Author: Zack Struver

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: https://energycommerce.house.gov/hearings-and-votes/hearings/us-public-health-response-zika-virus-continuing-challenges.

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The Louisiana Governor John Bel Edwards asked the U.S. Army to require Sanofi to charge a reasonable price for a taxpayer-funded Zika vaccine, in a letter dated May 10, 2017.

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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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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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April 3, 2017. Sanofi agreed to pay $19.9 million to resolve allegations under the False Claims Act that the company overcharged the U.S. Department of Veterans Affairs (VA) for drugs under two contracts between 2002 and 2011. According to the DOJ press release:

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21 MARCH 2017
PRESS ADVISORY
FOR IMMEDIATE RELEASE

CONTACT: Zack Struver, zack.struver@keionline.org, +1 (202) 332-2670 (office) / +1 (914) 582-1428 (cell)
Luis Villarroel, info@innovarte.cl, +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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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.

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