Health
company recruits governor for board of directors
June 13, 2006
BY BRIAN BASHN
ARKANSAS
DEMOCRAT-GAZETTE
Fred Nazem, the investor behind several multibillion-dol-lar health-care
companies, has tapped Gov. Mike Huckabee to serve on the board of directors for
his latest project — a
physician referral service. The company,
Flagship Patient Advocates, will go public later this month.
Flagship Patient Advocates connects subscribing patients to
top doctors in more than 150 specialties. For $750 a year, a member can receive
health-care advice from high-profile
medical professionals in the United
States and abroad, Nazem said.
The company had $7,000 in revenue and $3 million in losses for the
quarter ending March 31. But Nazem —
who helped create the Oxford Health Plan and a forerunner to the Tenet Healthcare Corp. hospital chain — says
he has
"tens of millions of dollars" in deals that will be rolled out over
the next year.
Huckabee, who joined the board in September, won't benefit much
immediately from the company's growth. He receives no pay for his seat on the
board, but instead was granted 25,000 shares in Finity Holding Inc., a related
company trading over-the-counter at just over one cent.
Following a shareholder vote later this month, shares in Finity Holding will convert in a "reverse
stock split" into shares of Flagship Patient Advocates, at a rate of 125 to 1. That would leave Huckabee with 200 shares, which could
increase in value if investors buy into Nazem's plan.
After that, Huckabee and other board members will likely
receive additional shares in exchange for their expertise, Na-
zem said.
Huckabee's involvement
with Flagship Patient Advocates grew out
of the release of his 2005 book, Quit Digging Your Grave With a Knife and
Fork, as well as lectures on health policy he gave last year, said Alice Stewart, a spokesman for the governor,
a story that Nazem confirmed.
"I read his book, and a friend of a friend says he knew
him," Nazem said. "I like ... what he stands for."
A sitting governor who is
also a member of the board of a publicly
traded company might raise eyebrows — if it
weren't so close to
the end of Huckabee's term, said Jay Barth, a professor of politics at Hendrix
College and a member of the Democratic Party's State Committee.
"It's not unusual at all for former elected officials to [join
corporate boards]," Barth said.
"It would not be happening if he had
longer left in his term."
Graham Sloan, head of the
Arkansas Ethics Commission, said Huckabee's board seat shouldn't pose a
problem as long as his business associates aren't given any special treatment
"I don't think it's that uncommon,"
he said. "A lot of members of the General Assembly sit on the
boards of corporations or bank boards."
Nazem said he had an easy
answer for potential ethical issues.
"I told the governor
we'd never do any deal with the state of Arkansas," he said.
\ Flagship Patient Advocates has its eye on more far-flung territory — namely China and India.
"We're hoping to become one of
the health-care companies of choice for the
2008 Olympics" in Beijing, Nazem said.
