What does changing the rules of the game mean?

“Regardless of the practical applications of the waiver, the administration’s and the WTO’s rhetoric alone throughout this process has been damning for the incentive for vaccine makers to invest in producing life-saving vaccines. lives.”

A terrible idea – capricious and ill-conceived, criticized on all economic, political and geopolitical fronts – has come to fruition. The World Trade Organization (WTO) TRIPS waiver on patents related to COVID-19 vaccines will discourage the entire industry from investing in vaccine production. To understand what happens next, let’s start by understanding the story.

where we started

On December 9, 2019, on the eve of the coronavirus pandemic, the Department of Health and Human Services (HHS) revealed that Sanofi Pasteur was “the only company with a seasonal recombinant influenza vaccine licensed in the states. States and have the resources to take advantage of them”. technology for pandemic influenza preparedness. In 2006, fearing the next global influenza pandemic and recognizing that the world was totally unprepared, the World Health Organization (WHO) estimated that the costs associated with increasing the production capacity of influenza vaccines in the event of a pandemic would require an investment of a minimum of 2 to 9 billion USD (i.e. in 2006 dollars). The WHO knew that the cost of entering the global vaccine race exceeded the enormity of normal R&D investments, even for biopharma.

Prior to the COVID-19 pandemic, the United States had only one company with the ability to vaccinate against pandemic influenza. Over the years, pharmaceutical companies have moved away from producing pandemic vaccines after suffering several years of net losses. It’s no secret that manufacturing vaccines was not a high priority in the pharma/biotech sphere. The 1986 US Congress established the National Vaccine Injury Compensation Program over certain vaccine manufacturers ending production of childhood vaccines. Vaccine manufacturing in the United States was not a major aspect of the pharmaceutical industry simply because it was not a hugely profitable aspect. Instead, the industry has chosen to focus most of its R&D investment on developing drugs and treatments.

incentive to act

Pushing the pharmaceutical/biotech industry to manufacture pandemic vaccines was not the result of a reaction to public needs. Is the oil industry driven to produce more oil by the current public need? The answer is no. Businesses don’t work that way. Instead, in 2020, the pharmaceutical industry has responded to monetary incentives provided against a predictable legal system that has induced economic investments in vaccine manufacturing to the tune of billions of dollars funded by public and private investments through the national borders. (The Pfizer/BionTech WARP speed contract alone was worth almost $6 billion).

Of the companies that received WARP Speed ​​money, almost none had previously specialized in manufacturing and manufacturing vaccines, let alone pandemic-type vaccines. Johnson & Johnson and Moderna, for example, weren’t even listed as vaccine manufacturers in the United States until 2020. But in April 2020, Johnson & Johnson entered into an agreement with Emergent BioSolutions in New Jersey to provide vaccine services. manufacturing, soon followed with an agreement with Catalent, prompting Catalent to ramp up manufacturing capacity at its Bloomington, Indiana plant. Just as recently as last February, Moderna negotiated a manufacturing pact with Thermo Fisher Scientific to bolster production of Moderna’s COVID-19 vaccine, Spikevax.

Of the current major COVID-19 vaccine makers, only Pfizer was previously listed as a U.S. vaccine maker, making meningococcal and pneumococcal vaccines. Yet Pfizer has invested more than $2 billion at risk in its COVID-19 vaccine development program between 2020 and 2021, including $500 million to increase manufacturing capabilities.

Most of the current manufacturing facilities used to make COVID-19 vaccines were built after the pandemic began. The mRNA technology used in vaccines from Moderna and Pfizer-BioNTech is the result of decades of research that finally had its day thanks to COVID-19. Vaccine makers are now developing mRNA vaccines to protect against other viruses, such as influenza and HIV.

With the threat of renunciation, next time may be different

What happens now that the WTO has changed the rules of the game for them with this exemption from the TRIPS Agreement? Regardless of the practical applications of the waiver, the administration’s and the WTO’s rhetoric alone throughout this process has been damning in inducing vaccine makers to invest in producing life-saving vaccines. lives. Would you invest in a house and bother to maintain it if you knew the government could condemn it for public use even though your name was on the bill of sale? For a business, would you bother to risk potentially losing billions of dollars with the likelihood of the government changing the legal landscape in which you operate? A rational actor might assume that this is just the beginning and that further erosion of intellectual property is in order because intellectual property is not an issue that the average citizen takes to the streets over. It is therefore reasonable to assume that the government will continue to chip away at this institution and that there will be few political consequences.

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Author: kikkerdirk
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