Enron doctor

Dr. John Mendelsohn works a day job as president of the University of Texas’ M.D. Anderson Cancer Center. It’s not a bad job. Wealthy people and corporations dump money into the good doctor’s coffers.

For example, just last fall former President George Bush became president of the cancer center’s “board of visitors.” In a show of gratitude, chairman Bush threw a heck of a party at Enron Field and raised $10.3 million for the center.

Talking about Enron, during the last few years Enron the company, and Enron the foundation gave the cancer center a total of nearly $100,000 in donations. In addition, Ken Lay – who recently resigned as Enron’s chairman and chief executive – and his family foundation gave the center nearly $250,000 during the same period.

It’s nice getting hundreds of thousands of dollars from corporate donors for your pet cancer center. Maybe the guys at Enron aren’t so bad after all.

Time for a reality check. Dr. Mendelsohn has another job that calls into question the apparent generosity of the Enron donations. The good doctor joined the Enron board of directors in 1999, but that’s not all.

Dr. Mendelsohn didn’t slink down low in his plush director’s chair as the real captains of industry stood tall around the boardroom and plotted the fate of Enron. No, not Dr. Mendelsohn. He assumed a position on the all-important Enron company audit committee.

Dr. Mendelsohn, cancer researcher at a public university, was charged with overseeing Enron’s auditor, the Arthur Andersen Company, and was charged with the task of guaranteeing the integrity of the company’s financial statements and partnership arrangements.

He may be a darn good cancer researcher, but hardly anyone other than the doctor himself believed he had the education or experience to effectively oversee the integrity of Enron’s auditors and the company’s financial statements.

Then there is the issue of his “independence” as an overseer of the company’s finances. The corporate leaders he was supposed to be overseeing were dumping hundreds of thousands of dollars into the doctor’s cancer center while they were looting hundreds of millions from the stockholders and employees. It was a good deal for the looters.

The year before Dr. Mendelsohn joined the Enron board of directors, he joined the board of ImClone, a biotechnology company. Dr. Mendelsohn brought credibility to the company because of his then sterling reputation as a preeminent researcher and cancer center administrator.

In an obvious breach of fiduciary responsibility as a director, the doctor was also a paid consultant to the company for which he received cash and 30,000 shares of stock options.

The doctor pushed ImClone’s revolutionary cancer treatment as he saw the company stock skyrocket. The giant pharmaceutical company, Bristol-Myers Squibb, was convinced, and paid a couple of billion dollars for a 20 percent share in the company. Dr. Mendelsohn personally cleared over $6 million in the transaction. But in all of this wheeling and dealing to corner the market for the miracle cancer drug, there was one nagging little problem.

There was no miracle cancer drug. The drug’s effectiveness was just as illusory as Enron’s billions. In fact, the drug was so worthless that the Food and Drug Administration refused to take seriously the company’s application for permission to market the drug. ImClone’s stock tanked as the facts became known. The Justice Deparment and the Securities and Exchange Commission are investigating.

Greed, profit, corruption, criminal activity. It’s hard to know where one ends and the other begins. Nationalize the energy companies. Protect the future of all workers with a real social security system that is public, covers 100 percent of the population, provides a living benefit and includes a national health service.

Public money actually funds most medical and pharmaceutical research in this country anyway. Nationalize and dismantle the profit-gorging drug companies. Next time you run into Dr. Mendelsohn, just say, “People Before Profits.” He’s had a rough time. He might understand now.