Novartis has made former chief ethics, risk and compliance officer Shannon Thyme Klinger its new group general counsel after Felix Ehrat stepped down over payments between the company and Donald Trump’s lawyer Michael Cohen.
Klinger, who joined Novartis in 2011 as general counsel for Sandoz US, a division of the company which focuses on generic pharmaceuticals and biosimilars, took up the post on 1 June.
Novartis confirmed in a statement on 9 May that it had contracted real estate lawyer and US President Donald Trump’s personal attorney Michael Cohen’s company Essential Consultants to provide information on nascent US healthcare policy under the Trump administration.
Novartis said that it entered into a one-year agreement with Essential Consultants as it had believed that Cohen would be able to “advise the company as to how the Trump administration might approach certain US healthcare policy matters”. A senior Novartis official told NBC News that Cohen had directly contacted the company followed the 2016 US presidential election, “promising access” to the administration.
"Although the contract was legally in order, it was an error,” Ehrat said in a statement: “I take personal responsibility to bring the public debate on this matter to an end”.
Jörg Reinhardt, chairman of the company’s Board of Directors, said: "I appreciate Felix's decision even as we regret his departure. We thank him for his contributions to the company as General Counsel."
Essential Consultants was reportedly set up by Cohen to pay adult film actress Stormy Daniels to keep silent about an alleged affair with Trump. Daniels’ lawyer, Michael Avenatti, published the document that originally revealed Novartis’ contract with the company on his Twitter page on 8 May.
Novartis said that, after an initial meeting with Cohen in March 2017, it had determined that he would not be able to provide the services that they had anticipated. However, the contract could only be “terminated for cause”, Novartis said, so the company continued to make US$100,000 payments each month, until the agreement expired in February 2018.
The company’s CEO Vas Narasimhan was not involved in the deal, Novartis added, noting that the contract predated his hiring. The company said that media reports drawing connections between the payments and a dinner attended by both Narasimhan and Trump at the Davos World Economic Forum in January 2018 “clearly misrepresent the facts and can only be intended to further personal or political agendas”.
Novartis confirmed that it had been contacted by Special Prosecutor Robert Mueller’s office in November 2017, regarding the contract with Essential Consultants. It said that it had “cooperated fully” and provided all the information requested. Mueller is investigating alleged collusion between the Trump campaign and Russia in the lead up to the election in 2016.
The Swiss attorney general is said to be “eyeing” Novartis’ dealings with Cohen but is not conducting a criminal probe at this time. Meanwhile, US Democratic senator Ron Wyden has called for an investigation into the matter.
