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Institut Pasteur Fights Claims of Financial Mismanagement

14 May 2013 3:35 pm
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In the spotlight. A report has criticized management at the Institut Pasteur in Paris.

The venerable Institut Pasteur is in turmoil over accusations by a government watchdog that it is misleading the donors that fund part of its research. In a scathing report published earlier this month, the Inspection Générale des Affaires Sociales (IGAS) says that the well-respected biomedical research organization massages figures to attract private donations and government funding, while it sits on a comfortable money cushion. Pasteur denies any wrongdoing, but the report could hurt its government funding as well as the trust of its donors.

Set up in 1887, the Institut Pasteur boasts an impressive track record of 10 Nobel Prize laureates. Today, it is a nonprofit research foundation focused on infectious diseases with a budget worth €243.6 million in 2011; IGAS says that includes about €60 million from the French government and €50 million in donations every year, including many small contributions from private citizens.

Pasteur tells its donors that donations and bequests make up a third of the institute's funding, while the actual figure is less than 20%, the report's authors write. They add that the institute "artificially" presents its balance sheet to funders as "structurally in the red" to appear vulnerable and dependent on external funding, including from France's research ministry.

But in fact, the organization is well-off, the report says: The institute's endowment was worth €658 million in investment funds in 2011—bringing its total wealth to about €1 billion, including real estate assets. The authors say that management of these funds should be better controlled and less risky, "if only to get closer to the will of donors who wish to contribute to research efforts, not to gamble on the evolution of financial markets."

The Institut Pasteur did not respond to requests for comment from ScienceInsider. In written statements published on its website on 3 and 6 May, the institute dismissed IGAS's accusations as "totally unfounded," "erroneous, unfair and malevolent," saying it would "not let [the report] tarnish its image and values." "The endowment allows the Institut Pasteur to shield itself from uncertainties that could affect the level of its different funding sources in the long term," one of the statements says. That's necessary because research activities often require funding over periods of 5 to 10 years, Pasteur's Director General Alice Dautry explained to national TV channel France 2.

But Alain Guédon, who served as Pasteur's vice president for business development between 2007 and 2009, says that IGAS is right. "It's true that you need money to manage science projects over 5 to 10 years, but that's true for a few million euros, not for several hundreds," he tells ScienceInsider. Guédon says he is "very pleased" with the report, which accurately reflects his own experience and frustration during his stint at the institute.

Dautry took over at Pasteur in 2005 after a tumultuous episode in which the institute's entire board of directors stepped down and her predecessor, Philippe Kourilsky, was forced to leave. In March, the board elected Christian Bréchot, a former head of France's National Institute of Health and Medical Research, to succeed her.

Geneviève Fioraso and Marisol Touraine, the French ministers in charge of research and health, respectively, have expressed their "trust" in Pasteur's "research excellence" and management in a reassuring, yet cautious joint statement. A research spokesperson tells ScienceInsider that the ministries will now take time to analyze the report. Out of 40 recommendations by IGAS, three are directed to the research ministry; suggestions include reviewing the amount of government funding allocated to Pasteur in light of the institute's "own wealth and actual funding needs."

IGAS carries out investigations on request from ministries in the field of health, social affairs, and labor policies. This report examined the Institut Pasteur's accounts between 2009 and 2011.

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