Five questions for Trudeau’s leadership
The last couple of weeks, I’ve been poring over internal documents leaked by former employees at Trudeau Institute, including more memos and studies provided this week to NCPR and the Adirondack Daily Enterprise.
They provide new detail and clarity on the turmoil and lingering uncertainty at the biomedical research laboratory, which employs about 100 people in Saranac Lake.
It appears that for the last half decade, the lab’s leadership has been painfully divided, with some board members and staff secretly pursuing a plan to relocate some or all of the institute without buy-in from other board members.
When the relocation plan was vetoed by the full board in January 2011, the organization entered into a period of unprecedented disruption, losing key administrators and faculty.
Trudeau’s national reputation has clearly suffered. Eighteen months after the decision was made to stay, the institute still lacks a permanent director, and the community has no clear understanding of what the new plan is for moving forward.
Trudeau is a private institution. But it is also a vital part of the North Country’s economy, culture and history, and it relies for the lion’s share of its funding on taxpayer dollars.
Saranac Lake has staked a significant part of its future on emerging as a biomedical research cluster, with Trudeau at its heart. It appears that state and Federal officials are willing to help by investing significant funds in that vision.
So as the public discussion moves forward — and it appears that the timeline for solving some of Trudeau’s “structural” problems will need to be fairly swift — here are the questions Trudeau’s leadership needs to answer.
1. In simple terms, what is the plan? Has the board accepted that Trudeau can no longer serve the mission of conducting fundamental research into the human immune system, as it has done for half a century? If so, what’s next?
2. Whatever the plan is, how much money do you need? Trudeau executives hoped to garner roughly $88 million in subsidies, grants and philanthropic donations to relocate to Florida. What kind of public support is needed to sustain your vision in Saranac Lake?
3. Is the current board of trustees up to the task of guiding this institution, or does there need to be a substantial change? A survey conducted of Trudeau staff and faculty in April 2011 revealed a lot of fear, anxiety and distrust. Is it time for a shake-up at the top?
4. Is there a way to better engage and communicate with the community? Trudeau Institute relies on public support for its operations, but the organization often operates invisibly. The result has been deep distrust between some local leaders and Trudeau executives, and a remarkable level of detachment and apathy among the public. Do you think that needs to be fixed and if so how?
5. Exactly what is the situation now? How much money is left in Trudeau’s endowment? What are the most pressing, short-term needs, financial and otherwise, that will keep Trudeau afloat while bigger questions are answered? And why has it taken so long to hire a permanent new director?
Trudeau chairman Benjamin Brewster declined to be interviewed on tape for our reporting. And he didn’t return phone calls after the most recent Trudeau board meeting last Friday.
But in the absence of a permanent director at the lab, someone needs to step forward soon to speak bluntly about the institute’s next steps.
Tags: adirondacks, economy, health, science
It’s not an accident that all those high tech businesses are clustered in a few locations. They need the highly educated labor and emersion in the intellectual forefront to be successful. they are the intellectual big cities. That said it isn’t clear that the places the Trudeau Institute was thinking about moving to are much of an improvement on Saranac Lake.
Has the board accepted that Trudeau can no longer serve the mission of conducting fundamental research into the human immune system, as it has done for half a century?
That’s part of the problem. Trudeau does basic infectious disease immunology using murine models of human disease. It appears NIH is no longer willing to support this kind of research without more evidence that it can more quickly be moved into practical use.
Is the current board of trustees up to the task of guiding this institution, or does there need to be a substantial change?
If this means are they able to raise private funding, the answer is obviously no. The board members are wealthy and well meaning but what Trudeau needs is the support of a couple of very, very wealthy individuals – think Bill Gates.
Is there a way to better engage and communicate with the community?
Scientist’s tend to be somewhat insular people. Also, if you are spending 80 hours a week trying to get funding – there isn’t much time left for community engagement. That doesn’t excuse the administrators however.
One thing Trudeau has never had a problem with is finding qualified employees.
“It appears NIH is no longer willing to support this kind of research without more evidence that it can more quickly be moved into practical use.”
Is it possible that this tendency is a result of the current anti-tax, pro-business, anti-science mood of Congress? Perhaps this will change after November?
Why the focus on these guys? Is the survey that was completed in 2011 open for the public or was that private survey that belongs to the Institute?
What do you mean by public discussion? Has the Institute agreed that this is a public discussion? The Chairman wouldn’t even talk to you, it does not sound as if they are interested in a public discussion about their future.
Walker, I’m not sure the anti-science crowd has much to do with NIH funding problems. I think it’s more an attitude of instant gratification rather than waiting for the benefits of basic medical research.
“Trudeau is a private institution. But it is also a vital part of the North Country’s economy, culture and history, and it relies for the lion’s share of its funding on taxpayer dollars.”
Does this mean that Corporate executives ARE NOT justified when they follow the highly vaunted and nearly universally touted 1919 Michigan Supreme Court offhand remark, that is regularly repeated in corporate law casebooks today, when it sided with John and Horace Dodge and ordered Ford Motor Company to pay its shareholders a special dividend rather than use the corporation’s money to build cheaper, better cars and to pay better wages:
“There should be no confusion . . . . A business corporation is
organized and carried on primarily for the profit of the
stockholders. The powers of the directors are to be employed
for that end. The discretion of the directors is to be
exercised in the choice of means to attain that end, and does
not extend to . . . other purposes.”
Heresy, sacrilege I say how are the 1%ers going to continue to pile up obscene wealth if corporations do not follow THEIR golden rule?
Anyone with a modicum of interest can direct their computing device or smart communicator to the following web link for a more detailed and enlightening explanation of the source of the “corporate golden rule”.
http://www.virginialawbusrev.org/VLBR3-1pdfs/Stout.pdf
Brian, doesn’t the institute publish an annual report each year that answers many of these questions?
The funding issue is a serious problem. But this institute, like all private and public scientific institutes, faces another problem. It is what we call the “translational gap” (some like to call it the “valley of death”). That is where technology developed at these institutions gets “lost” on its way to the “practical use” described above. The folks that fund this work (you and me) want and deserve to have this work make a difference in the world. If you look at the strategic vision of the institute this is a key goal (Walker, it is not something forced on them by “the current anti-tax, pro-business, anti-science mood of Congress”). This has been a goal of the institute even back when it first began.
To do this effectively today they may have to make some substantial changes.
Can an institute in the Adirondack mountains compete with something like an institute that is located near some of these new translational research centers?
Ken, are you commenting on the right story??
Paul is this quote not from this article?
“Trudeau is a private institution. But it is also a vital part of the North Country’s economy, culture and history, and it relies for the lion’s share of its funding on taxpayer dollars.”
Yes, but the rest of it seems to be on some other topic related to for-profit corporations as opposed to a (mostly) government funded private not-for-profit research institute.
The title of the story here at NCPR seems much better than the ADE title: “Trudeau at a tipping point”. That doesn’t seem very accurate. Sure they have some problems but a “tipping point”?
Private not for profit corporation means private, regardless of the sources of its funding. They are not a government entity they don’t have to adhere to open meeting laws or public inspection etc,. Lockheed Martin gets 95% of its funding from the government, and its board does not have an open process with the community. Not that the Tradeau institute wants to be like Lockheed Martin.
The board could simply decide to close the whole operation tomorrow and it would be their decision and their decision alone.
Paul, my apology I did not pick up on the “non profit” nature of Trudeau Institute. I found their FINANCIAL STATEMENTS for December 31, 2010 and 2009 at http://trudeauinstitute.org/uploadedFiles/Trudeau%20Institute%202010%20Financial%20Stmt.pdf
Mervel, given their tax exempt status they are not as “private” as you might think. They have to make most of their financials public. They are not like a private for-profit that can basically keep everything “private”. Also, since most of their funding is from federal research funds there they also have to keep very open books and are subject to audit at any time.
But yes business decisions are theirs to make.
Paul: I think the “Leadership” subheading of Chris Knight’s story today supports that yes, Trudeau is at a tipping point. Board members Benjamin Brewster and Lee Keet both said Trudeau needs excellent new leadership to move forward in a positive way, and is on the verge of getting that. “Without a chief executive, things tend to get pretty messy,” Keet said. “I believe things will calm down and stabilize once such a person is selected.”
-Peter Crowley, managing editor, Adirondack Daily Enterprise
If you want you should check out their 990 which is on guidestar.
They had revenues of around 14 million in 2010. The had 13 people making more than 100, 000, the top income earners are listed if anyone is interested. The CEO in 2010 Woodland made $285,000 per year. For an agency of 14 million that is not totally out of whack, its a little high but not crazy. I assume this guy is now gone given the discussion above. The next highest paid was their chief scientific officer who made $190,000. This was all back in 2010.
“Lockheed Martin gets 95% of its funding from the government” Mervel a government contract is very different than a federal grant. BTW: Lockheed is a publicly traded company not a private company.
Peter, thanks I guess it is a fair characterization from a leadership perspective. Good point.
Mervel, this is one of the issues for the institute given its location. Here is a place where they have no graduate students (as in cheaper labor!). You have got to use your “hard money” (draw from the endowment) to be competitive with places that are affiliated with a university and located near clinical settings where it is easier to get the “soft money” (grants). You are in a location where it is difficult for your spouse (who probably also has an advanced degree) to get a job. You are only going to attract good people there if you are able to pay a premium. Should they be using that money in this way in order to keep the institute in Saranac Lake? Or should they be using it to further the mission of the institute? That is a valid question for the board to consider. If some of the board were unable to even consider the possibility of a move than maybe that is what lead to what we are reading about in these stories.
Mervel, thanks for the info. Like I said, they are not so “private”.
Many of Brian’s questions are answered in these documents. It looks like the endowment is at about 24 million dollars. They have some pretty significant financial challenges.
On a side note I like this one:
Land (2010) $132,063 (2009) $132,063
You are all familiar with the institutes Lower Saranac Lake lake property right? I don’t know how they get away with this? They don’t have to pay property tax anyway but that land is (at least) worth 20 times this.
Paul –
I wonder if those land values have something to do with residential property the Institute owns in the village on Ampersand Ave., Shephard Ave., and Woodruff St.
@Peter Crowley-
According to your paper’s own story, Lee Keet is no longer on the Trudeau board and yet he is making all these comments about internal goings on. How does he know all these details? Is his brother (who is on the board) sharing them?
Lee Keet also says that the new CEO should have more of a business background so the insitute can attract more funds from private foundations. What is he basing that opinion on? Seems to me most private foundations that support basic research are evaluating on the basis of scientific quality and impact. What is a business person going to tell them that a scientist can’t? The implication is also that the institute isn’t going after these grants. Isn’t it just as possible that they do go after them but get rejected?
It must be something like that. Maybe that and they have combined the institute land with the buildings there that are valued in the 20 million plus range. The scary thing for SL is they could probably cut some kind of deal with a place that might want to give them some kind of long term lease to new facilities. One of those we give you the space and you bring the jobs kind of deals. Then they could turn around and (maybe not sure who would buy it) sell what they have in SL and double the endowment in one fell swoop.
I think it is likely due to an accounting rule about how they value land assets. I don’t think it is intentionally wrong, they would not benefit from reducing the value of their assets.
Yeah Paul I basically agree about the private issue. Not for profits are under the auspices of the NY state attorney general, they raise money from the public and are tax exempt. Thus they have to file a 990 which is usually open for the public to view. But on the other hand they are private in the sense that they control their own destiny, they are a private organization in that sense. They don’t have to follow the rules and open requirements for example that a public entity does, such as a school system or a local government entity. they can choose to move they can choose to shut down, without public input. Although I think a good agency would likely seek some public input.
Lockheed is a corporation true, but for example they like the Trudeau institute do not have to share with the public their board meeting discussions for example, they can make private decisions without public input. I would say there is very little difference between a military contract that Lockheed would get and an NIH federal grant. In fact I think Lockheed Martin gets a couple of Federal grants from the NIH, just as other large corporations do; they are into everything.
Its a tough business, unless you are making some drug that no one really needs, something like botox or sexual performance enhnacers or the next iteration of “sleep aid” or anti-anxiety drugs. This is where the money is not basic research.
“What is a business person going to tell them that a scientist can’t?”
Lee this is a typical dilemma for many similar institutions. These days the skill set required to work with potential donors and commercial partners is found in someone with a business background more than a pure scientist. Traditionally Trudeau, like many places, has opted for a director who also has a full time lab to manage. Doesn’t leave much time for administration and all that comes with that, especially in this challenging environment. The ideal candidate is someone with a business AND a science background. Someone who has left the lab and turned towards administration full time.
“Isn’t it just as possible that they do go after them but get rejected?” This is what is happening. That is why he suggests they need to look for alternative funding. The type of funding that may not be best found with a pure scientist at the helm. But I also know lots of scientists that make excellent business people. I also know some that don’t!
For example The Noble Foundation (very isolated like Trudeau out in Ardmore, OK) has been run for decades by CEO’s with a business bent. Here is an example of the type of leader they have just hired (his predecessor there for 20 years was a business man):
http://www.noble.org/news/news-releases/2011/11-057/
Trudeau would fair well with someone with a similar background with a focus on the medical side. Noble is a plant research institute so they go with a person with that type of background along with business experience.
It would also be nice if Trudeau had a billion dollar endowment like Noble also!
“botox” – Pretty much everything we know about the Botulinum toxin (Botox) came from basic research labs not companies. They just commercialized the good (and weird) uses of the stuff.
Same for “sleep aid” or anti-anxiety drugs” – Again, the most common widely used varieties of these medications, that have saved many lives, have come from basic research.
“This is where the money is not basic research.”
Mervel, basic research is what leads to this “money”. You really don’t seem to understand the importance of basic research or even where these things originated. That is why I think we cannot spend enough money in this area.
As for the Viagra comment, I am not gonna go there!!
Paul I am in agreement with you. I was just lamenting the fact that basic research seems not to get funding while the commercialization of many of these non-essential drugs and their perpetual iterations, are some of the most profitable businesses in the US.
Very true. One area that can help Trudeau is to make sure that the patent and capitalize on any technologies that they develop at the institute. They have some good stuff they should make sure they have a leader that understand the process. There is no doubt that basic research leads to profitable companies and JOBS. That is what everyone wants right? So when you talk to your representatives make sure they understand that when it is time for them to discuss funding for science.
Paul, thank you for your thoughts. Very interesting. As to this:
“It would also be nice if Trudeau had a billion dollar endowment like Noble also!”
Isn’t that what it really comes down to? ENDOWMENT. The least sexy, most vital funding any organization can acquire. But who wants to (or can afford to) give to endowment? Most people do their best to provide annual gifts to the organizations they care most about. Endowment gifts are made primarily by the very wealthy and through planned giving.
How many Trudeau trustees have the institute in their wills? How many have made endowment gifts above and beyond their annual gifts (which I assume are commensurate with the stature of the organization)? Looking at their most recent annual report on their website, the only trustee who gave $50,000 or more the previous year appears to be Ben Brewster. (Others may give anonymously.) I see a lot of other trustee names in the $1,000 to $9,999 range. That’s not going to get the job done, unfortunately. Not unless they expand their board exponentially.
This brings up a very good point: How large an endowment would enable Trudeau to remain in SL for the next decade? $10 million? $20 million?
Time to open up your checkbooks, folks, if you want them to stay here. Private foundations will ask to see how much money the board is giving and raising before they make a big gift to ANY organization. I wonder if that’s why it’s been so hard for Trudeau Institute to attract big foundation gifts over the years?
Lee, the key is that the board have good participation in the annual campaign. Which it looks like they maybe have. You can’t expect all your donations to come from the board. It would be nice but is not practical and in practice is not how it works. With an organization like this the board is often composed of less wealthy individuals that can give in other ways, for example technical guidance. Perhaps advise them on what type of individual would be good as a new director! But if they are not working together (to bring us back to the start) than they will have a difficult, or perhaps impossible, time being successful.
As far as who can afford it. Many people. Like I said yesterday David Murdoch gave over 600 million to start an institute in Kanapolis, NC.
Again here is a dilemma for the institute, since they are not affiliated with a university they really don’t have any alumni that they can reach out to when the hit it big someday. Again, an argument for relocating.
But here is a hint for the Trudeau development person (assuming they have one, and if they don’t they better get one fast). Sanford I. Weill who has donated more than a quarter of a BILLION dollars to Cornell (along with other millions to many other places) I hear has a “camp” on Upper Saranac Lake (can anyone confirm?). So get in a boat and start fundraising!!
Actually I read on Wikipedia that they have a place near Knollwood! That is right across the lake from the Trudeau! What I read said that the “Adirondacks saved his marriage”. This is a no-brainer! If they play that angle they should be able to squeeze 20 mil out no problem.
I don’t know very much at all about medical research, but I do know about fundraising for not for profits in the North Country. It is not easy but it is something you must do over a period of time.
Fundraising is not a quick fix. Decent gifts particularly large planed gifts may take a decade to cultivate before you start to see results. An organization starting from ground zero from a fundraising perspective should count on five to ten years before you really see the results required to build an endowment for example. Sure you can get lucky and get a transformational gift, but you can’t count on that or plan on it, certainly you can’t budget for it. I mean yeah Sandy Wiell has a lot of money, but people like him get asked a LOT, constantly if he has not been involved up to now with Trudeau it is doubtful he is going to jump for it in a big way now.
From my perspective you have to get the government or corporate grants as your base and fundraising can fill in the gaps and maybe do better over time.
That is just my two cents which really is not worth very much.
Mervel, I totally agree. I was mostly joking. Given that Trudeau has folks like Gary Trudeau and Jane Pauley involved they should have some very good connections.
True!
Are they in financial trouble? Through all of this reporting I have not seen a statement or anything claiming directly that they are in financial trouble now?
Is the issue a financial shortfall or that some employees are upset that they considered moving?
Paul writes: “That is where technology developed at these institutions gets “lost” on its way to the “practical use” described above. […] If you look at the strategic vision of the institute this is a key goal (Walker, it is not something forced on them by “the current anti-tax, pro-business, anti-science mood of Congress”). This has been a goal of the institute even back when it first began.”
Paul, you’re missing it. The root of Trudeau’s current problems is that NIH’s funding priorities have changed, fairly recently. If Trudeau had been focused on research that was tightly coupled to immediate application, they’d be fine now, as they were before the change at NIH.
As to their earliest priorities, this is from the address by Dr. Hollis G. Boren, director of the Trudeau Foundation Research laboratories, at their dedication in 1964:
One other thing– that Wikipedia story about the Weill place near Knollwood. The Weills own a mansion on over a hundred acres on Upper Saranac Lake, but the online Franklin County tax map shows no properties owned by them on Lower Saranac Lake near Knollwood. Maybe they did previously, and sold it? (That would seem to make the romantic story a bit suspect, though, eh?)
Is there something illegal going on at this organization?
Walker, thanks yes I guess they have a place on Upper Saranac. Like I said apparently the rumor I had was more accurate than Wikipedia. Not worth salt.
“Paul, you’re missing it. The root of Trudeau’s current problems is that NIH’s funding priorities have changed, fairly recently. If Trudeau had been focused on research that was tightly coupled to immediate application, they’d be fine now, as they were before the change at NIH”
Missing what? That is the point I was trying to make.
My prediction. This institute will be gone from SL within 5 years. I hope I am wrong.
“What is clear, however, is that a growing number of scientists within Trudeau came to share Woodland’s conviction that Saranac Lake was no longer an attractive location for a modern, top-tier research laboratory. In a memo written in March 2010, Ralph Steinman, then a leading member of Trudeau’s scientific advisory panel, argued that the Florida venture “would provide the Institute with an immediate pathway to immediately solving its infrastructure challenges, providing a pathway to the growth that is essential for its long-term survival.” (Steinman, a Nobel Prize winner, passed away last year.)”
This matches what I have heard from scientists that have left recently. Bu t I will note that that is based on changes in board expectations.
“Missing what? That is the point I was trying to make.” Ah, classic Paul etch-a-sketch! If that was the point you were trying to make, you put it very badly.
“What is clear, however, is that a growing number of scientists within Trudeau came to share Woodland’s conviction that Saranac Lake was no longer an attractive location for a modern, top-tier research laboratory…”
Yes, no doubt Woodland is a persuasive guy. No doubt, too, that Trudeau could have become a larger, wealthier institution had it accepted the millions and moved. But, as a majority of the board recognized, the Institute was founded with two goals, though only one is part of its written mission statement.
One was, of course, to carry on the medical research started by E.L. Trudeau’s pioneering Saranac Laboratory. The other goal, though, was not to leave Saranac Lake’s economy devastated. Saranac Lake had thrived in the thirties and forties as a one-industry town. It was also a town that many of its doctors truly loved– many had come here ill with TB themselves, and felt that they owed their lives to the place.
Back when it was founded, there was an attempt by some on the Institute’s board to move it to Yonkers, for reasons very similar to Woodland’s. Dr. Frank Trudeau, E.L.’s grandson, fought long and hard to keep the Institute in Saranac Lake. He succeeded by the narrowest of margins. The full story is here.
So yes, Trudeau Institute could become a larger institution if it moved. But it doesn’t need to become larger to succeed– it simply has to survive. If the Institute has made a mistake, it is in not looking to grow its endowment more in the fat years, depending instead on NIH grants. Let’s hope it can survive that mistake now.
Walker could the institute do more good though if it moved? I would think the first thing the leaders would look at was the mission and as you state the mission does not have a geographical location stated. How many new treatments could be discovered if the institute was larger and more successful?
But maybe it is the most successful it can be in Saranac Lake that would be the core question in my mind. The mission should come before the parochial needs of individual employees who happen to like living in SL. But I think the answer may be that SL IS the best place for completing the mission I certainly have no idea of the answer to that question.
“Originally founded in 1884 as a tuberculosis treatment and research facility, the Trudeau Institute today is an independent, not-for-profit, biomedical research organization, whose scientific mission is to make breakthrough discoveries leading to improved human health. The Trudeau Institute immunologists are committed to making breakthrough research discoveries that will prevent and treat cancer, asthma, allergy, arthritis, colitis, multiple sclerosis, and infectious diseases, such as tuberculosis, influenza, and sepsis.”
This is the key, the mission. Given the importance of this mission wherever you can make the most progress would seem to me to be the ethical decision you would have to make. The economic health of SL would not enter into that calculation nor should it. How do you balance a new breakthrough for infectious diseases against the economic interests of a town, I think you have to follow the mission.
“”Missing what? That is the point I was trying to make.” Ah, classic Paul etch-a-sketch! If that was the point you were trying to make, you put it very badly.”
This is a childish comment and I don’t know why I bother to respond.
“”Paul, you’re missing it. The root of Trudeau’s current problems is that NIH’s funding priorities have changed, fairly recently. If Trudeau had been focused on research that was tightly coupled to immediate application, they’d be fine now, as they were before the change at NIH”
Yes, like I said, if you read it, the focus now is more on translational research. This is difficult to do without a clinical partner. So what am I missing?
We both share the same desire to see the place remain where it is I don’t get why you make these combative comments. You do this all the time. Strange.
I am afraid that Mervel has it right. The board members that wanted to make a move were not doing it to sink the town, they thought that this is the best way to keep the institute afloat. The question is are they right?