Scientists’ Nobel-winning vaccine research brought Penn prestige — and a whole lotta money
University of Pennsylvania received more licensing revenue than any other U.S. university in the past two years.
Nearly three decades before she won the Nobel Prize in medicine, the University of Pennsylvania turned down Katalin Karikó for a tenure-track position. The Hungarian American scientist was working on potential uses of messenger RNA in medicine. Her goal of harnessing the body’s own genetic code to develop new therapeutics was so novel that she couldn’t secure federal funding and eventually left Penn.
But Karikó's research would prove to have returns that brokers in Wall Street dream of. In addition to the prestige of the Nobel Prize — awarded Monday to Karikó and her research partner, Penn professor Drew Weissman — the COVID-19 vaccine has made Penn the university with the most revenue from licensing agreements in the nation.
» READ MORE: Penn mRNA scientists Karikó and Weissman win Nobel Prize
Penn reported almost $1.3 billion in licensing revenue in fiscal year 2022, according to a survey by AUTM, an association of university tech transfer managers. That is more than the combined licensing revenue of the following top 12 universities that participated in the survey, which include Harvard, Emory, New York University, Duke, Massachusetts Institute of Technology, and Stanford.
Breaking down exactly how much of the revenue comes from vaccine royalties is tricky, and only those with insider knowledge know the exact amount that Penn received for the use of mRNA technology. Penn officials said that confidentially agreements with vaccine manufacturers Pfizer-BioNTech and Moderna prevent them from disclosing revenue figures, and declined to comment further on the financial success.
But public records provide insight into a bonanza that now includes bragging rights to the 28th and 29th Nobel laureate wins among the university’s ranks. (Neither Penn nor the newly minted Nobel laureates would have predicted the mutual celebration. Karikó told a Nobel official on Monday that she was “kicked out” of Penn in late 2012 and “forced to retire.” She then got a job at the German drugmaker BioNTech, which collaborated with Pfizer a decade later to make a COVID-19 vaccine. A second vaccine, also relying on Penn’s mRNA technology, was developed by Moderna.)
To estimate Penn’s windfall so far, The Inquirer reviewed federal data disclosing payments to teaching hospitals, company reports to investors, corporate filings, and financial information submitted by universities to a national professional association.
Penn’s royalties from Pfizer-BioNTech
The revenues Penn received from Pfizer-BioNTech’s COVID-19 vaccine are the easiest to track.
The Centers for Medicare and Medicaid Services maintains a federal database of payments and in-kind contributions that physicians and teaching hospitals receive from companies for medical devices or drugs. It shows that BioNTech paid $1.2 billion to the Hospital of the University of Pennsylvania in 10 payments of royalties or licensing revenues related to the COVID-19 vaccine in 2021 and 2022.
Penn receives payments from many other companies, the database shows. But no company, even when adding up the five past years together, paid close to the sums that Pfizer-BioNTech provided Penn for vaccine royalties.
Still, because the exact details of the licensing arraignment between Penn and the pharmaceutical companies have not been disclosed, there is no way to know if this is the full extent of the payments from Pfizer-BioNTech.
Estimating Penn’s royalties from Moderna’s vaccine
It is even harder to assess how much money Penn may have received through the Moderna vaccine’s success. Unlike Pfizer-BioNTech, no payments directly linked to Moderna appear in the disclosures released by CMS.
But Moderna investor documents provide insight into how much the company is paying for licensing related to the vaccine.
Penn does not license mRNA technology directly. Instead the university has a licensing arrangement that started before the pandemic with a company called Cellscript LLC. In its annual report, Moderna discloses what it paid Cellscript from the vaccine’s revenue: $635 million in 2022 and $641 million in 2021.
Experts told The Inquirer previously that Penn’s share is likely less than half of the royalties Cellscript receives. So if the university’s cut was as high as 40% of Moderna’s payment to Cellscript, it would have received more than $500 million in those two years.
This estimate aligns with the payments directly disclosed by Pfizer-BioNTech. In both cases, the total is less than 2% of the overall revenue from the each vaccine.
» READ MORE: Research behind COVID-19 vaccines reaps close to $1 billion in royalties for Penn
A tech transfer success story
Put together, Penn may have reaped as much as $1.7 billion from vaccine royalties and licensing revenues in 2021 and 2022, The Inquirer’s analysis found.
The university has shared plans to use $750 million in proceeds from the COVID vaccine’s success to expand its research into emerging medical technologies such as cell and gene therapy — another area of medicine that generates a high return in licensing royalties. This includes $350 million for new laboratory space.
But Penn’s royalties are just one aspect of its mRNA success story. The world benefited from a COVID-19 vaccine developed in less than a year during a pandemic because of connections established between scientists and the pharmaceutical industry before 2020, said Stephen Susalka, the CEO of AUTM.
That is a goal of a process called “tech transfer,” in which universities spin off inventions to real world and marketable applications. In addition to a discovery that works, that process involves patents, licensing agreements, and private companies willing to take risks.
Thousands more technologies are currently being developed and commercialized this way, Susalka said, adding that any one could be a lifesaver in another moment of global need.
“If none of that work underneath the surface had been accomplished ahead of time, we never would have had this vaccine in the record speed that we had,” he said.