This report was written by David Sirota, Walker Bragman, and Andrew Perez.
Several of President Joe Biden’s most powerful appointees and advisers have had business relationships with pharmaceutical giants lobbying the administration on COVID-19 and intellectual property issues, according to documents reviewed by The Daily Poster.
Those ties — and Biden’s longtime alliance with pharmaceutical industry interests — could prove particularly relevant as drug companies now try to defang any new waiver of patent rules that might reduce their profits and facilitate the wider distribution of vaccines to COVID-afflicted countries.
Last summer, Biden broke with his own legislative record and pledged to support relaxing those intellectual property rules to distribute a COVID-19 vaccine, saying it “is the only humane thing in the world to do.” With the pandemic creating a full-fledged humanitarian crisis in India this spring, Biden’s administration on Wednesday issued a statement reiterating that general promise.
“This is a global health crisis, and the extraordinary circumstances of the COVID-19 pandemic call for extraordinary measures,” said United States Trade Representative Katherine Tai in a press release. “The administration believes strongly in intellectual property protections, but in service of ending this pandemic, supports the waiver of those protections for COVID-19 vaccines.”
The declaration was widely hailed by public interest groups, who feared the administration would follow past precedent and oppose any emergency action on patents.
However, Tai’s statement was narrow: It only mentioned COVID vaccines and avoided endorsing an existing, broad waiver proposed by India and South Africa which would cover “diagnostic kits, vaccines, medicines, personal protective equipment and ventilators.” Her statement also preemptively warned that the “negotiations will take time given the consensus-based nature of the institution and the complexity of the issues involved” — a process that could provide drugmakers an opening to try to limit a final waiver.
“This is a magnificent development,” said Global Trade Watch’s Lori Wallach of the Biden administration’s general support for a waiver. “For it to translate into ending the COVID pandemic as quickly as possible, a final waiver text must include the full set of intellectual property barriers and must cover vaccines, treatments and diagnostic tests to defeat the COVID-19 pandemic.”
Pharmaceutical stocks dipped after Tai’s announcement, and the industry is already criticizing the Biden administration’s support for relaxing intellectual property rules. However, the decision from the Biden administration to not immediately support the existing WTO waiver proposal may ultimately prove to be an important win for drug companies. Public health advocates are already warning that drug companies will likely intensify their efforts to narrow any new measure.
"(Biden’s waiver) is on vaccines, but it’s not on diagnostics or therapeutics or other things in the pandemic,” said James Love, director of the D.C.-based nonprofit Knowledge Ecology International, which focuses on intellectual property issues as they pertain to health care and access to knowledge. He added that Tai’s assertion that the negotiations will take time is “not a good thing right now.”
Pharma Ties To The White House
The granular details of the waiver will be negotiated by a Biden administration populated by individuals with significant pharmaceutical investments and whose previous employers worked for a panoply of pharmaceutical giants. That includes drugmakers currently lobbying the White House on intellectual property.
Among them are:
• Antony Blinken: Before he was appointed secretary of state, Blinken helped form a corporate consulting firm, called WestExec Advisors. His client list included pharmaceutical giant Gilead Sciences, which manufactures remdesivir, the only drug approved by the U.S. Food and Drug Administration to treat COVID. Several U.S. government agencies “conducted or funded much of the preclinical and clinical development of remdesivir,” according to a report from Knowledge Ecology International.
Between January and March, Gilead reported lobbying Congress and Blinken’s State Department on "international trade and protection of intellectual property; compulsory licensing and other IP issues in multiple countries.”
Gilead recently made headlines announcing it would give India 450,000 vials of remdesivir and help ramp up production of its antiviral drug in the pandemic-ravaged country. On Tuesday, Gilead sued the Russian government after it allowed a domestic company to manufacture remdesivir.
• Linda Thomas-Greenfield: Biden’s ambassador to the United Nations previously worked for the consulting firm Albright Stonebridge Group, which has represented Pfizer.
• Jennifer O’Malley Dillon: Biden’s deputy chief of staff was a founding partner of consulting firm Precision Strategies, which has worked for both Gilead and Pfizer. O’Malley Dillon’s former colleague at the firm, Stephanie Cutter, is an adviser to a new nonprofit, Building Back Together, created to support Biden’s agenda. The organization listed its business address as Precision Strategies’ office in D.C. corporate records.
• Anita Dunn: Dunn’s job as a senior advisor in the Biden White House is only temporary, which means she doesn’t have to file a public financial disclosure. But her firm, SKDK, has also worked for Pfizer.
• Steve Ricchetti: Currently serving as a counselor to Biden, Ricchetti used to be a lobbyist for pharmaceutical companies like Novartis as well as Eli Lilly, and Sanofi. Those companies are top manufacturers of insulin, which is significantly more expensive in the U.S. than in many other countries.
Steve’s brother, Jeff Ricchetti, runs a lobbying firm, Ricchetti Inc., which has seen a boom in business since Biden won the presidency. His current clients include pharmaceutical firm Vaxart, which is working on a tablet-based COVID-19 vaccine.
Biden is also reportedly considering attorney Ellisen Turner for director of the U.S. Patent and Trademark Office. Turner, a partner at law firm Kirkland & Ellis, counts Gilead among his past clients. Turner has worked on behalf of pharmaceutical companies to prevent the development of generic drugs.
Outside the administration, Biden’s former legislative affairs director Sudafi Henry recently started lobbying for medical device company Abbott Laboratories on COVID issues, according to federal disclosures. Abbott has significant business in India and produces coronavirus tests, and could thus have an interest in whether any international trade waiver includes diagnostic tests in addition to vaccines.
On Thursday, Politico reported that Kwabena Nsiah, who served as chief of staff to former congressman and current White House senior adviser Cedric Richmond, was joining Henry's firm.
Biden’s History Of Helping Drug Companies
Biden’s decision to stock his administration with pharmaceutical industry allies tracks with his own previous record. Hailing from Delaware, the home state of the U.S. headquarters of pharmaceutical giant AstraZeneca, he has periodically aligned himself with drugmakers on patent issues.
Throughout his career, Biden has supported trade legislation strengthening pharmaceutical patent rules. That includes voting for the 1994 Uruguay Round Agreements Act, which backed the original WTO negotiating round that created the restrictive system of patents known as the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement in the first place. Pfizer and other pharmaceutical companies pushed hard for TRIPS, and the new agreement required member countries to enact national laws providing a minimum standard of intellectual property protection. Predictably, after its establishment, drug prices soared.
In 2000, Biden was one of eight Democratic senators to vote with Republicans against reinstating the government’s ability to compel reasonable pricing for pharmaceutical products developed with federal assistance after the National Institutes of Health, under pressure from industry, surrendered its ability to do so five years earlier.
Years later as vice president, Biden once again acquiesced to the pharmaceutical industry. In 2011, India’s Patents Office granted a compulsory license to patents for Sorafenib, a cancer drug marketed as Nexavar by German pharmaceutical giant Bayer. The license allowed Indian manufacturers to produce generic versions for the country’s market at a greatly reduced price. The Indian government was planning to do the same for dozens of expensive cancer drugs.
Bayer took the matter to court and the pharmaceutical industry appealed to the Obama administration. In response, Vice President Biden visited the country and successfully pressured the Indian government not to grant any further licenses.
Three years after his success in blocking affordable generic cancer drugs in India, Biden wrote a letter to Colombian President Juan Manuel Santos Calderón expressing the administration’s concerns about his country’s efforts to produce affordable generic cancer drugs.
As vice president, Biden was also a major proponent of the controversial Trans-Pacific Partnership trade agreement, which would have strengthened patent exclusivity and included protections against bulk purchasing by governments.
As the Sunlight Foundation noted at the time: “At the behest of the pharmaceutical industry, the U.S. is also pushing to limit the ability of national regulatory agencies to support generic drug development.” Speaking at the Export-Import Bank’s 2013 Annual Conference, Biden called the TPP “the most ambitious trade agreement underway in the world” and said it would be the “metric” by which future trade agreements were measured.
Considering his past efforts, pharmaceutical interests were likely optimistic about Biden’s support once he was elected president. Pfizer, which has manufactured one of the most widely-used COVID vaccines in the U.S., donated $1 million to Biden’s inaugural committee.
In 2019, the Associated Press reported that drugmakers Johnson & Johnson, Amgen, GlaxoSmithKline and Bristol Myers Squibb were "among a host of corporate partners and other groups that work on cancer-related projects promoted by" the Biden Cancer Initiative, a nonprofit Biden started after his time as vice president.
Big Pharma Has Already Previewed Its Campaign Against A Waiver
In the lead up to the Biden administration’s waiver announcement this week, drugmakers manufacturing vaccines and other COVID-related products had already been gearing up for battle. In the first quarter of 2021 alone, the pharmaceutical industry spent $92 million on federal lobbying efforts, much of it focused on fortifying intellectual property rules.
They were recently boosted by a letter from Sen. Thom Tillis, R-N.C., to the Biden administration arguing that the waiver requested by India and South Africa “would allow for the creation of entire industries in these countries that will compete with American companies in the development of cutting-edge health care technologies.”
Judging from the posture of its major Washington lobbying organizations, the pharmaceutical industry is united against any coronavirus vaccine waiver. Even companies that do not produce COVID vaccines likely fear that any waiver could set a precedent for weakening patents on other life-saving medicines.
“This change in longstanding American policy will not save lives,” wrote Pharmaceutical Research and Manufacturers of America (PhRMA), one of the biggest lobbying groups in D.C., with $459 million in revenue in 2019. “It also flies in the face of President Biden’s stated policy of building up American infrastructure and creating jobs by handing over American innovations to countries looking to undermine our leadership in biomedical discovery.”
Biotechnology Innovation Organization (BIO), a lobbying group that represents COVID vaccine makers Moderna, Pfizer and Johnson & Johnson, wrote a letter threatening that the Biden administration’s waiver ”decision will act as a disincentive to companies to respond to the next pandemic.”
The pharmaceutical industry argues that companies are being generous by developing extremely lucrative medicines.
“It is not true that the U.S. government underwrites our manufacturing efforts,” said Pfizer CEO Albert Bourla during an earnings call last month. “The orders that we had received from the U.S. government were only going to be delivered — and the U.S. government was only going to pay us — if the vaccine was successful, if the vaccine was successful in receiving regulatory approval, and if the vaccine was successful to the manufactured. The risk all was with us.”
In truth, however, most of the leading COVID vaccines being distributed around the world, including those from Pfizer, Moderna, and Johnson & Johnson, rely on technology developed by government scientists at the NIH.
The companies also benefited from the Trump administration’s Operation Warp Speed program. Moderna and Johnson & Johnson received federal assistance for research and development, while the government promised to purchase nearly $2 billion worth of Pfizer doses should they prove effective.
These considerations, as well as the Biden White House’s longstanding ties to the pharmaceutical industry, could all come into play as the administration hammers out the details of the vaccine waiver it has pledged to support.
“I think the most important thing is this (announcement) sort of shifts the conversation from, like, ‘We can't do anything; the companies’ got it under control; let's listen to Bill Gates’ — all that sort of stuff was kind of out the window,” said Love of Knowledge Ecology International. “Now it's a little bit like, ‘We have to do something, let's talk about what needs to be done, not what we can't do.’”
Photo credit: Eric Kayne/AP