LSU License Deal Creates Conflict of Interest & Possible State Constitution Violation

LSU License Deal

LSU officials failed to follow university procedures when licensing a medical software program, creating conflicts of interest and possibly a state constitution violation concerning the university’s relationship with the nonprofit Louisiana Health Information Technology Foundation (LaHIT).

David Jacobs reports that LSU President F. King Alexander asked the Legislative Auditor to review the relationship between the university and LaHIT, the makers of Clinical InQuiry or CLIQ, an LSU-developed software application that provides a web-based portal for electronic medical records and clinical data.

LaHIT is not unusual in its interface—public universities often license their research to for-profit companies in hope of spurring economic development raising money for the university, and creating real-world benefits for the academic pursuit of knowledge.  However this specific arrangement was unusual.

What was the Problem?

  • Dr. Frank Opelka, at the time LSU’s Executive Vice President for Health Care and Medical Education Redesign, did not use the university’s Offices of Technology Management in his efforts to license CLIQ, rather he relayed on a private law firm.
  • Opelka claimed licensing the software directly would have subjected the process to state bid law. But it turns out LSU is subject to the University Pilot Procurement Code which exempts technology transfers from competitive bidding
  • While the LSU Board of Supervisors were briefed on the LaHIT deal, three agreements related to the CLIQ licensing were never brought to the board for formal approval—including a deal with a sublicensee, HarmonIQ Health System Corporation, that failed to include the 40% equity stake LSU officials thought they were getting would have ensured the university and its developers shared in revenue from a potential buyout.
  • LSU may have violated the state constitution by using public funds to pay legal services for the benefit of a private, for-profit corporation, the report says. If any LSU employees’ time was spent working on the creation of HarmonIQ while on LSU payroll, those costs also may have violated the constitution.

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