Cancer Center at crossroads

A cancer research center is an investment that can yield powerfully valuable dividends over time. A robust institution can attract the personnel and grants to underwrite research and produce clinical trials of new treatments — therapies to which Hawaii patients, isolated by geography, would have ready access.

But developing a world-class cancer center is also a long-term project. It would appear Hawaii jumped into the deep end of this particular pool too quickly and without the ability to swim. State leadership, including the Legislature, will have to come to the rescue in the coming months.

Only four years ago, the University of Hawaii Cancer Center launched a business plan that served as the foundation for constructing the state-of-the-art facility in Kakaako Makai that it now occupies. That plan was based on projections for a revenue stream that proved far rosier than the reality.

As the recent tumult at the center has made clear, the result is an institution in danger of losing its hard-won federal designation unless it turns around its fiscal fortunes at an uncommonly rapid pace. That designation from the National Cancer institute is the credential that provides access to research grants, a critical part of the revenue picture.

The center has high operational costs, as well as an $8 million annual mortgage payment for the $100 million facility that UH can’t afford. This is largely because a principal source of revenue, a share of the state’s cigarette tax funds, is insufficient. The projected allocation for 2015 is about $11 million — far short of the roughly $20 million a year forecast by the 2010 business plan. Grants also have been coming in below expectations.

With the departure of its embattled director, Dr. Michele Carbone, the center is now headed on an interim basis by Jerris Hedges, dean of the medical school. That may prove useful, because better efficiency and sharing of costs between the center and the adjacent school is a necessary part of any future budgetary adjustment.

A new business plan with a more sustainable source of revenue is in the works. State Sen. Josh Green, chairman of the Senate Health Committee, said he would introduce legislation to broaden the tobacco tax revenues to include sales of all tobacco, including loose and roll-your-own products. That would bring in more money, but many additional steps will be needed. Among the possibilities that should be explored:

» Draw funds from the state’s tobacco master settlement agreement.

Hawaii is one of more than 40 states that receives payments in perpetuity from an endowment, and the cancer center could get a piece of the pie.

» Consider a tax on e-cigarettes to raise additional funds.

Electronic cigarettes produce a vapor that lacks the cancer-causing agents in tobacco smoke. But because the vapor contains nicotine, critics have said it can entice users to get their fix from tobacco products as well.

» Confer with the private hospitals that are part of a consortium conducting the clinical trials.

The trials produce revenue, a share of which comes to the center, but they’ve been falling off in number. Finding a way to turn this around should be a priority. The consortium was formed to compensate for the fact that UH lacks its own hospital to conduct the trials. The coordination required of such a system must be challenging, but that is the system we have.

There is another solution that’s less than optimal, but it needs to be considered, too: selling the Cancer Center. There are many private cancer centers that do quite well without taxpayer help, but this could diminish the broad access to a range of treatments in development.

Lawmakers and UH officials should work hard to avoid this outcome, but the fact that it’s going to be a heavy lift must be faced. If Hawaii wants this center, leaders first need a clear-eyed assessment of what it will take.