[Ip-health] KEI response to Sanofi letter to Senators who asked Army for hearing on Zika vaccine license

Kim Treanor kim.treanor at keionline.org
Mon Jul 17 14:47:03 PDT 2017


KEI response to Sanofi letter to Senators who asked Army for hearing on
Zika vaccine license
James Love and Andrew Goldman on 17 July 2017

July 17, 2017

The Honorable Richard J. Durbin
711 Hart Senate Office Building
Washington D.C. 20510

The Honorable Bernard Sanders
332 Dirksen Senate Office Building
Washington DC 20510

The Honorable Edward J. Markey
225 Dirksen Senate Office Building
Washington DC 20510

The Honorable Sherrod Brown
713 Hart Senate Office Building
Washington D.C. 20510

The Honorable Richard Blumenthal
706 Hart Senate Office Building
Washington D.C. 20510

The Honorable Angus King, Jr.
113 Hart Senate Office Building
Washington D.C. 20510

Dear Senators:
We write to you regarding the letter of July 12, 2017 sent to you by Gavin
Zealy, Senior Director of Business Development for Sanofi Pasteur, on the
proposed exclusive license of a federally-funded Zika vaccine to the

1 http://www.news.sanofi.us/press-statements?item=984

Mr. Zealy’s letter makes a nuanced objection to recent reports that Sanofi
rejected the Army’s request for fair pricing considerations in the license
of the Zika vaccine, albeit in a way that seems designed to mislead the

Zealy writes, “...Sanofi Pasteur did not reject a specific fair-pricing
term​ proposed by WRAIR as part of the licensing negotiations” (emphasis
added). At the same time, the letter does acknowledge that price was
discussed “in general.”

It is our understanding that the Army raised the issue of having language
in the license wherein Sanofi would ensure that the price in the United
States was fair and reasonable, but that Sanofi was opposed to having any
language in the license on the pricing.

Sanofi’s letter illustrates the lack of clarity and indeed candor as
regards the effort by Sanofi to obtain the greatest freedom to charge
whatever the market will bear in the United States for a federally-funded
vaccine. A public hearing can clear up much confusion as regards the actual
efforts (or lack thereof) by the Army to protect the public from high
prices for the Zika vaccine,and can also address two other questions.
First, is there a sufficiently compelling policy need and legal basis to
give Sanofi a legal monopoly on the vaccine until 2036, under the
restrictions on exclusive licenses found in 35 U.S.C § 209? Second, what is
the willingness of Sanofi to make commitments on the vaccine pricing before
the license is signed?

We also note the recent directive from the Senate Armed Services Committee,
which calls upon the Department of Defense to ensure that U.S. residents do
not pay more for DoD-funded drugs or vaccines than the median price of the
seven largest economies with a per capita income of at least half that of
the United States.

115th Congress, 1st Session, 2017, Senate Report 115–125. National Defense
Authorization Act for Fiscal Year 2018. Report to accompany S. 1519, page

Licensing of federally owned medical inventions
The committee directs the Department of Defense (DOD) to exercise its
rights under
sections 209(d)(1) or 203 of title 35, United States Code, to authorize
third parties to use inventions that benefited from DOD funding whenever
the price of a drug, vaccine, or
other medical technology is higher in the United States than the median
price charged in
the seven largest economies that have a per capita income at least half the
per capita
income of the United States.

It should also be mentioned that there is no reason to rush the decision,
and we do not
understand why the Army feels it must act now. BARDA has already funded a
Phase 2 trial for the vaccine, with an option to fund a Phase 3 trial if
needed. These trials will take time, and positive outcomes may yield better
leverage for licensing.

We encourage the Senators to insist that the Army hold a public hearing on
this proposed
license, so that Sanofi and others can present evidence regarding the need
for an exclusive license, and explore the commitments Sanofi will or should
make on pricing issues, before any license is executed, and not after when
there will be more limited recourse.

James Love
Knowledge Ecology International
james.love at keionline.org

Andrew S. Goldman, Esq.
Counsel, Policy and Legal Affairs
Knowledge Ecology International
andrew.goldman at keionline.org

Cc: Barry Datlof
Director Medical Technology Transfer Medical Research and Materiel Command
504 Scott Street MCMR-JA
Fort Detrick, MD 21702


Kim Treanor
Knowledge Ecology International
kim.treanor at keionline.org
tel.: +1.202.332.2670

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