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To respond to the need for a vaccine against and a treatment for Covid-19, the German Federal Government (German government) used various economic incentives to promote pharmaceutical and biotechnological (biotech) research and development (RD) as well as manufacturing. More specifically, it decided to subsidise several German companies working in this field. Such domestic measures might, however, present a challenge to European state aid law. It is against this backdrop that this article discusses the compatibility of the payments