The Office of Congressional Ethics is questioning businessmen and Republican party operatives in Western New York who invested in an Australian pharmaceutical company where Rep. Chris Collins is the top shareholder. PAI first documented the full list of Western New York investors in January.
The company, Innate Immunotherapeutics, came under scrutiny at the end of 2016 when Collins was overheard on the floor of the House of Representatives bragging about how many millionaires he’d made back home in Buffalo. The investments were made during a private placement in the summer of 2016 as Collins was helping to write the 21st Century Cures Act, a law to hasten the drug approval process, among other things.
One of the investors who took advantage of the private placement was then-Rep. Tom Price, who sat on the House health and technology subcommittee with Collins. Price’s investment with the company, which more than tripled in value after President Barack Obama signed the 21st Century Cures Act into law, became the source of criticism during Senate confirmation hearings for his appointment as Donald Trump’s Secretary of Health and Human Services.
PAI documented the members of the Buffalo power elite who took part in the placement in January and their various connections to Chris Collins, which was reported by the Buffalo News and which spurred a complaint by an Australian former securities regulator.
We found that people who bought into Innate in the summer of 2016, and their spouses and companies, donated more than $188,000 to Collins’ various political campaigns.
Collins’ donors and fellow Innate investors include executives at other companies he is invested in, such as Christopher Graham, president of Volland Electric, which has donated at least $20,000 to Collins’ various campaigns and where Collins is a board member and owner of a stake worth between $5 million and $25 million.
Another major donor who invested with Collins is prominent local GOP fundraiser Paul Harder, who has donated more than $32,000 to Collins over the years and who invested in Innate through an LLC called CHEP II. It is unknown if there are any other members of CHEP II, LLC or who they are.
Other investors were only minor campaign donors, but owed Collins more than $100,000 in debt. In his 2014 personal financial disclosure, Collins discloses a personal mortgage that he holds worth $100,000 to $250,000 on a house in Venice, Florida. Property records indicate that house is owned by William and Marcia Grove, who have donated around $3,000 to Collins’ campaigns and both participated in the 2016 private placement of Innate stock.
The table below details Innate investors and their contributions to Collins’ campaigns as well as other ties to the Congressman.
|Name||Bio||Connection to Collins|
|Caitlin Collins||Associate, Phillips Lytle, LLP||Collins’ daughter; Donated $5,000 to Collins’ capaigns; Phillips Lytle has donated at least $44,000|
|Christopher Graham||President, Volland Electric||Collins is a partner at Volland and owns between $5 million and $25 million in equity; Volland has donated at least $20,000 to Collins|
|Brian Geary||Executive, Bloch Industries||Donated $2,000 to Collins; Collins is chairman of Bloch Industries and owns between $500,000 and $1 million in equity|
|Brian Lipke||Former CEO, Gibraltar Industries||Lipke has donated $20,000 to Collins’ campaigns; Gibraltar has donated $5,500; Collins owns between $250,000 and $500,000 in Gibraltar equity|
|Paul Harder||Former CEO, Cliffstar; former CEO, Clinical Support Services; Manager, Uniland Development||Harder and his wife have donated at least $32,200 to Collins|
|Robert Stevenson||President, Eastman Machine||Stevenson has donated $15,800 to Collins and Eastman Machine has donated $10,000|
|Paul Reid||CEO, Reid Petroleum||Donated $17,000 to Collins’ campaigns|
|Glenn Arthurs||Managing Director, Arthurs Malof Group, UBS||Donated $8,300 to Collins’ campaigns; Arthurs’ son Donald is also invested in Innate|
|Phillip Delmont||Parter, Harter, Secrest, and Emery, LLP||Harter, Secrest, and Emery has donated $3,500 to Collins’ campaigns|
|William Grove||Retired||Donated $2,740 to Collins; Collins holds a mortgage between $100,000 and $250,000 on Grove’s Venice, Florida house|
|Thomas Massung||Former SVP, M&T Bank||Donated $1,300 to Collins|
|Bill Paxon||Senior advisor, Akin Gump||Donated $1,000 to Collins|
|Mark Lema||Chair, Department of Anesthesiology, Critical Care & Pain Medicine, Roswell Park Cancer Institute||Donated $500 to Collins|
All the Buffalo-area investors who took part in the Innate Immunotherapeutics private placements in 2016 and their various connections to Collins can be seen in the map embedded below.
On May 16, the Buffalo News reported that staff from the Office of Congressional Ethics was interviewing local investors about Collins’ role in inducing them to buy into the company.
Collins released a statement denying any wrongdoing and saying that his investment in Innate was due to his witnessing the “deadly impact [of multiple sclerosis] firsthand as it affected a close family member.”
While the one drug that Innate has developed is currently in trials to treat multiple sclerosis (MS), Collins’ investment in the company pre-dates the attempts to use the drug on MS by several years. Innate first attempted to use its drug against AIDS. After the September 11 attacks, the company tried its drug against anthrax. During the short-lived SARS epidemic, Innate then tried to use its drug to treat that disease. It was not until recently, after Collins had been the top shareholder in the company for several years, that Innate began MS trials for its drug.
The Office of Congressional Ethics cannot compel testimony from any of the people who invested with Collins, though the agency can recommend that the House Committee on Ethics investigate the matter and possibly discipline the Congressman.
In early 2017, House Republicans abruptly approved a rule change that would have gutted the Office of Congressional Ethics and then abandoned the change amid widespread public outcry. It is unclear how Collins voted on the initial measure to effectively kill the office.