Margaret Hamburg: Obama's FDA Appointee and Stock Options

Remember during the Iraq war all anyone heard about was then Vice President Dick Cheney's conflict of interest because of his involvement with Haliburton? It seems that Obama's pick to head the FDA, Dr. Margaret Hamburg, might be suffering from the same malady.

Hamburg is the daughter of Beatrix and David Hamburg, both physicians and is a graduate of Radcliffe College. She earned her M.D. from Harvard Medical School, and completed her training at the New York Hospital/Cornell University Medical Center.

Hamburg was New York's acting health commissioner in 1991 after just one year as deputy commissioner. One year later she was given the job permanently at 36 — the youngest in New York's history.

In 1997, President Clinton selected her to be assistant secretary for policy and evaluation at the U.S. Department of Health and Human Services. In 2001, she became vice president for biological programs at the Nuclear Threat Initiative, a foundation dedicated to reducing the threat to public safety from nuclear, chemical, and biological weapons.

Impressive resume, however there is more.

Currently, she sits on the Board of Directors for Henry Schein Inc. a medical supply and distribution company. As noted in the LA Times, this is a position she will have to relinquish upon Senate confirmation. Something I am sure Dr. Hamburg will be more than willing to do. The only problem I see is Schein's good-bye gift to the good doctor.

From the Security Exchange Commission,

Click on image to enlarge.

Dr. Hamburg received 5,384 shares of Henry Schein Inc. on March 9th, 2009, paying $0 for them. Not an uncommon event for sitting board members to be granted stock options. Consequently though, it was announced three days later that she was President Obama's pick to become the FDA Administrator, pending Senate confirmation.

Presently, Henry Schein Inc. is trading for $ 37.27 per share according to the NASDAQ. This puts her value of stock in Schein at $200,661.61. (That's a nice little hunk of change for a parting gift.)

Why might this be a "conflict of interest?" Here is one of the departments of the Food and Drug Administration she will be managing, the Center for Devices and Radiological Health. What do they do?

Wiki-The Center for Devices and Radiological Health (CDRH) is the branch of the United States Food and Drug Administration responsible for the premarket approval of all medical devices, as well as overseeing the manufacturing, performance and safety of these devices. read more...

Maybe a stretch maybe not, you decide. I just find it suspicious because of the timing of her "gift" from Henry Schein and what she will be doing if confirmed as FDA Administrator. I am sure there will be no retroactive Congressional mandate for Dr. Hamburg to give back her stock options. Unlike the recent order some executives of a certain global insurance company received from our illustrious legislators concerning their contractually obligated bonuses.

Photo credit to Chris Livingston / Getty and tip o'the hat to our research staff over at Phaedrus's Motorcycle Shop. Where their motto is, "We put the Zen back in your Hog."

Update: Seems we aren't the only ones taking notice of this potential conflict of interest. From the Health Care Renewal Blog, Putting a New Schein to the FDA?



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