By The Biz Team (Siam)
The Covid-19 pandemic has caused global chaos and devastation. Millions of people have lost their jobs, hundreds of thousands of businesses have closed, the airline and tourism industry has been decimated, and wearing masks and social distancing are now enforced in all public places. Everyone is hoping that a vaccine can be developed, so that life can return to some type of normalcy.
Everyone agrees that there is an urgent need for a COVID-19 vaccine, but the motives of the creators of a vaccine differ from those of the public. This will surely be made evident once the cost of the vaccine is known. At last count, there were at least 200 companies actively trying to develop a vaccine against the coronavirus. While some of these R & D companies have the public’s best interest at heart, the majority are in it for the money. There is big money to be made in creating a safe vaccine due to the fact that the world’s entire population needs a vaccine. When Bill Gates has invested a significant amount of money into vaccine research; one has to wonder why? Gates continues to tweet and make statements that all Americans should get vaccinated once it's available. Well, when Gates first built Microsoft, all the software was free. But today, there is nothing free about Microsoft. Even using Microsoft Word requires a hefty subscription, which should tell a lot about his vaccine motives.
At least a few companies in the US are slated to conduct clinical trials sometime this month. So now the question is, how much will the vaccine cost to the average person?
Unlike a drug, making a vaccine is not very expensive, and it provides immediate benefits to the masses. Once the population is immunized, the vaccine is used sporadically. On the other hand, some of the latest anticancer drugs can cost thousands of dollars per month, and patients need the drugs continuously, which is very profitable for Big Pharma. The technology for making vaccines has already been established, and most companies are using the same technology to make the vaccine for COVID-19. But the topic becomes a little more complex as most of the vaccine nanotechnology has not always been made by Americans. So any startup that does make the COVID 19 vaccine, will have to pay royalties to the company that owns the patent technology and in turn, these manufacturers will pass the cost to the consumer. The amount of royalties paid varies from 1-6%. And if the manufacturer of the vaccine has used two patents, then the royalties quickly start to add up.
At the moment, no one has any idea what the vaccine will cost, but considering that there is a critical need for a vaccine, charging money for it would be very controversial. This controversy becomes even bigger when one realizes that the U.S. Government has pledged close to $2.2 billion to at least five U.S. pharmaceutical companies.
Both the U.S. government and Big Pharma understand the need for a vaccine for COVID 19, but they differ in what that vaccine should cost. Pharmaceutical companies, of course, want to recoup all the costs of making the vaccine, and also earn a profit. Whereas the public want an affordable vaccine, so that every American can be vaccinated. It's questionable where the U.S. government stands on it all. The government does not want to disincentivize the private sector from making new drugs and vaccines, and hence when the vaccine is finally made and approved, they will hopefully come to an amicable solution for the price.
Sadly, the US is the only developed nation that has never been able to balance cost, efficiency, and social good in setting prices. Given the prevailing business-centric model of drug pricing in the nation, it may break the budget and make the vaccine unavailable to many. The last infection that required a vaccine to quell a pandemic in the U.S. was polio. The infection paralyzed thousands and killed just as many. At that time, the vaccine was offered free, courtesy of the March of Dimes Foundation. However, at that time healthcare was in its infancy, and no one knew that making drugs was a way to become filthy rich. Now, we are looking at the deliverance of a vaccine at the time of patents. Big Pharma is a multibillion-dollar business. The few companies that make drugs have a monopoly on prices. Today, new cancer drugs cost thousands of dollars a month, and older drugs like insulin that cost less than a dollar three decades ago, now cost thousands of dollars a year.
The U.S. government is at the mercy of Big Pharma. Recent vaccines to prevent deadly meningitis in college students and prevent shingles in the elderly have a retail cost of $400. If a COVID vaccine is developed and the cost is $100 per person, one can just do the math for a population of 400 million. However, healthcare workers say that spending $200-$300 billion is not unreasonable on an epidemic that has already cost the economy trillions of dollars, and left millions unemployed.
While other nations balance the cost and social good of medications, the U.S. has allowed businesses to increase the price ad hoc, forcing consumers to bear the higher costs. This feeling is particularly bitter because a significant amount of research is subsidized by billions of federal dollars.
Researchers have already started to smell the money Moderna, a small Boston company, has now partnered with the NIH to develop the COVID vaccine. Its worth has tripled in only a few months, from $7 billion to $23 billion, making everyone who works for the company instantly wealthy. And the fact is that Modern has never developed anything to fruition.
Big Pharma says an effective vaccine will prevent COVID- 19 from ever happening again. Already COVID-19 related healthcare expenses are in the billions, and researchers say that with an effective vaccine, all that money will be saved in the future. The return on the investment is much bigger than the research cost, say the researchers.
The truth is that the U.S. has no mechanism to control pricing. Too many of the politicians who sit on the price control committee themselves, sleep in the same metaphorical bed as Big Pharma bosses. Thus, the laws will always favor businesses, as long as the citizens allow irt. Neither Medicare nor the FDA has any say in pricing. To prevent price gouging, a bipartisan coalition is needed urgently.
Other nations like the United Kingdom take a more practical approach to drug pricing. A National Body looks at the cost-benefit analysis regarding drug prices, and whether it should be made available to citizens. With this information, the Body then negotiates with the drug-maker on the price, and then develops a national reimbursement program.
While not everyone disagrees that pharmaceutical companies deserve a decent profit from taking on this urgent project of developing a vaccine, the public should not be held hostage with the price. Before the vaccine even reaches the market, the government should discuss the actual prices. If nothing is done, rest assured the public will be practicing social distancing and wearing masks for a long time to come.