Rep. Jan Schakowsky Questions Dr. Anthony Fauci on Zika Vaccine Price at House Energy and Commerce Subcommittee Hearing

On May 23, 2017, Rep. Jan Schakowsky, D-Ill., asked Dr. Anthony Fauci whether he believed the federal government should use “every tool” to ensure that Sanofi charges a fair price for a taxpayer-funded Zika vaccine that is being developed by the U.S. Army and funded by BARDA.

Dr. Fauci responded that he did not believe that the government had the “mechanisms” to guarantee an affordable price, even when the U.S. government and taxpayers have made a “major investment” in the development of a drug.

KEI has separately uploaded a short clip of the exchange between Rep. Schakowsky and Dr. Fauci:

Additional information on the Army-BARDA-Sanofi vaccine collaboration is available at /zika and /zika-timeline.

Video of the full hearing and copies of written testimony are available via the House Energy and Commerce Committee website:

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U.S. Army/Sanofi Zika Vaccine Collaboration Timeline and Update

Today I published a timeline on the collaboration between Sanofi and the U.S. Army regarding the development of a vaccine for the Zika virus.

One major issue that we have raised is on the price of the Zika Vaccine. KEI and other groups have asked the Army to ensure that Sanofi does not charge U.S. taxpayers a higher price than in other high-income countries. This is not a remote concern. Recently, we published a blog showing that Sanofi charges Americans four to eight times more for its MS drug Aubagio (teriflunomide) compared to other high-income countries. If Sanofi refuses to agree to a reasonable pricing provision, then we know that Sanofi wants to keep open the option of charging the United States the highest price in the world for a drug funded by American taxpayers.

The timeline provides the dates of several key events, such as the filing of patent applications, the dates of the Army/Sanofi CRADA and grants from BARDA, the signing of the Principles of Collaboration with the Oswaldo Cruz Foundation (Fiocruz), the publication of Federal Register notices on the intent of the Army to grant exclusive licenses on patents, responses by patient and public interest groups, the New York Times op-ed by Sen. Bernie Sanders and the response by Dr. Elias Zerhouni on behalf of Sanofi, and the letter from members of the House of Representatives.
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How Sanofi Prices Its MS Drug Aubagio (Teriflunomide) in the U.S. and Five Reference Countries

The U.S. Army recently rejected requests by public interest groups, Senator Bernie Sanders, and almost a dozen House Democrats to refuse to grant Sanofi an exclusive license on patents on a Zika virus vaccine, or, alternatively, to ensure that the license included terms assuring that U.S. taxpayers would not pay a higher price than other high-income countries. Specifically, KEI proposed the following terms to be included in the contract:

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KEI Statement on House Letter to President Trump on the Protection of Taxpayers’ Rights in Federally-Funded Inventions

4 APRIL 2017
CONTACT: Zack Struver, or +1 (202) 332-2670

In a letter sent today, Representative Lloyd Doggett, D-Texas, and 50 other democratic members of Congress requested that President Donald J. Trump issue guidance for the use of Bayh-Dole Act march-in rights in order to protect taxpayer’s rights in federally-funded patented inventions.

The following statement should be attributed to James Love, Director of Knowledge Ecology International (KEI):

“The letter from members of Congress on the need to protect taxpayer’s rights in the inventions they fund is important, timely, and directly related to the challenge of providing affordable health care to everyone. Federally-funded inventions are now routinely placed on the market at extremely high prices. Astellas charges more than $350 per day for the prostate cancer drug Xtandi, and BioGen is charging $1.125 million for the first two years of Spinraza, which is used to treat spinal muscular atrophy in mostly young children. The notion that the federal government will not engage on the pricing of these products runs counter to the explicit provisions in the Bayh-Dole Act that require inventions be made ‘available to the public on reasonable terms.’ The President can curb high prices for these drugs without new legislation, and without putting patients at risk.”

KEI filed the most recent march-in request with the federal government on the prostate cancer drug Xtandi.

The letter is available as a PDF here and below in plain text.

Representative Doggett’s office issued the following press release:

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Patients, Members of Congress Ask Chilean Government to Issue Compulsory Licenses on Prostate Cancer and HCV Drug Patents

21 MARCH 2017

CONTACT: Zack Struver,, +1 (202) 332-2670 (office) / +1 (914) 582-1428 (cell)
Luis Villarroel,, +56 9 9827 9673

Santiago, Chile — Members of the Chilean Congress and a group of 6 patients visited the Chilean Ministry of Health yesterday to ask that the government use its authority under Chilean law to end patent monopolies on the prostate cancer drug enzalutamide (U.S. brand name Xtandi) and on sofosbuvir-based combination drugs for the treatment of hepatitis C virus (HCV).

The patients and members submitted a petition that outlined the legal authority and public policy rationale for the grant of compulsory licenses on the patents for the drugs described in the petition. Those compulsory licenses would allow prescription drug manufacturers to produce affordable generic versions of the drugs, subject to a reasonable royalty.
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KEI Testifies in Maryland on Drug R&D Cost Transparency Bill (HB666/SB437)

James Love and Andrew Goldman represented KEI on March 16, 2017, in a working group meeting of a subcommittee of the Maryland General Assembly House of Delegates Health & Government Operations Committee, where they testified on HB666/SB437, a bill that would establish transparency of R&D costs for prescription drugs sold in Maryland.

Vincent DeMarco of at Health Care for All! and Dr. Reshma Ramachandran of the Johns Hopkins Bloomberg School of Public Health also testified at the hearing.
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HHS Office of Inspector General Declines to Investigate Failure to Disclose Federal Funding in Ionis Pharmaceuticals’ Spinraza

The Department of Health and Human Services Office of Inspector General (OIG) informed KEI that it would not move forward with an investigation into whether Isis Pharmaceuticals, now known as Ionis Pharmaceuticals, failed to report federal funding in patents on Spinraza.

In a letter dated March 13, 2017, Matthew Charette, the Special Agent in Charge of the Investigations Branch of OIG, explained that OIG counsel believes that OIG has limited authority, and that the obligation to “monitor[] invention reporting and remedy[] noncompliance” “rests with NIH’s Office of Policy for Extramural Research Administration (OPERA).”

On January 18, 2017, KEI submitted a 22-page letter to OIG containing evidence that the patents on Spinraza benefited from federal grants. KEI did not just ask OIG to investigate Isis’ alleged failure to report this funding, in violation of the Bayh-Dole Act and federal regulations, but also urged the OIG “to investigate whether the National Institutes of Health failed to conduct proper oversight in administering its grants” and to “recommend appropriate action to remedy the situation in line with the statute and prior decisions with regard to failure to disclose a subject invention.”
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2017 R&D Cost Transparency Proposals in the United States

On March 9, 2017, KEI was scheduled to testify before the Maryland House Committee on Health on HB 666, a bill that would require an annual report on R&D costs from drug companies that sell high-priced medicines in the state of Maryland.

In advance of the hearing, I prepared a note that summarizes provisions in both transparency and pharmaceutical price gouging legislation that would require the disclosure of the costs associated with research and development. This note is a less detailed version of this 2016 summary.

This year, so far, legislators in 13 states have introduced 21 bills that would require some degree of transparency.

map of states with transparency bills
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