IMPACT: PAUL, ERNST ADVANCE ROYALTY TRANSPARENCY ACT, ACKNOWLEDGE OPEN THE BOOKS

The bill would cast sunlight on the multibillion-dollar government royalty complex.

America’s public health sector has emerged from the COVID crisis with severe reputational damage. People have simply lost trust in guidance from key institutions like the National Institutes of Health and Centers for Disease Control and Prevention. Regardless of one’s politics, it should be distressing that scientific claims are now met skeptically and through a partisan lens. From the origin of the virus to the virtue of our response, there’s plenty such controversy to sift through; but there’s one area where federal officials can quickly make up some ground with the average American. They can reveal the secret royalties that change hands between pharmaceutical companies and government scientists, which could have enormous implications for our health.

For three sessions, Senator Rand Paul has led the charge to open the books on the government royalty complex with the Royalty Transparency Act. Last week, during a meeting of the Homeland Security and Government Affairs Committee, he acknowledged the role of Open the Books in pressing the federal public health sector for more transparency.

Later during the same meeting Senator Joni Ernst entered a statement into the record acknowledging our late founder, Adam Andrzejewski. Our comprehensive report on royalties paid to government scientists by pharmaceuticals was his final publication, capping decades of work to advance spending transparency at every level of government.

BACKGROUND

It took the pandemic and mandated vaccinations for many to decide that perhaps Big Government and Big Pharma were much too close for comfort. Traditionally a concern for progressives skeptical of large corporations, it spilled over to conservatives who saw Washington elites trying to control their health decisions. During the pandemic, it became plain that those parties had been in bed together all along.

Indeed, a massive amount of money changes hands among the NIH, its scientists – public employees – and private entities like pharmaceuticals. Billions go out the door to fund research and hundreds of millions come back into NIH coffers through royalty payments.

Too much of this information is redacted, despite the potential for each of these transactions to create a conflict of interest. Auditors at Open the Books found some $710 million in royalties paid to government scientists as “inventors” during the Covid era (late 2021 through 2023). Going back to September 2009, the number rises to $1.039 billion. Add in the payments made to NIH subagencies (royalties are divided among inventors and NIH research centers), and the total becomes a staggering $2.685 billion.

You can read the full report here.

The license number, the dollar amount of each payment and the identity of the payor were all redacted when Open the Books first began its work to uncover the royalty payment complex. The NIH refused to reveal it, forcing the issue into court – again at taxpayer expense. A judge ruled they must disclose the payors and license numbers, but it’s still exceedingly difficult to match those with a product being sold to the public.

Americans deserve to know what financial stakes are in play when they receive guidance from public health officials – or when those decisionmakers choose the next research projects to fund. Are decisionmakers prioritizing genuine science, inquiry and evidence about what will benefit people? Or are their decisions being compromised by potential income for the NIH or themselves?

ROYALTY TRANSPARENCY ACT

Senator Rand Paul (R-Ky.) has led the charge on our findings, repeatedly grilling the face of the pandemic response, Dr. Anthony Fauci. In a September 2022 hearing, Paul recounted, “We’ve been asking you and you refuse to answer whether anybody on the vaccine committees gets royalties from the pharmaceutical companies. I asked you last time and what was your response? ‘We don’t have to tell you.’”

The Kentucky senator finished, “When we get in charge, we’re going to change the rules and you will have to divulge where you get your royalties from, from what companies, and if anybody on the committee has a conflict of interest, we are going to learn about it. I promise you that.”

Since the dustup with Fauci, the NIH has sent OpenTheBooks.com another year of redacted royalty documents, opening the door to a perennial legal dogfight.

We shouldn’t have to wait for a particular party to control Congress to get this fixed more permanently. Sen. Paul’s Royalty Transparency Act would force NIH and other government entities to disclose these payments as a matter of routine, and the HSGAC Committee voted 13-0 to advance it last week.

The new legislation would:

• Require Executive Branch employees subject to the public financial disclosure reporting requirements of the Ethics in Government Act of 1978 to disclose royalty payments for inventions developed during their employment with the federal government.

• Agencies would be required to publicly post financial disclosure reports on their websites.

• The bill would also require applicants for federal grants and contracts to disclose royalty payments to the government for the 10-year period preceding the grant or contract.

While lots of focus has rightfully been trained on the vaccines, this touches almost every therapeutic on the market – from cancer treatments to obesity management to combating Alzheimer’s disease. Enacting the Paul bill would bring sunlight to all of it.

It’s a complex system, but the guiding principle should be simple: when public research is used for profit, it’s the public’s business to know. When government scientists make decisions, it’s the public’s business to understand how and why.

Transparency advocates finally have a bipartisan wind at their backs, at least when it comes to public health. Lawmakers should take advantage of the moment and send this legislation to President Trump.

If you agree, you can sign our petition urging Senate Leader Thune to bring the bill up for a floor vote.

REMEMBERING ADAM’S WORK

Senator Ernst, who also backs the Royalty Transparency Act, wrapped up the committee meeting by asking to enter a statement into the record on the work of our late founder, Adam Andrzejewski:

This bill could also be known as the ‘Open the Books on Royalties Act,’ in honor of Adam Andrzejewski, the late founder and CEO of the taxpayer transparency and watchdog group Open the Books, a hero to taxpayers.

Adam, for years, worked to make public the royalties paid to officials at HHS and NIH. His group even took NIH to court to force the release of its royalty payments.

While Congress allowed government scientists to be rewarded for their work through the collection of royalties, the secrecy surrounding who receives them and how much they receive may hide conflicts of interest both inside and outside the government. That’s why it’s so important to open the books on royalties, as well as on all government spending. This bill and the transparency it will bring are long overdue.

Sadly, Adam, an avid marathon runner, suddenly passed away last year at the age of 55. Our hearts and prayers go out to his family, coworkers, and all who loved him. His legacy lives on through the Royalty Transparency Act and in those who continue to fight for transparency in government spending.

As I always say, if you don’t think there’s waste in Washington, you aren’t looking. Adam Andrzejewski never stopped looking for and exposing that waste, and it’s fitting today to acknowledge his lasting contribution to our nation.