Monopoly Rights on COVID-19 Vaccines Create Nine New Billionaires
Representational use only.
On May 20, The People’s Vaccine Alliance revealed that profiteering from COVID-19 vaccines has created nine new billionaires, whose combined wealth of $19.3 billion is enough to vaccinate everyone in low-income countries 1.3 times. In the meantime, low-income countries have only received 0.2 per cent of the global supply of vaccines due to a significant shortfall in the availability of doses.
The new billionaires include the CEOs of Moderna and BioNTech – Stéphane Bancel with a total worth of $4.3 billion and Ugur Sahil with a total worth of four billion dollars. Moderna, Inc. is a US pharmaceutical and biotechnology company based in Massachusetts while BioNTech SE is a German biotechnology company. The list includes Timothy Springer (worth $2.2 billion) and Robert Langer (worth $1.6 billion) – founder investors in Moderna – and Noubar Afeyan (worth $1.9 billion), Chairman of Moderna. The list also includes Juan Lopez-Belmonte, Chairman of ROVI, a pharmaceutical company based in Spain that has a deal with Moderna to manufacture and package the Moderna vaccine. The final three are the co-founders of Chinese vaccine company CanSino Biologics – Zhu Tao, Qiu Dongxu and Mao Huihua with a total worth of $1.3 billion, $1.2 billion, and one billion dollars respectively.
In addition to the new billionaires, eight existing billionaires with extensive portfolios in the COVID-19 vaccine pharma corporations have seen their combined wealth increase by $32.2 billion. This sum, it was argued, was enough to fully vaccinate everyone in India. Amongst the eight are the founder of Serum Institute of India (SII), Cyrus Poonawalla and the Chairman of Cadilla Healthcare, Pankaj Patel. The total worth of Cyrus Poonawalla has increased by 55% from $8.20 billion in 2020 to $12.70 billion in 2021 and that of Pankaj Patel by 72%, from $2.90 billion in 2020 to five billion dollars in 2021. SII has a ‘restricted emergency-use’ license to produce Covishield which has been developed by the British-Swedish firm AstraZeneca and Oxford University. Cadila Heallthcare manufactures drugs to treat COVID-19 such as Remdesivir and its COVID-19 vaccine ZyCoV-D is undergoing clinical trials.
In a statement, Anna Marriott, Oxfam’s Health Policy Manager said: “These billionaires are the human face of the huge profits many pharmaceutical corporations are making from the monopoly they hold on these vaccines. These vaccines were funded by public money and should be first and foremost a global public good, not a private profit opportunity. We need to urgently end these monopolies so that we can scale up vaccine production, drive down prices and vaccinate the world.”
The People’s Vaccine Alliance highlighted that the monopoly rights over vaccines that the pharmaceutical corporations enjoy allow them to take total control over the supply and price of the vaccine. These monopoly rights or Intellectual Property Rights (IPR) make way for unbridled profits for companies enjoying these rights, while making it harder for the poorer countries to secure the stocks required by them. IPRs are state-mandated monopolies that allow discoverers or inventors to retain exclusive rights to make, use or sell their invention for a limited time. Patents are a type of IPR. World Intellectual Property Organisation (WIPO) defines patents as an exclusive right granted for an invention, which is a product or a process that provides a new way of doing something or offers a new technical solution to a problem.
Recently, Moderna has projected a total revenue of $19.2 billion from the sales of its COVID-19 vaccine. Pfizer has projected a revenue of $26 billion in 2021 through sales of the COVID-19 vaccine that it developed with BioNTech. A few weeks ago, Pfizer reported that the vaccine had brought in $3.5 billion in revenue (nearly a quarter of its total revenue) in the first three months of the year. The vaccine has proved to be the biggest source of revenue for Pfizer. In February 2021, The British pharmaceutical company AstraZeneca had reported that their profit in 2020 had more than doubled to $3.2 billion. Their profit after tax had soared by 139% as compared to 2019.
Earlier this month, the US backed the WTO proposal by India and South Africa to temporarily waive patent protection for COVID-19 vaccines. The proposal has the support of over 100 developing countries and over 400 public health organisations. However, few rich nations like the UK and Germany still continue to block this proposal.
Even as the Indian government along with South Africa continued advocating for a relaxation on patent protections on vaccines for COVID-19 at the WTO, it has taken more than six months to shortlist three Public Sector Units (PSU) for technology transfer of Covaxin, developed by Bharat Biotech and Indian Council of Medical Research (ICMR) - a decision taken by the government only after the mid-April.
In fact, an affidavit filed on behalf of the Union of India in the case 'Distribution of Essential Supplies and Services During Pandemic’ revealed that the Public Private Partnership between ICMR and BBIL stipulates a five per cent royalty clause in favour of ICMR on net sales of Covaxin. The affidavit also noted that efforts had been made to support a scale-up of Covaxin production. There has also been consideration for support to one private industry and three public sector manufacturing facilities to equip them with enhanced capacities to support augmented vaccine production over the next six to eight months. The three PSUs recommended by the government to ramp up vaccine production are Indian Immunologicals Limited, Hyderabad; Haffkine Biopharmaceutical Corporation Limited, Mumbai; and Bharat Immunologicals and Biologicals Limited, Bulandshahr.
Incidentally, the government has also argued against compulsory licensing of key drugs and vaccines, suggesting that this move could be counter-productive and asserted that the real issue is scarcity of raw materials rather than manufacturing capacity. This approach by the Indian government is revealing of why India is experiencing an acute shortage in vaccine availability at the moment. We are in this lamentable situation despite the fact that India has sufficient capacity to cater to its vaccination needs.
In April, a report by Down to Earth revealed that India has a panel of seven PSUs which have the capacity to produce vaccines. However, the manufacturing licenses of three of these PSUs had been cancelled in 2008 for not following the good manufacturing practices laid down in the Drugs and Cosmetics Rules, 1945. These PSUs included Central Research Institute, Kasauli; BCG Vaccine Laboratory, Guindy and Pasteur Institute of India, Conoor. Even as a decision to revive these units was taken in 2012, they were not made fully functional. An Integrated Vaccine Complex in Tamil Nadu that was established to provide for the Universal Immunisation Programme of India, and was ready since 2016, was also found to be defunct at the moment.
A belated decision to involve three PSUs in vaccine production was taken by the government under immense public pressure. It was decided that grants will be provided to upgrade these units as well as to upgrade facilities of Bharat Biotech. How long these upgrades will take to deliver adequate vaccine dosages – at least enough to prevent vaccination centres from shutting down – is yet to be seen. In the meantime, we continue to wait in dread of a third wave, the virus continues to mutate and big pharma and its investors continue to watch their fortunes multiply.
The writer is an author and a Research Associate with Newsclick. The views are personal. She can be reached on Twitter @ShinzaniJain.
Get the latest reports & analysis with people's perspective on Protests, movements & deep analytical videos, discussions of the current affairs in your Telegram app. Subscribe to NewsClick's Telegram channel & get Real-Time updates on stories, as they get published on our website.