Pandemics, like wildfires, need to be extinguished quickly, otherwise they spiral out of control. Pfizer’s policies in regard to the allocation and pricing of its COVID-19 vaccine have brought the developing world to the brink of an enormous humanitarian catastrophe and has exposed rich countries to serious risks in the time to come.
COVAX: COVID Vaccine for All
The entire world had endured the trauma of COVID–19 through all of 2020. It was plainly evident that when a vaccine became available, there would be a mad frenzy to get to the front of the line—a line of over five billion people.
Recognising this, the World Health Organisation, in partnership with GAVI, the Vaccine Alliance, had established COVAX in the spring of 2020 to ensure a “fair and equitable” distribution of vaccines to all countries. The essence of the plan was for COVAX to procure two billion doses of the COVID vaccine. It would provide the first 20 percent of each country’s requirements in 2021, to cover the most vulnerable people in all countries. It established prices of US $1, 2, and 3 per dose depending upon the income level of the recipient country.
Pfizer Goes to Town
Following the FDA approval of Pfizer’s vaccine on December 12, all hell broke loose. True to script, demand exploded and Pfizer quickly realised that it could sell as much of its vaccine at whatever price it chose to.
Pfizer established a price of US $20 per dose, 10 times that of the recommended median COVAX price. Even at this price, customers were literally begging for vaccines. PM Netanyahu of Israel boasted—not complained—that he had had to call Albert Bourla, the CEO of Pfizer, 17 times to ensure an allocation for Israel.
Another COVID vaccine was brought to the market at about the same time by Moderna. Unlike Pfizer, an established “Big Pharma” company, Moderna was just ten years old and had been founded by university professors. Moderna’s management was content to follow Pfizer’s leadership, without asking any awkward questions. In fact, after seeing the insatiable demand for Pfizer’s vaccine, it priced its (identical) vaccine at US $30, i.e., 50 percent higher than Pfizer’s rate, which also the customers lapped up happily. David Ricardo’s theory of scarcity rent was proven like never before in history.
Pfizer’s “sales strategy” was very simple: Sell to whoever can pay right away. Naturally, the rich countries promptly soaked up the supplies leaving everybody else in the lurch. The list of Pfizer’s customers was identical to the list of countries with the highest per capita GDP in the world. The 90+ developing countries have so far received virtually no vaccine from Pfizer.
Pfizer’s management will defend its actions on the basis of trying to “maximise shareholder interest”. This is convenient but only partly true. The real motivation is, in fact, trying to maximise executive management compensation. To illustrate, the CEO, Albert Bourla, earned a salary and bonus of about US $5.2 million last year, and US $10.4 million from stock options. And, this was before Pfizer had sold a single drop of its outrageously priced vaccine.
As of date, Pfizer has committed to contribute a mere 40 million doses of its vaccine to COVAX. This is only 2.5 percent of both COVAX’s requirements (2 billion) and also the annual capacity of Pfizer and its associates (also 2 billion).
Vaccines are Public Goods
Vaccine manufacturers, particularly in the US, have been provided generous financial and research support by the government and private foundations. This is, indeed, laudable.
The pioneering work on the mRNA technology, which is the foundation for both the Pfizer and Moderna vaccines, was done at the National Institute of Health (NIH). The extraordinary commitment of Katalin Kariko—an unsung government lab technician at NIH—was central to the development of the mRNA technology. Her passion was the science, not the monetary rewards.
Pfizer received US $1.95 billion in financial support as an advance from the US government under the Operation Warp Speed programme. Ironically, the “Pfizer vaccine” was not even developed by Pfizer. It was developed by BioNTech, a German company founded by Turkish immigrants, which received a grant of 375 million euro from the German government and an investment of US $55 million from the Gates Foundation.
Donors of private foundations get tax benefits and to that extent their monies acquire the character of public funds. Knowledge and products that are born out of public funds are public goods. Hence, vaccines are no exception. Providers of such monies, both government and private foundations, must ensure that the concept of public goods is clearly written into their financial arrangements. In the absence of this, the drug and vaccine development business becomes a convenient vehicle for funneling public funds to corporate shareholders. Professor Marianna Mazzucato eloquently summarised this state of affairs: “We have socialised the risks and privatised the rewards”.
A Crisis of Conscience
Let us, first of all, recognise that the entire world is waging a war—a war against the virus. We have lost more than 3 million people to the virus so far. And the virus is not done with us yet. While we keep talking about masks and social distancing, the virus continues its macabre dance—spreading, infecting, killing, mutating, and sowing grief—silently, mercilessly.
At the end of the day, we really have only one weapon in our arsenal to fight this diabolical virus: A vaccine. Pfizer and Moderna have deliberately denied millions of innocent people this very basic tool to prevent what is quickly becoming the worst tragedy in the history of mankind.
Over four months have elapsed since the vaccines were rolled out. Yet, over 40 countries have vaccinated less than 1.0 percent of their populations. This list includes large and important countries such as Nigeria, South Africa, Venezuela, Egypt, Ethiopia, Pakistan, Iran, Iraq, and Sudan. Broad vaccination coverage will not happen in the vast majority of these countries before the second half of 2022. Mr. Tedros, the Director General of the WHO, aptly summed up this state of affairs in just one word, “grotesque”.
To be sure, rich countries ordering vaccines far in excess of their per capita requirements must shoulder a good part of the blame for this horrific state of affairs. But it is abundantly clear where the primary responsibility for this calamity lies: Pfizer and Moderna. Specifically: They set prices that have absolutely no relationship to costs. Allocated product without the slightest consideration of the critical need to inject a certain degree of “fairness and equity” in the process. They made a minute contribution of just 2.5 percent to COVAX.
Directly, as a result of Pfizer’s reckless policies, humankind is paying an unprecedented price in terms of human health and completely avoidable deaths of large numbers of people. And, it will get far more brutal.
The Perpetual Pandemic
There is cause for celebration in many countries. Disneyland is opening up, as are the pubs and West End in London. Restaurants and flight bookings are picking up. Spring is in the air. Finally.
But there is one underlying concern: Variants. It is through viral mutation that the most sinister variants survive and thrive, and the SARS-CoV-2 virus is no exception. Since the virus has already infected 150 million people, it has spun tens of millions of variants, many of them more lethal than the original virus.
In fact, this virus is waging an extreme form of guerilla warfare. Consider this: If you could capture all the SARS-CoV-2 viruses in the world, you could fit them in a single can of Coke. Yet, with all our guns, submarines, SAMs, nuclear weapons and, yes, intelligence, we are just unable to come to grips with this horrific enemy. And the virus respects neither the immigration officials nor border walls.
The variants are helped along by that most marvelous of human inventions—the airplane. Within days of the double mutant appearing in India, it was identified in France. The Brazilian variant is widespread in the US, and the South African and the UK (Kent) variants are, well, everywhere. Each of these variants has the potential to seed another, even more numbing pandemic than what we have witnessed so far.
This is great for the vaccine makers who are looking forward to developing new vaccines for every variant. The adage “No country is safe until every country is safe” is not just empty words. The risks for humanity are profound.
As Dr. Luciana Borio, the former Director for Medical and Biodefense Preparedness at the US National Security Council put it: “You can’t battle a pandemic with travel restrictions, unfortunately, which makes it so important to share vaccines with the world… before the virus gets to our shores.
By deliberately excluding the very poor from accessing vaccines, Pfizer and Moderna have set the stage for not just the poor but also their rich and famous clients to live under the Damocles sword of a perpetual pandemic for several years.
It is possible that the horror movie we are seeing in India will play out in some form or the other in many, many other countries before we can declare victory against this diabolical pathogen.
This article was first published on ORF.
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