How the National Institutes of Health became a den of cronyism

For too long, the bureaucrats at the National Institutes of Health (NIH) have been lining their pockets through clandestine agreements with big corporations, getting cozy with the very entities they are tasked with overseeing.  

In an era where trust in our public institutions is alarmingly low, this isn’t just a minor oversight; it’s an outright epidemic of corruption. Shockingly, over 55,000 royalty payments have been overlooked in the past decade alone. Each undisclosed royalty payment is a potential conflict of interest, undermining the credibility of our institutions and eroding the trust of the American people.  

The explosive revelations by Open the Books in 2022 shed light on this den of cronyism. It was uncovered that more than 2,400 NIH scientists pocketed a whopping $325 million in royalty payments in the last decade, with an average of $135,000 per person. Yet, the details of these sweetheart deals remain hidden in the shadows with vital information redacted from public view.  

Despite attempts to bring these details to light, the NIH refuses to disclose essential information, including the amounts of individual payments and the identities of the payers. 

In June 2022, my Republican colleagues on the Homeland Security and Governmental Affairs Committee and I sent a letter to NIH, demanding information about these royalty payments. But NIH is stonewalling, claiming they are above disclosing such details. It’s this kind of arrogance that fuels distrust and raises legitimate concerns about whose interests our government agencies are truly serving. 

When I directly challenged Dr. Anthony Fauci, former director of the National Institute of Allergy and Infectious Diseases, on royalties paid by vaccine manufacturers to members of the vaccine approval committees, Fauci argued the law protected scientists from revealing their royalties. The implications of these undisclosed payments extend far beyond simple bureaucratic secrecy. They cast a long shadow over the impartiality of our regulatory processes.  

Moderna’s royalty payments to the NIH, Dartmouth and Scripps Universities in the amount of $400 million will make it challenging for NIH scientists to treat Moderna objectively.  

The NIH’s potential profit from future royalties on Moderna’s COVID-19 vaccine is the icing on this conflict-of-interest cake, raising grave concerns about the integrity of our regulatory processes. This is not merely about financial transparency; it is about ensuring public health decisions are made in the American people’s best interest, untainted by the prospect of financial gain. 

The lack of transparency surrounding these payments is downright alarming. Americans deserve to know who is paying whom, how much and for what. The current ordeal of accessing public inspection reports — jumping through bureaucratic hoops, facing delays and obfuscation — is an insult to the American people and a hotbed for corruption. 

To address these issues, I introduced the Royalty Transparency Act of 2024, which has now advanced out of the Homeland Security and Governmental Affairs Committee on a bipartisan vote. This bill will cut through the secrecy by mandating that executive branch employees disclose any royalty payments received for government-developed inventions. It will also require agencies to publish these financial disclosures online, bypassing the current bureaucratic maze blocking public access to information. No more hiding behind red tape.  

Moreover, the act will compel the Federal Acquisition Regulatory Council and the Office of Management and Budget to produce requirements for applicants for federal grants and contracts to disclose any royalty payments made to the government over the past decade. The crux of the matter is transparency. Without it, we cannot hope to maintain the integrity of our research and regulatory frameworks, or the trust of the American people.  

Transparency is not merely a buzzword — it is the foundation of a functioning democracy. It is time to lift the veil of secrecy and hold our government agencies and their employees accountable for their actions. Only through transparency can we start to rebuild trust and ensure that our institutions serve the public good, not the financial interests of a privileged few. 

We must question conflicts of interest. We must ponder whether those who distribute government grants might be swayed to favor companies that offer them royalties. The push for royalty transparency has been a long time coming. 

Sen. Rand Paul(R-Ky.) is ranking member of the Homeland Security and Governmental Affairs Committee.