Purdue President Mung Chiang has been signaling a shift in research funding in recent months, ahead an expanded partnership with Eli Lilly. Plus, LPD officers cleared in fatal shooting May 1.
I support Purdue building industry partnerships, but the coverage of the Lilly deal deserves far more scrutiny. Labeling it the “largest ever” without clarifying how much of the $250 million is actually guaranteed—and how much is contingent—gives a distorted impression, especially since this deal largely replaces an agreement already in place through 2027. In my view, media should go beyond repeating the Mung administration’s talking points, especially given its track record of being casual with the truth.
What’s missing from the coverage is any detail about how the Lilly funds will be governed or what safeguards are in place to protect against corporate influence over research agendas, publication rights, or intellectual property. That’s a crucial oversight—particularly when you consider Lilly’s history with the antipsychotic drug Zyprexa during Daniels' tenure. The company paid $1.4 billion in one of the largest healthcare fraud settlements in U.S. history after being accused of illegally marketing the drug and downplaying serious side effects. At least 32 states filed lawsuits related to Zyprexa, with allegations that Lilly prioritized profits over patient safety.
That history makes transparency non-negotiable, especially when Lilly’s CEO sits on Purdue’s board and stands to influence both sides of this deal. These are exactly the kinds of situations where clear conflict-of-interest policies and public accountability should be front and center. Purdue’s faculty and students—and Indiana taxpayers—deserve to know how research priorities will be protected and whether public interests are being upheld in this partnership.
I have no quarrel with your first and third paragraphs, but am unsure what specific concerns arise from the Zyprexa story. I do not know the details, but think that was a postapproval issue that basically did not involve Lilly scientists, and in general would not have involved anyone at a university (particularly one without a medical school).
There are always at least two parties in these agreements. Let's say a psychologist wanted to seek money to run a study a hypothetical link between suicide and a Lilly compound. The outcome of that study could show no meaningful link. Would that psychologist want to risk reputational damage by having to disclose that Lilly supported the research? (Here is the true value of disinterested federal research support, it was great while it lasted.) Obviously, Lilly might want to stay away from that issue entirely but Sanofi or AZ might be eager to write a check.
As for IP concerns, there is a little outfit called PRF that would be happy to beat a funder about the head and shoulders with the Bayh-Dole Act if they thought they could claim rights to the change between your sofa cushions.
My bias is from good experiences, having had several corporate research grants that produced publishable results but nothing of commercial interest. One year went interestingly sideways and they were not only cool with it but sent along an extra $35K. Prepublication reviews took less than a week. Best grants ever.
Lilly knows how research goes. They want a pipeline of future employees who are not entranced by coastal alternatives. It might make sense for them to support graduate student fellowships in one department and hypothesis-based projects in another. It might be premature to write a first-refusal deal with Purdue as a whole... is that the concern you have?
Phthor, let me run the receipts and spell out the risk by filling in the ‘details’. Zyprexa’s real-world toll was staggering. Internal Lilly memos flagged extreme weight gain and skyrocketing blood sugar as a “top threat” back in 1998. Despite this knowledge, Daniels led Lilly to market the drug toward children and the elderly, for whom the drug was not federally approved and in whom its use was especially risky, in an effort to boost sales. That cascade led many patients to full-blown diabetes, and in too many cases, premature death. Between 2005 and 2007 the company paid about $1.2 billion to 28,500 patients. Thirty-two states and DC extracted another $62 million for consumer-protection violations. In 2009, Lilly pleaded guilty to illegal off-label promotion and wrote a $1.415 billion check to the federal government. Add it up: nearly $2 billion tied to a single drug where profit pressure outran patient safety.
Why it matters for Purdue: When the same firm funds campus labs – and its CEO holds a Purdue trustee seat – that is a related-party arrangement with a built-in risk premium. Without full sunlight on governance, publication rights, and milestone triggers, the partnership could bend toward marketing goals instead of public scholarship. Extreme weight gain, diabetes, and loss of life make a compelling case for rock-solid guardrails, especially when the same cast of characters are pulling the strings.
What should we expect given this risk? A line-item breakdown of cash already delivered versus funds contingent on future metrics. A public oversight structure that can veto sponsor pressure on research scope or timing. Clear conflict-of-interest rules covering trustees, faculty, and grad students, with enforcement teeth. Corporate dollars can turbo-charge discovery when aligned with academic independence. Transparency is the fee for that acceleration, and given Zyprexa’s history, the bill is overdue.
I guess we agree that what happened with Zyprexa is entirely Lilly's fault. The guardrails you propose are pretty standard, apart from the trustee stuff (which should be handled with recusals), and should apply to any corporate partnership. Any really valuable IP should be handled by a different funding mechanism. It's much easier to just found a company or out-license the technology to Lilly or another interested firm.
My main point is that Purdue is effectively protected by not having a medical school so not a lot of human clinical trials. In my view, Purdue research, particularly basic research, is unlikely to contribute to a second Zyprexa type disaster. The decision to go to market is well down the road.
Phthor, I wish that were the case. One more layer that shows why Purdue’s distance from human trials offers limited insulation:
1. Bench work already shapes the clinic: Purdue conducts animal studies, drug-delivery research, and data-science modeling that flow straight into clinical pipelines at partner institutions. When early findings tilt toward a sponsor’s wish list, downstream clinicians inherit that bias. The internal Zyprexa memos reveal how warnings about extreme weight gain (averaging 24lbs a year!) and diabetes were softened long before the first patient dose.
2. Universities can set treatment policy without clinical trials. The Texas Medication Algorithm Project (TMAP) proves the point. University of Texas researchers, backed by roughly $2 million from atypical-antipsychotic makers including Lilly, produced prescribing guidelines that put drugs like Zyprexa first in line for Medicaid, prisons, and state hospitals. Seventeen other states copied Texas, and atypical scripts in Texas jumped six-fold. No local clinical trials were required; the university brand gave the framework credibility. If you're interested in learning more this article provides quite a few insights https://www.narpa.org/reference/bitter_pill including this gem:
"...the system of developing and marketing drugs is so broken that it can coax corruption out of well-meaning doctors who think they are doing good. Every incremental permission that the atypical makers allowed themselves, and the regulators allowed them --- structuring their studies in the most advantageous ways, omitting studies unhelpful to their cause, publicizing only the most supportive data --- helped shift the medical perception of the atypicals. The companies didn't need to pay off doctors. They just needed to put the grant money out there and wait for the true believers, the Steven Shons, to walk through the door."
No. 2 sounds like a terrible idea that should never have happened.
I strongly doubt, from first- and higher-hand experience, that No. 1 is a factor at any big pharma. Given the liability and biology issues involved, you need to be crazy to try to develop new neuroactive drugs but trusting someone else's data is next level bonkers.
(Yes, Casava Sciences still exists; but I mistimed the short. Big pharma is different.)
I think I should leave it there and go back to insulting Todd Rokita. Thanks for your views.
I support Purdue building industry partnerships, but the coverage of the Lilly deal deserves far more scrutiny. Labeling it the “largest ever” without clarifying how much of the $250 million is actually guaranteed—and how much is contingent—gives a distorted impression, especially since this deal largely replaces an agreement already in place through 2027. In my view, media should go beyond repeating the Mung administration’s talking points, especially given its track record of being casual with the truth.
What’s missing from the coverage is any detail about how the Lilly funds will be governed or what safeguards are in place to protect against corporate influence over research agendas, publication rights, or intellectual property. That’s a crucial oversight—particularly when you consider Lilly’s history with the antipsychotic drug Zyprexa during Daniels' tenure. The company paid $1.4 billion in one of the largest healthcare fraud settlements in U.S. history after being accused of illegally marketing the drug and downplaying serious side effects. At least 32 states filed lawsuits related to Zyprexa, with allegations that Lilly prioritized profits over patient safety.
That history makes transparency non-negotiable, especially when Lilly’s CEO sits on Purdue’s board and stands to influence both sides of this deal. These are exactly the kinds of situations where clear conflict-of-interest policies and public accountability should be front and center. Purdue’s faculty and students—and Indiana taxpayers—deserve to know how research priorities will be protected and whether public interests are being upheld in this partnership.
Fair points.
I have no quarrel with your first and third paragraphs, but am unsure what specific concerns arise from the Zyprexa story. I do not know the details, but think that was a postapproval issue that basically did not involve Lilly scientists, and in general would not have involved anyone at a university (particularly one without a medical school).
There are always at least two parties in these agreements. Let's say a psychologist wanted to seek money to run a study a hypothetical link between suicide and a Lilly compound. The outcome of that study could show no meaningful link. Would that psychologist want to risk reputational damage by having to disclose that Lilly supported the research? (Here is the true value of disinterested federal research support, it was great while it lasted.) Obviously, Lilly might want to stay away from that issue entirely but Sanofi or AZ might be eager to write a check.
As for IP concerns, there is a little outfit called PRF that would be happy to beat a funder about the head and shoulders with the Bayh-Dole Act if they thought they could claim rights to the change between your sofa cushions.
My bias is from good experiences, having had several corporate research grants that produced publishable results but nothing of commercial interest. One year went interestingly sideways and they were not only cool with it but sent along an extra $35K. Prepublication reviews took less than a week. Best grants ever.
Lilly knows how research goes. They want a pipeline of future employees who are not entranced by coastal alternatives. It might make sense for them to support graduate student fellowships in one department and hypothesis-based projects in another. It might be premature to write a first-refusal deal with Purdue as a whole... is that the concern you have?
Phthor, let me run the receipts and spell out the risk by filling in the ‘details’. Zyprexa’s real-world toll was staggering. Internal Lilly memos flagged extreme weight gain and skyrocketing blood sugar as a “top threat” back in 1998. Despite this knowledge, Daniels led Lilly to market the drug toward children and the elderly, for whom the drug was not federally approved and in whom its use was especially risky, in an effort to boost sales. That cascade led many patients to full-blown diabetes, and in too many cases, premature death. Between 2005 and 2007 the company paid about $1.2 billion to 28,500 patients. Thirty-two states and DC extracted another $62 million for consumer-protection violations. In 2009, Lilly pleaded guilty to illegal off-label promotion and wrote a $1.415 billion check to the federal government. Add it up: nearly $2 billion tied to a single drug where profit pressure outran patient safety.
Why it matters for Purdue: When the same firm funds campus labs – and its CEO holds a Purdue trustee seat – that is a related-party arrangement with a built-in risk premium. Without full sunlight on governance, publication rights, and milestone triggers, the partnership could bend toward marketing goals instead of public scholarship. Extreme weight gain, diabetes, and loss of life make a compelling case for rock-solid guardrails, especially when the same cast of characters are pulling the strings.
What should we expect given this risk? A line-item breakdown of cash already delivered versus funds contingent on future metrics. A public oversight structure that can veto sponsor pressure on research scope or timing. Clear conflict-of-interest rules covering trustees, faculty, and grad students, with enforcement teeth. Corporate dollars can turbo-charge discovery when aligned with academic independence. Transparency is the fee for that acceleration, and given Zyprexa’s history, the bill is overdue.
I guess we agree that what happened with Zyprexa is entirely Lilly's fault. The guardrails you propose are pretty standard, apart from the trustee stuff (which should be handled with recusals), and should apply to any corporate partnership. Any really valuable IP should be handled by a different funding mechanism. It's much easier to just found a company or out-license the technology to Lilly or another interested firm.
My main point is that Purdue is effectively protected by not having a medical school so not a lot of human clinical trials. In my view, Purdue research, particularly basic research, is unlikely to contribute to a second Zyprexa type disaster. The decision to go to market is well down the road.
Phthor, I wish that were the case. One more layer that shows why Purdue’s distance from human trials offers limited insulation:
1. Bench work already shapes the clinic: Purdue conducts animal studies, drug-delivery research, and data-science modeling that flow straight into clinical pipelines at partner institutions. When early findings tilt toward a sponsor’s wish list, downstream clinicians inherit that bias. The internal Zyprexa memos reveal how warnings about extreme weight gain (averaging 24lbs a year!) and diabetes were softened long before the first patient dose.
2. Universities can set treatment policy without clinical trials. The Texas Medication Algorithm Project (TMAP) proves the point. University of Texas researchers, backed by roughly $2 million from atypical-antipsychotic makers including Lilly, produced prescribing guidelines that put drugs like Zyprexa first in line for Medicaid, prisons, and state hospitals. Seventeen other states copied Texas, and atypical scripts in Texas jumped six-fold. No local clinical trials were required; the university brand gave the framework credibility. If you're interested in learning more this article provides quite a few insights https://www.narpa.org/reference/bitter_pill including this gem:
"...the system of developing and marketing drugs is so broken that it can coax corruption out of well-meaning doctors who think they are doing good. Every incremental permission that the atypical makers allowed themselves, and the regulators allowed them --- structuring their studies in the most advantageous ways, omitting studies unhelpful to their cause, publicizing only the most supportive data --- helped shift the medical perception of the atypicals. The companies didn't need to pay off doctors. They just needed to put the grant money out there and wait for the true believers, the Steven Shons, to walk through the door."
No. 2 sounds like a terrible idea that should never have happened.
I strongly doubt, from first- and higher-hand experience, that No. 1 is a factor at any big pharma. Given the liability and biology issues involved, you need to be crazy to try to develop new neuroactive drugs but trusting someone else's data is next level bonkers.
(Yes, Casava Sciences still exists; but I mistimed the short. Big pharma is different.)
I think I should leave it there and go back to insulting Todd Rokita. Thanks for your views.