KEI request that HHS take ownership of US Patent 7,964,580 on sofosbuvir, now held by Gilead, for non-disclosure of NIH grants

In the attached letter dated March 14, 2018 to Secretary of the Department of Health and Human Services (DHHS) Alex Azar, KEI is asking for an investigation into a failure to report NIH funding on US patent 7,964,580. This is the first patent in the FDA Orange Book for all Gilead sofosbuvir based drugs for HCV.

The letter from KEI focuses on a series of NIH grants from July 2003 to July 2007, to Pharmasset. The principle investigator for these grants was Jinfa Du, one of the three inventors listed on the patent, all of whom were employees of Pharmasset.

Three of the grants, 1R01DK066922-01, 5R01DK066922-02 and 5R01DK066922-03, had the same title, “2′-AND/OR 4′-C-MODIFIED NUCLEOSIDES AS ANTI-HCV AGENTS.” The abstract for these grants included this text:

    In this grant proposal, we plan to design and synthesize a total of one hundred and ninety novel 2′-C- and/or 4′-C-modified nucleosides, as well as 3′-deoxynucleosides as potential anti-HCV agents. We will determine the anti-HCV activity of a series of newly designed compounds in vitro. In addition, in preparation for in vivo proof of principle studies, adequate safety and favorable pharmacokinetic (PK) profiles of candidate compounds will be determined in relevant animal models. Furthermore, potent HCV polymerase inhibitors will be used to select for drug-resistant viral mutants, and therefore, selection of HCV replicons with the proper mutations will be a relevant part of this proposal. [emphasis added]

A review of the patent shows, without difficulty, that the invention is based upon the work funded by the NIH in these three grants.

KEI asks DHHS to investigate the non-disclosure, and also to undertake measures to remedy the failures to disclose. Specifically, KEI ask DHHS to take title to the patent, an action that is possible under the provisions of the Bayh-Dole Act and the contractual requirements of the Pharmasset grant.

The letter concludes with these comments on the proposed remedy for non-disclosure.

    The patent in question may be worth billions of dollars. In addition to whatever liability for royalties Gilead could be responsible for stemming from its use of a government owned patented invention (if the government takes possession), there would be opportunities to use the Bayh-Dole royalty-free right to exercise considerable leverage over the prices of all SOF-based HCV treatments.
    In considering the remedies, KEI notes that there have been several recent requests to use 28 USC § 1498 to obtain access to affordable generic versions of SOF-based HCV treatments for veterans, 5 for state-run HCV programs, 6 and more generally to extend treatment to more persons who are infected with HCV. 7 In the past, and as you know from your involvement in the 2001 ciprofloxacin case, 8 government agencies have been reluctant to use § 1498 for cases involving pharmaceutical drugs, out of concerns over the compensation required. However, when the government uses its royalty-free rights in connection with a § 1498 non-voluntary use of a patented invention, the risks of excessive compensation can be significantly reduced. Even if a § 1498 remedy is ultimately not used, the possibility of such an action will be considered more likely if the public has rights in this patent, and hence, a government agency will have more leverage to negotiate a better price — one that can expand treatment to all persons who are infected, as opposed to only those with the most serious immediate health consequences.
    Indeed, taking action to remedy the non-disclosure of the patent creates all sorts of opportunities to advance the public’s interests. For example, the federal government could condition Gilead’s right to continue using the patent upon the provision of at-cost HCV medicines for veterans receiving care from the Department of Veterans Affairs, and thus remedy the situation where the high cost of sofosbuvir-based treatments has depleted the Department resources budgeted for health care for veterans.

[Footnotes in the letter omitted]


James Love

James Love is the Director of Knowledge Ecology International. Previously, he was an economist for the Center for Study of Responsive Law where he also directed the Consumer Project on Technology and the Taxpayer Assets Project, Senior Economist for the Frank Russell Corporation, and held lecturer positions at Rutgers and Princeton Universities. His KEI webpage is