Interview with JDRF CEO Arnold W. Donald

Yesterday, the Internet was abuzz over Kelly Close's terrific interview with JDRF's CEO Arnold W. Donald. I have made several posts on various message boards regardling my impression that the jury is still out on Mr. Donald's leadership as CEO. However, Kelly did JDRF a huge favor by filling a much needed gap here by conducting the interview.

I do not wish to focus on strictly negative thoughts, but I do want to be something of an offsetting balance to strict praise CEO's routintely receive by calling attention to areas they need to focus on as well. For example, why did it take nearly 1 year for this CEO to "go public"? I suppose one could say his Congressional testimony to speak on the topic of the artificial pancreas project was his first public appearance on a national level, but that is not really meeting with his "shareholders" as a public interview is. (By the way, on the topic of artificial pancreas, be sure to join the December 12, 2006 online chat with Dr. Aaron Kowalski, Director of Strategic Research Projects at the JDRF to speak with him about that project. [Note: The transcript for that chat is available at DiabetesTalkFest.com.]

Back to Mr. Donald. After almost 1 year on the job, I found the interview to be more disturbing than impressive. Why? Well, under former CEO Peter Van Etten, JDRF had a very clear direction, and while there was some criticism of Mr. Van Etten's focus on stem cell research at the expense of other promising avenues towards a cure, so far, Mr. Donald has yet to show the same degree of focus. This organization was founded by parents of children with type 1 to find a cure for their children. To a large extent, that group remains their most important constituency, so the CEO must try and motivate them. Personally, I did not find this interview to be very motivating to myself as a fundraiser who has consistently raised several thousand dollars per year for the organization.

Another area we should question was his response to the following question: "There's been a lot of media attention on type 2 compared to type 1, and I wonder how the JDRF reminds decisionmakers that type 1 is also on the rise?"

His response was "While I have some empathy for those who feel a need to drive type 1 as an agenda item because I'm at JDRF, I think that some times we get caught up on the distinction that, number one, medically is not as clean as we may have thought it was in the past. And, number two, in terms of addressing the human impact, it may be more academic. So, my attitude is, look, type 1 is an autoimmune disease, and based on that, it requires certain types of research that may be unique. But the learnings from the research in both areas can lend a huge amount of benefit to the other, and so where I'm at is we need to eliminate diabetes. That's the deal."

Sorry, but no matter how you spin that, focusing on the areas of overlap between the major types of diabetes, rather than the unique distinctions is really not going to motivate JDRF's fundraisers (does it motivate you?). The NIH/NIDDK already does that. So does the ADA. If JDRF's role is to, as he says, "fill in the gaps," JDRF really does not need to duplicate that role.

The other statement I would call attention to was when he was asked about the government relations front and if there was room for any improvements there. His response was "Again we've been incredibly successful, but there's more power to harness in the volunteer base and there are things to get front of. For example, the [closed loop] artificial pancreas."

However, I have a different impression of that. Previously, I hosted an online chat with Larry Soler, who is the VP for Government Relations for JDRF in Washington, DC. One issue we discussed was that there were many state-related initiatives (many of which were related to stem-cell research, either to fund or to ban it), and he told me that his perception was that JDRF was well able to handle issues on a federal level, but the local chapters need help from JDRF National in terms of organizing the database to identify people locally, etc. so that e-mail alerts could be targeted on a state level, or even by district level. Right now, everything JDRF Government Relations does (or nearly everything) is done on a federal level. JDRF needs to organize to be better able to handle things on a state level.

During the recent election, JDRF was not especially well-prepared in Mr. Donald's home state of Missouri, which had ballot measure on whether to allow stem cell research (amendment 2) which luckily passed, but that was largely thanks to the Michael J. Fox television commercials and the press garnered by Rush Limbaugh surrounding them, not due to JDRF. This is an example where the JDRF is not truly as prepared to handle initiatives on the state level as they need to be, yet for the new CEO to state "we've been incredibly successful" on the government relations front is overlooking an area that frankly, needs some improvement.

When all is said and done, the jury is still out on Mr. Donald's performance as JDRF's CEO, as he really has only had 1 year to move the organization. But its up to everyone who supports the organization to make it very clear where they are pleased, and where they want Mr. Donald to focus. Remember, we are all shareholders of the JDRF, and management has a fiduciary responsibilty to us as shareholders. My thanks again to Kelly Close for a great service to the JDRF and us as shareholders!