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Lawyer: U.'s analysis of its relationship with Huntsman Cancer Foundation nearing completion

FILE - The Huntsman Cancer Institute in Salt Lake City on Tuesday, April 25, 2017. A consulting firm that is examining the complex financial relationships between the University of Utah, Huntsman Cancer Institute and Huntsman Cancer Foundation could be fi
FILE - The Huntsman Cancer Institute in Salt Lake City on Tuesday, April 25, 2017. A consulting firm that is examining the complex financial relationships between the University of Utah, Huntsman Cancer Institute and Huntsman Cancer Foundation could be finished with its analysis by the end of the month.
Jeffrey D. Allred, Deseret News

SALT LAKE CITY — A consulting firm that is examining the complex financial relationships between the University of Utah, Huntsman Cancer Institute and Huntsman Cancer Foundation could be finished with its analysis by the end of the month.

Alan Sullivan, the attorney tasked with overseeing the U.'s new memorandum of understanding with the Huntsman Cancer Foundation as it pertains to the institute, said Wednesday that the firm in question, FTI Consulting, will soon be done collecting documents and begin initiating site visits as soon as the end of August.

After that the firm, based in Washington, D.C., will have 30 days to analyze the data and make recommendations to him, Sullivan said, at which point negotiations with the Huntsman Cancer Foundation will begin in earnest.

"We've said we would like to have that report to help us with the negotiations," Sullivan said.

Sullivan said he is hopeful a new memorandum of understanding could be negotiated by the end of 2017.

"The sooner the better," he said.

An agreement that went unsigned by U. President David Pershing this spring was at the heart of disagreements between the Huntsman family and U. administrators that erupted into a public conflict after the April 17 firing of cancer institute CEO Mary Beckerle, who was reinstated after a week.

The agreement, signed by Jon Huntsman Sr. and Peter Huntsman, sought to give Beckerle "full spectrum" stewardship of the entire cancer program at the U., including academic, research and clinical efforts, as well as authority to hire "critical faculty" without approval from academic departments.

The document would also have given Beckerle complete authority over the entirety of the U. cancer program's "financial resources generated from clinical revenues, legislative initiatives and other sources." It would also have resulted in 75 percent of Huntsman Cancer Hospital revenue going to the institute, 25 percent going to the hospital itself and none of it going to the University of Utah Health Sciences for three years.

That would represent a change from 25 percent going to Health Sciences, 25 percent going to the hospital and 50 percent going to the institute.

Upon Beckerle's reinstatement, Pershing announced Beckerle would begin reporting directly to him, rather than the vice president for Health Sciences at the U., which was another stipulation the unsigned memorandum sought. Dr. Vivian Lee, who filled that position overseeing health sciences at the time, resigned a few days after Beckerle returned to her job, amid heavy criticism from Jon Huntsman Sr. for the director's firing.

However, aside from that concession by the U. administration, none of the other structural or financial demands of the document were agreed to. Both sides have said since that time that they want to reach a new deal, though Peter Huntsman said last week that "if we're sitting here in six months and something hasn't been resolved, it will not be a good environment for anybody."

U. spokesman Chris Nelson responded by saying it was the university's plan to finish thoroughly examining the U.'s financial relationship with the Huntsman Cancer Foundation before moving forward.

Such examination is the job of Sullivan and the consulting firm that was hired, the attorney said.

"I think this will be helpful to everyone and it will provide everyone with a common set of facts to utilize on a going forward basis," Sullivan said.

A substantial issue being tackled by the FTI Consulting analysis, he said, is the question of "the way in which the U.'s financial obligations to the Huntsman Cancer Institute ought to be calculated."

He added that there is uncertainty specifically over the concept of how "net margin" at the Huntsman Cancer Hospital — as defined in the latest effective memorandum of understanding — is calculated in the first place, even before that money is divided up among the various parties. He indicated the term is financially ambiguous and lends itself to varying interpretations.

"My understanding is there no commonly accepted set of definitions for net margin," Sullivan said.