Britain - vaccines: profitable scarcity?

Stampa
Spring 2021

When Britain’s Medicine and Healthcare product Regulatory Agency (MHRA) approved the Pfizer/ BioNTech vaccine on 2 December, before any other country in the world, pro-Brexit politicians jumped on the opportunity to claim Britain was first because of Brexit. 

    In fact any EU country could have done the same thing. Even if Brexit had never happened, the MRHA would still have been able to approve the vaccine, because it was already allowed to do so under EU law. This states that ”Member States may temporarily authorise the distribution of an unauthorised medicinal product” in an emergency. And that is what this approval was: emergency authorisation before all the trial protocols were officially submitted - even if they were theoretically complete. Public Health England would rather not boast about that. Anyway, as it happened the USA followed within 9 days with its own authorisation and by the end of December the EU also approved this vaccine. 

    With the worst death rate among G7 countries, the British government was, of course, in desperate need of a vaccine. Johnson had signed up venture capitalist Kate Bingham (her husband is Jesse Norman MP, the financial secretary to the Treasury) as head of the vaccine taskforce, to secure as many doses of as many vaccines as possible - and ahead of everyone else. It was a race, of course, because there was never going to be enough vaccine to go around. To date Bingham has apparently secured 457m doses (most still on order) at an estimated cost of £11.7bn. It is highly likely that she did so by paying over the odds. This is enough vaccine to vaccinate the population 3 times over! 

    Yet despite placing such a huge order (at the expense of other countries, particularly the poorest), the available vaccine doses for commencing the vaccination roll-out were in short supply. This led the government to decide, without any scientific evidence at the time, to increase the gap between the two jabs, from the recommended 3 weeks to 12 weeks. So when Health Secretary Matt Hancock talks about the ”national success story” of the vaccine rollout, claiming at the time of writing that 33,752,885 people (over half the adult population) have been vaccinated, in fact only 12.8m have had 2 jabs. This amounts to 19% of the population and means that Britain’s roll-out is certainly not the best in the world - contrary to the constant assertions of government ministers. In fact, it is 15th in the world - around the same level as Hungary and Serbia, and behind Israel (57%), the US (27%) and even a poor country like Chile (33%). 

    This is what the government’s false “success stories” are worth. In fact, Johnson couldn’t have expressed it better when he said, during a zoom meeting with backbenchers: ”The reason we have the vaccine success is because of capitalism, because of greed”. Indeed, the real success story, if there is one, lies with the big pharmaceutical companies, which are on their way to making mega-profits out of the pandemic. 

The British state and AstraZeneca: a love story

When the pandemic broke out last year, it opened a gigantic new market to the big pharmaceutical companies specialising in vaccine manufacture. This market is essentially split between the US giants Pfizer, Merck and Johnson&Johnson, the British GSK and the French Sanofi. 

    Even companies that didn’t specialise in vaccine production were attracted by the possible huge profits the pandemic had opened up to them. This was the case for the British-Swedish company AstraZeneca, which had so far oriented itself towards cancer treatments rather than vaccines. But with such potential gain thanks to the pandemic, the company decided to lay its hands on the vaccine research conducted at the University of Oxford (and its spin-off company Vaccitech) back in April last year. 

    From the very start, all these companies were heavily subsidised by their respective states, directly or indirectly. The adenovirus technology used in the AstraZeneca vaccine, for instance, is the result of decades of publicly funded research - and not just carried out at the Oxford University. In fact, a recent study published by researchers in Britain and the Netherlands shows that 97% of the funding for the development of the AstraZeneca/ Oxford vaccine is publicly funded - from charities, taxpayers and... EU subsidies! And if this vaccine was developed so quickly, it was also thanks to the very first genetic sequencing of Covid-19, which was made freely available by... the Shanghai Public Health Clinical Centre, back in January 2020. 

    But more direct are the recent government subsidies to pharmaceutical companies: in May last year, for instance, Johnson announced a £65.5m handout to AstraZeneca/Oxford and an additional £74m for a range of related companies on-site. The government also provided £215m to accelerate the construction of the Vaccines Manufacturing and Innovation Centre in Oxfordshire - which is currently producing the AstraZeneca vaccine. Of course, after AstraZeneca closed several manufacturing plants as part of its 2014 “restructuring plan”, including the Avonmouth plant in Bristol, government-funded manufacturing centres come in handy. And most importantly, at zero cost to AstraZeneca. 

    But the government’s largesse towards AstraZeneca doesn’t stop there. It also promised to pay 40% more for the AstraZeneca vaccine than the EU vaccine consortium was offering. And it assumed full responsibility in case the vaccine had adverse effects (so-called liability waivers). This level of state support has undoubtedly played a role in vaccine deliveries to Britain being prioritised over the EU. 

    But the privileged links between AstraZeneca and the British state are also illustrated by the case of John Bell, regius professor of medicine at Oxford University, who has had a high-profile role in the government’s response to the pandemic, while also working on the AstraZeneca/Oxford vaccine. In fact, John Bell is also the non-executive director of Roche, the pharmaceutical giant that sold the government £13.5m of antibody tests, which Public Health England later found to be unreliable! 

    It is thanks to these massive subsidies and the close links between states and their respective national pharmaceutical companies that rich countries, with barely 14% of the world population, could secure 53% of all vaccine doses. In fact, the Covid vaccine market was shared amongst the rich countries long before vaccines were even approved. On 17 May 2020, the British government was the first to secure 100m doses from AstraZeneca. By November, 7.4bn doses of the 10 principal vaccine candidates were already pre-ordered - and over half of these were in the hands of the US, Canada, Britain, Japan and the EU. 

National rivalries and protectionist measures

But of course, the fact that these deals for bil- lions of doses were struck between rich states and their pharmaceutical companies in no way guaranteed the efficacy of the vaccine candidates. For instance, back in December, the GSK/Sanofi vaccine candidate was proven ineffective in its phase 1 and 2 clinical trials, delaying its delivery to late 2021 (although GSK/Sanofi don’t actually know if they can produce a successful candidate at all!). The same can be said for the vaccine being de- veloped by the German company CureVac, which is in a consortium with the German Bayer, British GSK and Swiss Novartis. Their vaccine is still un- dergoing clinical tests and is supposed to be delivered in summer this year - if it does pass these tests, which is, apparently, a big “if”. So these pharmaceutical giants are still wasting time and resources producing their own vaccines to meet their pre-orders, which are still pending, at a time when effective vaccines already exist.

    In fact, all this wasted time and these wasted resources are the result of ongoing so-called vaccine nationalism. Indeed, each national state is ensuring its own national pharmaceutical industry gets the biggest possible share of the vaccine market, at the expense of efficient vaccine rollouts. So for instance, there are 30m doses of the AstraZeneca vaccine sitting idle in US production labs - because the US Food and Drug Administration (FDA) has not approved its usage yet. In the meantime, the US vaccines such as Pfizer/BioNTech, Johnson&Johnson and Moderna take the lion’s share of the US market.

    And while the US delays the approval of the AstraZeneca vaccine, issues with the delivery of this same vaccine have sparked a nasty nationalist confrontation between Britain and the EU. AstraZeneca has been utterly incapable of producing the number of vaccines it has committed itself to deliver, thanks to years of cuts and closures of production facilities. It therefore decided in January to scale down a supply of doses to the EU, from 80m to 31m, while Britain was prioritised for its 100m pre-orders. In an (ill- conceived) attempt at retaliation, the EU threatened to use “Article 16” of the Brexit deal’s Northern Ireland Protocol - which can reinstate a hard border between North and South, against the “sacred” Good Friday Belfast Agreement, which stipulates an open border in order to keep the peace. This threat was withdrawn within minutes, but it was enough for Brexiteers to make anti-EU capital out of it. Indeed, in the context of Brexit, the vaccine has become a political football!

    But AstraZeneca, despite being incapable of delivering, has taken the highest number of vaccine pre-orders amongst all the pharmaceutical industries, de facto undercutting the vaccine market. Indeed, when AstraZeneca bought the rights to the vaccine developed at the Oxford University, the deal stipulated that it would sell ”at no profit during the period of the pandemic”. Which has no doubt helped it to “flood” the order market by undercutting the others (the cheaper, US state-funded, Johnson&Johnson vaccine, came later to the race). Of course, AZ’s contract still allows the company to “add” up to 20% above production costs to the price, and it will be able to increase its prices after July. But for the time being, this vaccine is the cheapest, selling between £1.50 and £2.90 (although higher prices apply to poor countries!). 

    This probably explains some of the hysteria surrounding the AstraZeneca vaccine, peddled by its rivals. However when President Macron called it ”quasi-ineffective”, or Merkel claimed it was unsafe for people over 55 years old, they were merely covering their political backs because they were short of vaccines for their respective populations. 

    The cases reported of cerebral thrombosis (blood clots in the brain) linked to the vaccine are no doubt real. But there is a 0.0004% chance (or 4.1 per million) that a vaccinated individual would get such a clot. Going just by general statistics, the likelihood of anyone who is unvaccinated getting a blood clot is even greater! But anything is allowed in the vaccine market in order to discredit a competitor. 

    Heads of states have done their national companies’ bidding. German chancellor Angela Merkel and French president Emmanuel Macron both threatened to offer part of the German and French vaccine market to the Russian Sputnik V, in order to put pressure on AstraZeneca. Whether they really will end up making a deal for Sputnik V deliveries or not, is another question. What is certain, is that both Merkel and Macron will ensure that a big enough share of their market is left to the vaccine candidates developed by their respective national companies - giants like Bayer or Sanofi. And to give them an extra-helping hand, the EU decided, on 14 April, to stop new AstraZeneca and Johnson&Johnson orders. 

    The threat to use Sputnik V, however, has shown that the reluctance to use it so far has nothing to do with “safety concerns”, as was claimed back in August when Sputnik V became one of the first vaccines to be authorised. In fact, Sputnik V has a protection rate of 91%, one of the highest amongst all vaccines produced so far. Nor were “safety concerns” the reason to blank vaccines like the Chinese Sinopharm and Sinovac, which were given conditional emergency authorisation back in July 2020. These vaccines offer protection similar, if not higher, than the AstraZeneca vaccine. 

    But when these early vaccines were announced, most Western pharmaceutical companies saw their prospective vaccine market shrink, and so did their shares. And in order to maintain their share prices, their respective governments have resorted to pure and simple vaccine protectionism - in the case of the Russian and Chinese vaccines, by reviving cold war politics. 

    The result has been to deprive populations of urgently needed protection, for months! But with a protected market and guaranteed profits, why should these giant pharmaceutical companies, in monopolistic positions, bother to increase their vaccine production? In fact, vaccine scarcity suits them perfectly, since it allows them to push prices up! 

Those left behind 

When the state-run Gamaleya Institute produced the Sputnik V vaccine, the vaccine manufacturers reported deals to supply 1.2bn doses abroad during 2021. Four Chinese vaccine manufacturers pledged they could supply another 500m doses. Of course, the Russian and Chinese regimes are using their vaccines for their own political agendas. But the reality is that for many poor countries, these are the only sources of vaccines available. With very limited manufacturing capabilities, however, it is very unlikely that the Russian and Chinese labs will be able to meet all their export targets. 

    The World Health Organisation, which refused for several months to accept that Russia and China might have produced an effective vaccine, has reluctantly given in. It had already sponsored a vaccine-sharing alliance called Covax (Covid-19 Vaccine Global Access), which aims to acquire and distribute 2bn doses to 142 poor countries this year, and will include Russian and Chinese-made vaccines. However, to do so, an estimated £24bn needs to be raised. So far, it has delivered a paltry 38m doses in 98 countries and has only raised £4.3bn. By the end of May, it would have supplied just enough vaccine for 3.3% of the population of the poorest 142 countries. Even if the targets aimed at by Russia, China and the WHO Covax programme were reached in 2021, unlikely as this is, it would mean that only 40% of the population of poor countries would get vaccinated this year. 

    In the meantime, a big proportion of the AstraZeneca vaccine, meant for the markets of rich countries, is produced in the Serum Institute of India, where production costs are lower thanks to India’s cheap labour. By 16 April, however, only 11% of the Indian population has been vaccinated. 

    As a result, poor countries like India and South Africa have pushed for a temporary suspension of intellectual property rights so that Covid-19 vaccines and other new technologies are accessible for poor countries. Of course, patents are just one obstacle preventing the worldwide production of vaccines among many: most poor countries don’t even have the health infrastructure that would be needed for effective vaccine rollouts. 

    It is obvious that in order to bring the pandemic under control, not a single country can be left behind. This is not just a question of international solidarity: as long as hotspots of infection remain, Covid variants will keep appearing and the virus will continue to ravage populations worldwide - and will ”wash up on our shores”, as Johnson put it. To fight effectively against this virus, vaccines need to be produced at a much greater rate. Competition, profiteering and the lack of any central control over resources are an obstacle to what should be a collective worldwide effort. The time and effort wasted so far have led to one of the most lethal pandemics in recent history. And yes, to quote Johnson again, it is ”because of capitalism, because of greed”. 

    When capitalist countries were at war with each other, sending millions of workers to their deaths, their states requisitioned the whole of the capitalist economy for the sake of the war effort. Of course, they did this temporarily and paid full compensation to the capitalists. But in the fight against Covid, governments have not even considered requisitioning vaccine research and manufacturing. This, however, would be the only option - and just the starting point - if the war against this virus and future viruses, is to be won. 

20 April 2021