The leading medical journal The Lancet admitted last night that research which helped to fuel the health scare about MMR vaccinations may have been compromised by a conflict of interest.

A paper published in The Lancet by Dr Andrew Wakefield and colleagues from the Royal Free Hospital in 1998 triggered public alarm about the link between the measles, mumps and rubella vaccine and autism. But a statement from the journal last night said that "serious allegations of research misconduct concerning the article" were being investigated. The editor, Richard Horton, said he now believed the paper's conclusions regarding a link between MMR and autism was "invalid".

The Lancet's statement said the journal's editors had been unaware at the time of publication that Dr Wakefield was being funded to do research for lawyers investigating whether parents of children with autism could sue for compensation because of the alleged link with MMR. The journal regretted the "perception of conflict of interest" that might have arisen from the Dr Wakefield's involvement with advocates for families seeking to establish an MMR link to autism.

Mr Horton said: "There were fatal conflicts of interest in this paper. If we had known the conflict of interest Dr Wakefield had I think that would have strongly affected the peer reviewers and in my judgement it would have been rejected."

"If we knew then what we know now, we certainly would not have published the part of the paper that related to MMR, although I do believe there was, and remains, validity to the connection between bowel disease and autism, which does need further investigation, but I believe the MMR element of that is invalid."

The statement is understood to have been prompted by an investigation by Brian Deer, a journalist working for The Sunday Times newspaper.

While accepting the appearance of a conflict of interest, the journal rejected broader allegations from Mr Deer that ethics approval for the investigations conducted on children in the 1998 study, some of them highly invasive (such as lumbar punctures), had not been given.

The Lancet also dismissed claims that Dr Wakefield and Professor John Walker-Smith had biased the selection of children in the study "based on parents' beliefs about an association between their child's illness and the vaccine".

Dr Wakefield said his contribution to the Lancet paper and his work for the lawyers were separate. The Lancet study "added nothing to the issue of causation than that which was already well-known to the lawyers" and the idea of a conflict of interest was "specious".

Both Dr Wakefield and Professor Smith strongly rejected any suggestion that there was any bias in the study.