Alex Constantine - May 2, 2009
The drug company behind the swine flu medicine Tamiflu is at the centre of controversy over its links to former US Defence Secretary Donald Rumsfeld.
Mr Rumsfeld, a former chairman of the company, has refused to comment on whether he still holds shares in Californian firm Gilead Sciences, which developed the drug now being desperately stockpiled by governments around the world to combat the threatened pandemic.
Last night an associate of Mr Rumsfeld said: ‘He does not publicly discuss his private finances.’
However, should Mr Rumsfeld have held on to shares in the company, he would be a major beneficiary of the surge in the global demand for the drug. The NHS alone has already purchased enough Tamiflu to treat three-quarters of the population in the UK.
Mr Rumsfeld has previously been accused of a potential conflict of interest over his links to Gilead Sciences, which sold the licensing rights for the medicine to Swiss giant Hoffman-La Roche in 1996.
Under the terms of the deal Gilead, headed by Mr Rumsfeld between 1997 and 2001, still receives between 14 and 22 per cent of the income from the wholesale trade in the drug, depending on the volume of sales.
Four years ago the value of Mr Rumsfeld’s shares in Gilead Sciences saw a huge hike from an estimated £3million to an estimated £17million over the avian flu scare.
It was partially sparked by a warning from President Bush’s top health adviser Mike Leavitt that a pandemic could cause nearly two million deaths in the US alone.
When details of Mr Rumsfeld’s shareholding became public he consulted a lawyer who advised him to keep the stock but excuse himself from any government decisions involving the flu drug.
He issued a document explaining the situation. Some months later the Pentagon ordered £39million worth of the Tamiflu drug for US troops.
Dr Joseph Mercola, author of The Great Bird Flu Hoax, said yesterday: ‘The only thing all this talk of swine flu does is spread fear. President Bush sought to instil panic by telling us a minimum of 200,000 people will die from avian flu but it could be as bad as two million deaths in the US alone. This hoax was justified by the immediate purchase of 80million doses of Tamiflu.’
As well as Mr Rumsfeld, Gilead has links with a number of other Republican figures. The largest shareholder is FMR Corporation, owned by Grover Glenn Norquist, a Republican activist.
And George Schultz, President Ronald Reagan’s former Secretary of State, was a major shareholder until he sold his stake in 2005, netting around £5million.
Gilead has announced record first-quarter results, with revenues of £1billion, although a lot of revenue came from their AIDS drugs.
Michael Riordan, 51, the founder of Gilead who retired in 1997, said yesterday: ‘If the company has been successful, it’s not because of any political affiliations.’