Despite the initial intent of charitable foundations to be not-for-profit, some of them tend to morph into organizations with bigger aspirations.
The Bill and Melinda Gates Foundation, the Chan Zuckerberg Initiative, the Dana-Farber Cancer Institute, the Juvenile Diabetes Research Foundation. All are examples of foundations that fund research via charity. This phenomenon, also called venture philanthropy, especially thrives in the USA. Whereas research funding in Europe mostly comes from the government, in the USA it comes increasingly from charitable foundations. Despite the initial intent of these charitable foundations to be not-for-profit, some of them tend to morph into organizations with bigger aspirations.
Billions and billions spent
One of the most famous examples in the history of venture philanthropy for drug development was the investment by the Cystic Fibrosis Foundation (CFF) in Aurora Biosciences (later acquired by Vertex) in 1999. Thanks to this organization, the life-changing drug Kalydeco, a therapy for mutations in the cystic fibrosis transmembrane conductance regulator (CFTR) gene, is now on the market. CFF sold its royalties for 3.3 billion dollars to Royalty Pharma, allowing CFF to fund more research and foster further breakthroughs.
The amounts of money these American foundations spend to fund research is tremendous. A prime example of this is the Jimmy Fund, founded by Dr. Sidney Farber and The Variety Club of New England. The club organized a radio broadcast for Farber’s 12-year-old patient, who was visited by members of the Boston Braves baseball team. Since its start in 1948, the Jimmy Fund has raised more than 750 million dollars, all of which is used to support the Dana-Farber Cancer Institute.
The Susan G. Komen foundation for breast cancer is another well-known philanthropic organization. It was founded in 1982 by Nancy Brinker as a promise to her dying sister, Susan, to end breast cancer once and for all. To date, the fund has invested more than 2.6 billion dollars in ground-breaking research, community health outreach, and advocacy programs in more than 60 countries.
In addition to these charities, there are also public/private partnerships that, through donations and grants, conduct innovative studies as well. The most famous example of this type of partnership is the I-SPY TRIAL Program. The program has engineered a novel approach to finding the most appropriate and efficient treatments for breast cancer. Using adaptive clinical trials that promote or “graduate” certain treatments through Phase I, Phase II, and Phase III clinical trials, and by identifying subsets of high-risk breast cancer patients that will benefit the most from new agents, they aim to reduce the overall cost, time, and patients needed to bring new drugs to the market.
The story is that some of these charitable foundations are morphing from mere charities into huge players that do good work overall, but it can be a balancing act.
Altruism or business by disguise?
These charities’ investments have allowed innumerable amounts of research to be conducted that would not otherwise have been possible. But as they become more cash rich, some charities are setting up their own clinical trials rather than investing in external research institutes. For example, the Leukemia & Lymphoma Society set up a wide-ranging clinical trial, called the Beat AML Master Trial, to investigate treatment regimens for acute myeloid leukemia (AML). But is this a good thing, isn’t there a conflict of interest? Do charities have enough knowledge to set up trials themselves?
Ward Capoen, senior analyst at V-Bio Ventures, comments: “The story is that some of these charitable foundations are morphing from mere charities into huge players that do good work overall, but it can be a balancing act. They are more like corporations run by professional managers, and that means they no longer are content with just raising money and handing it out to professors in some lab. Donations are variable and they want to streamline cash flows. Over the years, they have moved into being more proactive, for example, by starting trials on their own.”
There have been increasing numbers of charitable foundations engaging in large-scale venture philanthropy. The Bill and Melinda Gates Foundation is perhaps one of the best known of these organizations. Mark Zuckerberg and his wife, Priscilla Chan, have announced plans to invest 3 billion dollars in the next 10 years toward a goal of tackling all diseases. Sean Parker, the billionaire Silicon Valley veteran, plans to grant 250 million dollars to 6 cancer centers nationwide, which will form the “Parker Institute for Cancer Immunotherapy”.
Some charities seem to go very far to serve the “common” good. Take, for example, the Michael J. Fox (MJF) Foundation, which is the richest non-profit foundation seeking to cure Parkinson’s disease. The foundation initially agreed to fund the research of a Georgetown University scientist to test the off-label use of the leukemia drug nilotinib. But the MJF Foundation and Georgetown had a bitter falling out. This delayed the trial, and the MJF Foundation has now set up a separate study group competing with the original group performing the study. This could, at the very least, be perceived as though the foundation is vying to get the financial upside of the study themselves, rather than sponsoring others to do so.
Bragging at the country club
There is also Dr. Patrick Soon-Shiong’s “Cancer MoonShot 2020” Program. Some have called Soon-Shiong megalomaniacal and his program unrealistic, viewing his actions as more of a marketing trick for his expensive cancer diagnostic tool than as an actual effort to further cancer research and treatment.
There is no doubt that charity is a great and noble cause, and it has accomplished much in the past. However, some of these modern-day, wealthy investors may have ulterior motives when it comes to performing acts of charity. Curing a disease would come with obvious bragging rights at the country club. But this type of motivating factor goes against the very nature of altruism. Charity work can be highly beneficial to society, but investing money in healthcare research can be a complex undertaking, especially in this day and age. When dealing with these amounts of money, safeguards need to be in place to ensure that these charitable foundations maintain professionalism, fairness, ethical boundaries, and the spirit of collaboration, without which all of society may suffer.
