time.
    Mr. Stupak. Thank you, Mr. Markey. Ranking member of the 
full committee, Mr. Barton, has joined us. Opening statement, 
please, Mr. Barton.


    Mr. Barton. Thank you, Mr. Chairman. Apparently, I am still 
in time to do the digital transition opening statement too if 
that subcommittee chairman is here for this hearing. I want to 
echo what Congressman Markey just said about your leadership 
and Mr. Walden's leadership on this issue in taking a look at 
the Institutional Review Boards. We are following up today on 
an issue that was uncovered during an investigation in the last 
Congress. The question is whether these Institutional Review 
Boards do a good job of protecting human subjects. When we 
started looking into this, we were concerned that some of the 
IRBs were not equipped to handle the amount of the complexity 
of the work that comes up during the clinical trials.
    As a part of our subsequent investigation was an undercover 
work that the GAO conducted over the last year. GAO made up a 
supposed clinical investigator, outfitted him with a 
transparently suspicious resume, assigned him a fake medical 
license number. GAO also concocted a verifiably false company, 
devised med systems as a sponsor of the fake study. The study 
protocol was straight from the Internet, and the device, the 
company, and the doctor were 100 percent fictitious. Once this 
particular IRB learned the committee was investigating to their 
credit it took them less than a day to decide that something 
was wrong. Instead of actually doing something, they put out a 
news release that acted as if they had just been stung by James 
Bond instead of the GAO.
    The IRB is here today to explain why it decided to approve 
the equally easy to detect fake protocol and whether it stands 
by that decision. I suspect that this subcommittee will have 
some very direct questions about the alleged science and the 
patently false protocol that Coast IRB rubberstamped and why it 
caused no apparent concern even though it had no supporting 
data from clinical trials and the study devised matched 
examples of significant risk devices on the FDA's own web site. 
I think we should be careful not to over emphasize or to under 
emphasize the significance of what this investigation has 
shown. Coast IRB was sloppy and/or negligent, perhaps just flat 
wrong, in its judgment about the protocol and the risk it posed 
to its study's subjects.
    But, fortunately, two other IRBs that were presented with 
the same protocol rejected it, one without even considering it. 
The vast majority of clinical trials, at least I hope, are 
conducted without harm to patients. Even so, I am bothered by 
the fact that two of the IRBs that GAO investigated and the 
other IRBs who advertised in trade magazines and on the 
Internet seemed to focus on the speed of their review and the 
guarantees of a quick turnaround time. In some of those ads, 
patient protection and safety seem almost like an after 
thought. The bigger issue today may not be that one IRB made a 
grade error and then tried to throw attention elsewhere, but 
that the current set of regulations does little to prevent such 
an error. That is our job if we need to review those 
    We need to take a close look at those regulations and ask 
whether they are meaningful in the current research and 
clinical trial environment. Current regulations require that an 
IRB must make a number of determinations before approving a 
protocol, including that risks are minimized to the patient and 
that the patient has knowingly consented to participating in 
the study. But as GAO and the HHS Office of Inspector General 
have been reporting for years, there is basically no test that 
an IRB must pass before it opens for business to show that it 
is qualified to review such clinical trials. It is frustrating 
that the same problems keep popping up. These are problems that 
the GAO and the Inspector General have discussed in reports 
issued as long as 10 years ago.
    I know that the FDA recently announced a rule that would 
require IRBs to register with the FDA, but again that was a 
reform that was called for years ago, and I don't think that 
this rule would have made much difference with regard to 
solving the problems that the GAO has identified in its most 
recent undercover investigation. By putting the GAO findings in 
proper context, we can strengthen bio-medical research and 
innovation. If the public sees that our committee and federal 
agencies are ensuring that the research committee is looking 
out for the folks here confidence in clinical trials will be 
boosted and participation will increase. This should be a very 
meaningful hearing if we keep our discussion in perspective. I 
want to thank our witnesses for testifying today, and, again, 
you, Mr. Chairman, and Mr. Walden for leading on this issue. I 
yield back.
    Mr. Stupak. Thank you, Mr. Barton. That concludes the 
openings statements of members of the subcommittee. We have out 
first panel of witnesses before us. The panel that we have is 
Mr. Gregory Kutz, who is the Managing Director of Forensic 
Audits and Special Investigations at the Government 
Accountability Office, GAO, Dr. Jerry Menikoff, who is the 
Director of the Office for Human Research Protections at the 
Department of Health and Human Services, Dr. Joanne Less, who 
is the Director of the Good Clinical Practice Program at the 
Food and Drug Administration, and Mr. Daniel Dueber, who is the 
Chief Executive Officer at Coast IRB, LLC.
    It is the policy of this subcommittee to take all testimony 
under oath. Please be advised that you have the right under 
rules of the House to be advised by counsel during your 
testimony. Do you wish to be represented by counsel? If so, 
would you have them--would you state your counsel's name? Mr. 
Kutz. Dr. Less. Dr. Menikoff. Mr. Dueber.
    Mr. Emord. Jonathan Emord.
    Mr. Stupak. OK. During your testimony, if you want to stop 
and confirm with that, that will be fine. He cannot testify but 
he can give you advice. That is fine. It is the policy of this 
subcommittee to take all testimony under oath, so I am going to 
ask you to please rise, raise your right hand, and take the 
    [Witnesses sworn.]
    Mr. Stupak. Let the record reflect the witnesses replied in 
the affirmative. They are now under oath. We will proceed with 
your opening 5-minute statement. Mr. Kutz, we will start with 
you, please, sir.

                         COAST IRB, LLC

                   TESTIMONY OF GREGORY KUTZ

    Mr. Kutz. Mr. Chairman and members of the subcommittee, 
thank you for the opportunity to discuss Institutional Review 
Boards. Our investigation relates principally to private IRBs 
that authorize human subject testing. Today's testimony 
highlights the results of our investigation of the IRB system. 
My testimony has 2 parts. First, I will provide some very brief 
background, and, second, I will discuss the results of our 
investigation. First, as several of you have mentioned, federal 
regulations governing human subject testing evolved from 
society's horrified reaction to several cases.
    For example, there were the forced medical experiments on 
countless Holocaust victims. In the U.S., we had the 40-year 
Tuskegee study. In this case, hundreds of poor, mostly 
illiterate African American men, were not properly treated for 
syphilis so that the effects of this disease could be studied. 
Today, IRBs play a critical role in the safety and protection 
of human subjects. With this background in mind, let me move on 
to our results. Our investigation found that the current system 
is highly vulnerable to unethical or incompetent actors. We 
tested the IRB system with 2 separate but related undercover 
operations. The objective of the first operation was to see if 
an actual IRB would authorize our bogus medical device company 
to conduct human subject testing.
    The objective of our second operation was to determine 
whether a real medical research company would hire our bogus 
IRB. If successful, this would show that the bogus IRB could 
have authorized human subject testing. First, our bogus medical 
device protocol was approved by a real IRB even though we had 
no medical expertise. Our bogus device, which we called 
adhesive block, was a post-surgical healing device for women 
that matched several FDA descriptions of a significant risk 
device. We created our protocol and fictitious device using 
information that was publicly available and on the Internet. 
The monitors show excepts from the IRB board meeting where our 
protocols were unanimously approved and adhesive block was 
referred to as being probably very safe.
    As shown on the monitors, some due diligence would have 
shown a mailbox as our suite or office, a fictitious lead 
researcher with a fabricated medical license and resume, a 
fabricated FDA marketing approval for our device, and a cell 
phone as the only number we provided. The next picture on the 
monitor shows a coupon that this IRB provided which got our 
attention. Given that we are dealing with experimental research 
on human beings, we were surprised that anybody would offer 
discount coupons for this service. This IRB is no fly by night 
operation. They are currently the IRB of record for over 70 
federally-funded projects, and according to their own press 
release have overseen thousands of trials.
    Two other IRBs we sent these very same protocols to had a 
very different response. The monitor shows examples of their 
comments, including this protocol was awful and a piece of 
junk, the riskiest thing I have ever seen, the odds of approval 
were 0 percent, and my favorite comment, if somebody approves 
it, oh, boy. For the IRB that approved our study, the only due 
diligence they appeared to perform was after they received a 
letter from this subcommittee. After receiving this letter, the 
IRB was able to determine, for example, that our lead 
researcher and FDA marketing approval were, in fact, bogus. 
However, this IRB had already approved our bogus device for 
human subject testing 4 months before receiving your letter.
    For our second operation, we created a bogus private IRB. 
Once again, we used phony company officials and a mailbox as 
our business address. We registered our IRB on line with HHS 
and created a web site that looked like the web sites that 
other IRBs used. Then we went fishing. We advertised our 
services on the Internet and in newspapers to see if a real 
researcher or researchers would contact us. The monitors show 
our advertisements. Notice that we emphasized the speed of our 
reviews, our HHS approval, and guaranteed results. We did 
refrain from offering discount coupons as part of our 
advertising campaign.
    In response to these ads, our bogus IRB received protocols 
from one company and inquiries from five others. The company 
sending us its protocols was seeking approval to add a new test 
site for ongoing trials. Our bogus IRB, which as I mentioned 
had absolutely no medical expertise, could have authorized 
human subject testing at this site. However, we told this 
company that we couldn't review their protocols because we were 
experiencing significant financial problems due to the current 
economic crisis. In conclusion, every year millions of 
Americans submit themselves to experimental research. These 
people are among our nation's poorest and most vulnerable. I 
can't tell you whether our 2 undercover successful tests are 
isolated cases or the tip of the iceberg.
    What I can tell you is given the history of human subject 
testing, it is hard to believe that anybody could be 
comfortable with the integrity of the current system. Mr. 
Chairman, that ends my statement and I look forward to your 
    [The prepared statement of Mr. Kutz follows:]

    Mr. Stupak. Thank you, Mr. Kutz. Dr. Less, your opening 
statement, please. And for all the witnesses if you have a 
longer statement than 5 minutes, it will be included in the 

                    TESTIMONY OF JOANNE LESS

    Ms. Less. Good morning, Mr. Chairman, and members of the 
subcommittee. I am Joanne Less of the Good Clinical Practice 
Program at the FDA. I appreciate your invitation to appear here 
today to discuss FDA's role in overseeing Institutional Review 
Boards. For over 40 years, FDA has been committed to protecting 
the rights, safety, and welfare of subjects who participate in 
clinical trials of FDA-regulated products. The obligation to 
protect individuals who volunteer for research and assume 
research risks in order to advance public health and bio-
medical knowledge is integral to FDA's mission, and the agency 
continually strives to strengthen and promote the human subject 
protections. While measures to protect subjects are 
incorporated into all aspects and all stages of clinical trial, 
perhaps human subject protection is most clearly embodied in 2 
critical activities.
    The first is the requirement to obtain voluntary, legally 
effective informed consent from each study subject. The second 
is a requirement for independent ethical review of each 
clinical trial. The responsibility for human subject protection 
is one that FDA shares with sponsors, clinical investigators, 
study monitors, and IRBs. Every party with a role in the 
conduct and management of the trial has clearly defined 
responsibilities under FDA's regulations. All of these parties 
must fulfill those duties and be vigilant in doing so or 
subjects could be put at risk. This network of overlapping 
responsibility is key to protecting the rights, safety, and 
welfare of subjects who participate in FDA-regulated trials.
    IRBs are a critically important component of this 
collaborative oversight system. The primary purpose of IRB 
review is to assure the protection of the rights, safety, and 
welfare of human subjects. An IRB has the authority to approve, 
require modifications in or disapprove research. To approve a 
study, the IRB must determine that all of the following 
criteria are met. The risk to subjects are minimized, the risks 
are reasonable in relationship to anticipated benefits, 
selection of subjects is equitable, and informed consent will 
be obtained and documented. The IRB may require modifications 
to the protocol, informed consent or study procedures before it 
approves the study.
    An IRB may disapprove a study due to protocol deficiencies 
or for reasons such as limited availability of suitable 
subjects. Once a study begins, IRBs are responsible for 
reviewing changes to research. IRBs have the authority to 
suspend or terminate approval of research that has been 
associated with unexpected serious harm to subjects. There are 
different types of IRBs. Most IRBs are established and operated 
by universities, hospitals, and other institutions. These IRBs 
are comprised primarily of volunteers from the institution's 
faculty and staff. A small number of IRBs, often referred to as 
independent IRBs, are not affiliated with such an institution.
    Independent IRBs may provide reviews for industry-sponsored 
projects conducted outside a university or hospital, for 
example, in a doctor's office. FDA applies the same oversight, 
scrutiny, and inspectional practices to all types of IRBs. The 
agency places a higher priority on inspecting IRBs that are new 
that have not been previously inspected, that have previously 
been found to be out of compliance or that are reviewing 
research involving high risk products or vulnerable 
populations. During these inspections, FDA investigators select 
one or more studies in the IRBs inventory. The inspector 
reviews the IRB procedures and records, follows the selected 
studies through the entire process, and interviews key staff.
    FDA also conducts for-cause inspections of IRBs for which 
there have been complaints. During a for-cause inspection, FDA 
focuses on the issue identified in the complaint and determines 
if there is evidence to substantiate it. If an FDA investigator 
uncovers a regulatory violation, the agency may take further 
action. For minor deviations, FDA generally issues a letter 
describing the deficiency and provides reference to the 
relevant regulations or guidance. For more serious violations, 
FDA may issue a warning letter requesting that the IRB submit a 
corrective action plan within 15 days.
    FDA generally conducts a follow-up inspection to ensure 
that the violations were corrected. The agency may also impose 
administrative sanctions on an IRB. For example, FDA may 
withhold approval of studies that are reviewed by the IRB, 
direct that no new subjects be enrolled in ongoing studies, or 
terminate all ongoing studies. Because the clinical trials 
process has significantly evolved since FDA issued some of its 
regulations, FDA launched an initiative aimed at modernizing 
and strengthening the agency's oversight of clinical trials. 
FDA issued a number of guidances with the expectation that they 
will reduce burdens, improve IRBs efficiency, and allow IRBs to 
give more attention to critical human subject protection 
    Earlier this year, FDA issued regulations that would 
require all IRBs to register through an electronic system. This 
will enable the agency to more precisely identify IRBs that 
review FDA regulated research, assist us in providing 
educational information, and help us to identify IRBs for 
inspection. DA has also established a task force to ensure that 
all pending and future recommendations related to the agency's 
oversight of clinical trials raised by Congress, the HHS Office 
of the Inspector General, and the General Accountability Office 
are fully addressed.
    Finally, although FDA has traditionally conducted a 
majority of its inspections in association with the submission 
of a marketing application, the agency has been shifting more 
of its resources to inspections of ongoing studies. This will 
allow the agency to identify potential problems while the study 
is still active enabling implementation of corrective actions 
to minimize risk to subjects and preserve the integrity of the 
trial. FDA has also been improving its follow-up of violative 
inspections and working to identify alternative methods to 
select IRBs for inspection. It is FDA's strong belief that 
educating IRB members, chairs, and administrators fosters 
understanding of the human subject protection regulations and 
enhances their ability to protect subjects participating in 
    To that end, in partnership with OHRP and other 
organizations, FDA participates in numerous national and 
regional conferences and workshops. In conclusion, FDA remains 
committed to strengthening human subject protection and 
improving its oversight of IRBs and other parties that conduct, 
oversee, and manage clinical trials. FDA has taken steps to 
ensure that recommendations regarding the agency's oversight of 
clinical trials, including IRBs, are fully addressed. While FDA 
has already implemented a number of changes to its clinical 
trial oversight activities, the agency continues to look for 
and welcome input about new approaches to fulfill these 
responsibilities. This concludes my statement. I would be happy 
to answer any questions.
    [The prepared statement of Ms. Less follows:]

    Mr. Stupak. Thank you. Dr. Menikoff, your opening 
statement, please, sir.


    Dr. Menikoff. Good morning, Mr. Chairman, and members of 
the subcommittee. I am Jerry Menikoff, Director of the Office 
for Human Research Protections which is within the Department 
of Health and Human Services. I previously served as director 
of the office that oversees the NIH's human research protection 
program. Before that, for almost a decade, I chaired the 
Institutional Review Board at the University of Kansas Medical 
Center. The department's commitment to human subject 
protections spans more than 3 decades. In 1974 what was then 
known as the Department of HEW issued its first department-wide 
human subject protection regulations. OHRP is charged with 
enforcing the current regulations which are in 45 CFR part 46.
    OHRP's mission is to protect the rights, welfare, and well-
being of subjects involved in research conducted or supported 
by the department. The responsibility for protecting research 
subjects is one that OHRP shares with the FDA, agencies that 
fund research, institutions that conduct research, 
investigators who carry out that research, and the IRBs that 
review it. Everyone with a role in human subjects research must 
fulfill their duty to protect the subjects or else those 
subjects could be at undue risk. The core provisions of the 
department's current human subjects regulations cover three 
major areas. First, institutions conducting HHS funded research 
must enter into an agreement called an assurance agreeing to 
comply with the regulations. Second, a committee called an 
Institutional Review Board or IRB must review and approve the 
research before enrollment of any subject. The IRB plays a 
central role in ensuring that the rights, safety, and welfare 
of subjects are adequately protected.
    Third, the research must be conducted consistent with the 
regulations, which generally require obtaining the informed 
consent of the subjects and the IRB's continuing review of the 
research. The department's regulation in addition provides 
special protections for various populations considered to be 
vulnerable. Besides the regulations administered by OHRP, there 
are other federal regulations protecting research subjects. The 
FDA has its own set of regulations. These apply to clinical 
trials involving products regulated by FDA. These regulations 
are substantially similar to those administered by OHRP, though 
there are some differences.
    In 1991, 14 other federal departments and agencies joined 
HHS in adopting a uniform set of regulations that are identical 
to the core portion of the HHS regulations. This set of 
regulations is often referred to as the common rule. For all 
participating federal department and agencies the common rule 
outlines the same basic provisions for IRBs informed consent 
and assurance agreements. As I noted, the department's 
regulations require that institutions that are engaged in HHS 
funded research must sign an agreement with OHRP known as an 
assurance. Through this assurance the institution commits 
itself to have all its HHS-funded research conducted in 
compliance with the regulations.
    Assurances must also include designation of one or more 
IRBs that will review the research covered by the assurance. 
The institution holds primary responsibility for ensuring that 
the IRBs it designates are appropriately qualified to review 
the types of research studies it conducts. The Federalwide 
Assurance, or FWA, was introduced in 2000 and has been the only 
type of assurance accepted by OHRP since 2005. Previously, OHRP 
reviewed assurances using procedures that often involved 
lengthy discussions with institutions. In 1998, the HHS Office 
of Inspector General recommended that OHRP shift its focus and 
resources to other parts of the system so as to better protect 
research subjects. The current largely automated system for 
processing FWAs was implemented as a response to that OIG 
    With the adoption of the FWA system in 2000, a new 
requirement was added. Any IRB designated under an FWA must be 
registered with OHRP. The process for registering an IRB with 
OHRP is separate from the process for obtaining FWA but the two 
are related. This registration process was implemented in 
response to a recommendation from that same OIG report. The 
report recommended a simple registration system which would 
collect minimal descriptive information such as location and 
contact information. This simplified registration system would 
still allow OHRP and FDA to communicate effectively with IRBs 
while maintaining the standards of protection for research 
    The IRB registration process requires among other things 
submission of a list of IRB members identified by name, 
qualification, and affiliations. OHRP generally accepts all IRB 
registration applications that include information showing 
compliance with the following requirements, that there are at 
least five IRB members, there is at least one person designated 
as a non-scientist and one designated as a scientist, and then 
there is at least one member designated as not affiliated with 
the institution. On January 15 of this year both OHRP and FDA 
issued IRB registration rules. The two sets of registration 
rules are quite harmonious and will be implemented through a 
single web-based IRB registration system.
    In conclusion, the protection of research subjects remains 
a highest priority for both the department and for OHRP. We 
continue to work on ways to better achieve that goal and very 
much welcome any recommendations that the subcommittee may 
have. Thank you for this opportunity to address you. I will be 
pleased to answer any questions.
    [The prepared statement of Dr. Menikoff follows:]

    Mr. Stupak. Thank you, Dr. Menikoff. Mr. Dueber, your 
opening statement, please, sir.


    Mr. Dueber. Good morning. Coast IRB recently submitted the 
product in question, Adhesiabloc, to an independent forensic 
toxicological lab. That lab determined, as we did, as our board 
did on October 30, that the product was safe. Here is the 
conclusion by two top forensic toxicologists in the United 
States. It is my opinion within a reasonable degree of 
scientific certainty there is no sound scientific foundation 
for finding the constituents in the Adhesiabloc gel described 
in clinical study protocol pilot study of safety and efficacy 
of 2.5 percent Adhesiabloc gel to reduce adhesions following 
peritoneal cavity surgery, device clinical study protocol 
number P-D-15 version 1.4, unsafe at the dose recommended for 
    In October of 2008, the Government Accountability Office, 
at the behest of this committee, perpetrated an extensive fraud 
against my company, Coast IRB, LLC. It did so without probable 
cause that Coast had committed any crime. Indeed, no one at 
Coast has committed any crime. It did so without involving the 
executive branch. It did so without satisfying any of the legal 
safeguards that the Department of Justice and the federal 
courts have in place. It acted without probable cause that a 
crime had been committed.
    If this committee's objective with this fraudulent and 
illegal GAO sting operation was to demonstrate that IRBs need 
to do more checking and verification of sponsor and PI 
licenses, verify the existence of companies and so on, fine, we 
will do that. And we have changed our SOPs to do just that 
because of this illegal fraud. But did you have to take the 
extremely negative approach of setting up an elaborate, 
expensive fraud? Yes, your fraud was very sophisticated, and 
you pulled the wool over our eyes. Congratulations. But you 
need to understand the effects of this charade. I personally 
have wasted 5 weeks of my valuable time defending the honor, 
integrity, and reputation of both our company and of me. We 
have spent many years building that.
    My company has now spent over $100,000 defending itself, 
and do you know what that means? That means that we now have to 
lay off at least five people at our company to pay for this. A 
much better and positive approach would have been for you to 
call a conference together of key IRB industry leaders, FDA, 
OHRP, and the committee to identify what needs to be fixed and 
what laws, regulations are needed to fix the problem. No one 
would have had to have been harassed as Coast has with this 
sting. The GAO posed as a private business seeking review by my 
company of a medical device. It represented the medical device 
to be one that was substantially equivalent to a device 
approved for market by FDA.
    In an elaborate scheme, GAO violated federal and state 
laws, one, by falsely representing itself to be a medical 
device company, two, by submitting a fake clinical trial 
address, three, by submitting a fraudulent protocol for a 
fraudulent medical device, four, by submitting a forged CV for 
a fake principal investigator, five, by falsely representing 
the medical device to be substantially equivalent to a device 
approved by FDA for market, six, by submitting a fraudulent FDA 
510(k) number for the device, seven, by submitting a fraudulent 
Federalwide Assurance number, and eight, by forging a 
Commonwealth of Virginia medical license and license numbers 
for its supposed principal investigator.
    GAO also engaged in extensive verbal and e-mail 
correspondence with Coast IRB in furtherance of the fraud. The 
fraud would have persisted to this day had I not discovered it 
and had Coast not terminated the clinical trial. Had I not 
discovered it following receipt of this committee's request for 
documents, I am confident it would have been discovered before 
its next scheduled review of the trial in April, next month. 
Mr. Chairman, it is the exclusive duty and province of the 
executive branch of this government to engage in law 
enforcement actions. By well settled precedent that branch 
alone may engage in clandestine stings upon probable cause that 
a crime has been committed. Innocent citizens of this country 
cannot be lawfully defrauded by their government. To hold 
otherwise replaces the rule of law with tyranny.
    Mr. Chairman, what the GAO has done at the request of this 
committee is unlawful. The actions here involve mail fraud, 
wire fraud, forging of a Commonwealth of Virginia medical 
license, false presentation of license numbers and 510(k) 
numbers, and false holding out of people to be physicians in 
the Commonwealth of Virginia. Coast has notified federal and 
state law enforcement of these crimes. These are crimes whether 
committed by the GAO or anyone else in the absence of probable 
cause. They are crimes for which those responsible should 
answer. Although we have informed law enforcement that GAO is 
behind them, a fact never affirmatively confirmed by your 
committee staff to me, we have asked that the crimes be 
investigated and that those responsible be prosecuted.
    Mr. Chairman, the question confronting me, and which I hope 
will occur to you, is whether this committee and the GAO have 
the lawful authority to defraud an innocent party to prove a 
political point. My question, sir, is whether this committee 
and the GAO are above the law. You know, I am just very, very 
saddened and disappointed in our government right now. I cannot 
believe my government did this to me and my company. It is 
unconscionable. But Coast IRB shares everyone's concern in this 
room about the need to improve our oversight system. We have 
been at the forefront in the past about documenting the need 
for improvements in ICFs and IRB shopping and other categories. 
We want to work with FDA and this committee to improve the 
system in a positive way. Thank you, and I will be happy to 
answer any questions.
    [The prepared statement of Mr. Dueber follows:]

    Mr. Stupak. The members will be recognized for 5 minutes 
for questions. I will begin. Mr. Dueber, I have to tell you how 
disappointed I am, I think Mr. Walden said the same thing, and 
the other members who are up here, with your opening statement. 
Coast IRB could have come forward this morning and admitted 
that they made numerous mistakes by not checking into the 
credentials of a fake company, a fake doctor, and a fake device 
that Coast ultimately approved for use in human testing. 
Instead, like a kid who has got caught with his hand in the 
cookie jar, you now come before Congress today to complain that 
you were caught. Nowhere in your opening statement is there any 
sense of concern that your company's approval could have led to 
human subjects being exposed to a dangerous substance without 
testing. Lives could have been injured or lost as a result of 
your company's action, and all you do is complain that you were 
    Where is the first responsibility and where is the 
corporate responsibility? So let me ask you this, Mr. Dueber, 
you were interviewed on the record by committee staff last 
week. They asked you some basic questions about your medical 
review of GAO's experimental testing protocol. And let me put 
them on the screen. Here are your answers. When our counsel 
asked you, do you feel your company's medical review of the 
protocol was adequate, you indicated yes. So is it fair to say 
that none of the board members, including Dr. Dodd, who did the 
primary medical review, has raised concerns with the medical 
review of this protocol? Is that fair to say that you have no 
concerns about the protocol?
    Mr. Dueber. This was a sophisticated fraud, sir.
    Mr. Stupak. My question is, is it your opinion that the 
medical review was fair in this case?
    Mr. Dueber. We reviewed--we did a safety review. Dr. Dodd 
looked at the protocol.
    Mr. Stupak. And you feel it is safe?
    Mr. Dueber. We checked with--Dr. Dodd made the conviction--
made the conclusion that it was safe, and we have just proven 
that it is safe with an independent review of----
    Mr. Stupak. Sure, your independent review, you talk about 
the 2.5 percent of the Adhesiabloc. What about the 97.5 percent 
of the liter that would be left in the woman's abdomen? What 
about that 97 percent? You don't even know that it is, so how 
can you test to see if it is even safe in your little report 
you have there from your expert?
    Mr. Dueber. He looked at it and he said that----
    Mr. Stupak. He looked at what? 2.5 percent, that is what he 
looked at.
    Mr. Dueber. He looked at the whole device.
    Mr. Stupak. Look at your protocol. You are going to leave 1 
liter behind. What about the other 97.5 percent of the liter 
that you have no idea what it was in our protocol because you 
never asked.
    Mr. Dueber. Well, sir----
    Mr. Stupak. So, therefore, you can't sit here and say the 
other 97.5 percent has been tested and safe when you don't know 
what the tests were because you don't know what the product 
    Mr. Dueber. Sir, I am not a scientist. I did not do the 
    Mr. Stupak. Neither am I.
    Mr. Dueber. But what I can tell you is that Dr. Dodd told 
me when I talked to him about this that this propylene glycol 
    Mr. Stupak. Which is 2.5 percent, 1 liter, is safe. Didn't 
the doctor tell you what the other 97.5 percent was?
    Mr. Dueber. We didn't discuss----
    Mr. Stupak. You didn't ask? What if it is poison? So let me 
go on. GAO submitted this fake protocol to 2 other IRBs that 
came to exactly the opposite conclusion than you did. They both 
rejected the study. The first IRB that rejected the study was a 
company called Argus IRB. Here is what they said. We realized 
it was a terrible risk for the patient. The concept of the 
study was risky. It is the worse thing I have ever seen. Doing 
a surgery, a major surgery, on a patient, then a mystery guy 
walks in and dumps a solution in the body. Where is the safety 
for the patient? Who is overlooking all these parts? Who is 
looking for the patient--who is looking out for the patient? I 
had a problem with propylene glycol gel. They said it was a 
safe substance. I didn't see any data on it. There was no data 
in the protocol indicating that propylene glycol gel was safe 
internally. It was a serious problem.
    Mr. Dueber, how is it possible that your company found that 
this study wasn't risky at all when other IRBs rejected it? And 
actually a second IRB called Fox Company, they said I could 
have sent the protocol to Board of Review but I spared wasting 
their time. There was no monitoring for safety. It appeared 
that people were just going to go out and start injecting 
people. Mr. Dueber, given what the other IRBs found, don't you 
think your company made a major mistake here?
    Mr. Dueber. Our company followed the regulations that FDA 
    Mr. Stupak. Really? Where is the due diligence in your 
company? Where is the safety of the patient by injecting them 
with a liter bottle and 97.5 percent----
    Mr. Dueber. It had a 510(k) exemption for one thing.
    Mr. Stupak. Did you go check that 510(k)?
    Mr. Dueber. No, we did not.
    Mr. Stupak. Is that part of due diligence, checking a 
510(k)? You relied on it.
    Mr. Dueber. It is now. We have changed our SOPs to 
incorporate those since we have been now hoodwinked by our 
    Mr. Stupak. My time is up. Mr. Kutz, let me ask you this 
last question, if I can. Do you believe Coast's medical review 
was adequate? Do you agree with Mr. Dueber that there was no 
risk involved with injecting a liter of this mystery substance 
into a woman's abdominal cavity?
    Mr. Kutz. I don't have the expertise to say that, but what 
I would say is this is if you have a system where two companies 
can say this thing is the riskiest thing they have ever seen 
and they rejected it even in some cases before it got to the 
board, and at the same time we have an IRB that says this is 
perfectly safe, we got a real problem here. So I think that 
would be what I can say based on my expertise.
    Mr. Stupak. Thank you. And I recognize Mr. Walden for 5 
minutes, please.
    Mr. Walden. Thank you, Mr. Chairman. Mr. Dueber, I want to 
go to this report from I guess it is Kupeck Group, LLC, because 
he says in my opinion within a reasonable degree of scientific 
certainty there is no sound scientific foundation for finding 
that constituents in the Adhesiabloc gel described in clinical 
study protocol pilot study, blah, blah, blah, are unsafe at the 
dose recommended for testing. Is that the same thing as saying 
the entire grouping of those items in this proposed gel are 
safe? Does his report actually say or this company's report 
actually say that the entire compilation and usage of the gel 
was safe or just that the two constituent ingredients alone are 
    Mr. Dueber. That is our understanding. We asked him to 
review the gel at the 2.5 percent for this study and for the 
amount left in the cavity and he said that it is not unsafe at 
this dose recommended for testing.
    Mr. Walden. And so is he saying to you then that he would 
have approved it for use in human subjects?
    Mr. Dueber. That is the way we understood it, yes.
    Mr. Walden. And left in their stomach, sir, their belly for 
up to 5 months?
    Mr. Dueber. Yes.
    Mr. Walden. Where does it say that in the report? I don't 
see it in the conclusion, and where does it discuss the 
procedures involved?
    Mr. Dueber. I haven't had the opportunity to read the whole 
    Mr. Walden. When did you ask for the report, sir?
    Mr. Dueber. Several days ago.
    Mr. Walden. So what report did you ask for that would have 
shown this was safe when your board approved this gel 70?
    Mr. Dueber. Well, as I--excuse me.
    Mr. Walden. While you are consulting with counsel, I will 
go to Dr. Menikoff. You can continue to consult if you need to. 
Dr. Menikoff, obviously you are representing HHS. You heard my 
comments. I heard yours in terms of more of a recitation of 
what the rules and the procedures are for your agency and the 
same from Dr. Less for FDA. What troubles me greatly, and I 
think what troubles the people I represent, is that virtually 
anybody even with the most silly of applications can register 
as an IRB simply by e-mailing your agency and it gets entered 
even if the name of the town you are from is Chetesville, 
Arizona for which I assume there is no zip code. Is this 
    Dr. Menikoff. Congressman, it is true that anybody could 
enter information into the registration system. The 
registration system was a response to the very OIG report that 
several of you commented on, and it basically established the 
registration system, a method of collecting minimal information 
so there would be a list of IRBs.
    Mr. Walden. What do you do with that information mostly?
    Dr. Menikoff. We use it to contact IRBs to send information 
to them.
    Mr. Walden. Information about that?
    Dr. Menikoff. About a change in the system. There may be a 
compliance allegation alleged against a particular IRB, so we 
will contact them using the contact information.
    Mr. Walden. Do you use it to contact them about conferences 
and things?
    Dr. Menikoff. It could sometimes be used for that. 
    Mr. Walden. Mr. Dueber, let me go back to you because I 
sense you may have an answer to my question.
    Mr. Dueber. Yes, sir. The primary reviewer on this, Dr. 
    Mr. Walden. Very distinguished credentials, by the way.
    Mr. Dueber. Yes. And he is very familiar with propylene 
glycol which is the basis of this substance, and he told me 
that propylene glycol can be ingested in large amounts in the 
body and is not toxic and that it is proven to be non-
cancerous. There has been no question about its toxicity in any 
part of the body even remaining in the body for a period of 
time. He is an expert medical reviewer for the California 
Medical Board. He is chief of staff at the Lodi Medical 
Hospital. He is chairman of his Institutional Review Board at 
Lodi Medical Hospital. He is an OB/GYN also. He knows his 
    Mr. Walden. All right. I am sure he does. Dr. Less, since 
you are FDA, is there any problem with ingesting this chemical 
in your body and having it sit there for 5 months and in 
concert with the surgeries and all?
    Ms. Less. Having not----
    Mr. Walden. You can't answer that?
    Ms. Less. I was just going to say having not seen the 
device description pre-clinical test and by compatibility 
testing, we wouldn't be able to comment on that.
    Mr. Walden. Mr. Kutz, maybe you can help us here. What did 
the other IRBs say about this procedure and the protocols and 
the tests and all?
    Mr. Kutz. I think it is important to know that because it 
goes beyond just is the product safe. If could read a few of 
their comments to you, if that is OK.
    Mr. Walden. Please.
    Mr. Kutz. The first one, as you mentioned, said that our 
submission was so bad they weren't even going to give it to the 
board. They also said that our protocol showed no evidence of 
quality control for sterility or consistency of the product. 
The next comment is very, very important. They said there was 
no prior investigation report of the pre-clinical animal 
studies we claimed to have performed, and they wanted to know 
whether there had been any adverse events, whether our product 
killed animals or hurt animals.
    The second IRB said who is the manufacturer of Adhesiabloc 
and where is it made? It seems like a logical question. We 
didn't put that in our protocols. Where will these surgeries 
take place? That wasn't in our protocols. How are the hospitals 
and surgeons being selected? That wasn't noted. Has the surgeon 
or hospital read the protocols and do they agree? We didn't 
answer that. Provide the diagram used to record the incision 
lines. And the last one that seems fairly relevant when you are 
discussing it, who will be performing and taking the tissues 
and biopsies? So those are some of the substantive comments.
    Mr. Walden. Mr. Kutz, did this IRB, which by the way made 
itself known to the public through their public relations 
outreach efforts, you didn't do that, did you?
    Mr. Kutz. No, we never used----
    Mr. Walden. And we did not. And so did this IRB come back 
to you with any questions about the protocols, any questions 
    Mr. Kutz. Their initial focus was on the consent form, and 
they wanted us to, if you will, dumb it down so 5th grade level 
of reading could be done, so they were very focused on the 
consent form, which is part of their--not a lot of substance on 
the actual medical or the issues of the hospitals, who were 
these surgeons, who is this person actually putting the item 
into the woman's pelvic region after open surgery, no questions 
at all of substance like that.
    Mr. Walden. My time has expired.
    Mr. Stupak. Thank you, Mr. Walden. Ms. DeGette for 
questions, please.
    Ms. DeGette. Thank you, Mr. Chairman. Mr. Dueber, how long 
has Coast been in business?
    Mr. Dueber. Since 2002.
    Ms. DeGette. Since 2002. And since that time, you have 
reviewed 352 protocols, correct?
    Mr. Dueber. No. I don't know exactly how many we have 
    Ms. DeGette. OK. Have you declined any of the protocols 
that you have reviewed?
    Mr. Dueber. My understanding is yes, but I don't know how 
    Ms. DeGette. OK. Mr. Chairman, I would ask unanimous 
consent that Mr. Dueber supplement his response to tell this 
committee how many protocols that they have reviewed and how 
many they have approved and how many they have rejected.
    Mr. Stupak. Without objection.
    Ms. DeGette. Thank you. Now with this particular protocol 
you took this on 5 months ago, correct?
    Mr. Dueber. Correct.
    Ms. DeGette. And you approved the protocol for testing on 
humans within 48 hours, didn't you?
    Mr. Dueber. On this particular study, I am not sure what 
the turnaround time was.
    Ms. DeGette. Well, your company advertises a 48-hour 
turnaround on most cases, correct?
    Mr. Dueber. What that refers to, ma'am, is that----
    Ms. DeGette. Yes or no.
    Mr. Dueber. I can't answer yes or no because I need to 
explain it.
    Ms. DeGette. All right. Go ahead.
    Mr. Dueber. The turnaround time refers to the amount of 
time it takes for the Coast administrative staff, which is 
separate from the board, to review the documents presented by 
the protocol sponsor and----
    Ms. DeGette. OK, I got you. So it is the administrative 
turnaround. How long and on average per protocol does it take 
you to approve this protocol for human testing?
    Mr. Dueber. I am not sure because the board--every member 
of the board has to review thoroughly the protocol.
    Ms. DeGette. So can you give me--how long did it take on 
this case? Did it take 48 hours to approve it for human testing 
on this case?
    Mr. Dueber. Well, it probably took longer than that 
    Ms. DeGette. Well, how much longer?
    Mr. Dueber [continuing]. There were two board----
    Ms. DeGette. Three days, 4 days, 5 days?
    Mr. Dueber. Well, there was a week between the preliminary 
approval and the final approval.
    Ms. DeGette. A week. OK. Now, excuse me, sir, we can swear 
in your lawyer if he would like to testify, but I would like 
you to answer. Now so it took a week to approve this protocol. 
At the time that the protocol was approved for human testing, 
the report that was prepared by this very fine doctor that you 
talked about, did he prepare that report at that time that the 
protocol was approved?
    Mr. Dueber. Are you referring to the minutes of the board?
    Ms. DeGette. I am referring to the Kupeck Group LLC report 
that you provided to this committee late last night.
    Mr. Dueber. You are asking how long did it take him to do 
    Ms. DeGette. No. I am saying did he prepare this at the 
time, 5 months ago, when it was approved?
    Mr. Dueber. No.
    Ms. DeGette. No. Was there a written report by him approved 
that went through all the scientific basis 5 months ago?
    Mr. Dueber. No.
    Ms. DeGette. Was there anything in writing analyzing the 
scientific evidence and the risk and benefits?
    Mr. Dueber. There was extensive discussion at the board 
meeting itself between----
    Ms. DeGette. Was there any written report prepared at that 
    Mr. Dueber. There were minutes prepared for that.
    Ms. DeGette. Does this committee have copies of those 
    Mr. Dueber. Yes.
    Ms. DeGette. OK. I would ask our committee staff if I could 
get a copy of those minutes, please. Now this report, when was 
this prepared, the report that you keep referring to as to the 
scientific efficacy of the protocol, prepared?
    Mr. Dueber. Yesterday.
    Ms. DeGette. And why was it prepared yesterday?
    Mr. Dueber. Because we contacted----
    Ms. DeGette. Because you were coming in to testify today, 
    Mr. Dueber. We contacted this individual and asked if he 
would review this because we were----
    Ms. DeGette. Because you were coming in to testify today, 
    Mr. Dueber. Well, we were convinced because Dr. Dodd was 
convinced that this substance was safe. He made that 
determination. The board agreed. We have five doctors, high 
quality doctors, on our board, and they agreed it was safe.
    Ms. DeGette. OK.
    Mr. Dueber. We just wanted before we came here to find out 
if that was----
    Ms. DeGette. To find out, in fact, if it was safe?
    Mr. Dueber [continuing]. In fact the case.
    Ms. DeGette. We could have been doing human testing for 5 
months without that report.
    Mr. Dueber. But, ma'am, no one in--we have never at Coast 
ever had a fraudulent study submitted to us. There is no 
economic reason for anybody to do such a thing.
    Ms. DeGette. OK. I am sorry. First of all, let me stop you 
and say I now have the minutes in front of me, and the whole 
discussion is about a paragraph long. But as the chairman is 
saying, the paragraph never talks about what is in that 95 
percent of the substance, so how would they possibly know if 
this would be safe?
    Mr. Dueber. It is based on propylene glycol which is proven 
to be safe.
    Ms. DeGette. But that is 2.5 percent.
    Mr. Dueber. Propylene----
    Ms. DeGette. What is in the rest?
    Mr. Dueber. The board reviewed that and felt that it was 
safe and there was----
    Ms. DeGette. OK. I am going to----
    Mr. Dueber. --a 510(k) device upon which they were basing, 
you know, the fact that that existed and therefore it should be 
safe. And, of course, we didn't check the 510(k) device to see 
if it was real, but we never had reason to do that, ma'am.
    Ms. DeGette. Let me just stop you. Now Ms. Christensen-
Green and I are sitting here looking at this going we sure 
don't want this in our abdomens, and I think all the other 
women sitting here today are thinking that. That is the thing 
about IRBs. We think that when we approve--when we ask IRBs to 
review a protocol, we are doing it so that they can review the 
safety of the entire protocol. And we have had situations like 
this where--we had one situation where an IRB approved a 
protocol where they performed one type of plastic surgery on 
one-half of someone's face and another type on another half, 
and that person was grossly disfigured. What would have 
happened if this actually would have gone into human testing, 
and they would have put something poisonous as the other 97.5 
percent into women's abdomens?
    Mr. Dueber. I can't speculate on what would have happened.
    Ms. DeGette. I can't either. Dr. Menikoff, would you agree 
that is a problem?
    Dr. Menikoff. Congresswoman, this study is outside OHRP's 
jurisdiction. It was not federally funded.
    Ms. DeGette. Well, I understand that, but if there was a 
study that put 97.5 percent of a substance as part of a human 
trial into someone's abdomen, that would seem to be a problem?
    Dr. Menikoff. Again, this is not under our jurisdiction. I 
think FDA is in a better position to comment on the facts. We 
saw no protocol.
    Ms. DeGette. So you don't--OK. Dr. Less, what is your----
    Ms. Less. We have not seen the protocol or device 
description either. We would need to know what is in the 
product before we could comment.
    Ms. DeGette. Right, but you certainly wouldn't think that--
you certainly wouldn't approve some kind of a drug that put a 
whole bunch of fluid like this where it wasn't specified what 
it was as part of a surgical operation?
    Ms. Less. We would need to know what is in the product, how 
it is being used, a full device description.
    Ms. DeGette. I just have----
    Mr. Stupak. No, no, we got to move on. We have both former 
chairs who would like to ask questions. Mr. Barton for 
questions, please.
    Mr. Barton. Thank you. You talk about a target rich 
environment for questions. My first question is to our 
representative from the GAO. The protocol and the device that 
you all chose, you, not you personally, but your organization 
consciously picked one that the FDA had already rejected and 
then changed it to make it even worse, isn't that correct?
    Mr. Kutz. We picked something that was available on the 
Internet and altered it significantly. The 3 components of the 
actual gel, we made up from stuff on the Internet so we had 
never mixed it together. I can't--we don't know if it works or 
doesn't work. We just put it together on paper.
    Mr. Barton. But you tried to make it very easy for anybody 
that was really trying to review the protocol to figure out 
that it was terrible and reject it, which 2 of the IRBs did.
    Mr. Kutz. Yes. We didn't know what we were doing.
    Mr. Barton. And then this one rubberstamped it almost 
before they got it, is that a fair statement?
    Mr. Kutz. Well, they actually--I mentioned a coupon in the 
opening statement. They gave us a pre-review with the coupon 
and then the final review was where they authorized the 
informed consent and than the actual protocols.
    Mr. Barton. How did you pay for their review?
    Mr. Kutz. Well, we gave them our credit card number. As it 
turns out, they never actually charged us.
    Mr. Barton. Really? I would have thought they would have 
cashed the check almost as quickly as they certified approval.
    Mr. Kutz. We were surprised they didn't. Everybody else 
    Mr. Barton. Dr. Less and Dr. Menikoff, what can be done to 
decertify this company right now? Why are they still in 
    Ms. Less. Again, we don't have the--we have not seen the 
GAO's report to be able to comment on what actually transpired.
    Mr. Barton. I am not asking you about that. I mean I am so 
mad at the company, I can hardly be civil, but I am almost as 
upset with our government folks who are supposed to oversee 
these IRBs, and this company has gotten 4 or 5 notice letters 
in the last 2 to 3 years, and yet they are still in business, 
and they have the gall to come here and threaten to sue the 
government. They ought to have their butt being kicked out the 
door within the week.
    Ms. Less. I could provide some background to you on how the 
process would generally work for a product such as this. This 
would be considered a significant risk product subject to FDA's 
jurisdiction that would require an investigational device 
exemption in order for the study to proceed.
    Mr. Barton. So basically as the representative of the FDA 
you just say business as usual.
    Ms. Less. No.
    Mr. Barton. These folks are going to stay in business for 
another 4 or 5 years, maybe approve a product that kills some 
innocent person, and then we will have another oversight 
hearing 3 or 4 years down the road. What steps are being taken 
right now to decertify these charlatans that raised $4 million 
in revenue last year scamming the public?
    Ms. Less. Congressman, what I wanted to explain to the 
committee is that for significant risk products such as this 
there should have been FDA oversight as well as IRB oversight.
    Mr. Barton. There wasn't.
    Ms. Less. No. This product should have been submitted to 
the FDA so we could have reviewed the product, looked at what 
it was made of by compatibility testing, sterility testing, all 
of that. That piece of this picture was not part of the 
operation, so that piece of the human subject protection was 
not invoked.
    Mr. Barton. As the FDA representative, what are you going 
to do to use whatever enforcement mechanisms the FDA has to 
hold this particular IRB company accountable?
    Ms. Less. We would have to go and look at----
    Mr. Barton. What are you going to do?
    Ms. Less. We need----
    Mr. Barton. Are you going to do anything at all? Are you 
going to make a report? Are you going to make a recommendation?
    Ms. Less. We will take the information from the GAO, fully 
evaluate it, do our own investigation and see what needs to 
    Mr. Barton. You will do that?
    Ms. Less. We need to see the GAO's findings and see exactly 
what happened and evaluate it and see what we need to do.
    Mr. Barton. Do you have any sense of outrage about this?
    Ms. Less. Without knowing exactly what went on----
    Mr. Barton. So the answer to that is, no, you don't?
    Ms. Less. We do. We are very concerned with human subject 
    Mr. Barton. Dr. Menikoff, you represent HHS. Do you have 
any sense of outrage about this? Are we the only people--the 
people that are elected, are we the only ones that seem to be--
    Dr. Menikoff. First of all, I would certainly welcome on 
OHRP's behalf obtaining information about what happened. We 
have yet to see any actual information or documentation of what 
happened. We would welcome obtaining that and reviewing it and 
taking appropriate action.
    Mr. Barton. So you are in a passive mode also? If we bring 
a dump truck load of documents, you will review them? Are you 
going to be an advocate for investigation, use the authority of 
the Health and Human Services?
    Dr. Menikoff. OHRP is an advocate for improving the 
protection of research subjects. Again, nobody has provided us 
yet any document that information about what happened. We 
welcome that. We are eager to get it even before this hearing, 
and we would welcome receiving it, and we have appropriate 
procedures to protect subjects, and we would implement those 
procedures and determine appropriate action.
    Mr. Barton. Well, my time has expired, Mr. Chairman, but I 
am outraged, and I am going to encourage you and Mr. Waxman and 
Mr. Walden to use every authority of the United States Congress 
and the Energy and Commerce Oversight and Investigations 
Subcommittee to eliminate these bad actors. I have a sister-in-
law who is undergoing cancer therapy treatment. She is Stage IV 
right now. And she is looking at submitting to some protocols 
for some experimental drugs that would be subject to an IRB 
approval, and it appalls me, it appalls me, that, you know, it 
is apparently with the exception of GAO who seems to be pretty 
intense about this, FDA and HHS appear to be almost 
indifferent, and of course the IRB president is incense that we 
are even asking questions. I mean that is just outrageous. So I 
will work with you, Mr. Chairman, and we will----
    Mr. Stupak. Mr. Kutz, if you want to respond to Mr. Barton.
    Mr. Kutz. Yes. We have actually sent a letter to FDA as of 
yesterday requesting them to do an investigation. The 
interesting point is when the letter was sent by the committee 
and Coast made the allegations against us, FDA had an 
investigator with the U.S. Attorney to go after charges after 
our fake company, so they were very aggressive at that point in 
    Mr. Barton. Bless their little hearts.
    Mr. Kutz [continuing]. About going after--without any 
evidence except a letter from Coast they were ready to go to 
the U.S. Attorney to go after us, so I just wanted to make sure 
you understood that, Mr. Barton.
    Mr. Barton. We have a company here that has received three 
or four notice letters in the last several years. I mean it is 
just ridiculous. I yield back.
    Mr. Stupak. We thank the gentleman. Our hearing is going to 
continue. As the former chairman noted earlier, this is our 
second hearing on IRBs and something we have an interest in. 
There will be legislation. I know Ms. DeGette has legislation. 
There will be other legislative proposals after this hearing, I 
am sure. We have seven votes on the floor. I am going to ask 
members' patience and ask them to come back in approximately 1 
hour. We will be in recess for 1 hour, and then we will come 
back and continue this hearing. Thank you.
    Mr. Stupak. This meeting will come back to order. Witnesses 
are reminded they are under oath. And, Mr. Dueber, Ms. DeGette, 
hopefully she is going to come back, but she had asked you if 
it was your policy to prove the protocol to board members 
within 24 or 48 hours. You said, no, it was longer. She asked 
specifically about this one but under testimony before the 
committee the record should reflect on page 27 the question was 
you tried to do this once if a protocol goes to the board or 
board members turn around and make a decision within 24 to 48 
hours, is that correct? Your answer was right, right, yes.
    Mr. Dueber. Yes. I checked into that. Again, I am new to 
the company. I have been there 5 months.
    Mr. Stupak. Well, you shouldn't be new to the truth. Either 
it is yes or not. I mean you have your testimony. Your attorney 
has it. Just a caution, that is all.
    Mr. Dueber. I was not intentionally telling----
    Mr. Stupak. I didn't think so. OK. Ms. Christensen for 
questions, please.
    Mrs. Christensen. Thank you, Mr. Chairman. This is one of 
my first hearings on the Institutional Review Boards, and I am 
really shocked at some of what I am reading and hearing. And I 
am concerned that the IRB can be listed and then utilized by 
researchers without the Department of Health and Human Services 
even having to do a cursory check and that if federal funds are 
not involved or an FDA-regulated product is not involved there 
doesn't have to be any federal oversight or research if I am 
understanding correctly. And I also wonder listening and 
reading if there should even be private for-profit IRBs. Maybe 
they ought to be university-based or somehow more directly 
under the purview of the department.
    My first question, I will begin with you, Mr. Dueber. When 
the committee staff interviewed you last week, you acknowledged 
that your company did not verify the physicians leading these 
experimental studies or that their credentials were accurate. 
In fact, when the GAO submitted its fake protocol to your 
company you didn't verify that Jonathan Kruger, the person 
listed as the primary clinical investigator, in fact, had a 
legitimate medical license, is that correct?
    Mr. Dueber. Yes. What we did was we have never had the 
experience of having a fraudulent group of people lying to us 
about their existence and about their licenses. They did submit 
a license copy but it turned out to be fraudulent too. So what 
we have learned from this is we need to start checking that. We 
have changed our SOPs accordingly, but we did in our review 
what was required by regulations, and regulations do not 
require that that be done but regardless of whether it is 
required or not, we are doing that now.
    Mrs. Christensen. But you did eventually once you were 
asked to testify checked on the doctor. How long did it take 
for you to make that determination?
    Mr. Dueber. Well, this whole thing didn't come up until I 
got the letter from the subcommittee on the 23rd of February so 
some time after that, a day or two after that, we started 
checking into----
    Mrs. Christensen. Was it a long process to check to 
determine whether he was----
    Mr. Dueber. Well, the date that sticks in my mind where 
most of the work was done was March 5, and it took a team of us 
about maybe 3 to 4 hours to check all these things out, the 
existence of the company which didn't exist, the phone numbers, 
the licenses, and all that. It took quite a bit of time to just 
    Mrs. Christensen. For all of it, but probably checking to 
see whether the doctor was a duly licensed physician----
    Mr. Dueber. That doesn't take long. That is why--you know, 
that is prime example of why we are going to start changing 
that and start doing it.
    Mrs. Christensen. Mr. Kutz, let me turn to you. You 
submitted a fake medical license to Coast IRB on behalf of Dr. 
Kruger. I think it is in the binder that you might have there. 
It is tab 2. It is the State of Virginia. The date on the 
license is 1990.
    Mr. Kutz. That is correct. I don't have the binder but that 
is correct.
    Mrs. Christensen. But Virginia requires medical doctors to 
obtain a new license every 2 years like most places do so this 
19-year old license would have expired back in 1992. Isn't that 
something that the IRB should have caught?
    Mr. Kutz. Since they weren't looking at that, I guess they 
wouldn't have caught it, but certainly if they understood that 
they had to be done every 2 years that would be something that 
they could put in their protocols.
    Mrs. Christensen. Well, Mr. Dueber, how come the company 
did not catch the fact that this was an expired license? I am a 
physician, so I am very sensitive to issues relating to 
    Mr. Dueber. I don't know. I wasn't there. I don't know why 
it wasn't caught.
    Mrs. Christensen. But you would agree that if a doctor had 
engaged in malpractice or had lost their license that it would 
be the job of the IRB or Coast in particular to check that?
    Mr. Dueber. After this experience, I would agree, yes.
    Mrs. Christensen. And you would agree that if you realize 
that that license had expired 19 years before that you would--
would you have approved that study if you had picked up that 
the license had expired or that the person--well, that the 
license had expired, just simply that?
    Mr. Dueber. Well, that is speculating but if someone 
submitted something like that and then it had expired we would 
do a lot of other things then to check into the validity of 
other things sent to us, which could end up resulting in us not 
taking on the study or not approving it.
    Mrs. Christensen. But the principal investigator not having 
a valid license would be a reason to not approve, wouldn't it?
    Mr. Dueber. Yes.
    Mr. Stupak. Gentlewoman, would you yield on that point? 
This license was invalid on its face, was it not? You didn't 
have to check. It was invalid, 17 years old, 10 years old, so 
it was invalid. There was no checking to be done.
    Mr. Dueber. Yes, that is correct.
    Mrs. Christensen. My time has expired, Mr. Chair. Thank 
    Mr. Stupak. Any other questions?
    Mrs. Christensen. I did have another one.
    Mr. Stupak. Go ahead.
    Mrs. Christensen. OK. To Dr. Less. In April of 2007, well 
before our investigation of Coast began, HHS received a letter 
containing allegations about Coast. They turned the letter over 
to FDA because the accusations related to FDA-related research. 
FDA initiated an inspection of Coast in July, 2007. In March, 
2008, FDA issued a warning letter to Coast finding that Darren 
McDaniel, who was the CEO at the time, improperly assigned 
someone with only a high school education to conduct an 
expedited review of a human testing protocol.
    Dr. Less, I think it is commendable that the FDA took 
action to investigate and address this allegation, but as the 
GAO investigation has shown, Coast had numerous other problems 
including a review process that approve protocols based on a 
19-year old medical license, board members don't read 
protocols, and these coupons that explicitly encourage IRB 
shopping. Why didn't FDA identify some of these other clear 
deficiencies at Coast?
    Ms. Less. Congresswoman, FDA, when they go out and do an 
inspection they generally spend a few days inside and they pull 
two or three studies, follow those studies from approval 
through continued review, look for adverse events, see whether 
or not the IRB had appropriately addressed those adverse events 
or changes to the protocol. When we went out on this, it was a 
for complaint--a for-cause inspection. We had been out there 
several times before, had not identified problems. So for this 
case we went out specifically to look into the allegations that 
expedited review had not been used properly, so we were 
investigating that. And we did issue a warning letter and we 
imposed sanctions because we had been out there before and had 
found some minor violations so we imposed sanctions that they 
not use expedited review anymore.
    And generally what we will do when we do issue a warning 
letter is follow up. We make sure that the IRB institutes a 
corrective action plan within 15 days. We review that, look to 
see if it has adequately addressed everything that we were 
concerned about, and then we put them on our list for follow-up 
    Mrs. Christensen. So you don't do a comprehensive review 
generally when you visit an IRB, you just review the specific 
    Ms. Less. It depends on why we are out there because we had 
been there several times before and had done a more 
comprehensive review and pulled a number of studies and looked 
at those other studies. But in this particular case we just 
focused on the complaint.
    Mrs. Christensen. But the original letter also identified 
other concerns including back dating, changing board meeting 
minutes and not following through with board requests that the 
FDA inspection investigate those issues while you were there?
    Ms. Less. We did look into all of those. The ones that we 
identified in our warning letter, I believe, were all related 
to the abuse of expedited review and potential conflict of 
interest that the CEO had inserted himself into the process and 
had inappropriately used expedited review, and so we focused on 
those issues.
    Mrs. Christensen. Including the back dating and changing of 
the board--you did. And, Dr. Menikoff, did the allegations 
result in an evaluation of Coast's internal practices and 
    Dr. Menikoff. Are you talking about the current 
    Mrs. Christensen. No, the ones that I just referred to, the 
19 year old doing the expedited review and the backdating, 
changing board meeting minutes, not following board requests.
    Dr. Menikoff. Well, Congresswoman, as noted earlier, OHRP 
and FDA have separate jurisdiction. They began this 
investigation on a study which was under FDA jurisdiction and 
was not under OHRP jurisdiction. FDA and OHRP regularly 
communicate, and we discuss issues relating to actions that one 
agency or the other takes, and we will deal appropriately and 
generally do deal appropriately in terms of this.
    Mrs. Christensen. Well, I am going to stop here but my 
question really was did you do an allegation as a result of 
those set of allegations? Did you do an evaluation related to 
    Dr. Menikoff. The evaluation was under FDA's jurisdiction 
at the time, and we would normally at that point--it is the 
same set of regulations. We would normally allow FDA to conduct 
an appropriate investigation.
    Mrs. Christensen. Thank you, Mr. Chairman. I appreciate the 
additional time. Thank you.
    Mr. Stupak. Thank you. Mr. Dueber, if we go back to that 
license, that license that was 19 years old, if you could put 
that back up on the board, could also indicate that maybe the 
doctor had been malpractice, no longer licensed to practice 
medicine, could it not, if the license was 19 years old?
    Mr. Dueber. It could have been anything. The fact that we 
didn't catch that it had expired was something we should have 
    Mr. Stupak. Right. Right. And the reason why we are doing 
these hearings, and I have been on this committee now for 15 
years, and Mr. Walden for quite a while too, back in 2002 we 
had a veteran die during experimental drug testing conducted by 
someone who was not credentialed to practice medicine in the 
United States like this Jonathan Kruger technically is not 
because his proof of license is 19 years old. So your 
responsibility as an Institutional Review Board is to do due 
diligence to protect the health and safety of the patient. You 
are the gatekeeper between medicine and the patient. And you 
testified earlier you had four--I think you had five, you have 
four doctors and one registered nurse and two other people in 
reviewing this. I am baffled as to why there is no due 
diligence and why things like this are not caught.
    If I had four doctors looking at a license, I think someone 
would have caught it. You might talk about 2\1/2\ percent of 
Adhesiabloc but 97.5 percent of it, we don't know what it is, 
and then you are going to put this in a lady's abdominal cavity 
but not by the doctor who performed the surgery but by an 
assistant according to the protocol, and the doctor wouldn't 
even know. And if I was a patient and I became sick after you 
dumped this liter bottle in me, I would go to the doctor, and 
the doctor who performed the surgery wouldn't know anything 
about it because the protocol was real specific that the doctor 
had to be out of the room when they applied the Adhesiabloc gel 
to the patients. I would have thought someone--I am not a 
doctor, but I thought that is pretty strange, isn't it, because 
when I get sick, where am I going to go? I am not going to go 
to the assistant who put the gel in me because I don't know who 
it is because I am under anesthesia and I am out. I am going to 
go back to my doctor. My doctor isn't going to know anything 
about it according to this protocol. That is crazy, isn't it?
    Mr. Dueber. I spoke further with Dr. Dodd, and he told me 
that he was familiar with a product called Hisken. He said it 
is a similar product used in surgeries, and is added to the 
abdominal cavity in the same relative volumes as the protocol 
here. Dr. Dodd said he is very familiar with Hisken and was 
comfortable with that volume so----
    Mr. Stupak. But you never verified the 510(k) process to 
see what this junk is I am dumping in the woman's body. You 
never looked. Now there might be something out there that maybe 
in the surgical field someone may use but remember you are the 
gatekeeper. You are the person who is protecting the patient 
from some doctor whose license is 19 years old and you are the 
gatekeeper, so just because there might be something out there 
but since you don't know what 97.5 of this stuff is, you really 
can't say it is safe.
    Mr. Dueber. Well, that is precisely why after having 
experienced this whole episode that we have gone through, we 
have changed our SOPs to check the 510(k), to check on the 
predicate device it is based on, to check the doctor's 
credentials, to check the existence of the company.
    Mr. Stupak. So what about the--you said you have done 
thousands of these trials. Currently you are in 70 clinical 
trials. Did you do those in those others? Did you check the 
doctor's credentials? Did you check to see what the licensing 
regulations are, the 510(k), whatever you call it?
    Mr. Dueber. We did not, and, you know, we have never had a 
fraud like this perpetrated on us. We have had----
    Mr. Stupak. It is not a fraud on you. You didn't do your 
work. We caught you. That is all. It is not a fraud. Where is 
the fraud?
    Mr. Dueber. No, that is incorrect, sir. We did our job. We 
did what FDA regulations require.
    Mr. Stupak. Really? I thought you said your job was to do 
due diligence and protect the patient. How did you protect the 
patient in Coast's IRB with this protocol?
    Mr. Dueber. We were following the regulations that were 
outlined in the FDA's regulatory----
    Mr. Stupak. Does the FDA license say--regulations say you 
have to check the credentials of the doctor?
    Mr. Dueber. No.
    Mr. Stupak. Does it say you have to check the substance?
    Mr. Dueber. We never had to, sir, because we have never had 
anyone try to----
    Mr. Stupak. What expertise do you have, if you say now when 
you are caught, well, the FDA didn't tell me to do this, but 
the FDA doesn't tell you the basic stuff, so what is the 
expertise of your Coast IRB to even run to review protocols? If 
you can't catch simple things like this and if the FDA doesn't 
tell you and you can't think of it, what qualifications then do 
you have to be an IRB?
    Mr. Dueber. We have a great deal of qualifications. We have 
got some outstanding very educated, very experienced doctors 
and nurses and laypeople on our board.
    Mr. Stupak. Then why didn't they catch it? You had more 
medical people, and I have looked at a lot of IRBs, of the 
seven people, five of the seven have medical backgrounds and 
they never catch any of this stuff. That is amazing, especially 
since our protocol, as testimony was earlier, Mr. Kutz had 
indicated, is truly based on a real study of a product that 
killed people.
    Mr. Dueber. Our review--well, this product wouldn't kill 
people, and we know that. Our procedures are----
    Mr. Stupak. Tell me what is in this bottle. How do you know 
this won't kill anybody?
    Mr. Dueber. I am not a scientist. I can't answer that.
    Mr. Stupak. Well, you keep saying this product wouldn't 
kill anybody, Adhesiabloc wouldn't kill anybody. You don't even 
know what is in it. See, that is the part that baffles us up 
here. You act like you did nothing wrong, it would not harm 
anybody, but you don't know what is in here. Isn't that your 
responsibility again to protect the patient? Isn't that your 
responsibility? How can you protect the patient if you don't 
know what is in it? I mean the other two IRBs that we have 
spoke of and Mr. Kutz has talked about, man, that just said 
this is crazy. You shouldn't do this. There is no patient 
safety. We don't know what the substance is. No one should do 
this. And then when they finally realize someone approved it, 
they said, oh, boy. That was your famous quote, I think, there, 
Mr. Kutz.
    Mr. Dueber. We have had--you know, Dr. Dodd was the 
original expert that reviewed this, and now we have this other 
outside party that reviewed it who is an expert and----
    Mr. Stupak. This outside party, did he review--he reviewed 
Adhesiabloc, he reviewed this, your expert there you mentioned?
    Mr. Dueber. The expert reviewed that, yes.
    Mr. Stupak. Oh, yes? What is in here? What does your expert 
say is in here?
    Mr. Dueber. I don't have his report in front of me.
    Mr. Stupak. You just paid for another bad report because no 
expert has ever reviewed this. You know why? Because we made it 
up last night. There is 2.5 percent, the stuff on the top, we 
made this up. So if your expert--if you paid someone money to 
review this they never contacted us to get what the contents we 
are talking about. How can you review something if you don't 
even know the chemical formula of the stuff you are supposed to 
be reviewing? Let me ask you this. Let me ask you something you 
should know something about. This is your coupon that Mr. Kutz 
testified to that was delivered to him after you had your first 
contact with him where Coast, here is your coupon, good for one 
time research protocol review worth $1,300. Take a free test 
drive on us. And here is the back of your coupon.
    So let me ask you, take a free test drive. There is a 
picture of a car and all that here, and there is a smiley face 
looking--here is the car. Here is the smiley face looking at me 
in the rear view mirror in my car, and it says coupon good for 
one time research protocol review worth $1,300. And then it 
says coast through your next study. So it sounds like to me 
that your study is more likely to be approved if you go with 
Coast. Am I reading that wrong?
    Mr. Dueber. No--yes, you are reading it wrong because what 
that is is a marketing piece. It is just trying to get 
different companies, new companies, to try out Coast and try 
out Coast's customer service. You know, there is nothing wrong 
with using some kind of a promotion to gain new business. It 
doesn't have anything to do--this is the business side of the 
business. This has nothing to do with the review board and the 
decisions they make. Those are 2 separate businesses.
    Mr. Stupak. Coast through your next study. We coasted 
through in 48 hours and there are all kinds of problems with 
our study, right?
    Mr. Dueber. We are not using that marketing piece anymore 
but, you know, that is just a piece that was used to try to 
generate some new business. It has nothing to do with the 
actual review of the studies. That is done by a separate review 
board that are independent contractors, and they have nothing 
to do with the business side. They don't know anything about 
money that we make or money that we don't make. They are not--
    Mr. Stupak. Well, speaking of the money you make, you made 
what, grossed $9.3 million last year. At $1,300 a pop, that is 
a heck of a lot of reviews.
    Mr. Dueber. Most of them are a lot more than that because 
that is a single study rate. You know, there are protocols that 
have hundreds of sites, generate a lot more revenue because 
there is a lot more work involved to review it.
    Mr. Stupak. Sure. Let me ask FDA or HHS, how many 
Institutional Review Boards come on line every month?
    Dr. Menikoff. Each month we process about 300 applications. 
Some of those are amendments or renewals.
    Mr. Stupak. So basically how many are new ones a month?
    Dr. Menikoff. I don't have an exact number on that.
    Mr. Stupak. Are you concerned that people are seeing this 
as sort of a quick way to get rich? Do you need 300 a month? 
That is 3,600 a year.
    Dr. Menikoff. Again, Mr. Chairman, many of those are likely 
to be amendments or renewals of an existing IRB.
    Mr. Stupak. But don't you think we should have some kind of 
limitations on IRBs? Shouldn't they have some qualifications 
before you become an IRB?
    Dr. Menikoff. If you would like me to address the 
registration system, the registration system that OHRP runs was 
put into place as a result of the OIG 1998 report. The goals of 
the registration system were modest to have a list of the 
number of IRBs out there and to have some contact information.
    Mr. Stupak. This is your registration system. This is 
Trooper dog, remember, at Maryland House?
    Dr. Menikoff. Mr. Chairman, the system is such that we 
verify that people put in the information for requested piece 
of information.
    Mr. Stupak. Really? How do you verify it with Trooper dog 
    Dr. Menikoff. By registering an IRB the government, federal 
government, is in no way endorsing that IRB or in any way 
saying that IRB----
    Mr. Stupak. Don't you think when an IRB is registered with 
the HHS there is sort of like a seal of approval authentic 
because I have this approval, like fake medical devices sent up 
by Mr. April Fuhl.
    Dr. Menikoff. OK. Mr. Chairman, again, we in no way--the 
system is not designed to be any endorsement of an IRB, nor do 
we intend it to be, and to the extent any of the evidence you 
revealed during this hearing or the GAO has revealed----
    Mr. Stupak. Yes, but my question was doesn't it give people 
an aura of authenticity because you----
    Dr. Menikoff. I understand that. We were not aware that 
this was a problem that people out there were thinking----
    Mr. Stupak. Really?
    Dr. Menikoff [continuing]. Because an IRB was registered 
that the federal government was endorsing it. The federal 
government has many systems by which it has lists of--again, 
this is sort of like a contact phone book.
    Mr. Stupak. This is an IRB that is supposed to be set up to 
protect patient safety. This isn't a phone book.
    Dr. Menikoff. I understand that, and there are many parts 
of the system that actually help ensure that IRBs are operating 
appropriately. The registration system----
    Mr. Stupak. Tell me one thing you do after you register an 
IRB, what do you do to make sure they are valid IRBs or doing 
it properly?
    Dr. Menikoff. OHRP has several divisions that work at this. 
We have a compliance division that we accept reports of non-
compliance from anybody who wants to report.
    Mr. Stupak. So nothing until somebody complains like if 
someone dies?
    Dr. Menikoff. If you are asking whether the current system 
basically puts a stamp of approval on an IRB at the moment it 
is created, it was not designed to do that.
    Mr. Stupak. Mr. Kutz, what did your investigation find when 
people would register? Was that a seal of authenticity, 
approval or something? Why did you undertake that part of 
registering fake IRBs with HHS?
    Mr. Kutz. Obviously, he is saying it is not intended to, 
but one of the IRBs, for example, that we submitted our 
protocols to, said that it gave us an aura of legitimacy. And 
so, yes, I believe people out there would--and plus it is 
called assurance, but it is really self-assurance, and so it 
doesn't really provide anything except registration, as he 
said, of what is in the system. So maybe we shouldn't be 
calling it assurance either. It depends on how you perceive 
that. I could perceive assurance to mean someone has actually 
reviewed and approved an application.
    Mr. Walden. Mr. Chairman, will you yield on this point 
because I thought the CFRs, the regulations of the federal 
government in 45 CFR part 46.101(d) state that as part of 
evaluating assurances the department ``will take into 
consideration the adequacy of the proposed IRB in light of the 
anticipated scope of the institution's research.'' Is that not 
part of your rules?
    Dr. Menikoff. Yes. Now that rule dates back to 1974. It was 
implemented at a time when this whole system was first being 
created and people didn't understand the complexity of how the 
system works, how you best protect research subjects, and how 
an IRB should function. Over the decades as the system was 
implemented, people discovered basically that the efforts being 
spent in implementing that provision essentially amounted to 
verifying, for example, that an IRB that reviewed medical type 
studies had one or two doctors on it, and a lot of effort was 
being spent at assuring that fact. This was then reviewed by 
the OIG in the 1998 report I described, and it actually 
concluded that the way that provision was being implemented was 
not actually advancing human protections, that a better way to 
do this was to create a more streamlined system that basically 
what you needed was----
    Mr. Walden. And we are 10 years later, and that system is 
due to come on line this summer?
    Dr. Menikoff. No. Part of that system have already been 
    Mr. Walden. And so if you had had to follow this regulation 
that is still on the books, correct?
    Dr. Menikoff. Yes.
    Mr. Walden. Would not that check of assurance to make sure 
that the fake IRB created by GAO was legitimate, wouldn't that 
regulation have caught that? These folks listed themselves as 
from a city in Arizona named Chetesville. I mean come on. Do we 
have nothing in place that would have caught a fake IRB?
    Dr. Menikoff. Congressman, the system is currently designed 
in a way that you gave a registration with some cute names that 
again had spelling errors and other things that unless somebody 
sat there and tried to pronounce the names and the addresses, 
they would not pick up the things that seem incredibly obvious 
right now, and the system wasn't designed to do that. We do not 
have our staff going through the names to see whether people 
have put funny names on the list, nor indeed would we know 
    Mr. Walden. So what good is it to register with your agency 
when you put a stamp of approval on an IRB that then is system 
wide usable for others to go through to certify human tests? Is 
it a pointless purpose?
    Dr. Menikoff. Congressman, we are not putting a stamp of 
approval on the IRB. If the federal government----
    Mr. Walden. But people market it that way. We have examples 
of advertisement where they say, this one, I won't read you the 
name, you can count on IRB standard for high quality review and 
documentation, full AAHRPP accreditation, good standing with 
FDA, registered with OHRP.
    Dr. Menikoff. OK. And, again, it is mentioning several 
other entities. One of those is AAHRPP which is an 
accreditation entity that is in the business of accrediting 
IRBs. But in terms of the federal government aspects of this, 
we are not in the business currently--that would be a different 
system, and we welcome your input in terms of whether or not 
you think that would be a good thing to do. That would be a 
dramatic change from the system. The system is never designed 
to basically have us from the outset endorsing and putting some 
sort of stamp of approval----
    Mr. Walden. So you think the system works well today?
    Dr. Menikoff. Right now we think we have a well-functioning 
system. There is certainly room for improvement but in terms of 
the part of the system that OHRP deals with, it is interesting 
that GAO, for example, we deal with the funded studies. GAO was 
not able to create a fake study that went through and got 
federal funding.
    Mr. Walden. No, but GAO could have created a privately--a 
study through private funding that would have your HHS stamp of 
approval on an IRB, right?
    Dr. Menikoff. Again, it is not a stamp of approval. It is a 
    Mr. Walden. Well, you don't call it that but you could say 
I am registered with HHS.
    Dr. Menikoff. You are a problem. We welcome the information 
and we will look into this in terms of making sure that people 
out there know that the government currently is not putting a 
stamp of approval. It is a registration list. Anybody could 
sign up on the list. That is exactly what----
    Mr. Walden. Clearly.
    Dr. Menikoff [continuing]. OIG intended when it asked for 
this list to be created. They wanted a quick and dirty way to 
put people on our list so we would know vaguely how many IRBs 
are out there and contact information.
    Mr. Walden. Mr. Kutz.
    Mr. Kutz. Well, I think the Federalwide Assurance which 
includes the IRB and the medical device company, this is 
necessary for federally funded research so it is, I assume, 
meaningful for federal people applying for federal grants with, 
I believe, 19 agencies, so I would believe those agencies 
potentially put some credibility behind people that have 
Federalwide Assurance.
    Mr. Walden. Because what you are getting when you register 
with Mr. Menikoff's office is Federalwide Assurance.
    Mr. Kutz. Correct, for federal funded projects.
    Mr. Walden. That is the gate. You got to get through that 
gate in order to even go to the next step, right?
    Mr. Kutz. Correct.
    Mr. Walden. And then there may be a check or balance that 
catches you there?
    Mr. Kutz. There could be beyond that, yes, but just to get 
that--you have to get that to even apply is my understanding.
    Mr. Walden. So it does serve more than just a place to 
register to get mail for future conferences or other updates. 
It is actually something that is required elsewhere in the 
    Mr. Kutz. For federally-funded projects, not for privately 
funded. That is my understanding.
    Mr. Walden. Do you disagree with that?
    Dr. Menikoff. OK. If I could clarify, we are talking about 
two things here. There is a registration system which is a 
registry, a list of some information about each IRB. There is 
an assurance process, the Federalwide Assurance. They are 
different things. The registration list, yes, an IRB to be used 
by an entity that wants to get federal funding or HHS funding 
has to be listed on the registration list. If I could describe 
the Federalwide Assurance, that is essentially an agreement by 
which before you take federal funding, you have to agree, you 
have to sign on the dotted line that your entity agrees to 
abide by the federal regulations. So essentially by getting 
Federalwide Assurance an entity is actually committing itself 
and putting itself under a legal burden that it will abide by 
the regulations.
    The federal government is in no way endorsing the entity, 
but it is just that a federal funding agency at HHS cannot give 
funds to them until it has basically sworn and said, yes, we 
will protect human subjects. We agree that we will have to 
abide by the federal regulations. That is a good thing, and the 
intent of the system is to encourage, make sure people could 
get Federalwide Assurance and could basically be willing to 
swear that they will indeed abide by the federal regulations.
    Mr. Walden. I will tell you, I guess when I get back home 
and try and explain how you register an IRB or whatever you 
want to call it, and it is up here on the chart, fake medical 
device, easy reviews. They are clever names, I don't doubt 
that. And that that gives you then the authorization to oversee 
the protocols on the human tests and that that seems to be all 
it takes.
    Dr. Menikoff. If I could clarify, in terms of the 
jurisdiction side that OHRP deals with a major part of the 
picture has been left out, which is that the IRB is not working 
in a vacuum. As we noted again, GAO was actually not able to 
get federal funding. An IRB reviewing a study, is it hard to 
get federal funding.
    Mr. Walden. But they did get approval on the other side of 
the coin. They were able to go to an IRB and get approval for 
human tests.
    Dr. Menikoff. Yes. And I am just pointing out an IRB that 
is reviewing a study that is getting federal funding, getting 
federal funding itself involves a very detailed process of 
checks and balances----
    Mr. Walden. I understand that.
    Dr. Menikoff [continuing]. That again that is a part of the 
research world that is under OHRP's jurisdiction. Much of the 
vetting that you are concerned about will actually happen, for 
example, before NIH gives funds. Barely 20 percent of the 
studies actually get funded these days. It is very competitive. 
These things are reviewed by panels of the most eminent----
    Mr. Walden. So you don't see that there is any real problem 
with what you have learned from GAO, is that----
    Dr. Menikoff. Up to now, everything you have indicated GAO 
has done, I would think would be highly problematic for that to 
have happened in terms of the studies that get federal funding. 
Again, we are open to looking at the information on what 
happens but----
    Mr. Kutz. We didn't apply for federal funding and I am not 
sure--and I don't think we actually would because we might 
actually displace a legitimate applicant so that would not be 
necessarily an appropriate undercover test in this case, but we 
didn't apply. So I am not sure if we couldn't but we didn't 
apply, and I assume there are a lot of other controls there 
that would have had to have been tested, but just for the 
record we did not try to get federal funding. We just used this 
to give us an aura of credibility up there amongst the people 
that were medical device and IRB companies.
    Mr. Walden. So where in your fake IRB ad, you felt like you 
got that stamp of approval, and it meant something in the 
marketplace when you advertised?
    Mr. Kutz. We used it as that, and certainly again as I 
mentioned at least one of the IRBs that we sent our protocols 
to said it gave us legitimacy. And I understand what HHS is 
saying here, but that is the perception out there, so that is 
an important--whether they like it or not that is what the 
reality is out there amongst people.
    Mr. Walden. Thank you, Mr. Chairman.
    Mr. Stupak. Mr. Burgess, questions?
    Mr. Burgess. Thank you. Mr. Dueber, let me just ask you, 
was this product ever used? Are there any patients who received 
this product?
    Mr. Dueber. No, not that I know of.
    Mr. Burgess. The board approval came in October, the end of 
    Mr. Dueber. The first approval did and then November 6 they 
approved the total project including the ICF form.
    Mr. Burgess. But no patients had been enrolled? Is there 
any way to know that absolutely for certain?
    Mr. Dueber. No. We have not--we did not receive any SAEs or 
PD, protocol deviations, or anything of that sort like a 
sponsor would be required to send us if there was a need to 
send that to us.
    Mr. Burgess. But say there wasn't any protocol deviation. 
Say everything went just as smooth as silk. Would you know that 
a patient had or had not received the 4 250 milliliter vials of 
    Mr. Dueber. Not until we did a continuing review, which the 
board set for 6 months later, which would be next month, then 
we would have to go back and have resubmission to us of all the 
documents. It basically is a full review again of the protocol 
and the ICFs and what not.
    Mr. Burgess. Well, Mr. Chairman, I am going to ask that 
that information be made available to us, and I would hope it 
would be made available to us before a month from now. In light 
of everything that we have heard today, patient safety should 
be critical and uppermost in everyone's mind. If we have got 
people out there who have been treated with a product that 
wasn't even a product----
    Mr. Stupak. Mr. Kutz could probably answer it.
    Mr. Burgess. That is a real issue.
    Mr. Kutz. But there is no real patients. The whole thing 
was bogus so there were no people signed up. Now they could 
have been but they weren't. There were no surgeries performed. 
Again, everything that we provided was fabricated.
    Mr. Dueber. And on March 6, I might add, we convened the 
board of our company not knowing that this was still--not 
knowing what this was, we convened the board and rescinded 
approval for the study and notified the study sponsor of that, 
but never could get hold of anyone on the phone or what not. 
And who we had to send it to was a post office box so it was a 
phony site to begin with.
    Mr. Burgess. So there was no actual product produced.
    Mr. Dueber. No.
    Mr. Burgess. This looks like a big----
    Mr. Dueber. This was all a big setup.
    Mr. Kutz. We never actually mixed the product together, 
never, ourselves.
    Mr. Burgess. OK. Now the issue that was of concern to 
people about the 2.5 percent active ingredient, the propylene 
glycol, and then I guess 97.5 percent diluent. Do we know, was 
that just made-up stuff too? There was no actual diluent that 
was used in those 250 milliliter vials?
    Mr. Kutz. Correct. We didn't say what the other 97.5 
percent was. Our protocols were silent on that.
    Mr. Burgess. OK. I will just point out that is unusual to 
pick a product up off the shelf and not know what the rest of 
it is because the vehicle is important to--it is important to 
be aware of what the vehicle is. Let me just ask you this. If 
this had gone forward, if this has been a real product or 
whatever, who would have paid for the surgery? This is a 
product that could only be placed at the time of an operation, 
presumably an anesthetic. Day surgery or hospitalization, all 
of that entails some cost so to get to that point where you can 
actually administer the product, who was going to pay for the 
rest of everything else that was happening that day, lab work, 
hospitalization, day surgery, surgeon's time, anesthesia time?
    Mr. Dueber. I believe the way this was set up was that the 
patients were people that were going to have surgery anyway, 
and they would have had to have paid for that surgery through 
whatever means they had to pay it. They were not receiving----
    Mr. Burgess. OK. Let me just interrupt you on that thought. 
Would you have actively excluded the patient on the Medicaid 
system? We made a big deal about no federal funds were used, 
but would you have excluded a Medicaid patient from this 
    Mr. Dueber. That would have been the sponsor's decision, 
and we wouldn't have had any involvement in that, so I don't 
    Mr. Burgess. So there could have been federal funds used in 
the installation of this product in the peritoneal cavity?
    Mr. Dueber. If it were a real--yes, that could be the case.
    Mr. Burgess. Right. It is hard when you are dealing with a 
make-up world, and I do understand that and I sympathize with 
you but we shouldn't be here in the first place, so I am going 
to press on. The second surgery, the second look operation 20 
weeks later, so 6 months later we are going to have another 
look to see whether or not our product worked, who is going to 
pay for that surgery?
    Mr. Dueber. I am not sure, sir. I don't know. I don't know.
    Mr. Kutz. I don't believe our protocol said. That was one 
of the questions we got from one of the other IRBs, who is 
paying for the surgery, who are the physicians, who are the 
surgeons, who are the people that are going to actually apply 
Adhesiabloc to the women's pelvic area. That was all silent in 
our protocols. Those were serious questions we got from the 
other IRBs.
    Mr. Burgess. It just struck me because that is not a normal 
course of events. You do a laparoscopy for pelvic pain 
diagnosis endometriosis. You are not necessarily going to be 
back in 20 weeks looking to see what things look like today, so 
that is a little bit of an unusual situation just from my 
recollection of clinical practice. I realize it has been a few 
years but that would be a deviation. Someone has to pay for it. 
Again, my concern there is if we involve the Medicaid system 
then again federal dollars are used in this test protocol so we 
can't really just say no federal funding was used so we can't 
be interested. I think we should be interested from a patient 
safety standpoint but there was a real possibility had this not 
been a fake study that federal funds might well have been used 
depending upon the part of the country where the study was 
conducted because obviously we heard on this committee time and 
time again about the greater and greater proportion of patients 
that are being covered by Medicare given the state of the--I am 
sorry, Medicaid, given the state of the economy.
    Is there--I am not sure whether I need to address this to 
Dr. Menikoff or Dr. Less, but here you have albeit a make 
believe company and it got one positive response to several it 
sent out. Does anyone sort of take the 30,000 foot level look 
at this and say, wow, two IRBs turned this down and one bit? I 
wonder why it only had a 33 percent acceptance rate out there 
in the universe of IRBs. Would that trigger a red flag on 
anyone's part in any of the federal agencies that have 
oversight not necessarily of the federal funding but of the 
patient safety aspects?
    Mr. Dueber. Yes, I think it has a big bearing with all due 
respect. I sit here, you know, feeling troubled that only three 
were selected, and we were one of the three. I mean why not 
select 40 or 50 of them? I mean I understand where you are 
going, and I honestly have to say I am on your side. I want my 
company to do an excellent job of protecting human subjects, 
and of course we have work to do. We are not perfect. No one is 
    Mr. Burgess. I am going to interrupt you in the interest of 
time because the chairman is going to cut me off. He always 
does and I can't stop him. But, Dr. Menikoff or Dr. Less, is 
there any mechanism in place right now when you only have a 33 
percent uptake rate that that raises a red flag, that maybe 
this was a protocol that needs to be looked at more 
    Ms. Less. Congressman, there is a check in place in our 
regulations that when a study for a medical device, when it is 
presented to an IRB, the IRB is supposed to make the 
determination of whether or not an IDE is needed. If the IRB 
disagrees with the sponsor who has presented it as a non-
significant risk product, if the IRB decides it is not a non-
significant and it is, in fact, significant risk, the IRB is 
supposed to tell the sponsor that and the sponsor is supposed 
to report it to FDA within 5 days. So there is that check in 
place. FDA would be notified if an IRB, as they were supposed 
to do, make a decision, and if they disagreed with the sponsor.
    Mr. Burgess. Did that happen in this make believe world 
that we are in today? Did any of that occur?
    Ms. Less. No, that did not occur.
    Mr. Burgess. I know I am a little slow on this, but who 
should have picked that up? Where should that have occurred?
    Ms. Less. Well, the sponsor, who was fake, should have been 
reporting that to FDA.
    Mr. Burgess. And does the FDA have any mechanism in place 
to know that, oh, my goodness, this sponsor did not make any 
sort of report at all. We wonder why. There is some curiosity 
to go back and look and see why no report was made.
    Ms. Less. We wouldn't necessarily know if the sponsor did 
not comply with the requirement and not make that report. We 
wouldn't necessarily know. If they did make the report then we 
would go out and look at the study, decide whether or not we 
agreed with the IRB or the sponsor, decide whether or not it 
did in fact need an IDE.
    Mr. Burgess. So there is no way to track, I will just call 
them dropped cases for want of a better word, if the 
investigations just don't come back to you, then you don't know 
why they weren't pursued?
    Ms. Less. Well, what could have actually happened if they 
were a real case if a sponsor goes to an IRB and says my 
product is low risk, the sponsor says, no, in fact, that is 
actually high risk, that sponsor then could not conduct the 
trial. They would make the report to us. They would not be able 
to start the trial. If they went--and so there is that check in 
place that they would be reporting to us and----
    Mr. Burgess. What is they were venue shopping on this and 
went to several IRBs simultaneously as the fake company did?
    Ms. Less. Well, hopefully when they went to the second IRB 
they wouldn't lie and say that it is still a low risk product. 
They would fix their protocol or go in and say this is a 
significant risk product because again that second IRB would 
have to ask the sponsor of the trial is this a significant 
risk, does it require an IDE? The product could not be shipped 
and the study couldn't be started without our approval too for 
this kind of product so there is that second check in place 
that the trial could never have gotten--or should never have 
gotten started without coming to FDA.
    Mr. Burgess. Mr. Kutz, was that your finding as well?
    Mr. Kutz. We said it was significant risk and for the one 
IRB we provided a 510(k) which would have been a prior 
marketing approval but, no, we said it was a significant risk. 
We did not say it was low risk.
    Mr. Burgess. So should the FDA have picked up on that fact 
and gotten back to you and said hold the phone?
    Mr. Kutz. We never contacted the FDA.
    Mr. Burgess. Oh, you did not?
    Mr. Kutz. No.
    Mr. Burgess. But in the real world it would be your 
obligation as an investigational company to contact the FDA?
    Mr. Kutz. I am not aware of the regulations on that.
    Mr. Burgess. Right, but it was GAO in charge of the fake 
company so you were CEO of a fake company. If you were a CEO of 
a real company, would that have been the obligation of the real 
company to do that?
    Mr. Kutz. FDA knows the--I don't know the answer to that.
    Mr. Burgess. I need a yes or no or the chairman is going to 
whack me.
    Ms. Less. Yes. The fake company should have reported to FDA 
that the product was determined to be a significant risk. These 
types of products, we have a guidance document that lists 
significant and non-significant risk products. This type of 
product is listed as significant risk.
    Mr. Burgess. It is voluntary at this point. No one is 
required to do that so if somebody slipping under the radar a 
time or two, we really got no way to go back and do any sort of 
internal check on that. I would be interested if I were the FDA 
today, are there any others that have slipped under our radar 
like this? How many other bad studies have we missed?
    Ms. Less. It is not voluntary. It is mandatory that the 
sponsor report to us within 5 days of the IRB tells them that a 
product that they presented to them is significant risk.
    Mr. Burgess. What penalty might they invoke if they don't 
    Ms. Less. If they don't report, we would go after them. We 
could issue a warning letter. We would go out and inspect, 
issue a warning letter.
    Mr. Burgess. What if you found that federal funds were used 
such as in the Medicaid or S-CHIP system, would HHS become 
involved at that----
    Mr. Stupak. Last one now, Mr. Burgess. We have been more 
than generous with time. We have another member waiting.
    Mr. Burgess. All right. If the federal funds were used to 
pay for the surgeries or the procedures, Dr. Menikoff, would 
that get your interest?
    Dr. Menikoff. When you are referring to federal funds being 
used, the general sense of that is basically that the funding 
for the study taking place, in other words, an investigation 
that is funded by NIH or CDC or FDA itself may be running a 
study. Normally probably the fact that one of the procedures is 
paid through Medicaid, for example, wouldn't implicate that. 
The key is that somebody in getting federal funds to run one of 
these studies, if this study was done with NIH money, GAO again 
didn't fully respond, but the odds are extraordinarily low that 
any of this could have happened because in getting those funds 
the legitimacy of this entity would have been vetted this way 
and that. You would have had top scientists asking who is this 
person? What knowledge does he have to do this? Is he a well-
trained physician? What papers has he written?
    Many, many parts of this system work together and 
particularly on the HHS funded side to make sure that we have 
legitimate things happening and this information then works 
together with the IRB in terms of making sure that there are 
substantial protections in place. So again the facts do speak 
for themselves. GAO didn't end up producing a fake, federally-
funded study. I think it would have been very, very difficult 
to do that. There are many, many protections in place.
    Mr. Burgess. And yet still federal funds could have been 
    Mr. Stupak. Mr. Burgess, I really do have to in all 
sincerity--Mr. Markey has been waiting patiently. You are more 
than 7 minutes over.
    Mr. Markey. Thank you, Mr. Chairman, very much. Mr. Dueber, 
based on the review that your company conducted here, would you 
have been comfortable with your wife or your mother being 
treated in her abdomen with the solution your company approved?
    Mr. Dueber. I can't answer that. I do not know.
    Mr. Markey. You don't know if you would be comfortable 
recommending to your wife and mother something that you 
recommended for all of these other----
    Mr. Dueber. You know, it is speculating. I would have to--
you know, I don't know. The doctor that I talked to that was on 
our board that approved this does this surgery, uses a similar 
product. He felt it was safe. We have had it reviewed by an 
expert, outside expert, and he says it is safe. I mean the 
ingredients that supposedly were in it are supposed to be--the 
active ingredients are supposed to be safe. The inactive 
ingredients have no interference with the effectiveness of 
active ingredients so absent any other information to prove 
them wrong, I guess if I was in a decision-making mode, I would 
probably say, yes, go ahead and use it on them. But of course 
that is their decision, not mine.
    Mr. Markey. Well, if you look at your record the committee 
requested information on all of your reviews for the past 5 
years, and this is what you provided, that your company 
reviewed a total of 356 proposals for human testing, and you 
approved all of them. So that means you approved 100 percent of 
all the studies that you reviewed.
    Mr. Dueber. I am not sure the numbers you are looking at, 
356, what----
    Mr. Markey. You approved--356 protocols were approved and 
the board voted----
    Mr. Dueber. For what time period? I am sorry.
    Mr. Markey. Over a 5-year period.
    Mr. Dueber. No, we have approved more studies than that, 
    Mr. Markey. These are the records that you submitted to the 
committee, and I am working off of your documents that you 
provided to us.
    Mr. Dueber. I believe you may be looking at the audit 
numbers that we sent to you.
    Mr. Markey. We have every--you provided to us every vote 
which the board cast over the last 5 years, and of the 356 
protocols you approved every single one of them, 7 to 0 on each 
vote, except on one occasion when 1 single board member 
dissented, so that means out of 2,492 votes cast by board 
members all but one were in favor of approval.
    Mr. Dueber. We have been requested to provide you with a 
list of all of our protocols since the inception of Coast and 
which ones were approved, which ones were not approved, and we 
will work on that and send that information to you. I can tell 
you that we do audit a fair number of protocols. In the last 3 
years we have done about 50 to 60 audits, and some of those 
audits, we have overturned the original ruling of the original 
approval of those studies.
    Mr. Markey. Mr. Kutz, let me read to you from their web 
site. Here is what it says. It says Coast IRB's quick document 
turnaround will save you valuable time and ensure that you can 
seamlessly move on to the next steps quickly and efficiently. 
Our superior service guarantees your site approval documents 
will be sent to you the next day following every board meeting. 
In this case, do you believe that emphasis on speed contributed 
to the company's failure to conduct even cursory due diligence 
which if it had been done by the firm would have been as a 
result of a basic documentation review found that there was 
ultimately a fictitious nature to this entire enterprise?
    Mr. Kutz. The answer is probably yes. One of the reasons we 
picked the three we picked were because they appeared to have 
the less stringent documentation requirements. That is why we 
picked them. So we were testing the system. We were picking 
ones that we thought would have the less stringent paperwork 
requirements. And, in fact, as I mentioned also, the other 
thing that this IRB was selected is because they offered us a 
    Mr. Markey. Well, I think that it is pretty clear that--I 
know Mr. Dueber doesn't see it that way at this particular 
point in time, but I think the GAO and this subcommittee are 
providing a real service to your company, sir. I think that we 
are trying to help to protect against such a lackadaisical 
system harming human beings. And you seem to be outraged 
actually in our pointing out this deficiency in the way in 
which your company conducts business. I just think it is 
important for you, sir, to reconcile yourself to this as an 
intervention in underlying corporate pathology and that we are 
trying to help you correct your business practice so that the 
public is protected.
    I know you don't see it that way right now, but I think 
when you look back years from now you will see it that way, and 
I just think that perhaps now you are being advised by counsel 
to take the position which you are taking in your testimony 
here today, but it is not helpful to you to be denying the 
obvious which the GAO and our subcommittee chairman have 
identified to you. That is my advice to you. Try to start out 
where you are going to be forced to wind up anyway. It is going 
to be a lot prettier. This testimony that you are delivering 
today is not helpful to yourself or to the cause of insuring 
that there are real processes that protect the public. Thank 
you, Mr. Chairman.
    Mr. Stupak. Thank you, Mr. Markey. A couple questions I 
want to ask to follow up Mr. Burgess, and I think Mr. Walden 
hit on it too. On IRB shopping, IRB shopping, this is a 
practice in which researchers shop their protocol around to 
different IRBs until they get an approval. In 2002 the previous 
administration considered issuing regulations to require 
researchers to disclose prior IRB decisions so people would 
know if the study had been rejected in the past. On January 17, 
2006, the previous administration withdrew this proposal, 
concluding that IRB shopping does not occur or does not present 
a problem to an extent that would warrant rulemaking at this 
time, so 4 years later they withdraw it.
    According to this decision, the administration apparently 
felt they had no reason to believe IRB shopping was occurring 
with any regularity. Dr. Less, that came out of the FDA. Who 
would have made that decision in the FDA? Would it have been 
the FDA, HHS, the administration, who would have made that 
decision to withdraw this form shopping--IRB shopping 
    Ms. Less. Mr. Chairman, after we issued the Advance Notice 
of Proposed Rulemaking, we evaluated all of the comments 
received. We had a working group involving experts from across 
the agency including our Office of Chief Counsel, all of the 
centers, and we looked at the comments and made that decision 
based on the information that we received and also in light of 
current regulations and the protections that we think that our 
regulations offer.
    Mr. Stupak. So you asked IRBs and they said, no, we don't 
do that?
    Ms. Less. No. We put it out for public comment and we got 
55 comments. We reviewed all of those very carefully. We looked 
back at the IG report, which said that they were aware of a few 
case of IRB shopping, and the comments that we received, we 
also didn't have any real reason to believe that there was any 
concern over IRB shopping. There are a number of reasons why 
companies will go to multiple IRBs for legitimate reasons. 
Sometimes a company will go to more than one IRB at the same 
time simply to get their study up and running more quickly.
    That doesn't necessarily mean they are shopping for the 
fastest or the least stringent IRB. We also can--we were 
concerned with the burden that it would put on IRBs in the 
sense that if you had a study with multiple sites, say 10, 20, 
40 sites, if all of those IRBs had to share previous reviews, 
we felt it could overwhelm the system. And without knowing the 
other IRBs review practices, you would have no basis for 
deciding on the merit of that review. And we have seen that as 
an instance with say adverse event reporting.
    Mr. Stupak. So when Mr. Dueber--let me ask you this. We 
asked you when you were interviewed last week by the committee 
staff, you disagreed. You said that IRB shopping, and I quote--
in fact, if you want to look at your testimony it is front of 
Dr. Menikoff there on page 83, I believe it is. It has a green 
tab on it there. When asked about IRB shopping, you said, ''Has 
been a problem of IRBs, I understand for quite some time.'' So 
IRB shopping is a concern then, right, amongst IRBs, that they 
are going to go get a bad decision from one IRB, so they go to 
another IRB until they get it, that is a problem?
    Mr. Dueber. From my perspective and my company's 
perspective, it is a problem and----
    Mr. Stupak. Then answer me this. This is your coupon that 
you gave out to Mr. Kutz. On the bottom of the coupon it says, 
and I am going to read directly now, it says Coast IRB's free 
test drive offer applies towards initial protocol informed 
consent form and investigator's drug brochure reviews only, 
$1,300 value. Coast IRB, LLC pledges to protect the full 
confidentiality of all research studies sent to us for review. 
In 2005, the FDA removed the guidance prohibiting IRB shopping. 
As such, you are free to use our free test drive offer to 
compare Coast services with another IRB's concurrently if after 
comparing our services to those of another IRB, you choose not 
to continue with Coast IRB, we will destroy all documentation 
we have on file associated with your study.
    Neither your money, research time or confidentiality will 
ever be at risk. It sounds like to me you are encouraging with 
this free coupon IRB shopping, the practice that you say you 
are against.
    Mr. Dueber. Sir, that marketing piece was created before I 
arrived at Coast, and we are no longer using that for that 
particular reason. But, you know, our position is that--and the 
company's position has been that IRB shopping is a problem, and 
there needs to be some kind of a database that everyone can 
refer to to see if someone has submitted--a sponsor has 
submitted a protocol to some IRB and other IRBs can check that 
before we approve a study because----
    Mr. Stupak. Do you think there should be a ban on IRB 
shopping, and if a stud is rejected should be sent to the FDA?
    Mr. Dueber. I think the last part probably, yes, but we are 
in favor of improving the system and making it more difficult 
for people to do that because obviously that is not healthy.
    Mr. Stupak. Right. Mr. Kutz, under current law if you had 
been a real company, you would have been allowed to ignore 
these two rejections you received and continue with your 
approval from Coast, isn't that right?
    Mr. Kutz. I believe so, and actually one thing I would 
mention on the shopping in our initial e-mails to the IRBs we 
sent this to, we said very specifically that we were shopping 
for an IRB.
    Mr. Stupak. OK. So they all knew you were shopping, you 
were IRB shopping?
    Mr. Kutz. That is what our e-mail said, yes, the e-mails 
from the requests you got from the IRBs.
    Mr. Stupak. OK. And after you got the approval from Coast, 
could you have begun your experimental testing on human beings? 
Would there have been any other steps in the FDA or HHS review 
before you started your experimental test on real people and 
putting this fluid here, our liter bottle of Adhesiabloc in the 
pelvic abdominal cavity of women?
    Mr. Kutz. As I mentioned, because there is no federal 
dollars associated with it, my understanding is yes.
    Mr. Stupak. Thank you. Mr. Burgess, I know you always have 
    Ms. Less. Mr. Chairman, if I could clarify.
    Mr. Stupak. Sure.
    Ms. Less. That study should not have been started. It was a 
significant risk product. It would have required approval from 
FDA so the sponsor should never have started the study without 
coming to FDA.
    Mr. Stupak. Who should have come to FDA?
    Ms. Less. The sponsor. The sponsor would go to the IRB, get 
IRB approval, and they also would be required to get FDA 
approval before that study could start and before any product 
could be shipped, so the sponsor----
    Mr. Stupak. What is the requirement to do that?
    Ms. Less. Pardon me?
    Mr. Stupak. What was the requirement to do that? I got my 
protocol approved. I got my consent form approved. So why would 
I have to go to the FDA?
    Ms. Less. Under the IDE regulations and investigational 
device exemption regulations at 21 CFR part 812 for a 
significant risk product, which this is, the sponsor would be 
required to get both FDA and IRB approval before it ships the 
product or starts the trial.
    Mr. Stupak. That is because Mr. Kutz misrepresented, but 
what if it was some other project already approved? There was 
no requirement to go to the FDA because we had what, a 510(k) 
there, right?
    Mr. Kutz. We faked the 510(k).
    Mr. Stupak. We had a 510(k) so we don't have to go to the 
FDA on this one. He could have started on real patients if it 
was a real one.
    Ms. Less. Well, hopefully the sponsor, if it was a real 
sponsor, would have understood that this product is not subject 
to 510(k).
    Mr. Stupak. And what do you do to make sure a real sponsor 
does that?
    Ms. Less. A real sponsor is supposed to come to FDA----
    Mr. Stupak. I know. There is a lot of assumption in these 
laws, aren't there, that people are being above board. We 
proved today they are not.
    Ms. Less. Actually we have a number of programs in place 
where sponsors can come to FDA, ask if they need an IDE. We 
have a pre-IDE process where they can submit a pre-IDE to us, 
have us look at the protocol, look at the device, look at the 
testing that they have done to see whether or not it needs an 
    Mr. Stupak. With all due respect, FDA hasn't been doing 
their job. That is why we are having this hearing because when 
we did Copernicus study 3014 which there was criminal fraud and 
your own CID asked FDA to do criminal charges against 
Copernicus and the doctors who were doing this, FDA refused to 
do it. You rejected it. So there is very little faith on this 
side of the dais that FDA is doing it right. So when we suppose 
people are going to do it and we suppose the FDA is going to do 
their job, we know what the end results are. Unfortunately, 
people die. I will go to Mr. Burgess.
    Mr. Burgess. Mr. Kutz, let me just ask you, my 
understanding is you based this fictitious product on another 
product that actually existed but didn't have a good track 
record, is that correct?
    Mr. Kutz. We got it on the Internet off of FDA's web site 
and then we substantially altered the entire--we had a format. 
We didn't know what a protocol actually was supposed to look 
like so we got one just so we could know what it looked like, 
and then we changed it completely and then we actually made up 
the ingredients.
    Mr. Burgess. How many FDA protocols did you have to look at 
before you found one that struck you as a good one to proceed?
    Mr. Kutz. We just wanted one. I don't know if there were 
any more or not. We just found one on the Internet and once we 
found that, we just used the format. We didn't use the actual 
details of it. We created our own. It just showed us what one 
looked like.
    Mr. Burgess. Was it hard to find one that led you in the 
right direction?
    Mr. Kutz. Yes. I don't think there were a lot of them out 
    Mr. Burgess. OK. Dr. Less, Dr. Menikoff, I am assuming that 
the Inspector General at HHS has been notified of this 
situation, is that correct? I mean does HHS have----
    Dr. Menikoff. No. We referred this to FDA's investigators.
    Mr. Burgess. OK.
    Dr. Menikoff. That is the letter we sent.
    Mr. Burgess. Will it at some point go to HHS IG?
    Dr. Menikoff. No, we plan to refer it to the FDA and we 
talked to the investigators that work under Dr. Less.
    Mr. Burgess. Had there been Medicaid funds used on any 
patient who received this compound inappropriately, would that 
have triggered HHS' involvement?
    Dr. Menikoff. I don't believe so. Again, the HHS 
jurisdiction that OHRP has relates to there being a funding 
agency for the study so basically NIH or CDC----
    Mr. Burgess. Or CMS?
    Dr. Menikoff. Excuse me?
    Mr. Burgess. Or CMS?
    Dr. Menikoff. CMS could act as a funding agency for the 
study. The fact that one patient in the study got paid and----
    Mr. Burgess. We heard testimony by Mr. Dueber that the 
funding for the study was going to come from the third party 
coverage of the patient essentially. Perhaps there was no 
charge for the study protocol or the protocol drug but there is 
a substantial amount of activity that has to occur to get to 
the place where the drug is administered and all of that 
activity was presumably going to be paid for by a third party 
payer, so in a way CMS would have been funding this study had 
it proceeded if Medicaid patients had been enrolled or S-CHIP 
    Dr. Menikoff. My understanding is that is not the way in 
which something becomes HHS funded in terms of OHRP's 
jurisdiction. The basic issue is has somebody applied for a 
grant from an HHS grant making agency and they then approve 
this. I mean that is the protection, and it is actually a very 
strong protection. Again, this would not have happened if 
somebody tried to get HHS funding. I think it is 
extraordinarily unlikely, and people who are enrolling in HHS 
funding studies should actually be relatively confident that--
    Mr. Burgess. This whole deal is extremely unlikely and yet 
we find ourselves here in a parallel universe that the GAO made 
for us, and now we are having to try to pick our way through 
it. I just find it--I personally find it unbelievable that HHS 
is not more interested in the fact that funding sources could 
have been diverted into a bogus study and the patient required 
to have a second procedure, a second look procedure, 20 weeks 
later. I mean this is a big dollar item that we are talking 
about, 50 patients receiving a second look laparoscopy. There 
is no way to know how many of those would have been Medicaid, 
but that is a significant expenditure.
    Dr. Menikoff. Congressman, it sounds as if you are talking 
about use of federal funds for an inappropriate purpose, that 
is--I don't know what unit of HHS would deal with that 
basically. OHRP is dealing with the human subjects protection 
aspect of it, not misappropriation of federal funds or misuse 
of federal funds in some way. I can't comment on what part of 
HHS does deal with that.
    Mr. Burgess. Well, give us some comfort. Now what are the 
next steps that are going to be taken here? Clearly, there are 
things that need to be improved but are there some enforcement 
steps that are going to be taken? What happens next?
    Mr. Kutz. Only with respect to the one referral. I think 
the bigger picture is that you had the set of protocols that 
went to three IRBs and you get two completely different answers 
at the same time. That is the part I think that should concern 
the subcommittee here. On the one hand, two IRBs said this was 
a ridiculous protocol, unsafe to patients. It should have never 
been approved. Another one is still testifying as we speak that 
it was perfectly safe. It is hard to believe you could have 
that divergent of a situation and that raises questions to me 
about the whole IRB system, especially the private IRB system.
    Mr. Burgess. And, Dr. Less, would you concur that from 
FDA's perspective that there is reason to be concerned about 
the whole system?
    Ms. Less. No, sir, I would not. I think under this 
circumstance from what I have heard this product was a 
significant risk product. It should have been submitted to FDA 
for review. The study would not start without FDA and IRB 
review, and in this case there would have been that safeguard 
in place with having both the IRB approval and FDA approval 
needed before any patients could be put at risk or the study 
could have even started.
    Mr. Burgess. So any enforcement activity would be directed 
toward a company that doesn't exist that was made up by the 
GAO, would any enforcement activity be directed in Coast's 
direction for proceeding with a study with tenuous 
    Ms. Less. Without seeing the report, I can't comment on 
that but in general FDA has taken action when an IRB has failed 
to make the determinations that it is supposed to make meaning 
they found significant risk determinations and looking to see 
whether an IDE is required for the study.
    Mr. Burgess. OK. Well, so what would happen? What would 
that action be?
    Ms. Less. We would go out and do an inspection of the IRB, 
look at their studies, their processes, see whether there were 
other studies that perhaps a wrong decision was made and if we 
found a problem, we would issue a warning letter. We could 
impose sanctions. And then we would see if they put a 
corrective plan in place to take care of that. If not, then we 
could pursue other activities.
    Mr. Burgess. Do you ever make a silent pact with yourself 
that we will never use this IRB again? Do you keep a list? Is 
there a watch list?
    Ms. Less. Well there is a--all of our warning letters are 
public. They are on the web site so any sponsor doing a study 
should be looking at that web site to see----
    Mr. Burgess. Is there any way to know that one side is 
talking to the other on this because this seems to be one of 
the problems we have encountered today. You had to say this was 
a bad deal, one said it is OK. Nobody talks about it, so it 
potentially could have gone forward with a very, very difficult 
study from the standpoint of a patient.
    Ms. Less. Well, warning letters are public. IRBs are 
obviously not happy to receive those. They take them very 
seriously and do some corrective actions. We require that they 
submit a corrective action plan within 15 days if we issue a 
warning letter, and we do follow up to make sure that those 
corrective actions are taken.
    Mr. Burgess. Well, now Coast had on its web site Q and A, 
have you ever been investigated from the FDA, and they said, 
well, they had but they got a commendation, but in fact that 
wasn't accurate, I understand now, is that correct?
    Ms. Less. I have not seen the information on their web 
site. I am sorry, Congressman.
    Mr. Burgess. This is again a printout of Coast's web site. 
Do we have that to project? The frequently asked questions----
    Mr. Stupak. Coast's web site, do you have it? No, they 
    Mr. Burgess. Under the frequently asked questions section, 
have you ever been audited by the FDA? Answer, December 15-17, 
2003, Coast IRB was selected for a routine surveillance 
inspection. We received a commendation from the FDA 
investigator regarding the thorough and effective oversight 
provided by our IRB operations. A follow-up audit was conducted 
in 2005 at which time no further action was required by the FDA 
investigator. Do you think that is a true statement?
    Ms. Less. We inspected Coast four times. The first three 
times we did issue letters saying that voluntary action was 
indicated, meaning that we found minor deviations from the 
regulations and we asked them to--in the letter we pointed out 
what those deviations were, pointed them to the appropriate 
regulation or guidance. They did submit a letter back to us 
stating that they had taken care of the issues that we 
addressed in each of those three letters.
    Mr. Burgess. Were those warning letters? Would those be the 
equivalent of warning letters?
    Ms. Less. No. they did not rise to the level of a warning 
letter. They were what we call voluntary action indicated. We 
have no action indicated, voluntary action, and then official 
action, which is the warning letter level.
    Mr. Burgess. Have they ever received a warning letter?
    Ms. Less. Yes. Their most recent inspection that we 
conducted in 2007, we issued a warning letter to the IRB.
    Mr. Burgess. And we had this approval in October, 2008 by 
the board so presumably they were under a warning when this 
study, proposed study, was to be undertaken, is that correct?
    Ms. Less. We had issued a warning letter, and they 
submitted a corrective action plan, told us that they had put 
training in place for their safe and were testing their staff 
on the conduct under the regulations of what would be required, 
and so we had reviewed all of that information. They had also, 
I believe, hired an outside consultant that was also supposed 
to be overlooking their processes.
    Mr. Burgess. Is that the basis on which you gave them a 
    Ms. Less. We don't give commendations to anyone, 
    Mr. Dueber. In addition to that, Congressman, we----
    Mr. Burgess. But that is misleading statement on your web 
site then, isn't it? She said the FDA doesn't give 
    Mr. Dueber. They sent us a letter reinstating our use of 
expedited review. We had given them a corrective action plan 
and acted very swiftly. In addition to that, our CEO----
    Mr. Burgess. OK. I am going to interrupt you because I am 
going to get cut off again. If you would be good enough to 
provide that letter to the committee, we would very much like 
    Mr. Dueber. The committee already has that letter. We 
provided that in the package of materials we sent.
    Mr. Burgess. Thank you, Mr. Chairman. I will yield back in 
the interest of time.
    Mr. Stupak. Thank you, Mr. Burgess. Dr. Less, you said 
earlier that warning letters are more serious violations. In 
fact, the FDA issued a violation letter--a warning letter, 
excuse me, a warning letter on March 11, 2008, to Coast for 
three different parts on expedited review of IRBs, isn't that 
    Ms. Less. Yes, sir, that is correct.
    Mr. Stupak. And now Mr. Kutz has sent a letter about this 
situation and how Coast had reviewed this IRB--or this 
protocol, so will the FDA now invoke a more severe penalty then 
on Coast based--they already have a warning letter sitting 
there in their file. Now they got another allegation of 
wrongdoing. What will the FDA action be?
    Ms. Less. Congressman, we will need to take all that 
information into account and do a thorough evaluation. 
Normally, if we issue one warning letter, the next warning 
letter would include sanctions and we would take more serious 
action, but without knowing the specifics and having reviewed 
the entire case, I can't comment on this particular one.
    Mr. Stupak. Mr. Dueber, let me ask you this, and I will 
wrap up this hearing here. Are all of the seven people who 
approved this protocol, the bogus protocol, do they still work 
for Coast?
    Mr. Dueber. Yes, they do.
    Mr. Stupak. OK. Has anyone at Coast lost their job because 
of their failure to adequately review this protocol?
    Mr. Dueber. One individual is leaving the company shortly.
    Mr. Stupak. But not as discipline action for this matter?
    Mr. Dueber. No, sir.
    Mr. Stupak. OK. And how about the chair of the 
Institutional Review Board here, your chair of this board that 
reviewed this protocol. She indicated she didn't even read the 
protocol. Is she still working for you and she is still a 
member of the company?
    Mr. Dueber. Yes, she is. We evaluate our board members once 
a year.
    Mr. Stupak. OK. You said a couple times that you have 
changed your SOP. I take it that is standard operating 
procedure review process, right?
    Mr. Dueber. Right.
    Mr. Stupak. So it sounds like a lot of good changes have 
been implemented.
    Mr. Dueber. Yes, that is correct.
    Mr. Stupak. So a lot of good actually has come from being 
caught here on this bogus----
    Mr. Dueber. Yes, it has, and I might add that during our 
lunch break I talked to Dr. Less and I basically pleaded with 
her to bring FDA into my company and do a full top down, you 
know, front to back audit of our company because since I 
started with the company, I have done nothing but try to make 
sure that the company does exactly what it should be doing and 
do the best it can of any IRB.
    Mr. Stupak. And in all fairness, you have been there since 
December of 2008, right, basically 4 or 5 months?
    Mr. Dueber. I started at the end of September.
    Mr. Stupak. September.
    Mr. Dueber. And, you know, my track record is totally 
opposite of what we are talking about here so I need time to 
improve things, and we are improving. We have done--we have got 
an incredibly dedicated staff more so than I have ever seen in 
any company I have worked for before that they really--
everyone, their first thing that they worry about is protection 
of human subjects.
    Mr. Stupak. Then how did they miss this one so bad? I guess 
that is the part that baffles us.
    Mr. Dueber. Well, we got hoodwinked. I mean, you know, this 
was a pretty good----
    Mr. Stupak. You didn't get hoodwinked. You took the bait 
hook, line and sinker. I mean in your testimony in all fairness 
you said that once you got the letter you started looking at 
it. It took seconds to figure out that something was wrong 
here. I think it was the doctor's credentialing that was 19 
years old. It took you seconds to do that just by going on the 
Internet. The procedure that we used, our magic elixir here, 
was actually found on the Internet. All this could have been 
discovered with a little due diligence. Hopefully, I am glad to 
hear some good things have come from all this whole thing also.
    Mr. Dueber. Definitely.
    Mr. Stupak. I want to thank you all for coming here and 
thank you for your testimony today. That concludes all 
questioning. I want to thank all of our witnesses for coming. 
The rules of the committee provide that members have 10 days to 
submit additional questions for the record. I am sure there 
will be some. I ask unanimous consent that the contents of our 
document binder on the desk there be entered in the record 
provided that the committee staff may redact any information 
that is business proprietary, relates to privacy concerns or 
law enforcement sensitive. Without objection, the documents 
will be entered into the record.
    [The information appears at the conclusion of the hearing.]
    Mr. Stupak. This concludes our hearing. The meeting of the 
subcommittee is adjourned.
    [Whereupon, at 1:55 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]