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The inside story of the Pfizer vaccine: A 'once-in-an-epoch windfall'

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  1. patience_limited

    The vaccine has transformed Pfizer’s political influence. In July 2018, Bourla’s predecessor was forced to abandon price hikes after being publicly shamed on Twitter by former US president Donald Trump. For years, its most famous product was Viagra for erectile dysfunction.

    Now, the US drugmaker is behind the pharmaceutical product with the record for sales in a single year. Pfizer forecasts sales of the vaccine will hit $36bn in 2021, at least double those of its closest rival Moderna. Pfizer’s ability to dramatically expand production has made it by far the most dominant vaccine maker. In October, Pfizer had 80 per cent market share for Covid vaccines in the EU and 74 per cent in the US.

    Since the vaccine’s approval at the end of last year, Pfizer’s decisions have helped shape the course of the pandemic. It has the power to set prices and to choose which country comes first in an opaque queueing system, including for the booster programmes that rich countries are now scrambling to accelerate.

    Depending on its decisions, countries, regions and even whole continents can open up their economies or risk falling behind in the race to control the virus. Although supplies of vaccines to poorer countries have ramped up since September, the global disparities are stark. So far, 66 per cent of people living in G7 countries have had two vaccine doses; in Africa, only 6 per cent. The number of people in high income countries who have had booster shots is almost double the number in low income countries who have received first and second doses.

    The danger of such an unequal rollout has been underlined by the emergence of the new and potentially dangerous Omicron variant. Although its origins are still unclear, scientists have long warned that new variants are more likely if large parts of the world remain unvaccinated. “No one is safe until everyone is safe,” says Seth Berkley, chief executive of Gavi, the UN-backed vaccines alliance.

    How Pfizer wields this newfound power — and what it plans to do next — is treated as top secret, as the vaccine maker blacks out large chunks of contracts and binds even independent scientists with non-disclosure agreements.
    Jillian Kohler, the director of the WHO’s collaborating centre for governance, transparency and accountability in the pharmaceutical sector, says Pfizer had historically had a reputation for being “quite aggressive” and “interested in profit maximisation at the expense of everything else”. But the pandemic has amplified its power, “exacerbating Pfizer’s ability to ask extraordinary demands from governments”.

    Pfizer has told investors it will be able to raise the price after Covid-19 enters an endemic phase, when its spread is slower and more controlled. Analysts are cautious about assuming it will dramatically hike the price, wary that Pfizer could face more competition.

    But Pfizer’s dominance looks increasingly secure as other vaccines are delayed or abandoned. It is the only one of the pre-pandemic big four vaccine makers currently selling a shot: Sanofi and GSK have not yet reported their phase 3 data after a dosing mistake set back an earlier trial of their joint vaccine, while Merck left the race in January after poor results.

    Next year, Pfizer forecasts it will generate $29bn from the vaccine, based on contracts it had already signed in mid-October. In an earnings call in February 2021, Pfizer predicted that after the pandemic ends, its current margins — in the high 20 percentage points — will increase, as costs are likely to fall.

    Before deals could be agreed, Pfizer demanded countries change national laws to protect vaccine makers from lawsuits, which many western jurisdictions already had. From Lebanon to the Philippines, national governments changed laws to guarantee their supply of vaccines.

    Jarbas Barbosa, the assistant director of the Pan American Health Organization, says Pfizer’s conditions were “abusive, during a time when due to the emergency [governments] have no space to say no”.

    But negotiators feared that pushing back could delay the delivery of doses. Jonathan Cushing, head of global health at Transparency International, says: “It is effectively a race to the bottom: whoever signs over the most, will get the vaccines quickest”.

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