As researchers around the world race to find a vaccine for COVID-19, we speak with Peter Maybarduk, director of Public Citizen’s Access to Medicines Program, about who is profiting from government efforts to fund vaccines, testing and treatment. The Trump administration has announced major contracts with pharmaceutical companies as part of its $6 billion program, Operation Warp Speed, including with firms that have never brought a vaccine to market. Meanwhile, a New York Times investigation shows corporate insiders from at least 11 companies working on coronavirus research have sold shares worth more than $1 billion since March. “The problem is that the companies, the executives, the hedge funds are feeding on people’s hope and desperation, and it only takes a little bit of positive news to send stocks soaring,” says Maybarduk. Public Citizen recently released a database that tracks the billions of taxpayer dollars supporting COVID-19 research.
This is a rush transcript. Copy may not be in its final form.
AMY GOODMAN: This is Democracy Now! The Quarantine Report. I’m Amy Goodman, with Juan González.
Operation Warp Speed. That’s the name of the government program pumping billions into vaccine development and research. But who’s profiting? We look now at the nearly $6 billion the U.S. government has invested into coronavirus vaccines, testing and treatment.
The Trump administration has poured taxpayer money into more than six vaccine efforts, recently announcing a nearly $2 billion contract with Pfizer and a German company for 100 million vaccine doses by December. Earlier this month, the Trump administration gave $1.6 billion to a small company, Novavax, which has never brought a vaccine to market in its more than 30-year history.
This comes as The New York Times reports corporate insiders are profiting off the rush to make a vaccine. The Times reports, quote, “Insiders from at least 11 companies — most of them smaller firms whose fortunes often hinge on the success or failure of a single drug — have sold shares worth well over $1 billion since March.”
For more, we’re joined by Peter Maybarduk. He is the director of Public Citizen’s Access to Medicines Program, which has released a database that tracks the billions of taxpayer dollars supporting COVID tests, treatments and vaccines.
Welcome to Democracy Now!, Peter. It’s great to have you with us. So, lay out who’s getting this money. I mean, people want a vaccine, that’s for sure. Billions and billions of U.S. taxpayer dollars is going into where? How do these companies prove that there’s a possibility, a path to success?
PETER MAYBARDUK: Well, we don’t know how they’re proving their path to success, because there is a striking lack of transparency in the selection process. But BARDA, the Biomedical Advanced Research and Development Agency, as you’ve said, is giving hundreds of millions of dollars to each of a number of pharmaceutical corporations to advance vaccine development and also manufacturing. In many cases, these are vaccine candidates that are already built on taxpayer-funded science. In some cases, the National Institutes of Health actually owns or claims patents on some of the key technology. So, the public has been investing in these technologies for a very long time, but today we see executives and hedge funds making tremendous paydays just by announcing snippets of positive news, even though their candidates may turn out not to be successful.
JUAN GONZÁLEZ: And I wanted to ask you, because this is not just happening, obviously, in the United States. In the European Union, in China, in India, and we’ve seen recently in Brazil, huge sums are being invested in what is essentially the California gold rush for the pharmaceutical industry. Untold wealth awaits those who are able to produce these initial vaccines, and yet there is so little, as you mentioned, transparency as to who is getting this and how the decisions are being made.
PETER MAYBARDUK: Yeah, we don’t have the contracts. So, some heavily redacted contracts from BARDA were obtained by a consumer group called Knowledge Ecology International last month, but they’re so heavily redacted that it’s still hard to tell whether any significant conditions are being attached to the hundreds of millions of dollars that taxpayers are giving out.
Indeed, we want to be investing in vaccine research and development, but it’s important that there are conditions attached, regarding, for example, affordability and reasonable pricing, regarding plans to get to scale and supply and to transfer technology so that we can teach the world how to make this vaccine and avoid severe rationing in years ahead.
So there’s much more to know, but what is clear right now is that stock options are increasing five- and sixfold for the executives in these firms, even as they exaggerate their role in Operation Warp Speed.
AMY GOODMAN: Can you talk, Peter, about the company Novavax? BARDA — that’s, again, the Biomedical Advanced Research and Development Authority — was — the single-largest award from BARDA, $1.6 billion to Novavax, the little-known Maryland firm that had not developed a successful vaccine in 30 years. What do you know about it? Why do they get $1.6 billion?
PETER MAYBARDUK: We don’t know, is the short answer. And we don’t know too much more about Novavax than what you’ve said. So, it’s the largest grant, and it just indicates how little transparency there is in this process and how much we need to know. Unfortunately, it’s — we do know that Novavax’s stock options for executives jumped from $20 million to $100 million with their close association with Warp Speed, so there’s that. But in terms of the science, in terms of how it’s progressing, we know very little.
JUAN GONZÁLEZ: And this whole issue of the executives being able to cash in, even before a drug particularly comes to — is proven effective, or vaccine is proven effective and comes to market, is there any way to restrain this kind of activity, especially in an international emergency like this?
PETER MAYBARDUK: Well, we certainly should be attaching conditions, as regard reasonable pricing. We certainly should be demanding a great deal more transparency in the disclosures that are made. Trump’s vaccine czar actually comes from GlaxoSmithKline, and we had petitioned that he at least have to disclose his financial conflicts of interest, were turned down by the HHS inspector general. So I think the public needs to demand quite a bit more here.
But, really, what we’re primarily concerned about are the conditions of affordability and supply that come out of this, because no corporation manufactures at scale to supply the entire world. So, a year or two years from now, we could be encountering a serious, essentially, global vaccine apartheid, where much of the world’s population does not have access to vaccines. And that’s because there’s a tremendous reticence among our leaders to order corporations to transfer their technology to impose any conditions whatsoever on top of these grants, despite the fact that all the leading candidates that are being considered for Operation Warp Speed, one way or another, are benefiting not just from the BARDA grants, but from early-stage research by federal scientists, taxpayer-funded studies, that led to the development of the technology that’s being used to develop the vaccines today. So, we have already invested in these vaccines, and we should have the right to attach certain conditions and make sure everybody can access a safe and effective vaccine when it’s developed.
AMY GOODMAN: Peter, let’s talk about how investors are benefiting from the billions of dollars going to these drug companies. For example, The New York Times reports, after Vaxart, a small San Francisco-based company, was selected to be part of a federal program to develop a vaccine, stock options for insiders at the company soared. A hedge fund that partly controls the company immediately gained something like $200 million of profits.
PETER MAYBARDUK: Yeah, that’s right. So, as you’ve said, the problem is that the companies, the executives, the hedge funds are feeding on people’s hope and desperation, and it takes only a little bit of positive news to send stocks soaring, or, conversely, a little bit of negative news to send them plummeting right now.
And so, Vaxart, for example, noted in a press release that it had been selected by Operation Warp Speed. Now, “selected” just meant, in this case, a clinical trial involving primates. Vaxart is neither receiving BARDA funding nor negotiations to receive that funding. But just that bit of news, just that claim of a connection to the federal government, led Vaxart’s stocks to soar, as you said, allowed the hedge fund to make $200 million and walk away.
So, that’s the sort of climate that we’re in. And we obviously — you know, we need a little more discipline. We need transparency around the standards of how these contracts are being selected and what we can expect out of them.
JUAN GONZÁLEZ: And do you have any concerns about any other members of the Trump administration who may be, in one way or another, being able to privately benefit from the inside information that is developed within the administration as to who gets funded or who gets government support?
PETER MAYBARDUK: Well, in addition to Moncef Slaoui, the vaccine czar — as I said, comes from GSK, was on the board of Moderna, and maybe heavily invested — we don’t really know, because he’s not been forced to disclose his ties — the Trump administration is built on a number of pharmaceutical executives that have played key roles. Alex Azar, secretary of health and human services, is an insulin price spiker from Eli Lilly. Former adviser Joe Grogan in the White House came from Gilead, where he was a lobbyist. So, these policies — this background certainly has informed the Trump administration’s policy in this area and its extreme deference to corporate interests in Operation Warp Speed and elsewhere.
The central problem that we see — you know, it’s appropriate to be investing great sums of money right now in an effort — and putting money, investing money at risk, recognizing that some vaccines are not going to work out. We have to spend that money as a people in order to develop a safe and effective vaccine as quickly as possible. However, we should be able to ask for certain conditions attached to that. And we are very concerned about what happens when a vaccine comes online and there’s simply not enough manufacturing capacity to get it to everyone who needs it.
AMY GOODMAN: Finally, Peter, U.S. PIRG organized a letter that’s been signed by hundreds of health professionals, that essentially says to President Trump, “Shut it down, start over, do it right.” What are you demanding?
PETER MAYBARDUK: We’re demanding that the Trump administration impose — first, BARDA needs to publish the contracts. We need to see what is being done with the billions in taxpayer dollars, and more to come, that is being spent in the vaccine hunt.
Second, we need to attach basic conditions to the contracts, reasonable pricing and technology transfer. Technology transfer means we have to order companies to disclose their confidential information, to license their patents, so that other manufacturers can also make those same vaccines. Essentially, if we don’t teach the world how to make vaccines, there will be a global vaccine apartheid. There will be serious rationing in years ahead. The delay will cause great setbacks in poverty. It will cost people’s lives. It could come with costs to political stability in less wealthy parts of the world. So, we have to be willing to order corporations to do what is necessary to scale up supply, and that means not basing the vaccine market on monopolies, not simply entrusting any given corporation with hundreds of millions of our dollars to then just go and do the right thing, but making it a national project to get to scale, to liberate the vaccine technology and help others manufacture it, to publish the data so we can verify safety and efficacy, and so on.
AMY GOODMAN: Should patents be forbidden? Five seconds.
PETER MAYBARDUK: Patents for — well, they should be licensed. There shouldn’t be monopolies. Everything should be licensed nonexclusively, openly, so that others can make use of the technology.
AMY GOODMAN: And I should say, that letter from U.S. PIRG and hundreds of health professionals is more broad, beyond vaccines, again, telling the U.S. government to shut it down, to go back to a national strategy for dealing with the coronavirus pandemic. Peter Maybarduk, I want to thank you for being with us, director of Public Citizen’s Access to Medicines Program, organization recently releasing a database that tracks the billions of taxpayer dollars supporting COVID tests, treatments and vaccines.
When we come back, we will go to one of the people who went to a local hotel in McAllen, Texas, and saw children being held there, immigrant children. What’s happened to them? The state being hit not only by the pandemic, but by the hurricane. Stay with us.