The arrival of the Covid-19 vaccines is a beacon of hope for the masses battling the virus or the threat from it which has led to a complete lockdown twice in two years and has taken millions of precious human lives in more than having made hundreds and thousands of unemployed across the globe. However, the pandemic has also created a global market worth billions of dollars in sales for a few pharmaceutical companies that are poised to make windfall profits amid the world’s biggest humanitarian crisis.
In the initial phase, companies showed no rush to invest in vaccine projects. The vaccine has arrived at the need of a lot of time and research and one can always question its effectiveness. in the past, vaccines made during or immediately after a pandemic or acute health crisis have not proven to be very cost effective. Companies that have started work on vaccines against diseases like Zika and SARS have had their fingers burnt.
Poor countries need more vaccines but cannot afford high prices, and vaccines are usually only needed once or twice. As a result, these companies are focusing more on drugs needed in richer countries, especially those that require a daily dose, which is obviously a better deal for the drug companies.
Later, some researchers suggested that Covid-19 is a flu and is likely here to stay and requires annual booster shots. It was only then that companies started to pump money into vaccine development, as it could be profitable for those who come up with the most effective product. The influenza vaccine market is also worth several billion dollars a year.
The privatization of research and development in the field of immunology has opened doors for large companies, and names like Pfizer, AstraZeneca, Moderna, Biocon, Serum Institute of India, Bharat Biotech, etc. -19 wave.
The big question is who is funding these Covid-19 vaccines? The development of the vaccine has been funded by private companies, non-profit organizations and various governments. Vaccines like Moderna and Novavax have been primarily funded by the government while vaccine development by companies like Pfizer and AstraZeneca has seen huge investments from private companies. Johnson & Johnson has seen nearly 50% of private sector as well as public sector investment. The Gates & Milinda Foundation also donated a huge amount of money to Pfizer to speed up the trial process.
Everyone seems to be benefiting from this pandemic. Companies like Pfizer & Moderna have previously reported that they are selling their vaccine for a profit. While other companies like Johnson & Johnson and AstraZeneca see this pandemic as a good opportunity to improve their reputation (PR) and have decided to sell the vaccines without any profit margin.
The Serum Institute in India decided to maintain different prices for Center, State and private entities, which created great controversy. The government is accused of letting the company make huge profits. Shares of companies like Moderna have risen more than 1,000% in the past year. And investors are looking to make huge profits.
The production of vaccines such as Pfizer and Moderna that use the new mRNA technology is more cost effective when compared to traditional vaccines because the production is less capital intensive, simple and the doses are low.
Traditional vaccines use a viral protein that must be grown over weeks. On the other hand, mRNA molecules instruct the body to produce viral proteins on its own and are less complex and can be easily produced via a chemical process (instead of a biological process) making mass production a much faster pace. Even so, we find that the cost of mRNA vaccines is much higher when we compare it to AstraZeneca or Covexin.
Pharmaceutical companies and their owners and shareholders will make billions in profits. Thanks to the government, they first heavily subsidized the development of the drug, and then allowed companies to bill as they wanted, sometimes even well above their cost. Once again, the countries of the South are being ignored as governments defend the intellectual property rights of companies and thus prevent poor countries from producing vaccines at a faster and cheaper rate.
Pfizer shareholders include Vanguard Group (7.6%), State Street Global Advisors (5%) and Black Rock (4.9%). These are controlled by very powerful people and are called the “three giants”. They control $ 20 trillion in global assets. BioNTech, partner of Pfizer and headed by a husband and wife named Uğur Şahin and Özlem Türeci, respectively became billionaires overnight.
In India, the Serum Institute was already making a profit when it gave the vaccine to the government at Rs 150 ($ 2) per dose. But now he has decided to charge more than double that price to other state governments and private entities. In India, the estimated population over 18 to be vaccinated is around 900 million. India alone is said to consume more than 1.5 billion doses, causing the company’s finances to skyrocket.
The Moderna vaccine was co-developed by Moderna and US government scientists working for the National Institute of Health. Intellectual property still belongs to the company. The US government even allowed the company to keep all of the profits. The Oxford AstraZeneca vaccine was developed at its Jenner Institute run by Professors Sarah Gilbert and Adrian Hill.
Everyone in the world is touting the COVID-19 vaccine as a triumph for corporate science. While the truth is that only one of the first three vaccines (Pfizer, Moderna, AstraZeneca) was developed by the private sector. Everyone has also benefited from early research from the Shanghai Public Health Clinical Center, which at the very beginning released the first virus-free genomic sequencing of the COVID-19 virus. These companies have also obtained huge government subsidies, tax cuts, etc.
Governments and various other organizations have already pre-booked billions of doses at fixed prices. So, over the next few months, businesses will be busy filling these orders as quickly as possible. Those who sell to countries with larger pockets expect a return on their investment. On the other hand, AstraZeneca, despite having made agreements to provide the greatest number of doses, will only cover its costs.
Governments have ordered more than 800 million Pfizer vaccines, which will net the company more than $ 16 billion. The company expects the sale of 15 to 30 billion vaccines in 2021. AstraZeneca expects the sale of 2 to 3 billion vaccines in 2021. It has also indicated that it could increase the price of the vaccine once. the pandemic ended. And that’s when investors would start getting their money back. They would charge a 6% royalty on their sale.
The initial research that sequenced the COVID-19 genome and started the race for vaccine development has been published free of charge to all patent holders. Imagine what would happen if all vaccine research was published without a patent. This meant that everyone, including poor countries, could produce the vaccines at cost and redeem their citizens from the virus. Health crises like this can never be dealt with in isolation. Even if a country like the United States or the United Kingdom is able to vaccinate its citizens and get rid of the virus on its territory, the danger of the mutated virus from other countries remains. In this globalized world, we must work towards the goal of completely eradicating this virus from the earth
The government should also plan and invest heavily in pandemic strategies, just as it does in defense, seeing it as a necessary expenditure for things it hopes it won’t use.
Shubham Kumar is a former student of JNU and is currently pursuing a Masters in Peace and Conflict Studies at JMI, Delhi.