House Democrats Demand Fair Drug Pricing For Taxpayer-Funded Coronavirus Vaccine or Treatment

February 20, 2020
Press Release

EVANSTON, IL –  Today, Congresswoman Jan Schakowsky, a Senior Chief Deputy Whip and Chair of the Energy and Commerce Consumer Protection and Commerce Subcommittee, led 45 of her colleagues in sending a letter to President Donald J. Trump to raise serious concerns about awarding exclusive licenses for the production of a potential coronavirus vaccine or treatment and allowing drug manufactures to monopolize drugs that have been funded by millions of taxpayer dollars. 

In the letter, Representatives Schakowsky, Lloyd Doggett, Ro Khanna, Max Rose, Mark Pocan, Peter A. DeFazio, André Carson, Ayanna Pressley, Andy Levin, Alan Lowenthal, Jerrold Nadler, Raúl M. Grijalva, Carolyn B. Maloney, Sheila Jackson Lee, Pramila Jayapal, Grace Meng, Susan Wild, Tim Ryan, Steve Cohen, James P. McGovern, Bennie G. Thompson, Peter Welch, Thomas R. Suozzi, Darren Soto, Nanette Diaz Barragán, Marcy Kaptur, Judy Chu, Barbara Lee, Raja Krishnamoorthi, Danny Davis, Lucille Roybal-Allard, Mark Takano, Mark DeSaulnier, Emanuel Cleaver II, John B. Larson, Rashida Tlaib, Gregory W. Meeks, Debbie Dingell, Rick Larsen, Henry Cuellar, Julia Brownley, Tulsi Gabbard, Brenda L. Lawrence, William R. Keating, Nydia Velázquez, and Charlie Crist implored that the price of a potential coronavirus vaccine or treatment must not threaten public health by deterring access to these vital therapies.

“We write to ask you to ensure that any vaccine or treatment developed with U.S. taxpayer dollars be accessible, available, and affordable. That goal cannot be met if pharmaceutical corporations are given authority to set prices and determine distribution, putting profit-making interests ahead of public health priorities. Americans deserve to know that they will benefit from the fruits of their public investments. Specifically, we urge the Department of Health and Human Services (HHS) not to provide an exclusive license to any private manufacturer for a coronavirus vaccine or treatment in any government grants, contracts, or licensing arrangements,” the Members of Congress wrote.

The letter goes on to outline concerns with issuing an exclusive license using taxpayer dollars: “Providing exclusive monopoly rights could result in an expensive medicine that is inaccessible, wasting public resources and putting public health at risk in the United States and around the globe. If HHS or any other federal agency moves forward with such a proposal, we urge you to instead issue a limited license and implement requirements that a vaccine or treatment be made available at an affordable price. You should also allow HHS to intervene if a manufacturer prices a COVID-19 vaccine or treatment at an excessive level. Such action is particularly critical for vaccines, which are most effective when the vast majority of the public is immunized; you must use every tool of the federal government to ensure a coronavirus vaccine is affordable and accessible.”

This is the third time in the last 20 years that a coronavirus has made the leap from animals to humans—severe acute respiratory syndrome (SARS) coronavirus in 2002, Middle East respiratory syndrome (MERS) coronavirus in 2012, and now the 2019 novel coronavirus. Though Big Pharma hasn’t invested in coronavirus vaccines or treatments, the American taxpayer has. A Public Citizen report released today reveals that the National Institutes of Health has already spent nearly $700 million dollars on coronavirus research and development.

The letter continues: “We are concerned that your Administration has already indicated its willingness to invest heavily in public-private partnerships without any conditions in place to guarantee affordable drug pricing and access.” Over the past two weeks, the U.S. Biomedical Advanced Research and Development Authority (BARDA) has announced new agreements with Johnson & Johnson and Sanofi Pasteur to develop vaccines for the coronavirus. However, the Trump Administration has offered no indication that they will impose guidelines to ensure that these companies cannot monopolize the drugs and price them out of reach.  

The letter closes by asking President Trump not to break his promise to lower drug prices for the American people: “You have repeatedly called for action to lower drug prices and know that unjustifiably high drug prices are one of the most pressing public health concerns we face today. We should not grant any manufacturer a blank check to monopolize a coronavirus vaccine or treatment developed with public, taxpayer support. Without aggressive action to protect public health, we are fearful that Americans and people in lower- and middle-income countries will not be adequately protected against current and future coronavirus outbreaks.”

A signed copy of the letter is available HERE and complete text of the letter is below:

 

February 20, 2020

The President

The White House

1600 Pennsylvania Avenue, Northwest

Washington D.C. 20500

 

Dear Mr. President:

 

As the world works to confront the coronavirus disease 2019 (COVID-19) health threat, we are proud that the United States is a leader in developing a new vaccine and new treatments to protect patients. We write to ask you to ensure that any vaccine or treatment developed with U.S. taxpayer dollars be accessible, available, and affordable. That goal cannot be met if pharmaceutical corporations are given authority to set prices and determine distribution, putting profit-making interests ahead of public health priorities. Americans deserve to know that they will benefit from the fruits of their public investments.

 

Specifically, we urge the Department of Health and Human Services (HHS) not to provide an exclusive license to any private manufacturer for a coronavirus vaccine or treatment in any government grants, contracts, or licensing arrangements. Providing exclusive monopoly rights could result in an expensive medicine that is inaccessible, wasting public resources and putting public health at risk in the United States and around the globe. If HHS or any other federal agency moves forward with such a proposal, we urge you to instead issue a limited license and implement requirements that a vaccine or treatment be made available at an affordable price. You should also allow HHS to intervene if a manufacturer prices a COVID-19 vaccine or treatment at an excessive level. Such action is particularly critical for vaccines, which are most effective when the vast majority of the public is immunized; you must use every tool of the federal government to ensure a coronavirus vaccine is affordable and accessible.

 

Last month, Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases (NIAID) indicated that a vaccine to prevent COVID-19 could begin initial clinical trials within three months. This rapid development is only possible because of public, taxpayer funding of NIH research on coronaviruses.[1] An investigative report released today revealed that while pharmaceutical companies have devoted startlingly little resources to research and development relating to coronaviruses, NIH has spent nearly $700 million on coronavirus research and development. While much of this funding focused on early-stage research, all six active coronavirus clinical trials that began prior to the COVID-19 outbreak received public and taxpayer support.[2]

 

We are concerned that your Administration has already indicated its willingness to invest heavily in public-private partnerships without any conditions in place to guarantee affordable drug pricing and access. On February 4, 2020, the HHS Biomedical Advanced Research and Development Authority (BARDA) announced a partnership with Regeneron—a biotechnology company with the two highest paid executives in the entire pharmaceutical industry—to develop an experimental treatment for COVID-19.[3] Under the terms of the agreement, BARDA will pay for 80 percent of research, development, manufacturing costs for promising treatments.[4] BARDA has also already paid up to $8.9 million to Regeneron to support the development of a Middle East respiratory syndrome (MERS) coronavirus treatment, including packaging and labeling costs; Investigational New Drug Application costs, and clinical trial costs.[5] Although the U.S. government has utilized taxpayer resources to subsidize a large portion of Regeneron’s work on coronavirus treatments in recent years, there must be guardrails in place to prevent Regeneron from monopolizing the medicine and maximizing profits.

 

You have repeatedly called for action to lower drug prices and know that unjustifiably high drug prices are one of the most pressing public health concerns we face today. We should not grant any manufacturer a blank check to monopolize a coronavirus vaccine or treatment developed with public, taxpayer support. Without aggressive action to protect public health, we are fearful that Americans and people in lower- and middle-income countries will not be adequately protected against current and future coronavirus outbreaks.

 

We look forward to your response and to working with your Administration to ensure that the price of a coronavirus vaccine or treatment does not threaten public health by deterring access to these vital therapies both at home and abroad.

 

 

CC:      The Honorable Alex M. Azar II, Secretary of Health and Human Services

The Honorable Dr. Francis Collins, Director of the National Institutes of Health

The Honorable Dr. Robert Kadlec, Assistant Secretary for Preparedness and Response

Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases

Dr. Rick Bright, Director of the Biomedical Advanced Research and Development Authority

 

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[1]Bloomberg Law, “Coronavirus Vaccine Candidate Eyed for Human Trials by April (1),” January 22, 2020, https://news.bloomberglaw.com/health-law-and-business/coronavirus-vaccine-candidate-eyed-for-human-trials-by-april.

[2]Public Citizen, “Blind Spot: How the COVID-19 Outbreak Shows the Limits of Pharma’s Monopoly Model,” February 20, 2020, https://www.citizen.org/article/blind-spot/.

[3]U.S. Department of Health and Human Services, “HHS, Regeneron Collaborate to Develop 2019-nCoV Treatment,” February 4, 2020, https://www.hhs.gov/about/news/2020/02/04/hhs-regeneron-collaborate-to-develop-2019-ncov-treatment.html.

Institute for New Economic Thinking, “Financialization of the U.S. Pharmaceutical industry,” https://www.ineteconomics.org/uploads/papers/Lazonick_financialization.pdf.

[4]Regeneron, “Regeneron Announces Expanded Collaboration with HHS to Develop Antibody Treatments for New Coronavirus,” February 4, 2020, https://newsroom.regeneron.com/index.php/news-releases/news-release-details/regeneron-announces-expanded-collaboration-hhs-develop-antibody; “Regeneron Announces New Collaborations with HHS to Develop Antibodies Against Ebola, Influenza and Multiple Other Emerging Pathogens,” October 2, 2017, https://investor.regeneron.com/news-releases/news-release-details/regeneron-announces-new-collaborations-hhs-develop-antibodies.

[5]Regeneron, “Regeneron Announces Agreement with BARDA for the Manufacturing and Testing of New Antibodies Against MERS Virus,” August 22, 2016, https://newsroom.regeneron.com/news-releases/news-release-details/regeneron-announces-agreement-barda-manufacturing-and-testing?ReleaseID=985099.