Senators Demand NIH Disclose Patent Royalty Payments Made to Employee/Scientists & Leadership

Medical research becomes ever more relevant to the American public. Spurred on by COVID-19 accumulating spend in the American health system particularly involving pharmaceutical products, drives a growing momentum for transparency and clarity as to how and where taxpayer originated funds are going. Does the American taxpayer have a right to know the extent to which government doctors and scientists employed in agencies such as the National Institutes of Health (NIH) have a financial interest in the drugs and products they support? Is there a connection between the billions of dollars the NIH allocates in grants and royalty payments to specific agency-employed doctors and scientists? Finally, do American taxpayers deserve more transparency as to the distribution of hundreds of millions of dollars in royalty payments received by the NIH and whether its leadership, already some of the top paid in the federal bureaucracy, enjoy some hidden income benefit? Four U.S. Republican Senators apparently believe so, and consequently, recently requested patent royalty information from the National Institutes of Health (NIH). Specifically, Ron Johnson (R-WI), Rand Paul (R-KY), Rick Scott (R-FL) and Josh Hawley (R-MO), all members of the United States Senate Committee on Homeland Security and Governmental Affairs, wrote a letter to the NIH’s Acting Director Lawrence Tabak, pursuant to 5 U.S.C. section 2954, seeking a disclosure of royalty payments made by third-party providers to NIH employees and other details concerning royalty payments to NIH employees. The Republican Senators are clearly probing for any possible conflicts of interests given the billions of dollars of research grants allocated by the NIH ongoing and during the COVID-19 pandemic.

Federal employees, such as scientists that may also happen to be investors at the NIH, may be eligible for royalty payments based on section 401.10 of the Patent and Trademark Law Amendments (Bayh-Dole) Act. If a federal employee, say an immunologist employed at the NIH is listed as an “investor or co-inventor” on a product patent, this makes them potentially eligible for payment.

NIH’s involvement in the contribution of commercialized drugs is no trivial matter. In fact, according to the Senators’ letter to the NIH’s Acting Director, in a 2020 Government Accountability Office study “93 NIH patents contributed to 34 FDA-approved prescription drugs, generating roughly $2 billion in royalty payments to the agency [NIH] between 1991 and 2019.” The Senators declared in the letter that in 2004, “NIH scientists earned approximately $8.9 million in royalties for drugs and innovations they discovered while working for the government.”

No NIH Employee Royalty Disclosures Despite Policy

While a 2005 NIH policy promulgated a transparency requirement, necessitating the disclosure of such royalty payment information, no disclosures have ever occurred.

Importantly, a government transparency firm called Open the Books submitted a freedom of information act (FOIA) to identify this royalty information between 2009 and 2020. In response, the NIH disclosed only the names of employees receiving payments and the number of payments between 2009 and 2014. However, the NIH redacted critical information such as the following:

  • The amounts of individual payments

  • The innovation in question

  • The names of third-party payers

The Senators noted to the Acting Director that these FOIA redactions actually conflict with a 2005 statement by an NIH spokesman that an entity “would have to make a request via the Freedom of Information Act to find out royalty payments to individual researchers.”

Citing their authority based on their membership in the U.S. Senate Committee on Homeland Security and Governmental Affairs the Senators list the information they seek including:

  1. Itemized accounting of which employees have been paid and how much by third parties from January 1, 2009, to December 31, 2021.

  2. Accounting of payments from pharmaceutical companies to NIH employees between January 1, 2018, and March 1, 2022.

  3. Aggregate amount of money NIH and its employees have received between January 1, 2020, and March 1, 2022, in association with therapeutics, vaccines, testing, and the like.

  4. Declaration that per conflict of interest (18 USC section 208(a)), that all NIH employees that have received payments from pharmaceutical companies have either signed waivers or have proper exemptions.

  5. A full accounting for NIH royalty proceeds from January 1, 2009, and December 31, 2021.

The Senators conclude that they expect this request to be honored with acceptable response by June 17, 2022.

Call to Action: TrialSite will monitor this ongoing transparency probe. Follow the link to the letter.

https://www.trialsitenews.com/a/senators-demand-nih-disclose-patent-royalty-payments-made-to-employeescientists-leadership-bbc3d863