NIH Director Removes Reasonable Pricing Clause From CRADA

June 1, 1995

BETHESDA--Harold Varmus, MD, Director of the NIH, has removed the "reasonable pricing" clause from the Public Health Service's model Cooperative Research and Development Agreement (CRADA). Many believe that the clause has driven industry away from potentially beneficial collaboration with government scientists. "Eliminating [it] will promote research that can enhance the health of the American people," Dr. Varmus said.

BETHESDA--Harold Varmus, MD, Director of the NIH, has removedthe "reasonable pricing" clause from the Public HealthService's model Cooperative Research and Development Agreement(CRADA). Many believe that the clause has driven industry awayfrom potentially beneficial collaboration with government scientists."Eliminating [it] will promote research that can enhancethe health of the American people," Dr. Varmus said.

Adopted in 1989 partly in response to the price of zidovudine(Retrovir, AZT), which many considered too high, reasonable pricinghas been controversial ever since. In 1992, it came under Congressionalscrutiny during development of paclitaxel (Taxol). Many in Congressand in the pharmaceutical industry maintained that use of theclause politicized and acted as a deterrent to collaborative public-privateresearch, especially in cancer and AIDS.