NIH Executive to Stay Despite New Conflict Rules

WASHINGTON —  The director of the National Institute on Deafness and Other Communication Disorders, who last month said new ethics restrictions against owning biomedical company stocks would prompt his departure, has decided to stay in his federal post.

Dr. James F. Battey Jr. said Thursday that he would continue to lead the deafness institute, a part of the National Institutes of Health. Battey, who also specializes in stem cell research, added that he had withdrawn his application to help lead the newly formed California Institute of Regenerative Medicine.

Battey’s decision to remain with the federal government removes ammunition from critics of the NIH’s toughened conflict-of-interest rules. The critics had said that the rules -- which also ban all agency scientists from accepting consulting fees from the pharmaceutical or biotechnology industries -- would cause an exodus of top talent.

“I have the best job in the world,” Battey said in an interview, explaining his decision. “Imagine a job where at the beginning of each fiscal year, somebody hands you hundreds of millions of dollars and the only responsibility you have is working together with the research community to figure out how to spend that money wisely.”

Battey also will resume his position as chairman of the NIH’s Stem Cell Task Force, agency spokesman John Burklow said. The group was formed to seek the advice of scientific leaders about the challenges to advancing stem cell research.

Word of Battey’s decision comes the same week that another prominent physician and researcher, Dr. David A. Schwartz, said he would leave his position at Duke University to become director of the NIH’s National Institute of Environmental Health Sciences.

Throughout Battey’s 23-year career at the NIH, including the last seven as an institute director, he has never accepted an industry consulting fee. During most of his NIH tenure, Battey said, “I was working about 90 hours a week on my [government] laboratory science -- that’s kind of what it takes to stay on top in biomedical research right now.”

After he became institute director in late 1997, he said, “It was clear to me that ... I would simply direct all of my energies and attention toward managing [the institute] -- which is also, in my view, a more than full-time job.”

Battey has also managed a family trust that includes stock holdings in biomedical companies, including a Sunnyvale, Calif., firm for which his father was a longtime director.

Last month, Battey, 52, had said that the trust was the only source of income for his elderly parents, and that it would pay education costs for his two sons and five of their cousins. The new restrictions at the NIH, which as of October call for agency scientists to divest all of their holdings in specific companies, would unduly disadvantage his family, Battey had said.

He was questioned about his concerns at a Senate appropriations hearing last month. On Thursday, Battey said he and the NIH’s director, Dr. Elias A. Zerhouni, had conferred directly “and came to an agreement that the best [outcome] for me, at the end of the day, would be to stay.”

“I have the assurance of the NIH director that I will be able to fulfill my responsibility to my family and remain at NIH,” Battey said, adding that he did not know the particulars of how his personal financial activities would mesh with the new rules.

Zerhouni has said in recent weeks that he favored softening the stock divestiture restrictions. Without providing specifics, the NIH’s director told staff in an e-mail last week that “changes will be made ... within the next few weeks.”

The institute that Battey will continue to lead has an annual budget of about $397 million. The institute supports and conducts about 600 research projects, its website says.