Drugmakers’ Secret Royalty Payments to Fauci’s NIAID Jumped After Pandemic: Report

Dr. Anthony Fauci, former director of the National Institute of Allergy and Infectious Diseases (NIAID), arrives for a closed-door interview with the House Select Subcommittee on the Coronavirus Pandemic at the U.S. Capitol in Washington on Jan. 8, 2024. Drew Angerer/Getty Images

Secret royalty payments from drug companies to scientists, researchers, executives, and other employees of the National Institutes of Health (NIH) jumped following the COVID-19 pandemic in 2021, according to a new report from a nonprofit government watchdog.

“In 2022 and 2023, pharmaceutical and healthcare companies paid the [NIH] a sum of $710,381,160 in third-party royalties. These were payments healthcare companies made to NIH, its leadership, and scientists to license medical inventions created in federal, taxpayer-funded labs,” OpenTheBooks.com reports, in an analysis made public on June 3 as former NIAID Director Anthony Fauci testified before the House Select Subcommittee on the Coronavirus Pandemic.

The Epoch Times obtained a copy of the full report.

“The National Institute of Allergies and Infectious Diseases (NIAID), led until recently by Dr. Anthony Fauci, collected nearly all of it: $690,218,610 of the $710 million,” the report reads.

The $710 million total for 2022–2023 is double the $325 million that OpentheBooks.com previously reported was paid to NIH employees between 2009 and 2021. The nonprofit watchdog has had to take NIH to court twice for failing to provide requested data not covered by any of the nine exemptions to the federal Freedom of Information Act (FOIA).

Among the recipients of royalties was NIAID’s Dr. John Mascola, who was selected to manage Operation Warp Speed, the government’s crash program to develop a vaccine for COVID-19.

More than 1.2 million Americans have been reported as dying as a result of contracting the disease since January 2020.

Dr. Mascola directed NIAID’s Vaccine Research Center from 2013 to 2022, and during that time, he received royalty payments from Moderna, beginning in 2018. He selected the pharmaceutical company as one of the government’s partners in Operation Warp Speed.

Moderna received more than $10 billion from the government between 2020 and 2022 for its work developing a vaccine and delivering millions of doses to health care agencies. In 2013 to 2017, the government paid Moderna $60 million for development work on the mRNA technology that’s the basis of the COVID-19 vaccines.

OpentheBooks.com obtained the data on which its report is based from NIH, after the agency resisted providing the information in response to the group’s second FOIA request, which was filed in conjunction with Judicial Watch, a nonprofit legal firm that specializes in FOIA litigation.

The NIH was required to provide the names of government employees receiving the royalty payments, the amounts paid, and when they were paid. However, OpenTheBooks.com claims in its report that the government is still refusing to disclose the names of NIH employees in connection with 4,851 royalty payments made between 2009 and 2021.

In addition, nearly 1,000 names of NIH employees getting royalty payments made in 2022 and 2023 are being withheld. The government cites the FOIA’s exemption, which is meant to protect private firms’ commercial trade secrets.

“Why the names of NIH scientists are considered ‘confidential’ or ’trade secrets’ is unexplained, and something we are fighting in our ongoing FOIA litigation. ... We have no idea who these scientists are, what they are in charge of, or why their names are redacted. All of this raises significant questions about conflicts-of-interest within the royalty structure at the NIH for obvious reasons,” the report reads.

Dr. Fauci is expected to be questioned by members of the subcommittee about the secret royalty payments and why agency officials are defying the FOIA’s requirement that all federal documents that aren’t covered by the exemptions must be made available to the public on request.

Dr. David Morens, formerly one of Dr. Fauci’s closest advisers at NIH, testified before the panel about how he was advised by officials in the NIH FOIA office on how to avoid disclosing emails, text messages, and other communications considered potentially embarrassing.

A spokesman for NIH couldn’t be reached for comment by press time.