California, home to the largest public university system in the United States, is currently a battleground in a struggle over how to police perceived conflicts of interest at its medical schools. The university's campuses are trying to derail a proposal from its central administration that would clamp down on common drug-industry practices, such as the sponsorship of free lunches for medical students and the granting of general purpose, 'unrestricted' money to some faculty members (see page 394).

The campuses argue, for example, that these unrestricted grants can provide important sources of revenue. And some faculty members are also questioning the need for the policy. On behalf of a committee at the University of California, Los Angeles, for instance, Hossein Ziai writes: “With all the myriad problems facing health care in the United States...this issue seems rather trivial in comparison, and we question whether there is any demonstrable harm (as opposed to perceived harm) arising from these practices.” The campuses' concerns about their autonomy, and freedom of action for their staff, deserve careful consideration.

But these arguments fall flat against the growing evidence that some forms of support from drug companies can taint perspectives and practices. Policy analysts such as Lisa Bero at the University of California, San Francisco, have documented how pervasively industrial funding can influence the outcomes of studies, and have shown the inadequacy of measures meant to address these influences, such as disclosure of funding sources. Additionally, one source of the well documented problems of the US healthcare system is the large amount of money spent by pharmaceutical and medical-device vendors on marketing efforts, including some of the types of activity that would be banned under the University of California's proposed policy.

On both ethical and rational grounds the university's policy is worthy of general support. But, as with most things, the broader issue here is a fiscal one. In 2004, the University of California's president, Robert Dynes, signed a deal with Governor Arnold Schwarzenegger that froze state public funding of the university's system, began tuition and fee hikes, and committed the university to seek billions of dollars a year in additional private-sector funding.

In a sense, the latest policy tries to put the brakes on a trend towards heavier reliance on private funding that this fiscal squeeze has unleashed. The university's campuses are understandably concerned about their ability to attract funding from all sources so that they can continue to operate at world-class levels. The best course available to them, nonetheless, is to follow the high standards that have recently been set at other academic medical centres, such as those at Stanford University, and to embrace the proposed policy.