Published Nov. 19, 2005
The Parker Hughes Cancer Center in Roseville took a financial hit in 2004 as patient revenues fell by one-third and donations dwindled after revelations that its founder, Dr. Fatih Uckun, and the clinic were targets of government investigations.
A clinic official said Friday that the cancer center has rebounded this year, including growth in cancer care.
But a $3.8 million loss at the clinic in 2004 continued an erosion of the institutions'financial resources, which have shrunken significantly since the late 1990s after a California billionaire donated $34 million to Uckun's drug research arm, the Parker Hughes Institute.
Now the research institute is on shaky financial ground. Auditors who reviewed the institute's accounts said in financial documents filed recently with a state agency that the institute was in danger of financial collapse without millions of dollars of support from the clinic.
The institute asserts that it has become "one of the leading organizations in drug discovery and basic cancer research as well as virology research."
It has received $14.5 million from the clinic, which has pledged to donate another $6 million.
Donations from the public to the nonprofit institute and clinic fell 83 percent in 2004 to $53,000, the financial documents say.
Meanwhile, legal expenses for the clinic continue to grow, hitting $1.7 million in 2004 and $1 million in 2003. By comparison, the clinic's legal bills were $97,000 in 2002.
In a series of articles in 2003 and 2004, the Star Tribune reported that the clinic made inflated promises to cancer patients about their recovery, charged insurers for treatments that experts said were unnecessary and overstated the credentials of its doctors. The reports said that Uckun sought donations from businesses in return for doing business with the clinic and withheld information about the death of three chimpanzees in safety tests of an experimental drug.
Uckun has denied the allegations.
The clinic has disclosed in its audited financial statement that it was told in 2003 that it was the subject of investigations by two government agencies.
Three physicians employed by the clinic were notified in 2004 that they were being investigated by the Minnesota Board of Medical Practice, according to the same document. The newspaper has previously reported that the FBI had questioned at least one Twin Cities doctor about kickback allegations involving the clinic.
Uckun has acknowledged that he is one of the physicians facing an inquiry by the Medical Board, which licenses and disciplines physicians, and he called on it to bring the matter to a close.
"The Board of Medical Practice needs to decide to dismiss this or present it to an administrative law judge," Uckun said at a mid-October news conference.
He said the investigations and the news reports about them have angered and worried his patients, but has not hurt the clinic's business.
"Patients are happy. Outcomes are good," he said. "The clinic does good work."
Uckun said the clinic hired back some staff members who were laid off in February 2004, when nearly 90 people at the clinic and institute lost their jobs because of financial pressures.