So, the Biden Administration supports to waive international patent protections for covid-19 vaccines. How would this work to save the world?! Aren’t patents the bread and butter of the pharmas? Do other countries have the ability to produce the same vaccines? Will this leave a vacuum to fake vaccines?
The recent announcement that the United States Trade Representative will discuss options to waive some COVID-19 vaccine intellectual property (IP) rights has created some confusion to the world. Has Pfizer done enough to ensure fair and equitable distribution of our COVID-19 vaccine? Is the proposed waiver going to bring solutions or create more problems? I am writing to you today to discuss these questions.
Fair and equitable distribution was our North Star from day one. In order to ensure that every country can have access to our COVID-19 vaccine two conditions had to be met: a price that anyone can afford and reliable manufacturing of enough vaccine for all.
The first condition was met in the early days. Back in June of 2020 we decided to offer our vaccine through tiered pricing. The wealthier nations would have to pay in the range of about the cost of a takeaway meal and would offer it to their citizens for free. The middle-income countries were offered doses at roughly half that price and the low-income countries were offered doses at cost. Many of the poorest communities will receive their doses through donation. Equity doesn’t mean we give everyone the same. Equity means we give more to those that need more.
Meeting the second condition was much more challenging but we are getting there with remarkable speed. Thanks to the ingenuity and hard work of our scientists, engineers and skilled workers, and multibillion dollars of Pfizer investment, we announced that we will provide to the world more than 2.5 billion doses in 2021. In fact, our internal target is 3 billion doses, so we feel quite comfortable about our commitment. Achieving 3 billion doses this year means, by extrapolation, 4 billion doses in 2022. These doses are not for the rich or poor, not for the north or south. These are doses for ALL. We have concluded agreements to supply 116 countries and we are currently in advanced negotiations with many more for a total of approximately 2.7 billion doses in 2021. Upon finalization of all agreements, we expect that 40% of them, or more than 1 billion doses, will go to middle- and low-income countries in 2021.
This clearly poses another question. Until today, we have shipped approximately 450 million doses and the balance is more favorable to high income countries. Why is that? When we developed our tiered pricing policy, we reached out to all nations asking them to place orders so we could allocate doses for them. In reality, the high-income countries reserved most of the doses. I became personally concerned with that and I reached out to many heads of middle/low-income countries by letter, phone and even text to urge them to reserve doses because the supply was limited. However, most of them decided to place orders with other vaccine makers either because mRNA technology was untested at that time or because they were offered local production options. Some didn’t even approve our vaccine. Unfortunately, other vaccine producers were not able to meet their supply commitments for varying technical reasons. Most of the countries that did not choose us initially, came back and thanks to our phenomenal supply ramp up, we have started signing supply agreements with them. We expect the supply balance to weigh in their favor in the second half of 2021, and to have virtually enough supply for all in 2022.
Last week, I had the opportunity to provide these facts to the US Trade Representative and explain why the suggested waiver of IP rights could only derail this progress. Which brings me to the second question. Is the proposed waiver going to improve the supply situation or create more problems? And my answer is categorically the latter.
When we created our vaccine there was no manufacturing production of any mRNA vaccine or medicine anywhere in the world. We had to create manufacturing infrastructure from scratch. With 172 years of quality manufacturing tradition, substantial deployment of capital, and more importantly, an army of highly skilled scientists, engineers and manufacturing workers, we developed in record time the most efficient manufacturing machine of a life-saving vaccine that the world has ever seen. Currently, infrastructure is not the bottleneck for us manufacturing faster. The restriction is the scarcity of highly specialized raw materials needed to produce our vaccine. These 280 different materials or components are produced by many suppliers in 19 different countries. Many of them needed our substantial support (technical and financial) to ramp up their production. Right now, virtually every single gram of raw material produced is shipped immediately into our manufacturing facilities and is converted immediately and reliably to vaccines that are shipped immediately around the world (91 countries to date.) The proposed waiver for COVID-19 vaccines, threatens to disrupt the flow of raw materials. It will unleash a scramble for the critical inputs we require in order to make a safe and effective vaccine. Entities with little or no experience in manufacturing vaccines are likely to chase the very raw materials we require to scale our production, putting the safety and security of all at risk.
And I would like to make a final point. I worry that waiving of patent protection will disincentivize anyone else from taking a big risk. We deployed $2 billion before we knew whether we could successfully develop a vaccine because we understood what was at stake. Just recently, I authorized spending an additional $600 million on COVID-19 research and development that will bring our total spend for R&D in 2021 to more than $10 billion . The recent rhetoric will not discourage us from continuing investing in science. But I am not sure if the same is true for the thousands of small biotech innovators that are totally dependent on accessing capital from investors who invest only on the premise that their intellectual property will be protected.
Ending the pandemic and vaccinating the world is a massive, but achievable undertaking. We remain fully focused on getting high-quality, safe and effective vaccines to patients all over the world as quickly as possible and to putting an end to this deadly pandemic. Once again, we will not let politics stand in our way and we will continue doing what we do best – creating breakthroughs that change patients’ lives.
Someone in a WeChat group summarized the following:
- 疫苗从去年6月开始就是分层定价 tiered pricing, 高收入国家定价一顿外卖钱,中等收入国家半价,低收入国家成本价.但是当时中低收入国家普遍不愿意定,不相信mRNA, CEO当时直接给很多国家领导人email/打电话/text都没有用,这是造成现在看起来Pfizer基本全在高收入国家的根本原因. (当然最近很多国家又回来买了)