a nonprofit pharmaceutical service (is) not exempt as a charitable organization because it is operated for the substantial commercial purpose of providing pharmacy services to the general public.......although its services improve health, it is primarily a commercial venture

Recall that the Clinton Foundation is a charity exempt from tax in the US (501c3)

Every year the Clinton charity declares to the IRS that it has not engaged in any business, other than its tax exempt purpose.

Therefore every cent sent to it is treated as a donation, deductible from the taxable income of the sender.

What the Clinton Foundation does with money matters.

Here are two examples of things the Clinton Foundation did not and could not do:

Clinton Foundation Global Beer Initiative - where the grog bill is a tax deduction

- where the grog bill is a tax deduction Clinton Foundation Bordello Initiative - with high quality inputs, service quality certification and tax-deductible prostitution bills which appear as "Your Gift to the Clinton Foundation" on the credit card receipt.

There are grey areas not as likely to excite newspaper editors and headline writers.

Buying and distributing pharmaceuticals is one such area.

To avoid doubt, the US IRS lists what a 501c3 charity like the Clinton Foundation can and cannot do.

Clinton could get into the pharma business to his heart's content.

What he can't do, is lie about gifts and donations and pretend his commercial business is a charity.

Part 7. Rulings and Agreements Chapter 25. Exempt Organizations Determinations Manual Section 3. Religious, Charitable, Educational, Etc., Organizations 7.25.3 Religious, Charitable, Educational, Etc., Organizations 7.25.3.1 Overview

7.25.3.2 Organizational Test

7.25.3.3 Organizational Test Requirements

7.25.3.4 Operational Test

7.25.3.5 Charitable Organizations— Definition The Dual Test: Organized and Operated IRC 501(c)(3) requires an organization to be both "organized" and "operated" exclusively for one or more IRC 501(c)(3) purposes. If the organization fails either the organizational test or the operational test, it is not exempt. Reg. 1.501(c)(3)–1(a)(1). The organizational test concerns the organization’s articles of organization or comparable governing document. The operational test concerns the organization’s activities. A deficiency in an organization’s governing document cannot be cured by the organization’s actual operations. Likewise, an organization whose activities are not within the statute will not qualify for exemption by virtue of a well written charter. Reg. 1.501(c)(3)–1(b)(1)(iv).

In Federation Pharmacy Services, Inc. v. Commissioner , 625 F.2d 804 (8th Cir. 1980), aff’g 72 T.C. 687 (1979), the appellate court held that a nonprofit pharmaceutical service was not exempt as a charitable organization because it was operated for the substantial commercial purpose of providing pharmacy services to the general public. Although it provided special discount rates for handicapped and senior citizens in its area, it was not committed to providing any drugs below cost or free to indigent persons. Therefore, although its services did improve health in the area, it was primarily a commercial venture operated in competition with other area pharmacies.

ENDS

On 3 November 2006 the Clinton Foundation HIV/Aids Initiative Inc IRS 990 return for the year ending 31 DEC 2005 was received and stamped by the IRS.

It declared that on 7 June 2005 it received a "Gift" of $1,847,653.00 from COPRESIDA of the Dominican Republic.

That return reports that it EXPENSED $3.3M in pharmaceutical purchases. That's a lot of pills, written off immediately and ready to ship by the pallet load.

The line describing expenses incurred in the care of partners $4.7M is fascinating. $4.7M is a lot of lavish care expense, even by US Presidential Standards.

Here is a link to the Dominican Government's document setting out its purchasing agreement with the Clinton Foundation.

Here is an extract:

In this context, the FWJC acquires medicines and supplies in the international market, applying economy scale, which have not only met the required quality standards, but also their prices have been competitive Its website is www.copresida.gob.do While I'd expect prosecutors in the United States will ensure a more accurate translation in the documents it will present when its prosecutes this matter, here is the Google translation of that document. The Presidential Council on AIDS (COPRESIDA) is a governmental entity affiliated to the Presidency of the Republic, created by Decree No. 32-01 of January 8, 2001

The supply of antiretroviral drugs and opportunistic infections and

related conditions, people living with HIV (PLHIV) in the Republic

Dominican, was made ​​from 2004 until 2009, through the Foundation

William J. Clinton (FWJC) as purchasing agent, non-profit, through

operations and framed in legal instruments underwritten mechanisms

successively.

The inter - relationship of the Dominican Government, represented by COPRESIDA

and SESPAS, with FWJC, began in the month of May in the year two thousand and four (2004),

by signing a cooperation agreement, taking into account, as the

revised documentation,

the need to purchase drugs cited

above, at competitive prices and quality, for the benefit of PLHIV; Y

what

"National initiative [of FWJC] is a comprehensive program that integrates

prevention, care and treatment with the goal of contributing to the control of HIV / AIDS and

mitigate its impact on people living with HIV / AIDS in the Republic

Dominican "

, As established in the document entitled

"National Initiative

Strengthening the National Program for People Living with HIV / AIDS

Dominican Republic 2004-2009 "

, Dated April 26, 2004, developed by the

Dominican Republic in collaboration with the Clinton HIV / AIDS Initiative (CHAI).

For the signing of that agreement took into consideration the reputed

expertise

with

which tells the FWJC internationally, as was supporting countries via

developmental,

"In their efforts to implement comprehensive programs

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4

prevention, treatment and care of AIDS "

. In this context, the FWJC acquires

medicines and supplies in the international market, applying economy

scale, which have not only met the required quality standards, but

also their prices have been competitive; not to mention that for the country,

intermediation FWJC as Purchasing Agent against suppliers

international, has never represented no additional cost, other than the

concerning the acquisition itself, which is in the interests of PLHIV.

To use the FWJC as Purchasing Agent, delegated by the Government

Dominican COPRESIDA conducted proper analysis of the benefits

these operations accounted for the Dominican Republic and met the

formalities necessary against the Global Fund to Fight AIDS,

Tuberculosis and Malaria and the International Bank for Reconstruction and Development (Bank

World); agencies, donor provider first and the second, of resources

which they were made ​​such purchases; covered, respectively, in the

Grant Agreement signed by the COPRESIDA with the Global Fund to Fight

AIDS, Tuberculosis and Malaria, on 14 May 2004 to finance

Program the National Response to HIV / AIDS; and in the Loan Agreement

signed by the Government of the Dominican Republic with the World Bank, through the