Penn’s royalties from Pfizer-BioNTech COVID-19 vaccine grow to at least $2 billion after new settlement
The new $467 million includes $400 million in royalties for the Pfizer-BioNTech vaccine from 2020 through 2023.
The Nobel Prize-winning scientific innovation underlying the COVID-19 vaccine proved to be a notable financial boon for the University of Pennsylvania. And now the Ivy League school in West Philly is set to get nearly half a billion dollars more.
Penn will receive $467 million under a settlement with German drug manufacturer BioNTech, which partnered with Pfizer to develop a COVID vaccine that relied on mRNA technology developed at the university.
The settlement, disclosed last week in a U.S. Securities and Exchange Commission filing, will resolve a lawsuit that Penn filed in the Eastern District of Pennsylvania in August, in which the university alleged that BioNTech hasn’t paid all the royalties it owes.
Penn contended in the complaint that BioNTech has paid royalties only for sales in countries in which the university has patents for the mRNA technology, but that it was supposed to pay royalties on global sales of the BioNTech-Pfizer vaccine.
The university also said BioNTech paid a lower royalty rate than Penn is entitled to.
Financial information, such as royalty percents and overall payments made, was redacted in the lawsuits.
Under the settlement agreement, Penn will receive $400 million in royalties for 2020 through 2023, $15 million for a three-year extension for the company’s and Penn’s vaccine alliance, and $52 million for a research fund that the university and the drugmaker will jointly manage.
Pfizer will reimburse BioNTech for $170 million of the $400 million in royalties.
Penn agreed to dismiss its lawsuit once it begins to receive payment, according to BioNTech’s filing. The university did not respond to a request for comment.
The settlement “does not in any way constitute an admission of liability with respect to any allegation raised by Penn, all of which the Company expressly denies,” BioNTech said in the SEC filing.
BioNTech declined to comment beyond the information it provided to the SEC.
The Pfizer-BioNTech COVID-19 vaccine that rolled out in late 2020 utilizes patented technology that was developed by Penn researchers Katalin Karikó and Drew Weissman, who won the Nobel Prize in physiology or medicine in 2023 for their work.
Penn licensed the technology to BioNTech and Moderna in August 2020 through a subsidiary, Cellscript LLC, in return for royalties from sales.
» READ MORE: Scientists’ Nobel-winning vaccine research brought Penn prestige — and a whole lotta money
The settlement’s $400 million in back royalties brings Penn’s total windfall from the Pfizer-BioNTech vaccine to at least $2 billion through 2023.
Data from the Centers for Medicare and Medicaid Services’ Open Payment system, which tracks transactions from pharmaceutical and medical device companies to health-care providers and teaching hospitals, show that Penn received $1.6 billion in royalties from BioNTech between 2021 and 2023.
Data for 2024 are not yet available.
Penn has also been receiving royalties from Moderna, but estimating those is more difficult. Experts previously told The Inquirer that the royalties are likely in the hundreds of millions if the agreement is within industry standards.
BioNTech also disclosed last week a settlement with the National Institutes of Health for $791.5 million, including $750 million in royalties for patents held by the U.S. government. Pfizer will reimburse BioNTech for $364.5 million for its share. As in the Penn settlement, BioNTech noted that the agreement is not an admission of liability.