ITHACA, New York: As the second wave of the COVID-19 pandemic surpasses the severity of the first, a clear global shift is emerging.
The pandemic is easing, gradually and unevenly, in richer countries, but is breaking out in several developing and emerging economies, notably in India, but also to varying degrees in countries such as Bangladesh, Pakistan, Turkey. , the Philippines, Ethiopia and Kenya.
There are many reasons for this divide, but unequal access to health care – especially the blatant inequality in access to COVID-19 vaccines – is impossible to ignore.
On January 18, the Director-General of the World Health Organization, Tedros Ghebreyesus, noted that more than 39 million doses of the COVID-19 vaccine had been administered in at least 49 high-income countries.
READ: Commentary: Why many under 45 are hoping vaccination windows open in June
READ: Commentary: Why Singapore’s travel restrictions will keep changing for some time to come
In contrast, he said, “Only 25 doses have been administered in a country with the lowest income. Not 25 million; not 25 thousand; only 25. “
Over a billion doses of vaccine have now been administered worldwide, but large disparities remain. Seychelles tops the list, having fully immunized 59% of its citizens, while Israel (56%), Chile (34%) and the United States (30%) also lead.
Brazil, however, ranks 43rd in the world, with just 5.9% of its population fully vaccinated, while India and Bangladesh are well below, at 1.8% and 1.7%, respectively. And in some countries, mainly in sub-Saharan Africa, hardly anyone has been vaccinated.
Since a COVID-19 vaccine is such an essential commodity like food and shelter, we should be ashamed of these serious inequalities. To compound the problem, many rich countries are storing vaccines beyond what they need, as a precautionary buffer.
FAILURE TO ENSURE EQUITABLE ACCESS TO VACCINES
Until a few months ago, activists for access to medicines and open science hoped that the enormity of the pandemic would lead to the rejection of proprietary science and patent-based market monopolies.
In May 2020, for example, the WHO launched the Global COVID-19 Technology Access Pool (C-TAP) with the aim of encouraging widespread voluntary sharing of intellectual property related to the pandemic.
Likewise, the COVID-19 Vaccine Global Access (COVAX) facility, also established last year, was supposed to provide subsidized vaccines to poor countries, with financial support from the rich world.
But even then, as Alexander Zaitchik – echoing a common sentiment – recently wrote in The New Republic, “The optimism and sense of possibility that defined beginnings were long gone.
If we reflect on the world’s failure to ensure equitable access to COVID-19 vaccines, we will at least be less likely to leave poor countries in dire straits in the future. Failure is both intellectual and moral.
READ: Commentary: COVID-19 will cast long shadows of social repercussions
With the best of intentions, the plans and proposals of many activists have paid little attention to individual incentives. But while it is fair to campaign for companies to behave morally, it makes no sense to assume that they are moral.
We can design a future where people invest in knowledge creation and then put their findings into an open access pool, instead of trying to make money. But we are clearly not there yet.
For now, we must let private actors acquire rights to the intellectual property they create to ensure that they invest in expensive research.
At the same time, it is possible to drastically reduce the profits of pharmaceutical companies – by forcing them to sell products cheaper and allowing generic producers to sell in certain regions – without killing the pharmaceutical industry’s incentives to invest in research.
READ: Commentary: Pharmaceutical companies saved the world with COVID-19 vaccine in record time. But the credit also goes to others
A BETTER UNDERSTANDING OF THE VACCINE MARKET IS NEEDED
To do this properly, we need to understand the structure of markets for knowledge-based products such as new vaccines. Currently, this is not the case: the “market” is a mishmash of competition and side deals.
According to a recent article from the Institute for New Economic Thinking, governments and pharmaceutical companies concluded 44 bilateral COVID-19 vaccine deals last year, many of which have undisclosed details and poorly understood safeguards.
Poor countries have generally been left behind.
We badly need a theoretical framework to understand this market. Currently, it looks like what the oligopoly must have looked like before Augustin Cournot captured most of it in 1838.
Cournot’s breakthrough later enabled the development of the first antitrust laws, such as the US Sherman Antitrust Act of 1890, which allowed companies to set prices but prohibited secret multilateral agreements to support prices. These laws have gradually been refined.
READ: Commentary: Has China’s vaccine diplomacy worked in unexpected areas?
READ: Comment: Countries stockpiling vaccines will only prolong COVID-19 crisis
Today, we are setting the rules for the vaccine market while being trapped in a fog of uncertainty. From what little we know, it is clear that intellectual property rights must continue to play a role, at least for now.
On the other hand, pharmaceutical companies are undoubtedly making much larger profits than necessary to maintain their incentive to innovate (especially given the share of their intellectual property resulting from research financed by public funds).
In large pandemics like the current pandemic, we should compensate drug companies with lump sum payments to cover costs, revoke some of their patents, and allow generic companies to mass produce essential vaccines.
In the long term, we can go further, emphasizing that the success of a company does not depend solely on profit. The popular slogan “None of us will be safe until everyone is safe” is tantamount to urging the rich to be more selfish, because helping others is in their own best interests.
But the pandemic is a clear call to start thinking beyond the narrow limits of economic rationality and to identify the interests of others as part of our own.
Kaushik Basu, former Chief Economist of the World Bank and Chief Economic Advisor to the Government of India, is Professor of Economics at Cornell University and Non-Resident Senior Fellow at the Brookings Institution.