How a biotech startup working on a coronavirus cure got caught in a tug-of-war between the White House and Berlin

March 16, 2020, 6:42 PM UTC

A little-known German biotech outfit operating out of a sleepy university town near the Black Forest has grabbed the world’s attention after being plunged into the center of a political tug-of-war between President Donald Trump and the German government over a potential coronavirus vaccine. 

In the race to find a medical breakthrough to the pandemic, the startup, CureVac, said earlier this month that its proprietary technology has found suitable candidates that could lead to a treatment, and that it aims to start clinical trials in early summer. CureVac has received funding from the Bill & Melinda Gates Foundation.

The company came within Trump’s circle when its then-chief executive, the American Daniel Menichella, met with the president at the White House recently. Menichella was there as part of a coronavirus task force meeting to discuss how to stop the spread of the deadly outbreak that poses the biggest crisis yet to Trump’s presidency.

According to a bombshell report that broke this week in German weekly Welt am Sonntag, Trump was so convinced by the CEO that he was willing to fork over a reported $1 billion to acquire rights to any promising vaccine the company could produce. 

The news created a storm of outrage in Germany as fears rose that Washington would exert exclusive control over the production and distribution of the potential cure to the detriment of the rest of the world’s population.

Federal Health Minister Jens Spahn promptly took to German state television on Sunday night to ensure that in the case of any successful trials, any vaccine developed by the company would be made available to everyone who needs it.

“We’ve been in very good talks with the company over the past two weeks,” he told ZDF program Berlin Direkt before implying that the issue, which only came to light on Sunday in the German media, had already been dealt with. “Today’s report comes with a bit of a time lag.” 

In a sign of what’s at stake, the European Commission on Monday announced it had offered CureVac an €80 million line of credit to help it “scale up development and production of a vaccine against the coronavirus in Europe.”

The German-born commission president, Ursula von der Leyen, said in the statement: “I am proud that we have leading companies like CureVac in the EU. Their home is here. But their vaccines will benefit everyone, in Europe and beyond.”

Germany on edge

The report comes at a sensitive time. Just as coronavirus threatens to hit the export-reliant German economy, conservative politicians, including Spahn, have been jockeying for control of the party after Chancellor Angela Merkel’s successor stepped down as head of the Christian Democrats. 

CureVac’s majority owner, a billionaire philanthropist that co-founded German software giant SAP, and owns German first-division soccer team TSG Hoffenheim, said however he ruled out the deal as soon as he heard of it. 

“For me, it was self-obvious that a German company cannot develop a vaccine that is then exclusively used in the U.S.,” Dietmar Hopp told Sport1 in an interview published on Monday. Asked how the talks had progressed with Trump, the 79-year old German said CureVac came to him to gauge his reaction. “They asked me what I thought of it all, and I knew immediately that this wasn’t an option,” he said. 

In a strange twist, however, the Tübingen-based company’s itself has denied it was approached. In a statement on Monday, CureVac rejected all allegations made in the press, adding that it “had not received an offer before, during and since the Task Force meeting in the White House.”

The comments were then tweeted by the U.S. embassy in Berlin as proof there was no truth to the controversial approach.  

Adding to the confusion (and drama), CureVac had announced only last week it was replacing its American CEO, who joined in 2018. Founder and former CEO Ingmar Hoerr is back running the company. 

When asked about the report on CNBC, Trump advisor Peter Navarro not only did not deny the allegations, he spoke of a broader strategy to bring production and supply of key medications to the U.S. 

“What I can speak to is this broader interesting issue of how dependent the United States of America is on the global supply chain, not just for its medicines but for its medical supplies and medical equipment,” he told the business channel on Monday, before adding that he was working on a piece of legislation based on Trump’s “Buy American” campaign pledge.  

“The President personally asked me to move quickly on this issue. The essence of the Executive Order, which we hope to get to the finish line by the end of the week, is to bring all of that home so that we don’t have to worry about foreign dependencies—70 percent of our advanced pharmaceutical ingredients comes from abroad.”

This would then encourage the major governmental customers for medicines, medical supplies and equipment such asa Veterans Affairs, Health and Human Services and the Department of Defense, to all shop domestic.

“We need them to buy that from American producers on American soil,” he told CNBC. 

For now, it looks as if any potential CureVac vaccine—should it ever develop one that gets regulatory approval– would be made available for everyone, and not just Americans.

Speaking to reporters on Monday after announcing wide-ranging restrictions to leisure activities across country, Merkel was quick to take credit, along with CureVac owner Hopp, for deescalating the situation.

“The issue has already been resolved as we said on the weekend. The federal government took care of this at a very early stage,” she said.

This story has been updated to include the European Commission funding statement, and comments from Commission Ursula von der Leyen.

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