Rumsflued

Some facts to mull over:

• Gilead Sciences Inc. is a biopharmaceutical company that discovered a flu medicine called Tamiflu.
  
  
• Swiss giant drugmaker Hoffman-LaRoche (Roche) currently markets and distributes Tamiflu. From Gilead's own site,

  Roche has worldwide commercial rights to Tamiflu, and Gilead receives payments from Roche for the successful completion of program milestones and royalties on product sales.

  
  
  
• Gilead has been attempting to regain control of Tamiflu from Roche, and in June, 2005 they announced that they had terminated the 1996 "Tamiflu Development and Licensing Agreement" with Roche. They had not been happy with Roche's "commitment" to Tamiflu.
  
  
• As of the August 4, 2005 quarterly report, the notice of termination was not yet settled (the companies have entered into an arbitration process which is expected to take years).
  
  
• The World Health Organization recommends the culling of bird flocks to avoid outbreak of Highly Pathogenic avian influenza due to influenza A/H5N1. For human cullers who are suspected of having developed influenza A/H5, the World Health Organization recommends immediate treatment with Tamiflu.
  
  
• Sales of Tamiflu have more than doubled in the past year (from Q3 2004 to Q3 2005). From the BBC,

  "Roche will continue to take action, both on its own and with a significant number of suppliers, to increase production capacity for Tamiflu to meet seasonal and pandemic needs," the company said in a statement.

  
  
  
• As Roche mentions, Tamiflu is not a vaccine. It does not cure the flu, and will therefore not cure the avian flu. It instead attempts to prevent the spread of the influenza virus through the body.
  
  
• The U.S. government, and many other governments, have been stockpiling Tamiflu.
  
  
• This past Thursday, the U.S. Senate approved an $8-billion emergency, out-of-budget, expenditure to allow the U.S. government to buy even more Tamiflu (in addition to flu vaccines and other medicines).
  
  
• U.S. Secretary of Defense Donald Rumsfeld joined Gilead, the creators of Tamiflu, as a director and board member in 1988, and was named Gilead's Chairman in 1997.
  
  
• From CBS News back in 2001,

  Rumsfeld's 94-page financial disclosure form shows that his holdings include between $6 million and $30 million in Gilead Sciences, a pharmaceutical company, plus $1 million to $5 million in vested stock options.

  
  
  
• This past Thursday, on the same day that the Senate approved the emergency $8-billion 'Tamiflu-plus' spending, the New York Times reported the following:

  Rumsfeld to Avoid Bird-Flu Drug Issues
  
  By THE NEW YORK TIMES
  
  WASHINGTON, Oct. 27 - Defense Secretary Donald H. Rumsfeld has recused himself from government decisions concerning medications to prevent or treat avian flu, rather than sell his stock holdings in the company that patented the antiviral agent Tamiflu, according to a Pentagon memorandum issued Thursday.
  
  The memorandum, to Mr. Rumsfeld's staff from the Pentagon general counsel, said the defense secretary would not take part in decisions that may affect his financial interests in Gilead Sciences Inc.
  
  Before becoming defense secretary in January 2001, Mr. Rumsfeld was chairman of Gilead. On each of his annual financial disclosure statements, he has listed continued stock holdings in the company.
  
  Gilead holds the patent on Tamiflu, but contracts for it are signed with an American subsidiary of F. Hoffman-LaRoche Ltd., which holds marketing and manufacturing rights.
  
  Mr. Rumsfeld will remain involved in matters related to the Pentagon response to an outbreak, so long as none affect Gilead.
  
  

• Rumsfeld is set to profit handsomely from increased sales of Tamiflu, brought on by avian flu fears.
  

UPDATE (October 31, 2005):

As commentor Lou Minatti implies, there are some conspiracy theories out there about Rumsfeld and Tamiflu. From Lou's own post on the topic, these theories range from Tamiflu currently being a completely ineffective treatment for flu to the entire avian flu crisis being cooked up by Rumsfeld himself in order to make an extra million (and counting).

I do not believe in such conspiracy theories, though I admit I find it interesting and entertaining that Rumsfeld's association with Gilead and his current role in the government easily lend themselves to such theories.

I responded to Lou in the comments:

Lou,

I'm not sure what conspiracy theory you are talking about. I typically don't
believe in conspiracy theories.

If you are interested in my opinion (because I didn't offer one in the post, after all) I do think that Rumsfeld should have strongly considered immediately selling his already profitable stake in Gilead rather than seeking to continue to profit from decisions his peers and friends and bosses and underlings may/will be making from here on out.

Conflict of interest is hardly a conspiracy theory.