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A $450 million federal contract that calls for Regeneron Pharmaceuticals (REGN) to supply its Covid-19 treatment contains weaker than usual protections for taxpayers. And consumer advocates complain the agreement could make it harder for the U.S. government to constrain pricing should the drug maker attempt to engage in price gouging.

However, a spokesperson for the Department of Defense and Department of Health and Human Services, which awarded the contrast last July as part of the Operation Warp Speed project to help fund development or manufacturing of Covid-19 therapies and vaccine, disagreed with the contention. As part of the deal, Regeneron is receiving funding in order to supply up to 300,000 doses of its antibody treatment.


The advocacy group, Knowledge Ecology International, contended the contract does not contain the usual provisions for preserving taxpayer rights when federal funding is involved. A provision of the Bayh-Dole Act, known as march-in rights, allows the U.S. government to reclaim patents as a way to address prescription drugs that are out of reach for different reasons, such as shortages or pricing.

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