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Why Moderna won’t share rights to the COVID-19 vaccine with the government that paid for its development

Moderna claims its scientists alone invented the mRNA sequence used to produce its COVID-19 vaccine. The US government, which helped fund the drug, disagrees.

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2 years ago

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The U.S. government funded a significant portion of the R&D behind the Moderna vaccine. Peter Endig/picture alliance via Getty Images

A quiet monthslong legal fight between the U.S. National Institutes of Health and drugmaker Moderna over COVID-19 vaccine patents recently burst into public view. The outcome of the battle has important implications, not only for efforts to contain the pandemic but more broadly for drugs and vaccines that could be critical for future public health crises.

I teach drug regulation and patent law at Saint Louis University’s Center for Health Law Studies.

Moderna recently offered to share ownership of its main patent with the government to resolve the dispute. Whether or not this is enough to satisfy the government’s claims, I believe the dispute points to serious problems in the ways U.S. companies bring drugs and vaccines to market.

US was a major funder of the Moderna vaccine

Vaccines have played a crucial role in the response to the pandemic.

In December 2020, Moderna became the second pharmaceutical company after Pfizer to obtain authorization from the Food and Drug Administration to market a COVID-19 vaccine in the United States. People have since grown so used to talking about the “Moderna vaccine” that a crucial element in the history of how it was developed risks being overshadowed: Moderna was not the sole developer of the vaccine.

Unlike many of the other pharmaceutical companies involved in the COVID-19 vaccine race, Moderna is a newcomer to drug and vaccine commercialization. Founded in Massachusetts in 2010, the company had never brought a product to market until the FDA authorized its COVID-19 vaccine last year.

Throughout the 2010s, Moderna focused on the development of mRNA technology, attracting over US$2 billion in funding from pharmaceutical companies and other investors. It went public in 2018.

Even before the pandemic, research on both coronaviruses and vaccine candidates against emerging pathogens was a priority for agencies operating in the public health space. In 2015, the National Institute of Allergy and Infectious Diseases, an institute within the NIH, signed a cooperative R&D agreement with Moderna on basic research, including the development of new vaccines. The agreement resulted in an undisclosed amount of funding and assistance with research.

In addition, after the COVID-19 outbreak began Moderna also received almost $1 billion in funding from the Biomedical Advanced Research and Development Authority, which operates within the Department of Health and Human Services. This funding was specifically targeted to the development of a COVID-19 vaccine candidate.

Researchers have calculated that, collectively, the U.S. government has provided $2.5 billion toward the development and commercialization of Moderna’s COVID-19 vaccine.

US, Moderna scientists working side by side

In addition to providing financial support, the federal government was instrumental in the development of Moderna’s vaccine for other reasons. Namely, federal scientists worked alongside Moderna scientists on different components of the vaccine.

These contributions included working on dosing mechanisms, and the NIH said federal scientists created the stabilized spike proteins that are a key component of the vaccine made by Moderna.

The importance of the role played by federal scientists in their work with Moderna would soon become apparent. A 2019 agreement with a third party explicitly acknowledged this, alluding to mRNA vaccine candidates “developed and jointly owned by NIAID and Moderna.” And by late 2020, the U.S. government was calling it the “NIH-Moderna COVID-19 vaccine.”

While the U.S. government has spent money on COVID-19 vaccines made by other companies, its close involvement in the R&D stages of Moderna’s sets it apart.

How it became a patent dispute

As development of the vaccine progressed, Moderna applied for several patents, each one covering different components of the vaccine. U.S. law allows inventors to apply for patents on products or methods that are new, not obvious and useful. While some early modern vaccines – like the polio vaccine developed by Jonas Salk’s team – were not covered by patents, from the late 20th century onward it became very common for one or multiple patents to cover a newly developed vaccine.

In applying for some patents related to its vaccine, Moderna named National Institute of Allergy and Infectious Diseases scientists as co-inventors alongside Moderna scientists. This was the case, for example, in a patent application dated May 2020 for a relatively minor component of the vaccine.

However, in July 2021, Moderna made it clear that it would not name government scientists as co-inventors in a patent application covering a much more significant component of the vaccine: the mRNA sequence used to produce the vaccine, known as mRNA-1273.

Moderna’s position was that Moderna scientists alone had selected the sequence. The company informed the Patent and Trademark Office of its position in a 2020 statement.

In November 2021, government officials publicly challenged the company’s decision after months of failed negotiations with the company. Moderna then took to social media to defend its position, tweeting:

“Just because someone is an inventor on one patent application relating to our COVID-19 vaccine does not mean they are an inventor on every patent application relating to the vaccine.”

By contrast, the National Institutes of Health argued that three NIAID scientists – Kizzmekia Corbett, Barney Graham and John Mascola – had meaningfully contributed to the invention, though they’ve declined to publicly specify how. If true, patent law says they should be named co-inventors.

But this dispute is not merely about scientific principles or technical aspects of the law. While patents are also regarded as proxies for measuring scientific reputation, their most immediate and powerful effect is to give patent holders a significant amount of control over the covered technology – in this case, the main component of the vaccine made by Moderna.

From a practical perspective, excluding federal scientists from the application means that Moderna alone gets to decide how to use the vaccine, whether to license it and to whom. If, by contrast, the government co-owns the vaccine, federal patent law allows each of the joint owners to engage in a variety of actions – from making and selling the vaccine to licensing it – without the consent of the other owners.

This is especially relevant in cases of product scarcity or potential pricing issues in connection with the commercialization of the vaccine. For instance, the U.S. would have the ability to allow more manufacturers to produce vaccines using the mRNA-1273 technology. In addition, it could direct vaccine doses wherever it likes, including to lower-income countries that have received few vaccines so far.

Broader implications

A graphic shows how its mRNA technology works
Moderna explains its mRNA technology. Business Wire

The ongoing battle between the government and an emerging star in the pharmaceutical industry is yet another episode in a complicated relationship between actors with complementary yet distinct roles in the production of drugs and vaccines.

On the one hand, the federal government has long played a critical role in both performing and funding basic research. On the other, it does not have the resources and capacity to bring most types of new drugs and vaccines to market on its own.

The pharmaceutical industry thus plays an important and necessary role in drug innovation, which I believe should be rewarded – although not boundlessly.

If the NIH is correct about co-ownership of the vaccine, then Moderna is unduly using a legal tool to achieve a position of market control – a reward it does not deserve. This position of sole control becomes even more problematic in light of the significant amounts of public money that funded the development of this vaccine. This offset some of Moderna’s financial risk, even as the company projects to make $15 billion to $18 billion in revenue from vaccine sales in 2021 alone, with much more expected in 2022.

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However, even if the NIH prevails in the patent dispute, it is important to understand the limitations of such a “win.” The U.S. would be in a position to license the vaccine, for example, and could do so by requiring that licensees agree to equitable distribution of vaccine doses.

But co-ownership would not enable the government to fix any of the other problems that currently affect the manufacturing and distribution of COVID-19 vaccines, such as scaling up production or building infrastructure to deliver vaccine doses.

In my view, the dispute is a reminder of the many problems embedded in how vaccines are made and delivered in the U.S. And it shows that when taxpayers fund basic research of a drug, they deserve more of the control – and rewards – when that drug succeeds.

Ana Santos Rutschman does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

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Survey Shows Declining Concerns Among Americans About COVID-19

Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat"…

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4 hours ago

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March 11, 2024

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Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat" to the health of the US population - a sharp decline from a high of 67% in July 2020.

(SARMDY/Shutterstock)

What's more, the Pew Research Center survey conducted from Feb. 7 to Feb. 11 showed that just 10% of Americans are concerned that they will  catch the disease and require hospitalization.

"This data represents a low ebb of public concern about the virus that reached its height in the summer and fall of 2020, when as many as two-thirds of Americans viewed COVID-19 as a major threat to public health," reads the report, which was published March 7.

According to the survey, half of the participants understand the significance of researchers and healthcare providers in understanding and treating long COVID - however 27% of participants consider this issue less important, while 22% of Americans are unaware of long COVID.

What's more, while Democrats were far more worried than Republicans in the past, that gap has narrowed significantly.

"In the pandemic’s first year, Democrats were routinely about 40 points more likely than Republicans to view the coronavirus as a major threat to the health of the U.S. population. This gap has waned as overall levels of concern have fallen," reads the report.

More via the Epoch Times;

The survey found that three in ten Democrats under 50 have received an updated COVID-19 vaccine, compared with 66 percent of Democrats ages 65 and older.

Moreover, 66 percent of Democrats ages 65 and older have received the updated COVID-19 vaccine, while only 24 percent of Republicans ages 65 and older have done so.

“This 42-point partisan gap is much wider now than at other points since the start of the outbreak. For instance, in August 2021, 93 percent of older Democrats and 78 percent of older Republicans said they had received all the shots needed to be fully vaccinated (a 15-point gap),” it noted.

COVID-19 No Longer an Emergency

The U.S. Centers for Disease Control and Prevention (CDC) recently issued its updated recommendations for the virus, which no longer require people to stay home for five days after testing positive for COVID-19.

The updated guidance recommends that people who contracted a respiratory virus stay home, and they can resume normal activities when their symptoms improve overall and their fever subsides for 24 hours without medication.

“We still must use the commonsense solutions we know work to protect ourselves and others from serious illness from respiratory viruses, this includes vaccination, treatment, and staying home when we get sick,” CDC director Dr. Mandy Cohen said in a statement.

The CDC said that while the virus remains a threat, it is now less likely to cause severe illness because of widespread immunity and improved tools to prevent and treat the disease.

“Importantly, states and countries that have already adjusted recommended isolation times have not seen increased hospitalizations or deaths related to COVID-19,” it stated.

The federal government suspended its free at-home COVID-19 test program on March 8, according to a website set up by the government, following a decrease in COVID-19-related hospitalizations.

According to the CDC, hospitalization rates for COVID-19 and influenza diseases remain “elevated” but are decreasing in some parts of the United States.

Tyler Durden Sun, 03/10/2024 - 22:45

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Rand Paul Teases Senate GOP Leader Run – Musk Says “I Would Support”

Rand Paul Teases Senate GOP Leader Run – Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump…

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7 hours ago

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March 10, 2024

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Rand Paul Teases Senate GOP Leader Run - Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump into the race to become the next Senate GOP leader, and Elon Musk was quick to support the idea. Republicans must find a successor for periodically malfunctioning Mitch McConnell, who recently announced he'll step down in November, though intending to keep his Senate seat until his term ends in January 2027, when he'd be within weeks of turning 86. 

So far, the announced field consists of two quintessential establishment types: John Cornyn of Texas and John Thune of South Dakota. While John Barrasso's name had been thrown around as one of "The Three Johns" considered top contenders, the Wyoming senator on Tuesday said he'll instead seek the number two slot as party whip. 

Paul used X to tease his potential bid for the position which -- if the GOP takes back the upper chamber in November -- could graduate from Minority Leader to Majority Leader. He started by telling his 5.1 million followers he'd had lots of people asking him about his interest in running...

...then followed up with a poll in which he predictably annihilated Cornyn and Thune, taking a 96% share as of Friday night, with the other two below 2% each. 

Elon Musk was quick to back the idea of Paul as GOP leader, while daring Cornyn and Thune to follow Paul's lead by throwing their names out for consideration by the Twitter-verse X-verse. 

Paul has been a stalwart opponent of security-state mass surveillance, foreign interventionism -- to include shoveling billions of dollars into the proxy war in Ukraine -- and out-of-control spending in general. He demonstrated the latter passion on the Senate floor this week as he ridiculed the latest kick-the-can spending package:   

In February, Paul used Senate rules to force his colleagues into a grueling Super Bowl weekend of votes, as he worked to derail a $95 billion foreign aid bill. "I think we should stay here as long as it takes,” said Paul. “If it takes a week or a month, I’ll force them to stay here to discuss why they think the border of Ukraine is more important than the US border.”

Don't expect a Majority Leader Paul to ditch the filibuster -- he's been a hardy user of the legislative delay tactic. In 2013, he spoke for 13 hours to fight the nomination of John Brennan as CIA director. In 2015, he orated for 10-and-a-half-hours to oppose extension of the Patriot Act. 

Rand Paul amid his 10 1/2 hour filibuster in 2015

Among the general public, Paul is probably best known as Capitol Hill's chief tormentor of Dr. Anthony Fauci, who was director of the National Institute of Allergy and Infectious Disease during the Covid-19 pandemic. Paul says the evidence indicates the virus emerged from China's Wuhan Institute of Virology. He's accused Fauci and other members of the US government public health apparatus of evading questions about their funding of the Chinese lab's "gain of function" research, which takes natural viruses and morphs them into something more dangerous. Paul has pointedly said that Fauci committed perjury in congressional hearings and that he belongs in jail "without question."   

Musk is neither the only nor the first noteworthy figure to back Paul for party leader. Just hours after McConnell announced his upcoming step-down from leadership, independent 2024 presidential candidate Robert F. Kennedy, Jr voiced his support: 

In a testament to the extent to which the establishment recoils at the libertarian-minded Paul, mainstream media outlets -- which have been quick to report on other developments in the majority leader race -- pretended not to notice that Paul had signaled his interest in the job. More than 24 hours after Paul's test-the-waters tweet-fest began, not a single major outlet had brought it to the attention of their audience. 

That may be his strongest endorsement yet. 

Tyler Durden Sun, 03/10/2024 - 20:25

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The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While “Waiting” For Deporation, Asylum

The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several…

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9 hours ago

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March 10, 2024

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The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several months we've pointed out that there has  been zero job creation for native-born workers since the summer of 2018...

... and that since Joe Biden was sworn into office, most of the post-pandemic job gains the administration continuously brags about have gone foreign-born (read immigrants, mostly illegal ones) workers.

And while the left might find this data almost as verboten as FBI crime statistics - as it directly supports the so-called "great replacement theory" we're not supposed to discuss - it also coincides with record numbers of illegal crossings into the United States under Biden.

In short, the Biden administration opened the floodgates, 10 million illegal immigrants poured into the country, and most of the post-pandemic "jobs recovery" went to foreign-born workers, of which illegal immigrants represent the largest chunk.

Asylum seekers from Venezuela await work permits on June 28, 2023 (via the Chicago Tribune)

'But Tyler, illegal immigrants can't possibly work in the United States whilst awaiting their asylum hearings,' one might hear from the peanut gallery. On the contrary: ever since Biden reversed a key aspect of Trump's labor policies, all illegal immigrants - even those awaiting deportation proceedings - have been given carte blanche to work while awaiting said proceedings for up to five years...

... something which even Elon Musk was shocked to learn.

Which leads us to another question: recall that the primary concern for the Biden admin for much of 2022 and 2023 was soaring prices, i.e., relentless inflation in general, and rising wages in particular, which in turn prompted even Goldman to admit two years ago that the diabolical wage-price spiral had been unleashed in the US (diabolical, because nothing absent a major economic shock, read recession or depression, can short-circuit it once it is in place).

Well, there is one other thing that can break the wage-price spiral loop: a flood of ultra-cheap illegal immigrant workers. But don't take our word for it: here is Fed Chair Jerome Powell himself during his February 60 Minutes interview:

PELLEY: Why was immigration important?

POWELL: Because, you know, immigrants come in, and they tend to work at a rate that is at or above that for non-immigrants. Immigrants who come to the country tend to be in the workforce at a slightly higher level than native Americans do. But that's largely because of the age difference. They tend to skew younger.

PELLEY: Why is immigration so important to the economy?

POWELL: Well, first of all, immigration policy is not the Fed's job. The immigration policy of the United States is really important and really much under discussion right now, and that's none of our business. We don't set immigration policy. We don't comment on it.

I will say, over time, though, the U.S. economy has benefited from immigration. And, frankly, just in the last, year a big part of the story of the labor market coming back into better balance is immigration returning to levels that were more typical of the pre-pandemic era.

PELLEY: The country needed the workers.

POWELL: It did. And so, that's what's been happening.

Translation: Immigrants work hard, and Americans are lazy. But much more importantly, since illegal immigrants will work for any pay, and since Biden's Department of Homeland Security, via its Citizenship and Immigration Services Agency, has made it so illegal immigrants can work in the US perfectly legally for up to 5 years (if not more), one can argue that the flood of illegals through the southern border has been the primary reason why inflation - or rather mostly wage inflation, that all too critical component of the wage-price spiral  - has moderated in in the past year, when the US labor market suddenly found itself flooded with millions of perfectly eligible workers, who just also happen to be illegal immigrants and thus have zero wage bargaining options.

None of this is to suggest that the relentless flood of immigrants into the US is not also driven by voting and census concerns - something Elon Musk has been pounding the table on in recent weeks, and has gone so far to call it "the biggest corruption of American democracy in the 21st century", but in retrospect, one can also argue that the only modest success the Biden admin has had in the past year - namely bringing inflation down from a torrid 9% annual rate to "only" 3% - has also been due to the millions of illegals he's imported into the country.

We would be remiss if we didn't also note that this so often carries catastrophic short-term consequences for the social fabric of the country (the Laken Riley fiasco being only the latest example), not to mention the far more dire long-term consequences for the future of the US - chief among them the trillions of dollars in debt the US will need to incur to pay for all those new illegal immigrants Democrat voters and low-paid workers. This is on top of the labor revolution that will kick in once AI leads to mass layoffs among high-paying, white-collar jobs, after which all those newly laid off native-born workers hoping to trade down to lower paying (if available) jobs will discover that hardened criminals from Honduras or Guatemala have already taken them, all thanks to Joe Biden.

Tyler Durden Sun, 03/10/2024 - 19:15

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