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ICMR Will Get Royalty of 5% from Sale of Bharat Biotech's Covaxin. Here's Why It's Raising Eyebrows

Bharat Biotech is pursuing approvals in various countries as per legal requirements applicable in each country.

Bharat Biotech is pursuing approvals in various countries as per legal requirements applicable in each country.

The intellectual property governing the use of Covaxin, jointly developed by Bharat Biotech and the ICMR, was “shared” and that is why it would receive royalty payments.

Bharat Biotech will pay a royalty of 5 per cent on net sales of its Covid-19 vaccine to the Indian Council of Medical Research (ICMR).

According to a report by Hindu, the intellectual property governing the use of Covaxin, jointly developed by Bharat Biotech and the Indian Council of Medical Research, was “shared” and that is why ICMR would receive royalty payments.

In an emailed response to The Hindu, ICMR Director-General Balram Bhargava wrote, “The Public-Private Partnership was executed under a formal Memorandum of Understanding (MoU) between the ICMR and the BBIL which includes a royalty clause for the ICMR on net sales and other clauses like prioritisation of in-country supplies. The product IP is shared. It is also agreed that the name of ICMR-National Institute of Virology (NIV) will be printed on the vaccine boxes. The same is being done now.”

The move has raised questions on the need for the payout, to be done on a half-yearly basis and the basis for the calculation. The pay-out reflects in the cost of the vaccine, and hence impacts affordability, opine experts.

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Junior health minister Bharati Pravin Pawar told the Parliament that the royalty “clause is governed by the MoU executed between the two parties (Bharat Biotech and ) for the development of Covaxin”.

As per the website, when the vaccination was launched on January 16, a little over 5 crore doses of Covaxin have been administered in the overall 45 crore immunisation so far. The government had invested in preclinical studies for Covaxin, and Rs 35 crore was spent on its clinical trials, according to the Centre’s affidavit filed in May.

“The government should also verify the investments made by Bharat Biotech. If ICMR gets a royalty of 5% on Rs 35 crore funding, can the government verify that BB invested upwards of Rs 650 crore for development of Covaxin?” Murali Neelakantan, principal lawyer at Amicus said in an exclusive conversation with Times of India.

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first published:August 02, 2021, 11:35 IST