Complaint to HHS and OPM Re: Slaoui Employment Status
Slaoui Should Be Classified a Government Employee
By by Craig Holman and Margarida Jorge
| The Hon. Alex Azar, Secretary U.S. Dept. of Health and Human Services 200 Independence Avenue, SW Washington, D.C. 20201 |
The Hon. Michael Rigas, Acting Director U.S. Office of Personnel Management 1900 E Street, NW Washington, D.C. 20415 |
| Elizabeth Fischmann Designated Agency Ethics Official U.S. Dept. of Health and Human Services 200 Independence Avenue, SW Washington, D.C. 20201 |
Mark Robbins Designated Agency Ethics Official U.S. Office of Personnel Management 1900 E Street, NW Washington, D.C. 20415 |
RE: Government Employee Status of Moncef Slaoui,
Co-Leader, Operation Warp Speed
Dear HHS Secretary, OPM Acting Director and DAEOs:
Public Citizen and Lower Drug Prices Now request that your offices make a determination as to whether Dr. Moncef Slaoui, co-leader of the government program to oversee the development and funding of COVID-19 treatments and vaccines, known as Operation Warp Speed, should be classified either as a special government employee or regular government employee, subject to the ethics and disclosure requirements of federal employees.
Currently, Slaoui is under a contractual arrangement with the Department of Health and Human Services (HHS) to serve with Gen. Gustave Perna in directing the Warp Speed program. Even though Slaoui is recognized as chief scientist and co-leader of the government program, the contractual arrangement asserts that Slaoui will function as a private contractor rather than a government employee, immune from the ethics and disclosure requirements applicable to all other senior government officials, most notably the conflict of interest code (18 USC 208) and the personal financial disclosure requirements mandated by the Ethics in Government Act of 1978.
It appears that the contractual arrangement that classifies Slaoui as merely a private contractor is unwarranted and designed primarily to allow Slaoui to maintain an extensive web of conflicting financial interests without the need to divest of, recuse from or disclose those conflicting interests. This would constitute a violation of federal ethics laws and provide Slaoui with the opportunity to enrich himself, his colleagues and his employers, and calls into question the integrity of critically-important official actions that will be taken under the Warp Speed program.
On July 31, 2020. Assistant Inspector General for Legal Affairs Robert DeConti suggested this may be a matter that should be addressed by your offices.
- Government Employee
Three criteria for Government employment are identified in 5 U.S.C. §§ 2104 and 2105: (1) appointment in the civil service; (2) performance of a Federal function; and (3) supervision by a Federal official.
Federal statutes (5 USC § 3109) as well as the Office of Legal Counsel (OLC) recognize the authority of the president and agencies on occasion to name advisors and experts on a temporary or intermittent basis to provide necessary governmental services. Nevertheless, as the Office of Personnel Management (OPM) has made clear these experts and consultants also are to be considered government employees. An OPM “Fact Sheet on Expert and Consultant Pay” specifies:
“Experts and consultants appointed under 5 USC 3109 are considered to be Federal civil service employees under 5 USC 2105. (See 5 CFR 304.101.) Thus, they are generally covered by laws applicable to Federal employees, including laws related to compensation and leave, subject to any additional coverage conditions in the given law.”
Alternatively, Congress created a category of employees known as special government employees (SGEs), which it defined to cover situations in which outside experts and consultants provide advice on a temporary basis, with or without compensation. According to 18 USC 202, in order to qualify as an SGE, the individual generally must be “retained, designated, appointed, or employed” and cannot serve for more than 130 days during any 365-day period. Federal regulations expressly clarify that “[s]tatus as an employee is unaffected by pay or leave status or, in the case of a special Government employee, by the fact that the individual does not perform official duties on a given day.”
However, SGEs are also recognized as government employees subject to the conflict of interest code (18 USC 208) and disclosure requirements applicable to other government employees.
OLC has distinguished private-sector advisors from government employees based on their role in government. Those who assume a more formal role to assist the President or agency on specific matters, should be evaluated as a regular employee or SGE. In one OLC opinion, for example, the advisor “departed from his usual role of an informal advisor” by organizing and chairing meetings of government officials on a particular issue as well as assuming responsibilities for coordinating related government activities on that issue. The advisor “presumably [was] working under the direction or supervision of the President,” leading OLC to conclude that the advisor should be given a formal designation and subject to any consequent ethics requirements.
2. The Case of Moncef Slaoui
The appointment of Dr. Moncef Slaoui as co-leader of Operation Warp Speed certainly appears to qualify him as a government employee, either a regular or special government employee depending on his term leading Operation Warp Speed. Slaoui has received a formal contract to serve in a leadership position of a government program, in which there is a “firm mutual understanding that a relatively formal relationship” for employment exists. 1 Op. O.L.C. 20, 21 (1977). Slaoui likely will be instructing others in the project and making official decisions to guide government policy. His duties and role in government are very specific and focused on a singular mission. And Slaoui is accountable to higher government officials (including the President) and in doing so, characterizing him as an independent contractor and not an employee seems implausible.
The President certainly has the authority to appoint Slaoui to such a leadership position in government, but the public also has the legal authority to demand that Slaoui’s public service not be tainted by personal gain.
Granted, Slaoui has taken an initial step to ameliorate perhaps one of his most egregious conflict of interest – resigning from the corporate board and divesting of ownership in Moderna, a pharmaceutical company expected to receive large government contracts and assistance from the Warp Speed project. But many other conflicts of interest appear to persist, many of which may not be public.
Slaoui is a venture capitalist in the pharmaceutical industry and a long-time pharmaceutical executive, even while assuming his governmental role to pick and choose winners in the race for pandemic treatments and vaccines. As the New York Times reports, he still holds about $10 million in GlaxoSmithKline stock and remains a partner in Medicxi, a venture capital firm that specializes in investing in biotech concerns, with several companies engaged in the global race to develop treatments or vaccines to stanch the coronavirus pandemic. GSK and Sanofi, to name a few, have become partners in creating a vaccine candidate against the coronavirus.
Slaoui has not disclosed how much stock he owns in GSK. When he left the company in 2017, he held about 240,000 shares, according to the New York Times analysis. He told administration officials he does not want to sell these shares. “I have worked for 29 years for GSK,” Slaoui said. “What I said regarding the GSK shares, I said I cannot take the job if I have to sell them.”
Slaoui has been placed in a position to influence the awarding of massive government contracts in response to the critical health crisis currently plaguing the nation. It is imperative that there be a reasonable level of confidence that the decisions coming from the Warp Speed project are being based on the public’s interest. But the conflicts of interest posed by Slaoui’s private-sector employment and financial interests with his new official role in government are enormous and seriously undercut such confidence.
In fact, Operation Warp Speed has awarded $2.1 billion to GlaxoSmithKline and Sanofi Pasteur “for development including clinical trials, manufacturing, scale-up and delivery of its vaccine.” It is the largest investment through Operation Warp Speed to date – and Slaoui owns substantial investments in at least one of the corporate recipients of this multi-billion dollar contract.
Slaoui has close ties to multiple companies in the pharmaceutical industry, both domestic and abroad, judging from public records. There may well be more ties that are not known, since a private contractor is exempt from the public disclosure requirements.
3. Conclusion: Slaoui Should Be Classified a Government Employee Subject to the Conflict of Interest Code and Disclosure Requirements
There is far too much at stake, in terms of both the public’s health and the scope of public expenditures in response to the pandemic, to allow any person, including Moncef Slaoui, to assume a leadership position in the war against the pandemic without complying to the conflict of interest code and disclosure requirements.
Public Citizen and Lower Drug Prices Now request that the Department of Health and Human Services, as well as the Office of Personnel Management, determine whether Slaoui is in fact serving in the capacity of a government employee and should resolve his conflicts of interest and secrecy surrounding his financial interests.
Respectfully Submitted,
| Craig Holman, Ph.D. Government affairs lobbyist Public Citizen 215 Pennsylvania Avenue, SE Washington, D.C. 20003 (202) 454-5182 cholman@citizen.org |
Margarida Jorge Campaign Director Lower Drug Prices Now 1201 Connecticut Avenue, NW, Ste 300 Washington, D.C. 20036 (202) 422-2220 mj@lowerdrugpricesnow.org |