“The Trump administration gave Big Pharma billions but refused to disclose full terms of these deals.”
Dozens of congressional Democrats and Sen. Bernie Sanders on Monday urged top Biden officials to release unredacted copies of multi-billion-dollar coronavirus vaccine contracts that the Trump administration negotiated in secret with major pharmaceutical companies last year—and refused to divulge to lawmakers.
In a letter (pdf) to Health and Human Services Secretary Xavier Becerra and Defense Secretary Lloyd Austin, 50 lawmakers from the House and Senate argue that public knowledge of the specific terms of the vaccine contracts “has become all the more important as manufacturers talk of boosters and seasonal immunizations, while considering ‘post-pandemic’ price increases.”
“Taxpayers are serving as the angel investors in Covid-19 vaccine and therapeutic development, assuming the costs and risk,” the letter reads. “It is imperative that they also receive a stake in the outcome as well as complete transparency on how billions of tax dollars have been spent and what terms were agreed to and may still be renegotiated.”
As NPR reported in September, the Trump administration worked to dodge the “regulatory oversight and transparency of traditional federal contracting mechanisms” by issuing massive vaccine contracts to Pfizer, Johnson & Johnson, and other major drugmakers “through a nongovernment intermediary.”
“Instead of entering into contracts directly with vaccine makers, more than $6 billion in Operation Warp Speed funding has been routed through a defense contract management firm called Advanced Technologies International, Inc.,” NPR noted. “ATI then awarded contracts to companies working on Covid-19 vaccines.”
Further fueling concerns over the Trump administration’s handling of the contracting process was a whistleblower complaint filed last May by Dr. Rick Bright, the former head of the Biomedical Advanced Research and Development Authority (BARDA), which awarded huge contracts for vaccines and therapeutics to Johnson & Johnson and other pharma giants.
Bright—who said his removal last April was retaliation for his criticism of the White House’s pandemic response—alleged in the complaint that he faced pressure from higher-ups at Trump’s HHS to “ignore expert recommendations and instead to award lucrative contracts based on political connections and cronyism.”
“We don’t know the rewards or the incentives that the companies are getting, which might drive some companies to take additional risk or maybe do things inappropriately,” Bright said in an October interview. “There’s no reason to hide what’s in those agreements at all. For the government to set these contracts up in this way and block that type of transparency leads me to think that there’s something interesting in there they don’t want discovered.”
In their letter on Monday, the lawmakers demanded that the Biden administration disclose unredacted copies of all contracts, research and development agreements, and any other “arrangements entered into by the United States or any subcontractor, including Advanced Technologies International, Inc. (ATI), related to Covid-19 vaccines, therapeutics, and any other medical countermeasures.”
To substantiate their fears of impending price hikes on vaccines and coronavirus therapeutics, the lawmakers point to a Pfizer executive’s recent comment predicting “a significant opportunity for our vaccine… from a pricing perspective” should Covid-19 become endemic—as many experts anticipate.
“Despite taxpayers fully underwriting Moderna’s vaccine, significantly paying for Johnson & Johnson’s research, and conducting some of the underlying research that contributed to Pfizer vaccines, all three companies are apparently planning to raise prices as quickly as possible,” the lawmakers write. “In our exercise of congressional oversight, we seek access to these agreements to understand what protections are in place for taxpayer investments and what terms may need to be renegotiated.”
Rep. Lloyd Doggett (D-Texas.), chair of the Ways and Means Health Subcommittee and leader of the new letter, said in a statement that “while pleased with vaccine advances, taxpayers who financed development deserve full disclosure of the same type of information a private investor would demand.”
“In so many ways, the vaccines are our shot—our shot to contain the virus and our shot, developed and manufactured with at least $19 billion taxpayer dollars and over $2 billion more for therapeutics,” said Doggett. “Taxpayers should know how their funds were spent and what secret deals were reached.”
Read the full letter:
Dear Secretary Becerra and Secretary Austin,
The Trump administration remained nonresponsive to congressional requests to review the unredacted contracts negotiated for Covid-19 vaccines and therapeutics. When limited contract information has been belatedly released, key provisions concerning pricing terms, required deliverables and timelines, termination clauses, and patent right information has been redacted. We write to request that you release unredacted copies of all agreements regarding all of these and any other medical countermeasures entered into by the United States, or its subcontractors. Taxpayers are serving as the angel investors in Covid-19 vaccine and therapeutic development, assuming the costs and risk. It is imperative that they also receive a stake in the outcome as well as complete transparency on how billions of tax dollars have been spent and what terms were agreed to and may still be renegotiated. This information has become all the more important as manufacturers talk of boosters and seasonal immunizations, while considering “post-pandemic” price increases.
On March 11th, Pfizer Chief Financial Officer Frank D’Amelio noted at the Barclays Global Healthcare Conference that Pfizer sees “a significant opportunity…from a pricing perspective” to increase prices should COVID-19 become endemic, as many scientists predict. Similarly, Moderna President Stephen Hoge told the same conference “Post-pandemic, as we get into those what I will call seasonal epidemics that you would expect to happen with a SARS-CoV-2 virus, we would expect more normal pricing based on value.” Johnson & Johnson Executive Vice President Joseph Wolk told the Raymond James Institutional Investors Conference they expect “pricing that’s much more in line with a commercial opportunity.”
Despite taxpayers fully underwriting Moderna’s vaccine, significantly paying for Johnson & Johnson’s research, and conducting some of the underlying research that contributed to Pfizer vaccines, all three companies are apparently planning to raise prices as quickly as possible. In our exercise of congressional oversight, we seek access to these agreements to understand what protections are in place for taxpayer investments and what terms may need to be renegotiated.
During a September 16th press briefing, retired Lt. Gen. Paul Ostrowski, former Director of Supply, Production, and Distribution for Operation Warp Speed, asserted these secret contracts “entail information that allows us to all know that we paid a fair and reasonable price for each one of these vaccines as we went forward.” To assure this commitment is being met, we respectfully request that you provide the following information:
- Unredacted copies of all contracts, cooperative research and development agreements, grants, funding agreements, procurement agreements, manufacturing agreements, licensing arrangements, other transactions, and any other arrangements entered into by the United States or any subcontractor, including Advanced Technologies International, Inc. (ATI), related to Covid-19 vaccines, therapeutics, and any other medical countermeasures.
- Patents and patent applications for a Covid-19 vaccine, therapeutic, or other medical countermeasure with U.S. government coinventors, or on which there is disclosure of U.S. government interest. Please include the numbers and expiration dates of such patents and the numbers and filing dates of such patent applications.
- Any guidance, memos, email communications, written communications, transcripts, or other documentation regarding how federal investments shall be taken into consideration in making pricing determinations in funding and procurement agreements.
- The estimated cost to produce a dose of each Covid-19 vaccine and therapeutic candidate receiving federal research, development, or manufacturing support, and itemized breakdowns of the amounts of funding each manufacturer has asserted they have invested in the research, development, and manufacturing. Please include any steps you have taken, or plan to take, to verify the amounts each company has asserted they invested.
- Any compensation, including royalty fees, each Covid-19 vaccine and therapeutic candidate is receiving from the U.S. government for the licensing and production of their product.
- Any compensation subcontractors of the United States, including ATI, are receiving for administrative and management work related to Covid-19 vaccine and therapeutic development, manufacturing, and distribution. Please include any bonuses or other compensation any subcontractors may receive upon FDA emergency use authorization or approval of a Covid-19 vaccine, therapeutic, or other medical countermeasure as well as any royalty or licensing fees, or other monetary or non-monetary stake in any of these products.
In the event that you believe that any contractual provision restricts your ability to publicly disclose any of the information requested, please identify the specific applicable language. Further, for any information that you may contend is not subject to public disclosure, please provide it under appropriate seal for our Congressional oversight review.
We appreciate your immediate attention to these important questions to provide full transparency on how taxpayer dollars have been spent.