Noem Taps Top Career Donor to Conduct Statewide Hydroxychloroquine Study

South Dakota’s Republican Governor Kristi Noem is one of the only governors that has not issued a stay-at-home order to combat the spread of the coronavirus. Now, coronavirus cases in the state have surged and a meatpacking plant in Sioux Falls with a large immigrant workforce has become the largest coronavirus hotspot in the country. 

As a response to the outbreak, Noem announced she is launching a statewide clinical trial of hydroxychloroquine, the anti-malaria drug that President Trump has repeatedly promoted during his daily press events.

“For the past week, I have been in direct contact with the White House, with President Trump’s team, spoken with Vice President Pence, Jared Kushner, the chief of staff, many within the task force on making sure that they knew what we wanted to do here in South Dakota,” Noem said at a press conference on Monday. “This would be the first-ever state-endorsed, state-backed, statewide clinical trial available in the United States to help take care of our people here.”

South Dakota’s trial will have two components: all coronavirus patients in the state—44% of whom are from the meatpacking plant’s immigrant workforce—will have the option to take hydroxychloroquine, and a randomized placebo-controlled trial will be conducted for people who have been exposed to the virus.

While there is anecdotal evidence that hydroxychloroquine can be helpful, there is also reason to be cautious with the drug. In Brazil, a trial of a related drug, chloroquine, was recently halted after coronavirus patients developed potentially fatal heart arrhythmias. And in the U.S., while a number of federal agencies are currently facilitating clinical trials, coronavirus task force member Dr. Anthony Fauci has warned that very high doses of the drug are used for coronavirus patients and the toxicities are not yet known. 

To conduct the South Dakota trial, Noem has enlisted a corporation that has invested heavily in her political career: Sanford Health, a Sioux Falls-headquartered rural healthcare system that is one of the largest in the U.S. According to the Center for Responsive Politics, Sanford Health was Noem’s top career campaign donor during her years in the U.S. House of Representatives.

It’s unclear how much Sanford Health will be paid to conduct the trial, but initial funding will come from the state and Noem told reporters that the state could also tap into federal coronavirus relief money to fund the study.

From 2010-2018, Noem received more than $100,000 from individuals affiliated with Sanford Health, far more than she received from any other contributor. Corporations, including those like Sanford Health that include nonprofits and private entities, cannot legally donate to candidates, so the Center for Responsive Politics tallies contributions from company’s employees as well as through company’s PACs, which are funded by employees. 

Sanford Health CEO and President Kelby Krabbenhoft has been a reliable donor for Noem, giving $7,500 over multiple contributions to her House campaign and $5,000 to Noem’s gubernatorial campaign. Other Sanford Health donors to Noem include surgeons, cardiologists, and a vice president of public affairs.   

“If the Governor is going to ask South Dakotans to be guinea pigs in a risky experiment, she needs to be upfront about what’s really motivating her, whether it’s scoring points with the President, money, or both,” Jeremy Funk, a spokesperson for the nonprofit Accountable.US, told Sludge.

At a 2018 fundraiser for Noem’s joint fundraising committee that featured President Trump, Sanford Health employees contributed $12,500. Sanford Health also donated $5,000 to Noem’s gubernatorial inaugural celebration in 2019. 

Sanford Health is a large employer in South Dakota, but its size alone does not explain its position as Noem’s top donor. Neither Noem’s successor in the House (Rep. Dusty Johnson) or predecessor (Stephanie Herseth Sandlin) count Sanford Health among their top career donors, and Noem received more money from Sanford Health in her eight years in Congress than Sen John Thune (R-S.D.) has received from the company since first running for a seat in Congress in 1995. 

Noem’s longtime campaign attorney, Matt McCauley, who worked with Noem from her first House campaign in 2010 through her 2018 gubernatorial run, has been a registered lobbyist for Sanford Health in South Dakota since at least 2016, the earliest year for which lobbyist information is available from the Secretary of State’s website. McCauley was hired by Noem in 2018 to lead her transition team, and while he continues to lobby for Sanford Health and other private entities, a law firm where he is managing partner has signed multiple contracts to provide legal services and legislative consulting with Noem’s office, according to South Dakota News Watch. 

Noem has ties to a conservative nonprofit called Job Creators Network that was one of the first organizations to promote hydroxychloroquine for treating coronavirus victims. The group, was founded by Trump megadonor Bernard Marcus and receives funding from the pharmaceutical industry’s top trade group, ran a multi-faceted campaign and petition in March calling on Trump to “cut the red tape” and immediately make hydroxychloroquine available to treat patients. 

Noem is a member of Job Creator Network’s Governor’s Committee, which, according to a December 2019 press release “will focus on fixing American healthcare in 2020 by pursuing JCN’s Healthcare for You reform framework.” The group’s hydroxychloroquine petition was hosted on its “Healthcare for You” website.

UPDATE: Sludge asked Noem’s office if the campaign contributions from Sanford Health employees impacted her decision and if she had discussed hydroxychloroquine with anyone affiliated with Job Creators Network. “The answer is ‘no’ to both questions,” a spokesperson said by email after this article was published.

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