No wall left between corporate world and venture philanthropy

“There’s a reason why corporate America exists, and there’s a reason why philanthropic organizations exist,” said David Cornfield, a professor of pediatric pulmonary medicine at Stanford University. “When that distinction becomes invisible, it becomes very difficult to know where philanthropy ends and venture capital begins.” -- Washington Post

Cornfield was responding to the rise of venture philanthropy in the field of medicine and pharmaceuticals where non-profits like the Cystic Fibrosis Foundation have earned billions through their investments in drug companies. While such investments have sometimes led to research breakthroughs, the trade-offs raise serious question about the power and politics of big philanthropic organizations.

Robert Beall, now in his fourth decade at the CF Foundation and one of the top-earning chief executives in the nonprofit world (Beal makes more than $1 million/year), says he is aware of the concerns and criticism prompted by his $3.3 billion Kalydeco deal last fall. Among them: that such a financial bonanza might discourage future contributions from supporters; that the foundation should be sharing its billions more directly with patients; that the group should have pushed harder to lower the price of Kalydeco and subsequent drugs.

There's no bigger player in the field of venture philanthropy that the Bill and Melinda Gates Foundation which has used its public investments to unduly influence public education policies. But it's the foundation's' profitable private investments in giant global corporations, many of which have done great harm in the world, that have drawn the greatest scrutiny.

HERE'S THE LATEST... The Gates Foundation is under investigation in a 2014 India Supreme Court case for funding Merck’s HPV vaccine trials of Gardasil, despite knowing the serious adverse reactions, injuries and deaths caused by treatment. According to a report by published by Narayana Kumar in The Economic Times of India, several tests had been conducted in 2009 on 16,000 school girls between the ages of 9 and 15 in Andhra Radish, India. Through the vaccine trials, 120 girls became seriously ill and seven died. Those who fell ill suffered from adverse reactions to the vaccination and experienced symptoms including seizures, severe stomachaches, headaches and mood swings. Consent forms to oversee the HPV vaccination were illegally signed by wardens from the hostels where the young girls resided or by illiterate parents via their thumbprint. Many young girls and their parents did not understand the tests or the risks entailed until they were significantly involved in the trial.