Three Longs & Three Shorts

Makers Keepers: What can we learn from listed vaccine makers

Author: Anand Sridharan
Source: Buggy Humans in A Messy World (https://buggyhuman.substack.com/p/makers-keepers-what-can-we-learn )

As India’s pandemic continues to rage on, moving into small town and rural India with even greater inadequacies in terms of medical infrastructure, experts are unanimous in our only way out of it is to vaccinate ourselves out of it. Yet, India’s vaccination program has only gone in reverse gear with vaccination rate dropping across the country. Indeed, one of India’s largest and most prosperous states Maharashtra suspended vaccination for people under the age of 45 citing shortage of vaccine supply. On the same day, the state of Ohio announced an incentive scheme to cajole vaccine hesitant citizens – a chance to win a million-dollar lottery and for students to get a tuition fee waiver – several states in the US have followed. Whilst such inequities amidst vaccine nationalism was to be expected, here’s a data driven piece by Anand Sridharan digging through the vaccine makers’ earnings filings to show where have the vaccines gone so far and how is supply likely to shape up in the coming months:
He begins by showing how “majority of vaccines didn’t cross borders:
  • Pfizer-Biontech: 70% of revenue (>75% of doses) from US
  • Moderna: 79% of revenue (86% of doses) from US
  • AstraZeneca: 81% of revenue (82% of doses) from EU+UK
  • J&J: 100% of revenue/doses from US
With all of above vaccines made in US or Europe (67:33 split), ~90% of doses were delivered to North America and Europe. US, by law, exported zero vaccines in Q1. Europe reluctantly did better, but even EU & UK are squabbling over blocking vaccines to each other. ~5% of doses were delivered to COVAX initiative, aimed at getting vaccines to poorer countries.”
Anand says the guidance from these companies suggests even Q2 is not likely to see any pick up in vaccines supplies to the rest of the world but the second half holds promise.
“Production estimates for 2021:
  • Pfizer-Biontech: 2.5-3 billion doses (1.6 billion contracted)
  • Moderna: 0.8-1 billion doses
  • AstraZeneca: no guidance
Above implies 400+ million doses/month over H2 of 2021 from two manufacturers. If N America + Europe vaccination stays at April pace of 200+M/month, availability for export to rest of world could increase disproportionately in H2.”
Whilst Anand is all for vaccine makers getting their RoI, he cites Astra Zeneca as an exception in terms of supplying majority of the affordable vaccines to poorer countries as part of the WHO’s COVAX initiative:
“…AstraZeneca is likely to forego pre-tax profit of nearly $10/dose on a few hundred million doses. No hollow pledge, this.
Doses delivered to COVAX initiative”
  • Pfizer-Biontech: 1.2 million
  • Moderna: Zero
  • AstraZeneca: 18.4 million (sub-licensee Serum delivered another 29.9 million)
While Pfizer & Moderna have contracted future deliveries to COVAX, it’s well after supply-demand eases at home. While numbers till date are a rounding error on poorer countries population, AstraZeneca has done most among big-3 to deliver affordable vaccines to all.”
He concludes by recognising the efforts of the two Indian vaccine makers in providing affordable vaccine supply and why our best hopes remain pinned on them:
“…Serum has sold >200M vaccines to India at $2/dose and will sell even more at $4/dose. Thanks to Serum, India can buy over half a billion doses at a price  lower than Moderna’s material cost. Serum has exported 3x more vaccines to developing countries than Big-3 combined (>60M vs 20M). As it scales from 70M doses/month to 100M doses/month, Serum will maintain its World #2 status.
….Bharat Biotech is equally commendable. Their May production run-rate (30M/month) nearly matches AstraZeneca’s and is 3-months behind Moderna’s ramp-up. At 70M doses/month, they’ll match Moderna in a few months. That they did it without an MNC collaborator makes it even more creditable. To have two Indian companies amidst global top-5 in a highly-specialized niche is a phenomenal achievement (and blessing).
There’s a vested narrative, painting Indian vaccine makers as a ‘profiteers’, with irresponsible threats of compulsory licensing and casual criticism of not doing more, better, sooner. While I don’t generally advocate vigilante justice, one tight slap is in order for such maleficence. India’s 2 billion doses/year run-rate in H2 2021 will be nearly as large as that of US and larger than that of EU. This is as good as it can get, amidst a global pandemic. Thank you, Bharat Ratnas.”