The Demise of the Trump Foundation, an Extreme Example of Elite "Do-Gooding" to Prop Up the "Broken System" that Benefits Them

Big foundations often claim that they are out to improve society.  For example, the Robert Wood Johnson Foundation claims to be

the nation’s largest philanthropy dedicated solely to health.

Its goal is to improve health care for all, that is,

help raise the health of everyone in the United States to the level that a great nation deserves, by placing well-being at the center of every aspect of life.

Yet, as we discussed here, large foundations with an interest in health rarely address the sorts of issues we discuss on Health Care Renewal, particularly problems with health care organizational leadership and governance, most particularly leadership that is ill-informed, incompetent, self-interested, conflicted, or even corrupt.  One explanation was provided by Anand Giridharadas, author of  Winner Take All: Elite Charade of Changing the World, as summarized in an August, 2018, op-ed ine New York Times.

His thesis was that society has handed over the responsibility for reform to those who benefit most from the status quo. Thus,charitable foundations, one vehicle for reform, are now largely run by people with business management background, and financial ties to big corporations.  The foundations thus largely propose minimal, if not fake reforms, representing change "the powerful can tolerate." So, 

American elites generally seek to maintain the system that causes many of the problems they try to fix — and their helpfulness is part of how they pull it off. Thus their do-gooding is an accomplice to greater, if more invisible, harm.

What their 'change' leaves undisturbed is our winners-take-all economy, which siphons the gains from progress upward.

In a recent interview with the Guardian, Giridharadas explained how his concerns evolved while he was a fellow of the Aspen Institute,

a thinktank that organizes exclusive ideas conferences for the wealthy and powerful, as part of a program designed to raise up a 'new breed of leaders' and solve 'the world’s most intractable problems'.

Aftr being selected as a fellow, along with a bunch of corporate leaders, he realized that the Institute was carrying out its view that

the people best-equipped to protect the interests of the poor are the rich and rich adjacent.

In a 2015 talk to an Institute audience, he

delivered an electrifying critique, arguing the 'change makers' and 'thought leaders' in America’s winners-take-all economy – once again, the very people he was speaking to – are less helping the world through their various philanthropic efforts than propping up the broken system that made them.

The 2015 audience was apparently "aghast," but it is not clear whether Giridharadas' insight led them to change their ways.   Instead, foundations continue to prop up the "broken system," but in often subtle ways.   It is likely that those that benefit from the current status quo continue to promote little reforms around the edges, while failing to face the real issues, because doing so could "could implicate powerful people, or perhaps even themselves."

Foundations may continue to fund projects that promote small incremental changes, while avoiding those that could lead to questions about aspects of the system that benefit its current top leaders, or suggest changes in the policies that allow this.  For example, as we wrote here, the Bill and Melinda Gates Foundation's is currently led by a former top pharmaceutical executive who had defended extremely high drug prices which presumably helped fuel her extravagant compensation.   Meanwhile, the Foundation has been accused of "ideological commitment to promote neoliberal economic policies and corporate globalisation."



Example: the Demise of the Trump Foundation

Now in 2018, three years after Giridharadas confronted the Aspen Institute with little effect, we witness a truly extreme example of a non-profit foundation supposedly set up to do good for society, instead propping up the system, and specifically the supposedly generous philanthropists who founded it.  However, rather than funding marginal reforms, this example demonstrates much more direct, crude efforts to prop up the system which supported the founders of the "charity" in question, that being the Trump Foundation, the creature of our current US dear leader.

Major questions were first raised about the Foundation in 2016, when the Washington Post published an article by David Farenthold entitled, "Trump Boasts About His Philanthropy.  But his Giving Falls Short of his Words."  The Post continued its investigation of the topic, leading to an investigation by the New York Attorney General.  This week, that investigation resulted in an agreement to shut down the Trump Foundation, as again reported Farenthold in the Washington Post.  In announcing this agreement, Barbara Underwood, the New York AG, said the investigation found

a shocking pattern of illegality involving the Trump Foundation — including unlawful coordination with the Trump presidential campaign, repeated and willful self-dealing, and much more.

Transactions Benefiting Trump and Family


Basically, the Foundation was alleged to have made transactions that resulted in direct personal benefit to Donald Trump and his family.  For example,

The largest donation in the charity’s history — a $264,231 gift to the Central Park Conservancy in 1989 — appeared to benefit Trump’s business: It paid to restore a fountain outside Trump’s Plaza Hotel. The smallest, a $7 foundation gift to the Boy Scouts that same year, appeared to benefit Trump’s family. It matched the amount required to enroll a boy in the Scouts the year that his son Donald Trump Jr. was 11.

One suspicious transaction could be construed as a bribe meant to forestall investigation of another shady Trump venture, Trump University.  Per an opinion piece in USAToday, the Foundation made a "donation" to

Florida Attorney General Pam Bondi's re-election campaign in September 2013, years before Trump decided to run for office. According to Florida campaign finance records, the Trump Foundation contributed $25,000 to And Justice for All, a section 527 political organization associated with Bondi.

Charitable foundations like the Trump Foundation, however, are prohibited from political activity. On its tax forms, the Trump Foundation claimed it did not transfer any money to a 527 organization or engage in any political activity, and did not report any contribution to And Justice for All. Instead, it reported a contribution to a similarly named nonprofit organization. The foundation cited 'coincidences and errors,' but it looked like a ham-handed attempt to hide the illegal political contribution.

In fact, something more sinister than improper political activity may have been going on. The Trump Foundation made its contribution three days after it was widely reported that Bondi's office was reviewing joining the New York attorney general's lawsuit against Trump University. Following the donation, Bondi's office decided not to join the suit or open an investigation. It is possible the contribution was meant to influence Bondi's decision, and it is possible that it worked. Whatever the intent, the payment was illegal, and the IRS ultimately sanctioned the foundation, levying a fine for the violation.

After the shut down of the Foundation was announced, Trump boasted on Twitter that at least his charity had not paid him directly, as reported by Politico,

The Trump Foundation has done great work and given away lots of money, both mine and others, to great charities over the years - with me taking NO fees, rent, salaries etc.

It seems like a distinction without a difference  

The Foundation Functioned as an Arm of the Trump Campaign

In recent years, the Foundation mainly worked to benefit Trump's presidential campaign. Per the Washington Post,

In 2016, state investigators allege, Trump effectively 'ceded control' of his charity to his political campaign. He raised more than $2 million at a fundraiser in Iowa that flowed into the foundation. Then, the state said, Trump campaign manager Corey Lewandowski determined when and where it would be given away.

'Is there any way we can make some disbursements . . . this week while in Iowa?' Lewandowski wrote in an email cited in Underwood’s lawsuit.

Trump gave away oversize checks from the foundation at campaign events in the key early-voting states of Iowa and New Hampshire, pausing his campaign rallies to donate to local veterans’ groups.

Federal law prohibits charities from participating in political campaigns. As president, Trump has called repeatedly for that law to be repealed.

Again, the Foundation was acting directly to promote Donald Trump's interests.

The Foundation Had No Meaningful Governance Structure Beyond Trump's Whims

Finally, the Foundation seemed to have no meaningful governance structure that could counter its use as a family "piggy bank"

The attorney general’s investigation turned up evidence that Donald Trump Jr., Eric Trump and Ivanka Trump — all listed as officers of the charity — had never held a board meeting. The board hadn’t met since 1999. The charity’s official treasurer, Trump Organization executive Allen Weisselberg, told investigators that he wasn’t aware that he was on the board.

State investigators asked him what the foundation’s policies were to determine whether its payments were proper.

'There’s no policy, just so you understand,' Weisselberg said.

So, thanks to the investigations that have swirled around Donald Trump and company since he began his campaign for the presidency, we have seen an amazingly blatant example of a non-profit charitable foundation used not to improve society, but to support the "broken system," and particularly the advantageous position of the charity's founder within the system.


Further Discussion

This example may be extreme, but it may not be unique.  Vox just published an opinion piece entitled,"The Trump Foundation shows just how preposterously light our oversight of charity is." It noted,

As the political theorist Rob Reich explains in his new book Just Giving, we really don’t expect much from foundations as a matter of public policy.

They don’t have to have a website or some other way for interested charities to contact them about funding. They don’t have to make their giving strategy publicly available or accessible in any way. They do have to fill out 990-F tax forms, which are public and provide some information on their assets, spending, and grant recipients. But those take the form of long, difficult-to-parse tax documents, and crafty philanthropists can get around these requirements by starting up offshore foundations. And there are basically no requirements to speak of beyond filing a 990-F and spending at least 5 percent of assets every year.

'Foundations are often black boxes, stewarding and distributing private assets for public purposes, as identified and defined by the donor, about which the public knows very little and can find out very little,' Reich writes.

Maybe the revelations about the Trump Foundation will inspire a more skeptical look at "do-gooder" foundations.  We need to know the extent to which they are devoted to the interests of rich insiders rather than of society at large.  Per Giridharadas, shining more light on their obscure operations might inspire them to start

listening to more of society’s losers, and fewer winners. 'The powerful are very good at disseminating their own bullshit,” he says. 'They don’t need the intellectual reputation laundering of ideas festivals to make their heavily marketed bullshit smell even sweeter.'

'I sincerely believe,' he says, 'that had more of the institutions of this country – and particularly those involved in thinking and ideas, not just conferences but all kinds of things – been more skeptical of elite fantasies and more mindful of what was actually going on in other people’s lives in this country, I think it’s very possible we wouldn’t have orange Mussolini in the White House.

We also could have had real health care reform.

Fake Reform Foisted on Us by Those who Benefit Most from the Current Dysfunction

Introduction - No Funding for You

To better understand health care dysfunction, I interviewed doctors and health professionals, and published the results in Poses RM.   A cautionary tale: the dysfunction of American health care.  Eur J Int Med 2003; 14(2): 123-130. (link here).  In that article, I postulated that US physicians were demoralized because their core values were under threat, and identified five concerns:
1. domination of large organizations which do not honor these core values
2. conflicts between competing interests and demands
3.  perverse incentives
4. ill-informed, incompetent, self-interested, conflicted or even corrupt leadership
5.  attacks on the scientific basis of medicine, including manipulation and suppression of clinical research stuides

After that my colleagues and I have tried to raise awareness of these and related issues, now mainly through the Health Care Renewal blog.  We also set up FIRM - the Foundation for Integrity and Responsibility in Medicine,  a US non-profit organization, to try to provide some financial support for the blog.

Since we were mostly health care academics, we assumed we could get some financial support for the blog and FIRM from foundations with interests in improving health care.  Had we not identified important causes of health care dysfunction that had been largely anechoic, but once identified could be addressed, thus presumably improving health care costs, quality, and access?  It seemed reasonable at the time.

However, we failed to find any prominent foundations willing to help.  We have occasionally gotten small amounts of money from a few small foundations, but not recently.  Meanwhile we have not seen any major health care foundations supporting any iniatives by anybody meant to address any of the issues we discuss on Health Care Renewal.  In particular, while outright health care corruption seems one of the most outrageous issues we discuss, we have never found a foundation willing to take that on - at all.

 We should not have been surprised.  We later discovered that the leaders of many health care foundations had conflicts of interests which likely decreased their enthusiasm for even considering issues such as ... conflicts of interest and their risk of generating health care corruption.  (See below for further discussion.)  Recently, however, we have found some enlightenment on how such foundations, and other change agents and do gooders working the health care sphere, have managed to ignore such important problems

Why Expect Those Who Profit from Current Dysfunction to Lead Real Reform?


Last week, the New York Times published an essay by Anand Giridharadas, author of  the just published Winner Take All: Elite Charade of Changing the World.  The author's thesis was that society has handed over the responsibility for reform to those who benefit most from the status quo.

'Change the world' has long been the cry of the oppressed. But in recent years world-changing has been co-opted by the rich and the powerful.

He posited,

America might not be in the fix it’s in had we not fallen for the kind of change these winners have been selling: fake change.

Fake change isn’t evil; it’s milquetoast. It is change the powerful can tolerate. It’s the shoes or socks or tote bag you bought which promised to change the world. It’s that one awesome charter school — not equally funded public schools for all.

He suggested that the very wealthy seduce us with their dedication to change, even while sponsoring

world-changing initiatives funded by the winners of market capitalism do heal the sick, enrich the poor and save lives. But even as they give back, American elites generally seek to maintain the system that causes many of the problems they try to fix — and their helpfulness is part of how they pull it off. Thus their do-gooding is an accomplice to greater, if more invisible, harm.

What their 'change' leaves undisturbed is our winners-take-all economy, which siphons the gains from progress upward.

They have

a strong interest in convincing the public that they can help out within the system that so benefits the winners.

After all, if the Harvard Business School professor Michael E. Porter and his co-author Mark R. Kramer are right that 'businesses acting as business, not as charitable donors, are the most powerful force for addressing the pressing issues we face,' we shouldn’t rein in business, should we?

This is how the winners benefit from their own kindness: It lets them redefine change, and defang it.

In a 2017 essay in Medium which previewed the ideas that would appear in the book, Giridharadas had summarized the problem thus

change-makers [focus] on the difference they make to those they choose to help. Yet they risk avoiding the causes of the disease and remedies that would actually cure it. And they avoid these things in part because facing them could implicate powerful people, or perhaps even themselves.

This is a powerful idea.  As a society, at least in the US, we have abandoned true reform, including reform of health care, for faux reform controlled by those who would lose the most were true reform to take place instead.  We have handed the problem of excessive drug prices over to the executives of pharmaceutical companies who benefit most from currently outrageous pricing.  We have handed the problem of a dysfunctional health care insurance system over to executives of insurance companies who benefit most from high cost commercial insurance plans that cover as little as possible.  We have allowed corporations accused of unethical and criminal practices to make lax legal settlements that pretend they will be able to improve themselves without penalties accruing to the managers on whose watch the bad behavior occurred.  And we have let health care foundations led by top health care corporate managers and their cronies to sell change that matters. 

Broadening Understanding of the Conflicts of Interest Affecting Leadership of Health Care Foundations

Gridharadas has given us a broader view that explains why many big foundations fail to fulfill their glorious mission statements.

Example: the Robert Wood Johnson Foundation

For example, the Robert Wood Johnson Foundation boasts,

The inspired vision of our founder, General Robert Wood Johnson II, was to improve health and health care in America, especially for those most in need. Energized by our legacy of taking on challenging issues, we are dedicated to building a Culture of Health that provides everyone in America a fair and just opportunity for health and well-being.

Has the foundation ever really addressed ill-informed, incompetent, self-interested, conflicted or even corrupt health care leadership, or attacks on the scientific basis of medicine, including manipulation and suppression of clinical research studies?

Should we expect anything more - or less - from a foundation whose current 15 person board of trustees is chaired by:
- a retired corporate vice president and general counsel of Johnson & Johnson

and which otherwise includes:

- a retired corporate compliance officer and vice president, Technical Resources, of Johnson & Johnson

-   a surgeon who was  founder of the for-profit Columbia/ HCA, now HCA hospital system

- a retired vice president of government affairs and policy responsible for federal, state, and international relations for Johnson & Johnson.

- a retired vice president, chief information officer, and a member of and the first woman to serve on the Johnson & Johnson Executive Committee.

- and another retired retired corporate vice president of Johnson & Johnson

Example: the Bill and Melinda Gates Foundation

The Gates Foundation boasts

We see equal value in all lives. And so we are dedicated to improving the quality of life for individuals around the world.

Yet in 2006, Transparency Internationa published a report on health care corruption, which asserted that corruption is widespread throughout the world, serious, and causes severe harm to patients and society.

the scale of corruption is vast in both rich and poor countries.

Also,

Corruption might mean the difference between life and death for those in need of urgent care. It is invariably the poor in society who are affected most by corruption because they often cannot afford bribes or private health care. But corruption in the richest parts of the world also has its costs.

Has the Gates Foundation ever addressed health care corruption and the conflicts of interest that are risk factors for corruption?  Should we expect more, or less from foundation that is now run by a multi-millionaire former pharaceutical executive as foundation CEO?

As we noted here, Dr Susan-Desmond Hellmann, the CEO of the Gates Foundation was previously President of Drug Development at Genentech, Dr Desmond-Hellmann had defended the then sky high pricing of bevacizumab.  Of course, Dr Desmond-Hellmann, as a top executive, personally profited from such pricing.  In her last year at Genentech while the company was still independent, her total compensation was over $8,000,000.  As we discussed in 2014, while she was the Chancellor of UCSF, questions arose about her committment to public health when it was revealed she and her husband had large stock holdings in the tobacco company Altria.  Yet she continued to dismiss the importance of her many apparent conflicts of interest.And there have been many accusations that the foundation she runs is more about promoting corporate interests in health care than actually promoting health, see the 2016 Global Policy Forum report per this Guardian article, this article in the Independent that accused the foundation of having a

ideological commitment to promote neoliberal economic policies and corporate globalisation

and  a PLoS Medicine article [Stuckler D, Basu S, McKee M. Global health philanthropy and institutional relationships: how should conflicts of interest be addressed? PLoS Med 8(4): e1001020.  doi:10.1371/journal.pmed.1001020.  Link here. ]

'There is a revolving door between the Gates foundation and pharmaceutical corporations. Many of the foundation’s staff had held positions at pharmaceutical companies,' the report adds.

For more details about Dr Desmond-Hellmann, look here.  

As we noted, in 2012,  the Global Fund to Fight AIDS, Tuberculosis, and Malaria as struggled with corruption issues, but even after these wake up calls, the Gates Foundation, one of its major donors, has done nothing to address corruption beyond its doors.  Likewise, while the Health Alliance International  has also struggled with corruption, the Doris Duke Foundation has shown no interest in health corruption initiativies (look here).

Other Foundations

As we noted in 2011, uninterested in health care conflicts of interest and corruption are the Ford, Rockefeller, Kellogg and Robert Wood Johnson Foundation which were noted to have significant holdings in Coca-Cola, Kellogg, PepsiCo, Pfizer, GlaxoSmithKline, McDonalds, Nestle, NovoNordisk, YumBrands, Pizza Hut, KFC, Johnson & Johnson, and Sanofi-Aventis, while the Ford Foundation held shares in a tobacco company, Lorillard, and the Kellogg and Rockefeller Foundations "were indirectly invested in tobacco corporations through conglomerate equity funds...."

So health care interested foundations, which may derive financial benefit, and may be led or governed by people who mightily benefited from the dysfunctional health care status quo, are likely to continue fake reform to appear socially responsible, but avoid challenging their and their cronies sources of wealth.

Conclusion

Giridharadas suggested in an interview in New York Magazine,

What all that does is create this moral glow. And under the haze created by that glow, they’re able to create a probable monopoly that has harmed the most sacred thing in America, which is our electoral process, while gutting the other most sacred thing in America, our free press. And they do it under the cover of changing the world.

Unfortunately, he apparently has not come up with what to do about this problem.  The best conclusion I can reach derives from the end of a review of his book by Joseph Stiglitz in the New York Times,

Democracy and high levels of inequality of the kind that have come to characterize the United States are simply incompatible. Very rich people will always use money to maintain their political and economic power. But now we have another group: the unwitting enablers. Despite believing they are working for a better world, they are at most chipping away at the margins, making slight course corrections, while the system goes on as it is, uninterrupted.

So I say first, beware of fake reform pitched by those who benefit most from the current dysfunction, call it out, and whatever you do, do not continue enabling it.

The Shame of US Health Care Dysfunction: Hookworm Returns to Alabama

An article just published online(1), and reported so far in only one major media outlet (the Guardian, based in the UK) showed how hookworm, now considered a disease of poor, third world countries, has returned to the American south.  This in a country which spends more per capita on health care than any other supposedly developed country.

Background - the Supposed Eradication of Hookworm

A 2009 article in Health Affairs documented the supposed elimination of common diseases once found in US.(2)  The background of the article included:

In 1916 a new textbook appeared on the 'endemic diseases of the southern states.' With chapters on malaria, pellagra, and intestinal worms, the book’s authors identified the region as particularly, and peculiarly, diseased. Absent was the dominant southern disease of the nineteenth century: yellow fever. Although yellow fever had traveled hand in hand with the import trade of southern cities, the twentieth-century triad of pellagra, malaria, and hookworm was inextricably linked with the rural poverty engendered by cotton culture and the tenant labor system that evolved to replace slavery after the Civil War. The rural farm worker had little money or access to health care, ate a poor diet, and lived in a subtropical landscape that was host to parasitic worms and mosquitoes. In 1916 the South’s endemic diseases appeared to be thoroughly entrenched. Later, in the depths of the Great Depression, these diseases continued to plague southerners. Yet by 1950 southerners were almost free of them all.

The article noted that hookworm in particular was associated with the South:

Hookworm disease was once associated so much with the South that when a baseball commentator referred to southern players as coming from the 'Hookworm Belt' in 1947, the phrase needed no explanation. The hookworm is a tiny parasite that latches onto the wall of the small intestine, secretes an anticoagulant to promote bleeding, and feeds on the host’s blood. About 110 worms can consume a teaspoon of blood a day. A well-fed host with adequate iron intake can usually replace the lost iron and plasma proteins of a mild infection, but a malnourished person harboring sizable numbers of parasites will become anemic and protein deficient. In children the disease stunted physical and cognitive development. It made them weak, apathetic, and perpetually tired.

In the beginning of the 20th century, the Rockefeller Foundation launched a campaign that probably began the apparent eradication of hookworm.

In 1902, however, Charles Stiles, a medical zoologist, recognized in southerners the same symptoms he had seen among European hookworm victims. Once he started looking, he found a startling prevalence of the disease. He convinced representatives of the Rockefeller Foundation to take up the cause of hookworm eradication, and in 1909 the philanthropy launched an all-out assault on the disease. Their initial surveys found 43 percent of those surveyed to be infected with hookworm; in some areas the percentage rose into the 90s.

The Rockefeller campaign stressed education, treatment, and the assumption by local and state boards of health of the responsibility to carry on what the foundation had begun. With a million dollars in their coffers, the Rockefeller men spread across the South, offering lantern shows about the hookworm, testing and treating individuals, and pushing the construction of sanitary privies. Surveys of rural schools and churches found that 80 percent lacked any sort of privy; private homes were even less likely to have sanitary facilities. Children of all classes went barefoot in the summer, often not wearing shoes until they were teenagers. By 1914, when Rockefeller ended its U.S. campaign, the prevalence of infection had been cut to 39 percent, but the message of hookworm and its implications was now well known throughout the South. The campaign also energized southern public health, leaving a legacy of empowered institutions on the state and local levels.

For more on the history of the Rockefeller Foundation campaign, look here.  I hope the Foundation will not mind me using a picture of a hookworm treatment clinic from 1923.

Hookworm persisted for a surprisingly long time after these initial eradication efforts, although it seemed to be nearly gone by the 1980s.  The article noted that

Even in the 1960s there was persistent infection in coastal South Carolina (3 percent) and eastern Kentucky (14 percent). One source reported that hookworm prevalence in southern Georgia went from 60 percent in 1910 to 13 percent in 1964 and to 6 percent in 1970.

So the disease prevalence fell from over 40% in the early 20th century to a few percent by the 1980s.  One particular mechanism for the decrease was basically better plumbing.

Concerns about typhoid, which was frequently fatal, drove the cities to put in sewers and running water, and fears that the privies of the poor would infect the affluent meant that even the poorer sections of towns had sanitary waste disposal throughout much of South in the 1920s. Slowly the expectation grew that the sanitary privy was essential for adequate housing. In North Carolina in the 1940s, the state board of health required them by law.

So the problem appeared to be solved.  I learned about hookworm in a course in tropical diseases in medical school in the 1970s.  At the time, since I was not planning to go into global health, the knowledge did not seem very relevent.  I suspect that such courses were no longer very prevalent in medical school.

That was then.  This is now.

Hookworm Returns to the Impoverished US South

The new article by McKenna et al noted that hookworm is still very common globally.  In addition, it noted that the conditions are again ripe for the return of hookworm, and presumably other ailments now considered irrelevant to developed countries, to parts of the US.  In particular, the advances in plumbing so important to the eradication of hookworm are no longer so much in evidence.

According to the Alabama Center for Rural Enterprise (ACRE), an organization that addresses poverty and economic development in one of the poorest areas of the nation, there continues to be residences without adequate sanitation systems, increasing exposure to open sewage near dwellings. The “Black-Belt” soil native to this area is composed of a firm sedimentary limestone bed overlain with a layer of dark, rich soils, which requires expensive septic systems for proper waste disposal. In Lowndes County, Alabama, where the per capita income is $18,046, and 31.4% of the population lives below the poverty line, sanitation systems are unaffordable. For rural, impoverished individuals, the main form of waste removal involves use of 'straight piping,' a method involving a series of ditches or crudely constructed piping systems to guide human waste away from the residence. Most pipes never reach more than 10 meters in length, and during rainstorms or flooding, the residents report visible stool entering their homes (reported by ACRE, unpublished data).

The investigators therefore performed an epidemiological study in Lowndes County.  There sample size was small.  However, their findings were striking.  More than one-third (34.%) of subjects tested positive for necator americanus, the American hookworm.  This is close to the prevalence reported back in the early twentieth century.

The Guardian article provided vivid anecdotal evidence about the state of public health in rural Alabama that likely contributed to this result.  The reporter's tour of Lowndes county revealed vividly inadequate sewage systems.  He documented that in Alabama, "public health" was ostensibly insured by making it a criminal offense for people to have inadequate sewage systems.

people were afraid to report the problems, given the spate of criminal prosecutions that were launched by Alabama state between 2002 and 2008 against residents who were open-piping sewage from their homes, unable to afford proper treatment systems. One grandmother was jailed over a weekend for failing to buy a septic tank that cost more than her entire annual income.

'People are scared. They don’t like to speak out as they’re worried the health department will come round and cause trouble,' [community activist Aaron] Thigpen said.

Apparently the state government does not see that it has any resonsibility to provide adequate sewer systems, or provide any help to people to improve sanitation, even those clearly unable to affort it on their own.  Consider, for example, the plight of Ruby Rudolf

Rudolph, now 66, does have her own septic tank at the back of her house, which she shows us in the sweltering 41C (105F) heat. But it doesn’t function properly and when it rains the tank spills over, spreading raw waste all over the yard. 'That’s better than when it flushes back into the house, and I’ve had that too,' she said.

She’s been told a replacement system would cost her at least $12,000, which is beyond her means. She runs through her finances: she gets up at 4am every day to do an early shift at a Mapco convenience store, which brings in less than $1,200 a month. From that amount she has to pay $611 for her mortgage and there’s the electricity bill that can be more than $300 a month when it’s hot and the air conditioning is busy. There’s not a lot left to put toward a new tank.

Left entirely unsaid in the scholarly article or the Guardian story is the likelihood that any residents of these rural Alabama counties have access to any other ways to mitigate the hookworm problem.  Left also unsaid is whether they have access to health care professionals who could test them or treat them for hookworm.

Conclusions

As we have noted endlessly, the US spends more per capita on health care than any other developed country.  US politicians used to make the claim that the country has the best health care system in the world, often to ward off any attempts at true health care reform.  However, US rankings on various measures - some of which may be disputed - of health care processes and outcomes have been decidedly mediocre.  (See for example the latest Commonwealth Fund study here.)

The new study of hookworm prevalence was not based on a big, systematic, or geographically diverse sample.  However it is striking, and dismaying that a disease once thought to be eradicated is again alive and well in the poorer parts of a very rich country. 

Note that while the eradication of hookworm was partially attributed to the energizing of public health in the south, currently public health officials seem to think their job is to arrest poor people who cannot afford adequate sanitation.  The government does not seem to think it has a responsibility to assure working sewers or other forms of basic sanitation.  There also seems to be a governmental abandonment of public health focused on reaching individuals who might most be at risk of disease.

Meanwhile, the country, as we have said before, has seen the diversion of tremendous amounts of health care and public health dollars into the pockets of health care managers, their cronies, health care management and administration in general, and in some cases investors.  This appears in turn to be a consequence of deregulating the system, allowing concentration of power,  allowing the commercialization of various kinds of health care organizations (insurance, hospitals, medical practices, etc), and of turning health care leadership over to managers trained in business schools (managerialism) with no appreciation of health care professionals' values, and with perverse incentives focused on increasing their organizations' revenue and hence their personal enrichment.  We can spend untold sums on new treatments with dubious margins of benefits vs harms, but not on basic public health or access to primary care. 

And hookworm is back. 

Shame on us. 

References

1.  McKenna ML, McAtee S, Bryan PE et al.  Human intestinal parasite burden and poor sanitation in rural Alabama.  Am J Trop Med Hygeine 2017; https://doi.org/10.4269/ajtmh.17-0396

2.  Humphreys M. How four once common diseases were eliminated from the American south.  Health Aff 2009; 28: 1734-1744.  Link here. 

Trumping Up a Health Care Charity - Trump Organization Received Increasing Revenue from a Children's Cancer Care Charity

While health and health care are clearly not central interests of the current US President, Donald J Trump, we have noted some disturbing stories about the effects of his leadership on health care.  Most importantly, prior to the election, a story appeared alleging that Mr Trump licensed his name, and actively supported the Trump Network, which sold dodgy vitamin supplements to gullible consumers based on the results of urine tests of unproven, at best, accuracy (look here). While Mr Trump is controversial, to say the least, on multiple levels, never in modern history can I recall a president who was alleged to have been a major player in what appears to be a health scam.

Moreover, since Mr Trump was elected we have noted his proposed and actual appointments to positions of power over health and health care people with severe conflicts of interest, sometimes with no or limited experience in and knowledge of health and health care, and sometimes who had acted against the values of health care professionals  (look here, here, here, here, here, here, here, here, and here ).  (Please note that since while our focus in health care dysfunction, we emphasize cases that are not extensively reported in the media and/or medical and health care literature.  So this list is hardly exhaustive.)

Now we have in the public arena a case in which Mr Trump apparently subverted the good intentions of a charity designed by his son to benefit children with severe illness, resulting in apparent private gain for Mr Trump.

The Beginnings of the Eric Trump Foundation and its Support of St Jude Childen's Research Hospital

An article in Forbes published this week recounted how Eric Trump set up a charity whose main goal was to support children's cancer care, and which would channel the maximum amount of money raised directly to reputable health care organizations.

Eric Trump set up his foundation as a public charity, a classification that allows it to raise most of its money from outside donors. In 2007, when he was 23, the first Eric Trump golf tournament took place, raising $220,000. A compelling sales pitch evolved--the free golf course and the donated goods and services assured donors that every penny possible went to charity. The Eric Trump Foundation employed no staff until 2015, and its annual expense ratio averaged 13%, about half of what most charities pay in overhead. His original seven-person board was made up of personal friends, an innocuous lot who helped sell tournament tickets, which last year ranged from $3,000 for a single all-day ticket to $100,000 for a pair of VIP foursomes.

For the first four years of the golf tournament, from 2007 to 2010, the total expenses averaged about $50,000, according to the tax filings. Not quite the zero-cost advantage that a donor might expect given who owned the club but at least in line with what other charities pay to host outings at Trump courses, according to a review of ten tax filings for other charitable organizations.

That is all admirable, to say the least. But apparently it was not to continue.

Donald Trump Demands His Pound of Flesh

Eric Trump's plans to minimize his charity's overhead soon collided with the wishes of his father, Donald J Trump, then CEO of the Trump Organization, now President of the United States.  Per Forbes, 

But in 2011, things took a turn. Costs for Eric Trump's tournament jumped from $46,000 to $142,000, according to the foundation's IRS filings. Why would the price of the tournament suddenly triple in one year? 'In the early years, they weren't being billed [for the club]--the bills would just disappear,' says Ian Gillule, who served as membership and marketing director at Trump National Westchester during two stints from 2006 to 2015 and witnessed how Donald Trump reacted to the tournament's economics. 'Mr. Trump had a cow. He flipped. He was like, 'We're donating all of this stuff, and there's no paper trail? No credit?' And he went nuts. He said, 'I don't care if it's my son or not--everybody gets billed.''

Katrina Kaupp, who served on the board of directors at the Eric Trump Foundation in 2010 and 2011, also remembers Donald Trump insisting the charity start paying its own way, despite Eric's public claims to the contrary. 'We did have to cover the expenses,' she says. 'The charity had grown so much that the Trump Organization couldn't absorb all of those costs anymore.' The Trump Organization declined to answer detailed questions about the payments.

Furthermore, the amount of money demanded by the Trump Organization rapidly increased.

The cost for Eric's golf tournament quickly escalated. After returning, in 2012, to a more modest $59,000--while the event brought in a record $2 million--the listed costs exploded to $230,000 in 2013, $242,000 in 2014 and finally $322,000 in 2015 (the most recent on record, held just as Trump was ratcheting up his presidential campaign), according to IRS filings. This even though the amount raised at these events, in fact, never reached that 2012 high.

The Forbes article alleges this occurred despite Eric's protestations to the contrary.

Remember, all those base costs were supposedly free, according to Eric Trump. The golf course? 'Always comped,' he says. The merchandise for golfers: 'The vast majority of it we got comped.' Drinks: 'Things like wine we were normally able to get donated.' And the evening performances from musicians like Dee Snider of Twisted Sister and comedians like Gilbert Gottfried: 'They did it for free.'

The Trump Organization Takes Over the Eric Trump Foundation

The move to claw back increasing amounts of charitable proceeds from the Eric Trump Foundation as payments to the Trump Organization seemed to coincide with a shift in the governance of the Eric Trump Foundation. Per Forbes,

In 2010, the year the economics of the tournament suddenly pivoted, four of the seven original board members, who were personal friends of Eric, left. Those 4 were eventually replaced by 14 new board members, the majority of whom owed all or much of their livelihoods to the Trump Organization. Six of them were effectively full-time employees, including Trump lawyer Michael Cohen and executive vice president Dan Scavino Jr., who both serve in political roles for President Trump. Another owns a company that billed the Trump campaign $16 million. Add in Eric himself, as well as his wife, Lara, and 9 of the 17 Eric Trump Foundation board members had a vested interest in the moneymaking side of the Trump empire. The foundation had become a de facto subsidiary of the Trump Organization.
 
'They were wearing two hats,' says Langan, the former director of golf, who says he sat in on meetings where he couldn't tell where the business ended and the charity began. 'You're dealing with people talking about the event and the charity who also at the same time are thinking about it as a corporation and as a business. It's a for-profit club. You know, they're trying to make money.'

Why this happened, and who orchestrated it were not clear. However, it does suggest that at best, the charitable nature of the Eric Trump Foundation was diluted, to the point that it conceivablye became a de facto part of the for-profit Trump Organization, a company whose majority owner was, and still is Donald J Trump.

Eric Trump Launches an Ad Hominem Attack Against Critics of His Charity

Within a day of the Forbes article, Eric Trump was interviewed by the British Tabloid, the Daily Mail. Its headline was:

Eric Trump says critics of his children's charity are 'sick' and 'disgusting' after news report clobbers him for paying his company $100K for expenses – and he insists there was 'zero profit' to his family

To make a long story short, Mr Trump perseverated about the total amount of money his charity brought to St Jude, and fixated on the amount of a single payment made by the Trump Organization to the charity of $100,000 supposedly to offset the bills sent to the charity from the Trump Organization.

But $100,000 in one year's revenues for his family's company pales in comparison to the millions the foundation raises each year for child cancer research.

He maintained that

none of the money resulted in actual profit to the Trump organization - only reimbursements for costs that couldn't be paid through specific donations.

However, the Daily Mail article included no discussion of the escalating payments after 2011, allegedly reaching as high as $322,000 in 2015, and no justification that these were required only to cover costs.  Calling critics "sick" or "disgusting" was an ad hominem attack.  However, Mr Trump never did contradict the rising unexplained payments made by his foundation to his father's company. 

Summary

Eric Trump ought to be commended for his original goal, to benefit pediatric cancer care through a charity which had minimal overhead expenses.  While he apparently was able to maintain this mission for several years, it appears that his father, Donald J Trump, CEO of the Trump Organization and now President of the United States, was able to siphon increasing amounts of money from the charity back into his family-owned corporation, and to position his cronies as trustees of his son's charity.

While the Eric Trump Foundation seems to be continuing to raise substantial money for pediatric oncology care, his claims that the organization has virtually no overhead, and his own control of the foundation now appear dubious.  His father's ability to convert donated money into corporate revenue appeared at the least to compromise the stated mission of the Foundation

to support St Jude Children's Research Hospital

In the last few years its mission also appeared to be to support the revenue of the Trump Organization. Thus the transformation of the Eric Trump Foundation seems to fit the ethical definition of corruption per Transparency International

the abuse of entrusted power for private gain

albeit that the Eric Trump Foundation was entrusted to support St Jude at minimal overhead cost, and that the gain accrued privately not to Eric Trump, but to the Trump Organization and presumably its principal owner at the time, Donald J Trump.

This case, of course, just adds to many others in which non-profit health care organizations threaten their own missions at the apparent behest of and/or for the apparent benefit of their leaders, and in this case, their leaders' relatives.  So I could simply again point out that we need leadership of health care organizations that puts mission, and patients' and the public's health ahead of all other considerations, including revenue enhancement, and particularly ahead of the leaders' enrichment.

This is a special case, though, because the person who seemed to gain the most benefit from the machinations was not just another corporate CEO, but the future president.  Now, as president, Donald J Trump is the de jure leader of the entire government health care apparatus, including the Department of Health and Human Services, and all its associated agencies, and is the de jure leader of the entire government law enforcement apparatus, including the Department of Justice.  The leader of the US Internal Revenue Service, which enforces the laws and regulations about non-profit organizations, incidentally also answers to the President.

Thus as an advocate for more functional health care, disquieting is far too polite a term to describe the presidency in the hands of someone who apparently so cavalierly re-engineered for his personal benefit a charitable foundation meant to help sick children, who so cavalierly supported conflicted and ill-informed leadership of government health care agencies, and who so cavalierly licensed his name to a sketchy vitamin sales scheme.    

Abort, Retry, Fail - Billionaire Bill Gates Opines, Sans Evidence, on ... the Efficacy of Hepatitis C Treatment?

If you needed advice about the technical characteristics of computer operating systems you probably would not go to your doctor for it.  So why would you seek the opinion of a software company mogul about the efficacy of pharmaceuticals?

Software Mogul Bill Gates on the Pricing and Efficacy of Antiviral Drugs for Hepatitis C 

Nonetheless, per Bloomberg, last week Bill Gates pontificated about drugs for the treatment of hepatitis C.  When apparently asked about the priorities of the Bill and Melinda Gates Foundation, Mr Gates said

market forces were working properly in hepatitis C, invoking Gilead Sciences Inc.’s treatments Sovaldi and Harvoni, which have been criticized by insurers and politicians as too expensive at $1,000 a pill or more for 12 weeks of treatment, before discounts and rebates.

While Gilead is the market leader, it’s now facing competition from Merck & Co. and AbbVie Inc., forcing prices lower.

'Curing hepatitis C, this is a phenomenal thing, and now you have multiple drug companies competing in terms of the quality and the price of that offering,' he said.

More broadly, Mr Gates defended the high prices of drugs in the US, partly because:

The drug companies are turning out miracles....

Not a Wonder Drug, According to the Clinical Research Evidence

Mr Gates, it seems, has not done a critical review of the data on the new antiviral treatments for hepatitis C.  In fact, starting in March, 2014, we have posted about the lack of good evidence from clinical research suggesting these drugs are in fact so wondrous.  The drugs are now touted as "cures," at least by the drug companies, (look here), and physicians are urged to do widespread screening to find patients with asymptomatic hepatitis C so they can benefit from early, albeit expensive treatment.

However, as we pointed out (e.g., here and here)
-  The best evidence available suggests that most patients with hepatitis C will not go on to have severe complications of the disease (cirrhosis, liver failure, liver cancer), and hence could not benefit much from treatment.
-  There is no evidence from randomized controlled trials that treatment prevents most of these severe complications
-  There is no clear evidence that "sustained virologic response," (SVR), the surrogate outcome measure promoted by the pharmaceutical industry, means cure. 
-  While the new drugs are advertised as having fewer adverse effects than older drugs, it is not clear that their benefits, whatever they may be, outweigh their harms.

Furthermore, health care professionals and researchers with heftier credentials in clinical epidemiology and evidence based medicine than mine have since published similar concerns.  These included
- a report from the German Institute for Quality and Efficiency in Health Care (the English summary is here)
- an article in JAMA Internal Medicine from the Institute for Clinical and Economic Review (1)
- a report from the Center for Evidence-Based Policy (link here)
- an article in Prescrire International (2)

These publications and your humble scribe noted that the clinical trials or other types of clinical research about new hepatitis C treatment published in the most prominent journals had numerous methodologic problems that all seemed likely to make the new drugs look better, perhaps intentionally.  (See posts here,  here, and here.)

Why Do Rich People Who Run Foundations Tout Expensive Drugs?


Yet there is something about hepatitis C and the newer treatments of it that seems to inspire rich people who run foundations to sound like marketers for Gilead, sans evidence to support their viewpoints.  About one year ago, former US President Bill Clinton, now a leader of the well-publicized Clinton Foundation and of the now apparently independent Clinton Health Access Initiative, said something similar, as we posted here:

Clinton pointed to new hepatitis C drugs, Sovaldi and Harvoni, which are sold by Gilead Sciences for more than $80,000 for a 12-week program of treatment. Those medications often cure a disease that can cause liver disease and eventually lead to transplants or death, which are expensive, too. But the sticker price on the drug has caused a backlash by payers and patients.

'Who wants to let somebody's liver rot? Nobody,' Clinton said. 'Who's got $80,000 to spend? Not many. And if you're a small businessperson and you're in a small pool [of employer-based insurers], are you going to fire somebody who needs that treatment? These are all practical problems, and we can solve them.'

So what is going on here?  In a general sense, it may be that people who have become very rich, and have held very high level executive positions, start to believe they are expert on everything, especially in a country increasingly dominated by market fundamentalism/ neoliberalism in which money is touted as the ultimate measure of everything important.  But more specifically, Mr Gates may also be spending too much time with the top brass of his foundation, who may be all too used to hawking expensive drugs.

Former Pharmaceutical and Biotechnology Executives Running Supposedly Charitable Foundations

In particular, the current CEO of the Gates Foundation is Dr Susan Desmond-Hellmann.  When Dr Desmond-Hellmann's appointment as Chancellor of UCSF was announced in 2009, I suggested that she was a very unusual choice because of aspects of her track record in the pharmaceutical/ biotechnology business.  During her previous service as President of Drug Development at Genentech, Dr Desmond-Hellmann had defended the then sky high pricing of bevacizumab.  Of course, Dr Desmond-Hellmann, as a top executive, personally profited from such pricing.  In her last year at Genentech while the company was still independent, her total compensation was over $8,000,000.  As we discussed in 2014, while she was at UCSF, questions arose about her committment to public health when it was revealed she and her husband had large stock holdings in the tobacco company Altria.  Yet she continued to dismiss the importance of her many apparent conflicts of interest.

Also, in 2011, prior to the hiring of Dr Desmond-Hellmann, as we discussed here, a PLoS Medicine article by Stuckler et al(3) suggested a revolving door between the leadership of the Gates Foundation and of pharmaceutical and biotechnology companies,

Members of personnel also move between the Foundation and pharmaceutical companies. For example, in April 2010, a former Merck senior vice president, Richard Henriques, became the chief financial officer of the Gates Foundation. At least two other members of the Gates Foundation leadership have transferred from the leadership of GlaxoSmithKline to sit on the Foundation’s board of directors, including Kate James, the chief communications officer, and Tachi Yamada, until February 2011, the head of the Foundation’s global health program. Similar patterns were observed with the other foundations studied.

Foundations Promoting the Biotechnology and Pharmaceutical Agenda

Dr Desmond-Helmann has continued to use her bully pulpit at the Gates Foundation to promote high-tech medicine that uses the newest, most expensive drugs.  For example, in an interview in December, 2015 in the Washington Post, she promoted "precision public health" which would emphasize the supposed "innovation, that speed, that ability to use big data" characteristic of precision medicine brought to public health.  However, "precision medicine" has so far not been proven to fulfill its promise to benefit patients.

In addition, in May, 2016, a Wall Street Journal article noted that she has led the Gates Foundation to invest in commercial biotechnology firms,

Dr. Desmond-Hellmann cited a $52 million investment by the foundation in CureVac, a German biopharmaceutical company, as the type of partnership that could produce new tools against epidemics. CureVac is developing vaccine technologies based on messenger RNA that would instruct the body to produce its own defenses against infections. The funding, which the foundation announced in 2015, is for construction of a manufacturing facility; the foundation said it would provide additional funding to develop vaccines for several infectious diseases.

Are these investments the best way to provide better global health care?  An aside in the Bloomberg article suggests they may be more about making money.

The foundation reported in May that it had received an unexpected boost to its endowment when a stake in a small biotechnology firm, Anacor Pharmaceuticals Inc., sold for $86.7 million -- about 17 times the fund’s original investment. While the foundation had invested in Anacor to encourage the company’s work in neglected diseases, Anacor shares took off after its toenail fungus drug was approved.

I am sure that toenail fungus is not a major public health problem anywhere, much less in the developing world.

The tragedy here is that the Gates Foundation, which appears to be the largest private foundation in the US (and the world), has a huge impact on global health, and yet its leadership is squandering its moral authority in the pursuit of the pharmaceutical/ biotechnology agenda.  A review of a new book out about the foundation in November, 2015 in the Intercept noted that the book's author

spends much more time discussing whether the Gates Foundation is protecting the patents of pharmaceutical companies and whether it is making common cause with Monsanto to spread genetically modified crops in Africa

In January, 2016, the  Global Policy Forum put out a report that, per a Guardian article,  accused

organisations like the Bill and Melinda Gates Foundation, the Rockefeller Foundation and others are promoting solutions to global problems that may undermine the UN and other international organisations, says the report by the independent Global Policy Forum, which monitors the work of UN bodies and global policymaking.

Futhermore, the report asserted,

 Through their multiple channels of influence, the Rockefeller and Gates foundations have been very successful in promoting their market-based and bio-medical approaches towards global health challenges in the research and health policy community – and beyond.

More specifically, an article in the Independent accused the foundation of having a

ideological commitment to promote neoliberal economic policies and corporate globalisation

The report, per the Guardian, also accused the foundation of conflicts of interest,

The report also questions why the Gates foundation invests heavily in companies like Monsanto and Bayer. 'In addition to its grant-making activities, the Gates foundation has recently stepped up its support for the biotechnological industry directly.'

Also, similar to the PLoS Medicine article cited above(3)

'There is a revolving door between the Gates foundation and pharmaceutical corporations. Many of the foundation’s staff had held positions at pharmaceutical companies,' the report adds.

More dramatically, per the Independent,

the Gates Foundation 'often appears to be a massive, vertically integrated multinational corporation, controlling every step in a supply chain that reaches from its Seattle-based boardroom … to millions of end-users in the villages of African and south Asia.'

Furthermore, per the Intercept book review article, the larger problem is that the Gate Foundation and its CEO are largely unaccountable,

Bill and Melinda Gates answer to no electorate, board, or shareholders; they are accountable mainly to themselves. What’s more, the many millions of dollars the foundation has bestowed on nonprofits and news organizations has led to a natural reluctance on their part to criticize it. There’s even a name for it: the 'Bill Chill'  effect.

I would note parenthetically the foundation's board of trustees only includes Bill and Melinda Gates, Mr Gates' father, and Mr Warren Buffet.  Most large foundations have considerably larger boards of trustees, with at least some diversity in family membership and backgrounds.

In an interview with the Financial Times in March, 2016, Dr Desmond-Hellmann made a hash of addressing the accountability issue:

Accountability is another concern. To whom do these multibillion-dollar foundations answer?

For once, Dr Desmond-Hellmann’s confident responses falter. In reply to a suggestion that trans­parency is not the same thing as accountability — putting everything online means you can see what the foundation is doing, but does not mean that it is being held to account — she seems uncharacteristically stuck for words.

'The way that people can hold us accountable is to look at what we achieved as a foundation through our collaborations,' she says, quickly regaining her poise.

So even the foundation's CEO cannot say to whom, and how she is accountable.


Conclusions

So maybe Bill Gates' seemingly ill-informed apologia for the extremely high drug prices charged in the US, and his lack of understanding of the evidence about the efficacy, or lack thereof, of some of these high priced drugs is a small humorous story that indicates just the tip of the iceberg.  It appears that in our current market fundamentalist, neoliberal world, foundations may be more about promoting the commercial interests of their board members and officers than about improving the lot of humanity.  Yet for the most part they may succeed in obfuscating what they are doing through the haze of marketing and public relations.

True health care reform would first make transparent the web of institutional and individual conflicts of interest that seems to tie together nearly all big health care organizations, and open discussion of how to make health care organizations better serve health care rather than the narrow financial interest of their top leaders.

Graphic Interlude

A "blue screen of death"

 References

1. Ollendorf DA, Tice JA et al. The comparative clinical effectiveness and value of simeprevir and sofosbuvir in chronic hepatitis C viral infection. JAMA Intern Med 2014. Link here.
2. Sofosbuvir (Sovaldi), active against hepatitis C virus, but evaluation is incomplete. Prescrire Int 2015; 24: 5- 10. Link here.
3.  Stuckler D, Basu S, McKee M. Global health philanthropy and institutional relationships: how should conflicts of interest be addressed? PLoS Med 8(4): e1001020.  doi:10.1371/journal.pmed.1001020.  Link here.

Abort, Retry, Fail? - Lancet Avoided Much Recent Unpleasantness in Reporting on New Gates Foundation CEO (Including Her Defense of $55,000 a Year for Bevacizumab)

The April 26, 2014 issue of the prestigious journal Lancet used two full pages and two separate articles by the same author to discuss the ascension of the Gates Foundation new CEO, Dr Susan Desmond-Hellmann.(1-2)

Two Somewhat Redundant Lancet Articles

Dr Desmond-Hellmann trained as an oncologist, spent time working on AIDS and Kaposi's Sarcoma in Uganda, but then spent much of her career as a pharmaceutical/ biotechnology executive, as described in the first article,(1)

After returning from Uganda, Desmond-Hellmann joined the nascent Taxol development programme at Bristol-Myers Squibb, before being poached by Arthur Levinson, the then Head of Research and Development at Genentech. Levinson was convinced Genentech had a strong pipeline of anticancer therapies, and brought Desmond-Hellmann on board to help guide them through to approval. The pipeline went stratospheric, and took Desmond-Hellmann with it. By 2009 she had been promoted to President of Product Development, having overseen the introduction of two of the first gene-targeted therapies for cancer, bevacizumab and trastuzumab.

After Genentech was bought out by Roche, Dr Desmond-Hellmann became Chancellor of the University of California, San Francisco,

Over the next 5 years, Desmond-Hellmann instituted wide-ranging reforms at UCSF, including aggressively cutting administrative waste and putting a greater emphasis on partnerships with the biotech and pharmaceutical sectors, coming in for some criticism in the process. 'Some of the press suggested one of Sue's goals was to take UCSF out of the public system', says [current UCSF interim Chancellor Sam] Hawgood. 'Nothing could be further form the truth. She was very proud of the public mission of UCSF, and had no intent to alter that.' Mindful of how damaging perceived conflicts of interest could have been to her credibility during her time at UCSF, Desmond-Hellmann says she 'specifically avoided being on pharma and biotech boards'.

The article suggested we should expect nothing but great things from Dr Desmond-Hellmann at the Gates Foundation,

it is Desmond-Hellmann's ability to forge partnerships and her wide network of contacts, rather than her knack for cutting administrative overheads, that will have seemed most attractive to the Gates Foundation as it looks to speed up the process of translating research into results.

The second article used remarkably similar wording(2), e.g., regarding her career in the pharmaceutical business,

Soon after joining the Taxol team, Desmond-Hellmann was leading it; the kind of progress that was bound to catch the eye of Genentech's then Head of Research and Development Arthur Levinson. What happened next is part of pharmaceutical folklore, as Desmond-Hellmann helped to mastermind one of the most profitable drug-development pipelines in history, including the approval of two of the first targeted cancer therapies, for Genentech.

Also, regarding her career at UCSF,(2)

 Desmond-Hellmann from embarking on a programme of structural reforms to cut administrative inefficiency and forge closer links with private industry, something that still stirs up controversy. 'There definitely were concerns, and there remain concerns in academia, about conflicts of interest, privatisation. I think what helped most was that I was clear in my actions that I did and do value that UCSF is a public institution, and I think my actions spoke and speak for themselves', she says. But Desmond-Hellmann is robust in her defence of the importance of public—private partnerships for driving innovations that ultimately benefit society.

Finally, regarding expectations for her performance in the future,

'There are a lot of people who are looking to the foundation, and in the world of philanthropy there's a lot of visibility to the Bill & Melinda Gates Foundation, so I certainly feel accountable and responsible for doing a good job.' But, she asserts, 'I'm up for it'. With a track record that ranges from clinical research, global health, and the sharp end of commercial drug development, she seems to be made for it.

So Lancet, a very well known journal which normally is very parsimonious about its use of the printed page, used two full pages for two very similar articles about the new Gates Foundation CEO.  Both articles made the same points,
-  Dr Desmond-Hellmann had a brilliant career in the pharmaceutical/ biotechnology business, and was responsible for the development of several important cancer drugs
-  Dr Desmond-Hellmann made major reforms at UCSF, including pushing for some sort of privatization, and for public-private partnerships, while dismissing concerns about any resulting conflicts of interest
 -  Dr Desmond-Hellmann is likely to be very successful as Gates Foundation CEO.

What the Articles Did Not Say

When Dr Desmond-Hellmann's appointment as Chancellor of UCSF was announced in 2009, I suggested that she was a very unusual choice because of aspects of her track record in the pharmaceutical/ biotechnology business.  Yet the Lancet's two articles on her prospects as new Gates Foundation CEO ignored these considerations, and ignored or downplayed aspects of her track record as UCSF Chancellor.  In particular,

Defending $55,000/ Year Bevacizumab

As I noted in 2009, Dr Desmond-Hellmann's defense as a Genentech executive of the sky high prices the company was charging for its new drugs was well documented in an article in the Journal of the National Cancer Institute)(3)

And cancer biologics, though among the most costly drugs, are still only a tiny fraction of total GDP, said Genentech's Susan Desmond-Hellmann, president for product development, at AACR.

Hellmann and others argue that with these drugs’ potential to alleviate the huge societal burden of cancer, biologics are worth the cost.

The industry has responded to concerns about costs by putting more resources into patient assistance programs. When Genentech received U.S. Food and Drug Administration approval for bevacizumab in lung cancer last October, it also announced a cap on expenditures for the drug for patients with family incomes less than $100,000 a year. In 2005, the median household income was $46,326.

Originally announced as $55,000, the cap actually doesn't kick in until after a patient has received 10,000 mg. At the wholesale acquisition cost, 10,000 mg is about $55,000, said Genentech spokesperson Edward Lang.

What the companies have not done so far is reduce prices. The reason, industry representatives say, is the need to recoup massive research and development costs, including high manufacturing costs for biologics. These costs have long kept biotech companies from making much of a profit overall, Hellmann said. She noted that profit levels of publicly held biotech firms have 'hovered close to zero' throughout the life of the industry.

Whatever the company's nominal profit levels, its executives, including Dr Desmond-Hellmann, have made extremely good money.   According to Genentech's 2008 proxy statement, (the last available, since the company has been bought out by Roche), Dr Desmond-Hellmann's total compensation was $8,361,348 in 2007 and $7,820,142 in 2006. In 2007, her total compensation was equal to 0.3% of the firm's total net income.

Of course, since 2007, and especially since 2009, the problem of hugely expensive pharmaceuticals as a driver of health care costs, especially in the US, has become all too apparent.  The Lancet articles were completely silent about this aspect of Dr Desmond-Hellmann's track record, and what implications it might have for her new role of a foundation that spends $3 billion a year, mainly ostensibly to improve the health of poor people.

Since she began as Chancellor of UCSF in 2009, other aspects of Dr Desmond-Hellmann's track record came to light that might have a bearing on how she will conduct herself as Gates Foundation CEO. 

Investments in Tobacco Stocks

As I posted in 2010, then NY Times reporter Duff Wilson discovered that Dr Desmond-Hellmann and her husband (also a physician), had stock holdings in Altria, the parent company of tobacco company Phillip Morris USA, worth between $100,000 and $1,000,000.  When this made public, they abruptly sold the stock.  The head of the UCSF tobacco control center then said,  “I do find that kind of shocking, but at least she got rid of it,...”

The goals of tobacco companies seem completely antithetical to those of a medical school, especially one with a tobacco control center, and incidentally seem antithetical to those of the Gates Foundation, which has a tobacco control initiative, with a stated goal:

to reduce tobacco-related death and disease in developing countries by preventing the initiation of new smokers, decreasing overall tobacco use, and reducing exposure to secondhand smoke.

The Lancet articles were silent on this issue.  

Questions Whether Industry Partnerships Threaten the University Mission

In 2011, I posted about Dr Desmond-Hellmann's vigorous push to create public-private partnerships, which seemed meant to turn UCSF into a de facto drug company research and development contract shop.  At the time, I noted that many of her arguments seemed to be based on logical fallacies, and that she never provided any good evidence for her claims of marvelous new "innovations" that would result from such supposed partnerships.  The Lancet articles did not mention any substantive concerns about this issue.

Dismissing Concerns about Conflicts of Interest

In 2012, I posted about how Dr Desmond-Hellmann also dismissed concerns that public-private partnerships could lead to damaging conflicts of interest, again employing several logical fallacies.  In particular, she implied that medical academics should no longer just do research to advance knowledge, but had become responsible for getting their "discoveries to society," and therefore would have to "start a company or work with a company to commercialize a product."  She did not seem to acknowledge the possibility that academics could make discoveries, but perhaps other people would be better at turning these discoveries into useful products.  The Lancet articles were silent on these issues.

Minimizing Concerns about Conflicts of Interest due to Membership on the Board of Corporations with Health Care Agendas

As noted above, Dr Desmond-Hellmann stated that she demonstrated her sensitivity to the issue of conflicts of interest affecting academic health care by avoiding membership on boards of directors of "pharma or biotech" companies.  These, of course are not the only sorts of for-profit corporations who have health care agendas.  This statement appears to have been carefully worded to avoid dealing with Dr Desmond-Hellmann's membership since 2010 on the board of directors of Procter & Gamble (see the company's 2013 proxy statement.)   While Procter & Gamble is no longer a major pharmaceutical company, it has a Global Health and Grooming unit, whose products include over the counter pharmaceuticals (e.g., Pepto-Bismal, Metamucil, Prilosec OTC).  Also, while Procter & Gamble does not make it very obvious, it has also owned MDVIP, a company that employs physicians to provide concierge medical services, since 2010, although as Cincinnati.com just reported, it will soon sell this unit to private equity.   So while perhaps Dr Desmond-Hellmann could claim that while she was UCSF Chancellor she was not on the board of directors of any pure pharmaceutical or biotechnology company, she was certainly on the board of a major international company that sells pharmaceuticals and other health care related products, and employs physicians to provide direct patient care.  (Presumably, she will be staying on the P&G board while she is Gates Foundation CEO.)  The Lancet did not mention this issue. 

Privatizing UCSF

Also, the Lancet articles seemed to contradict other reports that Dr Desmond-Hellmann made a serious attempt to privatize at least some aspects of UCSF, but that this effort failed. (Note that quote by Dr Hawgood from the first article above.)    

However, in 2012, I posted about a prevalent conspiracy theory that University of California managers were trying to take the university private.  However, it seemed to be more of a theory, because at least one news report included statements that Dr Desmond-Hellmann wanted to take UCSF out of the state university system.  This week, an article in the San Francisco Business Times suggested that this was a serious plan, in that Dr Desmond-Hellmann

ran into opposition when she  proposed in early 2012 that some of UCSF's functions be separated from the rest of the UC system.

The autonomy coming from the separation, Desmond-Hellmann argued at the time, would have meant that the sole graduate-level-only campus in the 10-campus UC system would no longer subsidize UC undergrad programs. It also would have translated into UCSF having more control over the money it generates from its medical center and other operations.

However, the same article noted that the current University of California President,

dismissed as 'loose talk' a more than two-year-old plan for UCSF to weaken its ties to the larger UC system. 'UCSF is firmly part of the system and will remain so,...'

The current president seemed to thus acknowledge that this plan existed, however "loose" it may have been.  Clearly, the Lancet articles suggested rather that Dr Desmond-Hellmann did not have any privatization plans, whatever the criticisms people could have made of them.  

Summary

We have often discussed the anechoic effect, how it seems taboo to discuss certain unpleasant facts and issues relevant to the health care system, especially those that might lead to questions about the abilities of the current leadership of large health care organizations.  This taboo seems to particularly affect public discourse within the health care system, such as is found in medical and other scholarly health care journals.

The Lancet is one of the largest circulation and most prestigious medical journals.  The Gates Foundation is one of the biggest foundations working in the health care sphere.  In their latest letter, Bill and Melinda Gates stated,

Our foundation is teaming up with partners around the world to take on some tough challenges: extreme poverty and poor health in developing countries, and the failures of America’s education system.

Yet when the Lancet devoted two full pages to often repetitive discussion of the new leader of the Gates Foundation, it avoided discussion of several issues that might have lead to questions about whether her future leadership would really be about challenging "poor health in developing countries," rather than promoting the interests of large pharmaceutical/ biotechnology and other health care related companies, as she had apparently tried to do before.  That such an important medical journal would publish such incomplete health news reporting suggests the operation of the anechoic effect.

I hope the questions that ought to be raised about Dr Desmond-Hellmann's priorities as CEO of the Gates Foundation will eventually be put to rest.  It would be more reassuring, however, if they could be confronted directly rather than obfuscated.  As long as big health care journals remain so deferential to big health care leaders, concerns we have raised before about whether health care is now primarily lead by a small in-group of executives and managers who may put private interests ahead of entrusted responsibilities remain acute.

As we have said many, many times, true health care reform would ensure that leaders of big health care organizations really put patients' and the public's health ahead of private interests. 


References

1.  Holmes D. New CEO takes the reins at the Gates Foundation.  Lancet 2014; 383: 1440.  Link here.
2.  Holmes D. Susan Desmond-Hellmann taking charge at the Gates Foundation.  Lancet 2014; 383: 1455.  Link here.
3.  McNeil C. Sticker shock sharpens focus on biologics.  J Nat Cancer Instit 2007; 99: 910-914.  Link here.

ADDENDUM - Material about MDVIP as subsidiary of Procter & Gamble added 5 May, 2014 PM.