Vaccine for all: key to reviving the world economy

The human civilisation hasn't experienced such a grievous catastrophe in the last 100 years. Both lives and livelihoods are dreadfully impacted due to the pandemic caused by the deadly coronavirus. This is the worst-ever global economic recession in decades, according to the World Bank.

A study conducted by the UNCTAD reveals that the global economy would shrink by 4.3 per cent in 2020. Consequently, an additional 130 million people will fall into the trap of extreme poverty. For the first time since the 1998 Asian financial crisis, global poverty shows an upward trend.

The global poverty rate, which was 35.9 per cent in 1990, had come down to 8.6 per cent by 2018. However, because of the pandemic, it has already inched up to 8.8 per cent this year and will likely to rise throughout 2021.

According to the International Labour Organisation (ILO), 1.6 billion workers in the informal economy are in immediate danger of having their livelihoods destroyed.

The billion-dollar question is what the way out is. The answer is relatively straightforward – contain the virus, and the only way to do that is to have an effective vaccine.

There have been enormous efforts being put in by different organisations, researchers and academia to discover a vaccine ever since the virus was detected. All these significant initiatives seemed to have paid off.

The recent announcement that an effective coronavirus vaccine has been developed has given a rapturous hope to the world. US drug-maker Pfizer and German biotech firm BioNTech came up with the great news first in the second week of November that their vaccine's efficacy is more than 90 per cent.

US-based Moderna said interim results from a large-scale Phase 3 study demonstrate its candidate vaccine is 94.5 per cent effective with no significant safety concerns. Another breaking news came this week that the vaccine developed by Oxford University and the drug-maker AstraZeneca has shown promising results.

All this great news has naturally brought tremendous enthusiasm and hopes to the global economy. 

According to research conducted by RAND Europe, the global economy is currently losing output at a rate of $3.4 trillion annually. If an effective vaccine gets available in the US, the EU, the UK, China, India and Russia, it estimates that loss would fall to $1.2 trillion annually, or $103 billion a month.

However, a more widespread rollout that left only the poorest countries without initial access to a vaccine would cut the annual loss to $153 billion and amplify the benefit to rich countries.

Kristalina Georgieva, managing director of the International Monetary Fund (IMF), says strong international cooperation on coronavirus vaccine could speed up the world economic recovery and add $9 trillion by 2025.

These statistics are indeed excellent; however, we have to be pragmatic that it will not happen overnight. There are multifold challenges like production, distribution and affordability of the vaccine.

Pfizer and BioNTech said they expect to produce up to 50 million doses in 2020, and up to 1.3 billion doses in 2021. As this vaccine requires two doses per person, therefore, a maximum of 25 million people can be vaccinated in 2020, and another 650 million people could be brought under vaccination in 2021. In order to bring the entire 7.5 billion of the world population under immunisation, it would require several years.

We can expect that by 2021 Moderna and Oxford vaccine would also be available, which would certainly expedite the vaccination coverage. 

The other critical issue to be focused on is the cost of the vaccine or, in other words, affordability. The vaccine would be zero per cent effective to the people who can't access or afford it, says Oxfam, the global poverty charity.

We see completely different approaches of the companies who have already developed the vaccines. Pfizer is treating this as a regular commercial opportunity. It has invested $2 billion of its own money to develop the vaccine. It turned down research funding offer from the US government.

BioNTech received €375 million from the German government and a €100 million loan from the European Investment Bank. The price that Pfizer agreed with the US government is $19.50 per dose, meaning $39 for a two-shot course. It has signed a deal to supply 100 million doses to the US, 200 million to the EU and 40 million to the UK. According to an analysis done by Morgan Stanly, Pfizer and BioNTech are expected to generate $13 billion in global sales from their coronavirus vaccine next year.

On the contrary, AstraZeneca, along with Johnson and Johnson, is developing a coronavirus vaccine in partnership with Oxford University and has promised to make their vaccines available on a not-for-profit basis during this pandemic. AstraZeneca is charging governments $3 to $5 a dose. They said low-income countries would receive its vaccine on a cost basis "in perpetuity".

US biotech firm, Moderna, another frontrunner in the race, has priced its vaccine $32 to $37 a shot. They have received $1 billion from the US government as research funding.

Drugs research and development is typically driven by market forces. It is more likely that the developed countries might be supplied with the vaccine first because of their ability to pay higher prices. The question naturally arises: how do the majority of the world population living in poor countries get vaccines? 

We must keep in mind that until everyone on the planet is brought under vaccination, the world is not safe from this deadly virus. The pandemic seems to be proving that when people are fighting for life or death, the spirit of international collaboration is conspicuously absent.

Here comes the interventions of the world leaders, the international organisations like the UN or the WHO to ensure everyone gets vaccinated as early as possible.

United Nations Secretary-General António Guterres has rightly said: "A Covid-19 vaccine must be considered a global public good. Not a vaccine for one country or one region — but a vaccine that is affordable, safe, effective, easily-administered and universally available — for everyone, everywhere."  

The author is chairman and managing director of BASF Bangladesh Limited. The opinions expressed in this article are those of the author.