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Impending Covid-19 vaccine reveals the flaws in big pharma’s business models

Impending Covid-19 vaccine reveals the flaws in big pharma’s business models

By Mariana Mazzucato, Henry Lishi Li, and Els Torreele*

London – Recent announcements of demonstrated efficacy in COVID-19 vaccine trials have brought hope that a return to normality is in sight. The preliminary data for Pfizer/BioNTech and Moderna’s novel mRNA vaccines are highly encouraging, suggesting that their approval for emergency use is forthcoming. And more recent news of effectiveness (albeit at a slightly lower rate) in a vaccine from AstraZeneca and the University of Oxford has fueled optimism that even more breakthroughs are on their way.

In theory, the arrival of a safe and effective vaccine would represent the beginning of the end of the COVID-19 pandemic. In reality, we are not even at the end of the beginning of delivering what is needed: a “people’s vaccine” that is equitably distributed and made freely available to all who need it.

To be sure, the work to create vaccines in a matter of months deserves praise. Humanity has made a monumental technological leap forward. But the springboard was decades of massive public investment in research and development.

Most of the leading vaccine candidates prime the immune system’s defences against the viral “spike protein,” an approach made possible through years of research at the US National Institutes of Health. More immediately, BioNTech has received US$445 million from the German government, and Moderna has received US$1 million from the Coalition for Epidemic Preparedness Innovations and more than US$1 billion from the US Biomedical Advanced Research and Development Authority and the US Defence Advanced Research Projects Agency. The AstraZeneca-Oxford vaccine has received more than US$1.3 billion of public funding.

But for technological advances to translate into Health for All, innovations that are created collectively should be governed in the public interest, not for private profit. This is especially true when it comes to developing, manufacturing, and distributing a vaccine in the context of a pandemic.

No country acting alone can resolve this crisis. That is why we need vaccines that are universally and freely available. And yet, the current innovation system prioritizes the interests of high-income countries over those of everyone else, and profits over public health.

The first step toward a people’s vaccine is to ensure full transparency of the clinical-trial results, which would enable independent and timely assessments of safety and efficacy. The publication of scanty, preliminary data through corporate press releases is meant for financial markets, not the public-health community. This practice sets a bad precedent. While pharmaceutical share prices surge, health professionals and the public are left second-guessing the reported results. As more detail about the flaws in clinical trial design and implementation for the AstraZeneca-Oxford vaccine emerge, so do the calls for open science and immediate sharing of protocols and results.

In addition, critical questions about the leading vaccine candidates remain unanswered. Responding to political and economic pressure in high-income countries, pharmaceutical companies are rushing their vaccine candidates across the finish line. Accordingly, they have designed their phase-three clinical trials to deliver the quickest possible positive read-out, rather than addressing more relevant questions such as whether the vaccine prevents infection or just protects against the disease. It also is unclear how long the protection will last; whether a given vaccine works equally well in young and old people, or in people with co-morbidities; and how the top candidates compare to one another (critical for designing effective vaccination strategies).

Moreover, national interests – especially those of developed countries – remain the dominant factor in vaccine rollout. While the international purchase and distribution platform COVAX represents a momentous step forward, its impact is being offset by massive bilateral advance-purchase agreements by rich countries that can afford to bet on multiple vaccines. For example, high-income countries have already bought close to 80% of the Pfizer/BioNTech and Moderna vaccine doses that will be available within the first year.

All told, rich countries have laid claim to 3.8 billion doses from different vaccine makers, compared to 3.2 billion (which includes around 700 million doses for COVAX) for the rest of the world combined. In other words, high-income countries have pre-ordered enough doses to cover their populations several times over, potentially leaving the rest of the world with too few to cover even their most at-risk communities.

At the same time, because the vaccine race is focused primarily on Western markets, some candidates are scarcely viable outside of a developed-country context. The Pfizer/BioNTech vaccine must be kept at -70ºC, which is colder than an Antarctic winter. Distributing this vaccine will create costly and complex logistical challenges, especially for low- and middle-income countries. Although other candidates – such as the AstraZeneca-Oxford vaccine – are stable at higher temperatures, it is notable that such glaring features of market discrimination are built into the first product to reach the approval stage.

Beyond national interest lurks the problem of even narrower private interests, which stem from an over-financialized biopharmaceutical innovation model. The business model for future vaccine development is already being sized up now that the pandemic has revealed the potential windfall for investors. But while they benefit from sky-rocketing stock prices, soaring capital gains, and dumping a company’s shares the same day it announces promising preliminary results in a clinical trial, delivering a people’s vaccine has become an afterthought.

The COVID-19 crisis is a perfect test of whether a more public-health-oriented approach to innovation and production will prevail in the years ahead. While Pfizer is sticking with the model of maximizing shareholder value, AstraZeneca has at least pledged not to profit from its vaccine “during the pandemic.” Yet, despite all the public investment that underwrote these innovations, the process will remain opaque, leaving one to wonder if AstraZeneca is actually ready to prioritize public health over profit and offer its vaccine at cost.

While the recent vaccine news has brought hope, it also has exposed the pharmaceutical industry’s broken business model, casting doubt on the prospects of delivering a people’s vaccine and achieving Health for All. Business as usual may allow us to scrape by in this crisis. But there is a better way to do things. Before the next pandemic arrives, we must recognize vaccines as global health commons, and start to reorient the innovation system toward symbiotic public-private partnerships governed in the public interest.

* Mariana Mazzucato, Professor of the Economics of Innovation and Public Value at University College London and Founding Director of the UCL Institute for Innovation and Public Purpose, is Chair of the World Health Organization’s Council on the Economics of Health for All. Henry Lishi Li is a research fellow in health innovation at the UCL Institute for Innovation and Public Purpose and Els Torreele is a visiting policy fellow at the same institute.

Copyright: Project Syndicate, 2020.


About The Author

Daniel Steinmann

Brief CV of Daniel Steinmann. Born 24 February 1961, Johannesburg. Educated at the University of Pretoria: BA, BA(hons), BD. Postgraduate degrees are in Philosophy and Divinity. Editor of the Namibia Economist since 1991. Daniel Steinmann has steered the Economist as editor for the past 29 years. The newspaper started as a monthly free-sheet, then moved to a weekly paper edition (1996 to 2016), and on 01 December 2016 to a daily digital newspaper at His editorial focus is on economic analysis based on budget analysis, dissecting strategic planning and assessing the impact of policy formulation. For eight years, he hosted a weekly talk-show on NBC Radio, explaining complex economic concepts to a lay audience in a relaxed, conversational manner. He was a founding member of the Editors' Forum of Namibia. Over the years, he has mentored scores of journalism students as interns and as young professional journalists. He often assists economics students, both graduate and post-graduate, to prepare for examinations and moderator reviews. He is the Namibian respondent for the World Economic Survey conducted every quarter for the Ifo Center for Business Cycle Analysis and Surveys at the University of Munich in Germany. He is frequently consulted by NGOs and international analysts on local economic trends and developments. Send comments to [email protected]

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