Can Clinton global health charity survive loss of former president’s clout?

Bill Clinton has promised to leave the Clinton Foundation board if Hillary Clinton is elected president, but his potential departure from another Clinton charity could have far greater consequences for global health.

Though it’s less well-known than the foundation, the Clinton Health Access Initiative has played a central role in bringing down drug prices in the developing world and helping governments in Africa and Asia build health care delivery systems.

Known as CHAI, it relies so heavily on the former president, say global health experts, that his exit would raise a fundamental dilemma for the influential organization: Can it operate in any meaningful way without the Clinton clout? Global health experts fear that hard-won gains could be reversed absent Bill Clinton’s authority and his capacity to wring compromises from bottom-line oriented corporate leaders.

CHAI’s achievements have been all about “Bill’s leverage,” said Laurie Garrett, a global health expert with the Council on Foreign Relations. Without him, she said, not much remains.

Bill Clinton announced last week that, if his wife becomes president, he would step down from the Clinton Foundation board, the foundation would “accept contributions only from US citizens, permanent residents, and US-based independent foundations,” and he would no longer personally raise money for the group. Clinton said that he would also drop off the CHAI board, and that other changes in CHAI “to ensure that its vital work will continue” would be announced later.

If CHAI were forced to end or vastly curtail operations, “I don’t know who picks up the slack,” said Dr. Ashish K. Jha, director of the Harvard Global Health Institute. No other organization “brings the kind of trust that the Clinton name brings to a lot of countries (and) a lot of national leaders,” saving many thousands, if not millions of lives, he said.

“We as a global health community are going to have to figure out who is going to take it on in the future,” Jha said.

CHAI, a nonprofit whose directors include Bill and Chelsea Clinton, began in 2002 as a Clinton Foundation project. It was spun off in 2010 as a separate organization, yet maintains close ties to its parent.

In addition to the Clintons, Bruce Lindsey — Bill Clinton’s 1992 presidential campaign director, White House lawyer, and personnel chief — serves on both boards. CHAI’s top executive is Ira Magaziner, the former president’s longtime confidant and advisor and the architect of Bill and Hillary Clinton’s failed health care plan.

It is unclear from publicly available documents how much financial support, if any, the Clinton Foundation gives to CHAI. In its most recent annual report, the foundation said it spent $143 million on CHAI as a “program expense” in 2014 — more than 57 percent of its budget for that year.

But CHAI spokeswoman Regan Lachapelle disputed that, and the CHAI 2014 annual report lists total revenues of $142 million that year. She said CHAI  accepted a loan from the foundation when it split off in 2010, but paid it back, and has not received any support since 2013.

The Clinton Foundation did not respond to repeated inquiries from STAT seeking clarification.

Lachapelle said CHAI, incorporated in Arkansas and based in Boston, is completely separate from the foundation.

CHAI has largely escaped the criticism aimed at the foundation for taking foreign contributions, but it shares much of the foundation’s dependence on a donor base heavy on foreign governments, foreign individuals, and foreign foundations but hasn’t made a decision about whether to reject such donations during a Clinton presidency. Its board will soon address possible conflicts involving the Clintons, Lachapelle said.

Overseas contributors have accounted for more than half of CHAI’s budget since 2014, and foreign sources dominate the top of the donor list. Between January 2010 and June 2016, 7 of the 8 sources of cumulative donations over $25 million were from outside the United States. Among CHAI donors of between $5 million and $25 million, 8 of 11 were foreign entities or individuals, including Sheikh Mohammed Hussein Ali Al Amoudi, whom Forbes magazine lists as Saudi Arabia’s second wealthiest citizen.

Critics of the Clintons have alleged that some foreign donors don’t disclose enough about their own operations to allay concerns that they are seeking to influence Hillary Clinton. One of the largest, The ELMA Foundation, provides an example of such secrecy concerns. Its holding company, The ELMA Philanthropies Services, is headquartered in midtown Manhattan and registered in New York. But its Executive Director, Robyn Calder, said in an email that ELMA is a “non-US group of foundations” and has no obligation to disclose governance information, the names of its directors, or even what country the group is chartered in.

“It’s hard to view CHAI as separate from the Clintons or the Clinton Foundation,” said Jha. “Can there be a (nonprofit) that is working directly with foreign governments, however it’s funded, that is named after the sitting president of the United States? I think it’s going to be very hard for CHAI to operate the way it has.”

CHAI has assisted more than 11 million people with “CHAI-negotiated prices for HIV/AIDS medicines,” according to its 2015 annual report, and “implements programs on vaccines, malaria, health systems strengthening, and maternal and child health in more than 30 countries around the world,” according to other documents on its website.

Andrew Hurst, a spokesman for CHAI donor UNITAID, said CHAI’s work “had a very significant impact on the effectiveness and scale of the international response to the AIDS pandemic,” particularly for children and those who needed “second-line” drugs after the first round of treatments failed.

The group helped Indian companies obtain permission from major pharmaceutical companies to produce generic versions of HIV drugs. It also worked to boost TB testing in India and elsewhere in the developing world.

Garrett said that among the Clintons’ philanthropic efforts, CHAI “is where the great triumphs have occurred.”

“Bill has many times … stated a kind of mea culpa — that he had failed to recognize the severity of the (AIDS) epidemic and what it would do to the African continent” when he was president, Garrett said. CHAI has worked diligently to correct that, exploiting the former president’s prestige and power, she added.

Clinton’s work to push down drug prices in developing nations inspired other organizations to get creative about global health finance, Garrett said. UNITAID, a Switzerland-based, World Health Organization affiliate, pressed many nations to implement a small tax on air-travel tickets. That tax now raises hundreds of millions of dollars annually for global health programs.

CHAI also has helped developing nations improve their health systems and financing. It developed an innovative process that lets local officials collect health data from many sources, then analyze the information to identify gaps and inefficiencies and increase access to care. In Malawi, the program has saved millions of dollars by streamlining several parallel supply systems for medicines.

It’s an area that most major global health players, which tend to focus on vaccinations and medicines against scourges including AIDS and malaria, have rarely tackled head-on.

Experts worry that such work will backslide if CHAI dissolves, in part because no one else wields the Clintons’ unmatched influence. Harvard’s Jha said no other organization looks like an obvious candidate to take over leadership on the ground in Africa — even the giant Bill & Melinda Gates Foundation, which has focused on technical solutions to global health problems. A Gates spokesperson said that foundation had no comment.

UNITAID and other organizations might step in to a degree, but a hit on the global health workforce could be among the most significant losses, according to Garrett. “(CHAI) has served as an entry point for young idealistic kids, coming out of graduate programs and schools of public health, wanting to make a difference,” she said. “That’s all going to go away.”