2017: KEI and MSF release comments on the proposed license of Zika vaccine candidates to PaxVax

(More on government funded inventions here. Other KEI comments on NIH licenses are found here.)

Background:

The National Institutes of Health has proposed giving an exclusive license for multiple Zika vaccine candidates to PaxVax, a company with close ties to the federal government.

The NIH-owned vaccine technologies are different from the Zika vaccine candidate the U.S. Army had proposed licensing to Sanofi. In the Sanofi/Army case, when BARDA withdrew funding for the late stage clinical trials, Sanofi withdrew from the license negotiations.

The MSF / KEI submission

In comments submitted today, Knowledge Ecology International (KEI) and Doctors Without Borders/Médecins Sans Frontières (MSF) provided a joint submission which opposes the use of an exclusive license to the patents on a National Institute of Allergy and Infectious Diseases (NIAID) vaccine.

The KEI and MSF joint letter also proposes that if the NIH insists on proceeding with an exclusive license to PaxVax, it include the following measures on pricing and transparency:

1. That PaxVax agree to market the publicly-funded vaccine in the United States at a price no higher than the median price charged in other countries with large GDPs and at least half of US per capita income, and
2. That PaxVax disclose the steps it will take to make the vaccine available at an affordable price in every country with a demonstrated need.

KEI and MSF are also requesting more information on what technology is included in this licensing agreement. We believe that two vaccines are being considered, one of which is already in phase 2 clinical trials. In our comments, we ask what funds have been invested by the federal government, and about plans for future funding prospects.

If approved, the vaccine will likely earn PaxVax a publicly-resourced priority review voucher worth $100 to $200 million, twelve years of exclusive rights to test data, seven years of exclusive rights under the Orphan Drug Act, tax credits under the Orphan Drug Tax Credit currently equal to 50 percent of the costs of conducting trials, and a period of years during which no other company can realistically register a biosimilar vaccine, regardless of the patent status. Given these benefits, and the fact that one of the vaccines is already in advanced stage clinical trials, an exclusive license does not appear to be legal, under the under the standards set out in 35 U.S.C. § 209.

KEI also provided a separate letter that raises concerns about the appearance of a conflict of interest. Cerberus Capital Management acquired a majority interest in PaxVax in late 2015. The co-founder and CEO of Cerberus is Steve Feinberg, who gave millions to the Trump Presidential Campaign. The founder and former CEO of PaxVax, Ken Kelley, has been working as a White House Presidential Executive Fellow since 2015, advising NIAID, and working on the government’s response to the Zika outbreak. The potential of a conflict of interest between interested parties in PaxVax and parties within the federal government calls for a higher level of transparency into the transfer of any publicly funded technology.

Kim Treanor