Sunday, November 18, 2018

From Russia with Money - Harvard Medical School Accepts $200 Million from Russian Emigre with Ties to Russian Oligarchs and Putin, and Who Is Under Investigation for US Election Meddling

On Health Care Renewal we have frequently written about individual and institutional conflicts of interest.  The landmark but often ignored 2009 report by the Institute of Medicine on Conflicts of Interest in Medical Education, Research and Practice defined institutional conflicts of interest as arising when

an institution's own financial interests or those of its senior officials pose risks of undue influence on decisions involving the institution's primary interests.

We have written about institutional COIs affecting academic medical institutions, medical societies and patient advocacy organizations.  Typically, the COIs arise from industry (that is, usually pharmaceutical, biotechnology medical device, and sometimes health insurance corporate funding) that might be seen as influencing the institution's decisions about medical care, health care policy, teaching and/or research.  For example, most recently we wrote about systematic research on institutional conflicts of interests affecting patient advocacy organizations, and on organizations writing clinical practice guidelines

But now things are different.

We present a big case of what looks like an entirely new, and very troubling variation on an institutional conflict of interest.

A "Transformative" Gift to Harvard Medical School

On November 8, 2018, Felice Freyer, writing in the Boston Globe, documented a huge new gift to Harvard Medical School.

Harvard Medical School has received a $200 million donation — the largest in its history — to support research into fundamental questions about human illness and health.

The pledge, from the Blavatnik Family Foundation, will enable the school to hire researchers, add to its advanced technology, and a build an 'incubator' in the Longwood area to help bring research findings to market.

The gift is so large that Harvard will rename many of the school's components after Blavatnik.

Harvard Medical School is keeping its name for now. But a large portion of the school will be renamed. The 10 academic departments in science and social science — as distinguished from the affiliated hospitals where postgraduate training takes place — will be called the Blavatnik Institute at Harvard Medical School.
Per the Harvard's in-house publication, the Gazette,

Announcing the donation, Harvard President Larry Bacow described it as an 'unprecedented act of generosity and support,' and thanked Blavatnik for his faith that HMS — and the region’s broader life sciences community — can make dreams of dramatic progress in human health become reality.

'It’s one thing to dream for oneself, for one’s family and friends, even for one’s community. It’s another thing to dream for all people, to dream for a future in which more lives are improved and saved through the creation and application of knowledge through science,' Bacow said.

HMS Dean George Q. Daley called the donation 'a transformative opportunity' for the School and said it will enable a new generation of scholars and scientists to emulate those who made key discoveries in every area from organ transplants to polio vaccines to gene therapy.

The Gazette described the donor, Len Blavatnik, thus

The foundation is led by Blavatnik, who graduated from Harvard Business School (HBS) with an M.B.A. in 1989, founded Access Industries, and became one of Britain’s wealthiest men.

What could possibly go wrong?

The Russian Connection

Actually, while he may currently operate out of Britain, Blavatnik came from Russia.  Per the Globe,

Blavatnik made his fortune in aluminum, oil, and gas after the fall of the Soviet Union and in 2011 bought the Warner Music Group. His philanthropy has sometimes raised eyebrows because of his alleged connections to Russian oligarchs.

His connections to these (other) oligarchs should raise some eyebrows, and concerns. 

The Access-Alfa Renova Consortium, Alleged Russian Sponsored Harassment of BP, and FSB Active Measures

Blavatnik's recent generous donations to Oxford sparked protests, and provided documentation of some relevant issues. Per the Globe

When Oxford University in England named a school of government after Blavatnik in 2015, some 20 critics wrote to chide the school for 'selling its reputation and prestige to [Russian President Vladimir] Putin’s associates,'

Their letter, published in the Guardian in 2015, stated that Blavatnik belongs

to a consortium of Russian billionaires called Access-Alfa-Renova (AAR). The consortium has long been accused of being behind a campaign of state-sponsored harassment against BP. In 2008-09 dozens of British and other western managers were forced out of Russia. As part of this campaign, Vladimir Putin’s FSB intelligence agency fabricated a case against two Oxford graduates. According to evidence from its jailed owner Sergei Bobylyov, Alfa-Bank oligarchs also raided a retail company called Sunrise.

The spy case and the attack on Sunrise involved the participation of Russian officials who are listed as gross human rights violators by the US Treasury in line with the Sergei Magnitsky Rule of Law Accountability Act of 2012.

These corporate abuses took place in Russia with active official support. There was a backdrop of state-sponsored propaganda. Russian state media broadcast libellous assertions against western and Russian citizens. AAR went on to make billions from a highly controversial deal with Rosneft.

The letter writers asserted

Oxford University apparently failed to investigate these facts, AAR’s track record from the beginning, and its close ties with the Kremlin.

A 2015 Guardian article described the background of the letter's signatories, including

Pavel Litvinov, one of eight people who in 1968 protested on Red Square against Moscow’s invasion of Czechoslovakia. He was exiled for five years to Siberia. Another is Vladimir Bukovsky, jailed by the KGB. Bukovsky, who lives in Cambridge, exposed the Kremlin’s use of psychiatric treatment against dissidents.

Others include former Oxford academics and graduates, members of Russia’s democratic opposition and human rights activists. One is Vladimir Milov, a colleague and friend of Boris Nemtsov, the opposition leader shot dead in February outside the Kremlin. The letter was organised by Ilya Zaslavskiy, a TNK-BP employee and Oxford graduate who ran Moscow’s Oxford alumni association.

In 2008 Putin’s FSB spy agency arrested Zaslavskiy and his brother Alexander in Moscow and accused them of being 'western agents'. Russian state TV claimed the FSB had exposed a major spy ring. The case against them was 'fabricated', the letter says.

Despite their credentials suggesting that the letter writers knew whereof they spoke, Oxford apparently has not done any further investigation.   However, per the Globe again, 

Last year, after Blavatnik donated $1 million to Donald Trump’s inauguration committee, an Oxford professor quit in protest, the Guardian reported.

In fact, according to contemporaneous (2017) coverage in the Guardian, Professor Bo Rothstein

a specialist on corruption, called the donation 'incomprehensible and irresponsible' in his resignation letter.

The academic subsequently told the Guardian he had received hundreds of messages of support about his decision, adding: 'I’m not going to be the Blavatnik chair of government and public policy because I’m not going to give legitimacy and credibility to this person. $1m is a sizeable amount of money. In my book by donating to the inauguration of Donald Trump you are supporting Donald Trump.'

The 2017 Guardian article expanded on the allegations made by the 2015 letter writers

Access began making investments in Russia after the fall of communism as the energy and aluminium groups of the former Soviet Union were broken up. Eventually Blavatnik combined assets with Viktor Vekselberg and Mikhail Fridman to form AAR. Their partnership with BP ended in acrimony.

In 2008, Bob Dudley, then the chief executive of TNK-BP and now the boss of BP, left Moscow after what the British company described as an 'orchestrated campaign of harassment'. Armed police also raised TNK-BPs office and more than 100 BP managers had to leave Russia after the authorities refused to renew their visas.

US diplomats alleged that at least one individual in AAR, German Khan, was involved in a state-sponsored campaign against BP to try to force them out of Russia. However, AAR and lawyers for Blavatnik have denied any involvement, including that of Khan, in a plot against BP.

In the end, both BP and AAR were bought out of the venture by state-backed Russian energy company Rosneft. The $55bn (£42bn) deal in 2013 handed the oligarchs, including Blavatnik, $28bn. It was signed off at a meeting with Putin.

The cash from the sale of TNK-BP pushed him to the top spot of the Sunday Times rich list in 2015. By this stage Access had already diversified beyond Russia and the energy sector.

However, note that the 2017 Guardian article's addendum included

Sir Leonard Blavatnik’s lawyers have informed the Guardian that the term 'oligarch' in his view does not apply to him. [But] The Guardian editor-in-chief disagrees.

So to recap, Blavatnik made a lot of money from aluminum, gas and oil in Russia after the collapse of the USSR.  He banded together with other very rich Russians in a consortium, AAR, that was accused by multiple people of dirty tricks meant to drive the UK oil firm BP from the Russian market.  There were allegations that this trickery involved Russian state agencies, and was likely to have been condoned by Putin.  The people behind AAR eventually netted a lot of money from the resulting buyout of their firms and of BP, a deal that apparently did involve Putin. 

Blavatnik's Changing Pattern of Political Contributions Raise Question about Foreign Influence on the US Election

While giving a lot of money to various educational and cultural institutions, Blavatnik was giving modest amounts of money to politicians. 

However, his pattern of political giving apparently changed greatly upon Trump's advent on the scene.  A May, 2018, Dallas News op-ed article by Professor Ruth May of the University of Dallas on Russian oligarchs' affinity for Trump's campaign stated,
Data from the Federal Election Commission show that Blavatnik's campaign contributions dating back to 2009-10 were fairly balanced across party lines and relatively modest for a billionaire. During that season he contributed $53,400. His contributions increased to $135,552 in 2011-12 and to $273,600 in 2013-14, still bipartisan.

In 2015-16, everything changed. Blavatnik's political contributions soared and made a hard right turn as he pumped $6.35 million into GOP political action committees, with millions of dollars going to top Republican leaders including Sens. Mitch McConnell, Marco Rubio and Lindsey Graham.

In 2017, donations continued, with $41,000 going to both Republican and Democrat candidates, along with $1 million to McConnell's Senate Leadership Fund.

A Vice News article April 2018, provided more detail,

according to the Wall Street Journal, Blavatnik gave $12,700 in April 2017 to a Republican National Committee fund that was used to help pay for the team of private attorneys representing Trump in the probe of Russian interference in the 2016 election. He’d given the RNC legal fund $100,000 in 2016, the Journal said.

The problem is that, as stated by Represenative Adam Schiff (D-CA), likely now incoming chair of the House Intelligence Committee,

'Unless the contributions were directed by a foreigner, they would be legal, but could still be of interest to investigators examining allegations of Russian influence on the 2016 campaign. Obviously, if there were those that had associations with the Kremlin that were contributing, that would be of keen concern.'

Under federal law, foreigner nationals are barred from contributing directly or indirectly to political campaigns in local, state and federal elections.

Note that according to an April, 2018, Mother Jones article, the 

the question of possible illegal foreign donations from Russia is also under scrutiny by the FBI and the Federal Election Commission. 

Apparently because of these allegations that Blavatnik was helping to channel Russian money to influence the 2016 election, per the Globe

Although no wrongdoing has been alleged, ABC News reported in the spring that special counsel Robert Mueller is looking into Blavatnik’s donation to the inauguration as part of an inquiry into foreign financial support for Trump.
So to recap, Blavatnik became a dual UK-US citizen, and for quite a while made political donations in a style similar to that of many rich businesspeople at the time, giving amounts to both parties, presumably to enhance access whoever was in power.  However, when Trump became a presidential candidate, Blavatnik began making much bigger donations, and only to Republicans and Trump-related causes.  Then he gave a million dollars to Trump's inagural.  Given the known scheme  by Russia to meddle in the US election to benefit Trump (see the 2018 Senate committee report as discussed here), this raised suspicions that Blavatnik, was helping to also influence the election on Russia's behalf. 

Blavatnik's Sanctioned Associates

Moreover, perhaps Mueller is also interested in Blavatnik's ties to other Putin-linked oligarchs.  A profile in Forbes from October, 2018, stated

Blavatnik still retains a few Russian assets. He and Vekselberg, along with [Oleg] Deripaska, are key investors in Rusal, one of the world’s largest aluminum producers.

Note that

His former business partners are now facing U.S. sanctions. They include Viktor Vekselberg (net worth: $13.1 billion) and Oleg Deripaska (net worth: $3.3 billion), two of seven Russian oligarchs that the U.S. Treasury and State departments identified in the April sanctions. Allegations made against the sanctioned oligarchs include interference with the 2016 presidential elections and financially profiting from a Russian government that engages in 'destabilizing activities.'
To recap, Blavatnik has ongoing business relationships with other oligarchs who have been sanctioned for meddling in the 2016 US election.

Blavatnik's Former Lobbyists Spin Through the Revolving Door into the Trump Administration

Furthermore, the April, 2018, Vice News article documented apparent ongoing ties between Blavatnik operators and the Trump administration.

Two senior Trump administration officials were once registered as lobbyists for an investment company controlled by a Soviet-born industrialist who made billions doing business with newly sanctioned Russian oligarchs.

Makan Delrahim is now the assistant attorney general for the Antitrust Division in the Department of Justice, after rising from his original appointment as deputy White House counsel and deputy assistant to the president. David Bernhardt is the No. 2 official in Trump’s Department of the Interior.

Both men registered as lobbyists in 2011 and 2012 for Access Industries, a holding company controlled by billionaire Leonard Blavatnik, according to public filings reviewed by VICE News. And though they are far from the only D.C. lobbyists to get plum jobs in the Trump administration, the connection to Blavatnik, long in business with billionaire associates of Russian President Vladimir Putin, reveals yet another link between Russia and senior Trump officials.

The article noted,

As of the fourth quarter of 2017, the lobbying firm that Delrahim and Bernhardt worked for was still on Access Industries’ payroll, according to public records. Bernhardt told the Senate during his confirmation hearing that despite filing the paperwork, he never actually did any lobbying for Blavatnik’s firm.

Delrahim, may have been in a particularly fraught position,

Both wound up on the Trump transition team. One, Makan Delrahim is now the assistant attorney general for the Antitrust Division in the Department of Justice, after rising from his original appointment as deputy White House counsel and deputy assistant to the president. David Bernhardt is the No. 2 official in Trump’s Department of the Interior.

The problem is while

Neither Delharim nor Bernhardt, who registered to lobby for Blavatnik and Access Industries in the past, currently has a job with direct oversight of issues related to the Russian economy or the Russia probe.... Delharim might have been involved when he was in the White House counsel's office, a position he left in September for the DOJ.

Richard Painter, former White House ethics lawyer under President George W. Bush, said that in his view, Delrahim would have needed to recuse himself from any work at the White House involving the investigation into Russia’s role in the 2016 election due to his previous work for Access Industries.

'I think that if I were in the White House Counsel’s Office, I’d say, ‘This guy needs to stay away from the entire Russia thing,'' Painter told VICE News.
To recap, former lobbyists for Blavatnik's firm served on the Trump transition team, and then were appointed to responsible federal offices, suggesting at the least, conflicts of interest.

Harvard Officials See No Evil

Nonetheless, Harvard officials had nothing but praise for Len Blavatnik, their generous donor.  Per the Globe,

[Lawrence S] Bacow, Harvard’s president, stood by the donor, calling him a 'distinguished alumnus' and 'somebody that we know very well.'

'We’re very comfortable with who Len is,' Bacow said. 'Len is well-known to the medical community here at Harvard and has been very supportive of science at Harvard and elsewhere. . . . He’s also somebody who is intensely curious, who believes in the power of science to improve the human condition, and he also believes in backing really talented young scientists.'

Were they totally unaware of all the accusations against, suspicions of, and likely investigations of their very wealthy donor?  Or did they just not want to look this very generous gift horse in the mouth? 

Not With a Bang,...

As noted above, there were vigorous protests of Blavatnik's much smaller gift to Oxford in 2015, and then in 2017 after Blavatnik's million dollar gift to the Trump inaugural was announced.  Yet so far, there has been little media discussion, and no protest of Blavatnik's "transformative" gift to Harvard, and the naming of a good chunk of the Harvard Medical School in his honor.

Blavatnik's story seems to be anechoic so far.  It has gotten little public coverage.  A Bloomberg article and a tiny AP story made no mention of Russia, oligarchs, Putin, etc.  Not surprisingly, coverage by Harvard's public relations did not bother either, (see the Harvard Gazette as above, and Harvard Magazine.) The only media coverage beyond the Boston Globe that said anything about the questionable aspects of Blavatnik's background was by the Harvard Crimson and WBUR.   

Summary and Discussion

Len Blavatnik  has been accused of acting in association with other Russian oligarchs, and with the Putin regime's FSB to use unethical means to push UK oil interests out of Russia.  Blavatnik has been accused of helping Russia to influence the 2016 US elections.  Some of Blavatnik's business associates have already been sanctioned by the US government for election meddling and profiting from "destabilizing activities."  And Special Counsel Mueller and other federal authorities are apparently in the midst of investigating Mr Blavatnik.

So Blavatnik's huge gift to Harvard Medical School seems likely to generate a new version of an institutional conflict of interest.  Consider a typical insitutional COI: a medical school getting a big donation from a pharmaceutical corporate foundation.  The concern in that case might be that the people running the school would be unduly inclined to support research that might boost the company's products, or support teaching that would again favor its products, or favor pharmaceutical therapy over other approaches.  Perhaps the students and professionals at that school might feel they are supposed to help hype the company's products, or avoid criticizing them.  All that would be highly concerning.

However, in the current case the issue is not how the school, its officials, its faculty, its health professionals and/or its students would favor Mr Blavatnik's corporate products and avoid criticizing them.  It is that they all are being pushed to cozy up to an oligarch, and thus might be pushed to favor the authoritarian government to which Mr Blavatnik appears tied, its anti-democratic practices, its corruption, and its apparent attempts to meddle in US elections, undermine US democracy, and support a particular candidate who may be beholden to it.

The protesters at Oxford in 2015 wrote
We insist that the university should stop selling its reputation and prestige to Putin’s associates.

Now Harvard University and its medical school appear to be "selling its reputation and prestige to Putin's associates."  This endangers Harvard, and the rest of us. Yet no on at Harvard appears to be protesting.  The silence is deafening.

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