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University of Utah officials say foundations owned by America's richest doctor "delivered on commitments to the university," despite a recent news report detailing how his companies apparently drew significant benefits from a charitable contribution to the U.
Earlier this week, STAT — a news organization affiliated with The Boston Globe — reported that Patrick Soon-Shiong and his philanthropic foundations in 2014 donated $12 million to the U. for research. But under the contract governing the gift, the U. later paid $10 million to NantHealth, a company founded by Soon-Shiong, an arrangement questioned by some tax experts.
Four and a half months after the U. donation and after vetting other companies, university officials concluded NantHealth was the only test facility equipped to meet exacting standards for genetic testing specified in the gift contract, STAT reported.
In a statement to The Salt Lake Tribune, Jen Hodson, public relations director for NantWorks, an umbrella company that includes NantHealth, said the contract "did not dictate that the university had to use NantHealth's platform," and instead allowed the U. to choose any company "who could meet the time frame and clinically validated standards" of genomic sequencing.
And in an interview with the Los Angeles Times, Soon-Shiong denounced the STAT report as "maliciously false" and said his foundations' gift to the U. reflected "a desire to make this knowledge available to scientists throughout the world."
"I'm befuddled by any other motivation that could be perceived," he told the LA Times.
In accepting Soon-Shiong's donation, Vivian Lee, CEO of the U.'s health care system, at the time praised what she called the biotech billionaire's commitment to advancing health worldwide through exploitation of big data.
"I think we should be really grateful for that," Lee said at the 2014 event, captured on video.
Soon-Shiong, a part owner in the LA Lakers who has met at least twice with President Donald J. Trump on health care issues since the election, said via his spokeswoman that he had been impressed by the U.'s vision of creating a genetic database "for the benefit of all scientists."
Through the donation, his spokeswoman said, Soon-Shiong and his wife, the former actress Michele Chan, "sought to make this knowledge available to mankind as rapidly as possible."
The gift contract, Hodson said, "was fully vetted by attorneys on both sides," and NantHealth "did not recognize any revenue from these tests performed on behalf of the University of Utah and has to date not recognized any such revenue."
STAT, a national publication specializing in health coverage, also reported the U. deal allowed Soon-Shiong to boost order numbers for a genetic testing tool called GPS Cancer in a November report to investors — although researchers said his work for the U. had little to do with diagnosis or treatment of cancer patients.
STAT interviewed several tax experts who concluded the deal with the U. was "suspicious," one going as far as asserting Soon-Shiong and his foundations were "laundering funds through (the U.)."
In a statement, U. officials said the quality of the research conducted "exceeded expectations and benefited scientific discovery."
The U. directed further questions to the foundations or NantHealth, adding that "it is not the university's role to advise [those entities] on the tax consequences of these transactions."
Soon-Shiong, a 64-year-old Los Angeles-based physician and entrepreneur in the pharmaceuticals industry, has an estimated net worth close to $8.67 billion, according to a report earlier this month by Bloomberg.
Stock prices on NantHealth and another Soon-Shiong related firm NantKwest have declined to all-time lows since the STAT news report.
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