Pharma millionaire Fred Eshelman graduated from the University of North Carolina School of Pharmacy in 1972. These days, the school is one of the top-rated graduate pharmacy programs in the country, ranked second in the nation by U.S. News and World Report in 2013. The school isn't just known for its academics, but for its role in shaping the pharmacy industry. The school has produced more than 100 patents and 19 spin-off companies including Meryx, which develops cancer treatments.
UNC also helped produce Eshelman, a successful entrepreneur, who recently gave $100 million to UNC School of Pharmacy, which has been named the Eshelman School of Pharmacy since 2008. That's the kind of mammoth gift that every school dreams about, but it hasn't drawn all that much attention, and is interesting to explore on several levels. This is a story not just about how a donor got deeply drawn into his alma mater; but also about a donor coming to the aid of an underdog, upping past commitments, and embracing a vision for how a university can drive regional growth.
Eshelman originally became interested in pharmacology and medicine while watching pharmacists mix drugs while he was in high school. After graduating from UNC, he went on to receive a doctorate from University of Cincinnati. He worked in various managerial roles at pharmaceutical companies before going out on his own in 1985. The company he founded eventually became known as Pharmaceutical Product Development (PPD), based in North Carolina, where Eshelman served as CEO and later executive chairman. In 2011, Eshelman sold PPD for $3.9 billion and personally made about $160 million after taxes. According Forbes, Eshelman is worth at least $380 million.
Eshelman is a long-time funder of UNC. Over the years, he's given $38 million to the school, including $3 million to support the school’s drug-discovery center and $20 million for assorted scholarships, fellowships, faculty development in teaching and research, and residency programs. There are currently five Eshelman Distinguished Professors at the UNC Eshelman School of Pharmacy.
In other words, the new $100 million gift has precedent, serving as yet another reminder that long-time donors often ramp up their giving, particularly if they see that their money is being well spent. You might distill this lesson in the following maxim, which should be on a poster in every campus office: If you want to find a donor who can give big, ask a donor who's already given big.
Of course, as we say, that assumes the donor is a happy camper, and clearly Eshelman was. In part, that may be because he's been actively involved in UNC's direction, serving on the UNC Board of Governors. Interestingly, Eshelman resigned from the board in July, a year early, just prior to shelling out $100 million to UNC.
Normally, one wouldn't expect the biggest individual gift ever given to UNC or to a pharmacy school for that matter, to come on the heels of a board resignation. In this case, the story also serves as another important lesson. As it turns out, UNC is one of many public universities across the country that has been hit by state budget cuts. The UNC board proposed a five-year plan to bolster funds for research and development and the state couldn't provide. Eshelman stepped down, and then stepped in.
In his words: “This is a tough environment for additional state funding, and therefore if we are going to increase the pace to attain our goals, the private sector must make the investment like never before." In just a few words, Eshelman defines the growing importance of private philanthropy in an era of declining government. But he also underlines a theme we often stress in our coverage of higher ed funders: Alums know that public universities have been hit hard by cuts, and many are worried about this trend. Tapping into that concern can be a very powerful cultivation strategy. Or to put it another way: Underdogs can often make stronger appeals to alumni donors than top dogs.
The $100 million gift will be used to create the Eshelman Institute for Innovation and provide faculty with new resources to engage in timely research and education. It's worth noting that Eshelman himself has bankrolled some of the startups that have sprung not just from UNC, but also at University of Virginia and Emory.
According to North Carolina Governor Pat McCory, the hopes are that the state will become the "third vertex" of the "nation's innovation triangle." From policy to tech, donors have been increasingly seeing universities as engines to transform entire cities and regions.
Remember, Eshelman made his millions in this region, so it makes sense that he'd be invested in its fate. And therein lies another key lesson that we often stress here at IP: It's not unusual to find major donors who are serious civic champions for their community or region, and who see universities as important agents of economic growth. Indeed, these people know firsthand the way schools can play that role because of their own life stories—of graduating and then sticking around in a region to create businesses and jobs.