The Cost of Health
How Big Pharma Continues to Hamper the Global Response to COVID
Before the COVID-19 pandemic, only three out of the world’s eighteen major pharmaceutical companies developed vaccines. It simply wasn’t profitable. Now, there are over one hundred coronavirus vaccines in various stages of development. So why is most of the world’s population not expected to receive vaccinations before 2024?
Bidding Your Way to The Front of the Line
“The US government has the right to the largest pre-order because it’s invested in taking the risk. That’s how it will be because they’ve invested to try and protect their population, to restart their economy.”
This is what the CEO of French pharmaceutical giant Sanofi, Paul Hudson, said in May 2020.
The statement would be a harbinger for the events to come.
Market forces have acted against the interests of the public good and individual greed has derailed collective efforts to bring an end to the pandemic.
This was most significantly highlighted at the end of the year as global collective action brought 171 countries together in October 2020 to sign the COVAX initiative — a global vaccine campaign to distribute vaccines to the most vulnerable and at risk across the world. The initiative would notably allow low-income countries to gain access to the vaccine through a collective fundraising pool, referred to as an ‘Advance Market Commitment’.
By committing to purchasing a certain number of vaccination doses, signatory nations would gain access to vaccines approved in the COVAX portfolio, simultaneously creating an international market and driving down prices. The AMC would allocate development aid as well as private sector donations to countries that might not otherwise be able to access the vaccines.
According to the Global Alliance for Vaccines and Immunizations (GAVI), $1.8 of the $2 billion in funds needed to launch the AMC fund have already been collected. The COVAX initiative was supposed to allow for the fair distribution of vaccines and prevent the hoarding of doses, thereby avoiding the risk of prices soaring, while allowing for a vaccination campaign that would reach the majority of the world’s population.
There are several reasons why this has not happened.
First off, the United States refused to join the COVAX initiative. Second, a number of signatory countries, including Canada, Switzerland (and several other wealthy countries) negotiated bilateral deals with pharmaceutical companies in parallel. Their actions not only undermined the COVAX initiative, but also provoked a shortage of produceable doses, inevitably shooting up prices for not only the most effective vaccines, but the entire cold supply chain needed to transport them.
This so-called, “vaccinationalism” has impacting the projected delivery of the vaccines around the world, with countries like Canada buying up enough doses to vaccinate its population five times over.
In France, Hudson’s statement sparked outrage in Europe, where the European Commission had subsidized the firm’s vaccine development with tens of millions of euros of public money. Days after Hudson was called before French President Emmanuel Macron who clarified “the vaccine was to be developed for the public good, not subject to the laws of the market”.
However, while billions of dollars of publicly funded research has contributed to the development of COVID-19 vaccines, it is big pharma who have profited.
In November 2020, a month after the announcement of the COVAX agreement, Pfizer announced that its COVID-19 vaccine was “highly effective”. As a result, its share price shot up to an all-time high. It was at this moment that Pfizer’s CEO, Albert Bourla, cashed out more than 60% of his share holdings, pocketing $5.6 million.
Other pharma CEOs followed suit, with the Moderna chief executive Stéphane Bancel selling $49.8 million worth of shares in a year where the company’s stock price quadrupled.
Patents, Profits and the Pandemic
Intellectual Property, “which is the blood of the private sector, is what brought a solution to this pandemic and it is not a barrier right now.”
This is what Albert Bourla, chief executive of Pfizer, said in October 2020 (shortly before cashing out his shares).
Pfizer, the producer of the COVID vaccine BioNTech, has been one of several pharmaceutical companies to successfully lobby against a motion raised in the World Trade Organization by South Africa and India to waive vaccine-patent clauses during the pandemic. By temporarily suspending patent protections under the Trade-Related Aspects of Intellectual Property (TRIPS) agreement, countries would be able to produce generic vaccines in order to accelerate the containment and eradication of the coronavirus.
Such an action is not without precedent and was notably used at the height of the HIV-AIDS epidemic. Many countries and non-governmental organizations argue that such measures would help to increase access to vaccines and save lives.
Yet, while the proposal put forward by South Africa and India received support from several countries, it was notably blocked by a number of wealthy countries with vested interests in the pharmaceutical sector, including the UK, Switzerland and the United States.
Negotiations ended in November 2020 with no agreement reached. And while talks are said to resume this year, there is little hope the patent waiver will be approved, even temporarily, given the current trend of profiteering, and regardless of the fact that it would certainly help to bring the pandemic to an end sooner.
Vaccine Access & The Ultra Cold Suppy Chain
“You can burn your fingers if you touch that stuff without the right protection.”
These are the words of Brian Swift who works for Jefferson Health system. He’s talking about dry ice, the cooling system used to pack the Pfizer vaccine.
Worldwide, food distribution already relies on a cold chain distribution system, but the leading Pfizer COVID-19 vaccine requires an ultracold chain to keep the vaccine at the required storage temperature of -70 degrees Celsius. Once removed from dry ice, the vaccine will only keep for 24 hours in a regular refrigerator. As a result, hospitals are clamouring to get their hands on ultra-cold freezers which can extend the shelf life of the vaccine by up to six months.
Unfortunately, these freezers cost somewhere between 10–15,000 dollars. And again, suppliers are favoring the highest bidders, who buy in bulk and tend to be the largest and already best equipped hospitals. This leaves smaller, less-financially robust hospitals without a hope of being able to store the vaccine, let alone distribute it.
In developing countries, storing a vaccine at -70 degrees Celsius is impractical and improbable. And while the Moderna vaccine needs to be stored at a comparably better -20 degrees Celsius, if the COVAX initiative fails, most developing countries will most likely opt for one of the other more affordable vaccines such as China’s Sinovac vaccine.
The pandemic continues to highlight how the capitalist system is not only ineffective but destructive to long-term international economic and sustainable development goals.
A forecasting study conducted by the Bill & Melinda Gates Foundation found that deaths from COVID-19 could be almost halved if countries took a cooperative approach that allowed for the equitable distribution of vaccines. However, leaked GAVI documents indicate the COVAX initiative is at a high risk of failure and that most low-income countries will not be able to begin vaccinating their populations before 2024.
