Pandemic wind-down reveals vaccine winners

Cantillon: Emerging markets surprise observers with vaccine preferences

Pfizer, its partner BioNTech, and Moderna increasingly look like winners in the Covid vaccine market. Photograph: Ruth Fremson/New York Times

The winding-down of pandemic restrictions in most countries is changing the dynamic also for the companies that invested heavily in vaccine development and production.

And in that shakeout, it looks increasingly like Pfizer/BioNTech and Moderna will be the big winners.

Early arguments that the new-style mRNA vaccine would not be suitable for far flung populations in developing world countries with less sophisticated distribution infrastructure, given its more onerous temperature requirements, have proved wide of the mark.

Johnson & Johnson, which had high hopes for its one-dose vaccine, this week suspended guidance on vaccine sales for the year. Sold at a not-for-profit price tag in those markets, J&J had initially pencilled in $3.5 billion (€3.2 billion) in 2022 sales but managed to secure just $457 million in the first quarter.


And a recent report from Covax, which is co-ordinating the supply of vaccines to less-developed states, showed that AstraZeneca has also failed to achieve an expected breakthrough in markets yet to be inoculated.

Poorer nations have refused tens of millions of AstraZeneca jabs,the Covax report said, in part over concerns at its short shelf life. They have opted instead for vaccine doses from Johnson & Johnson, Pfizer/BioNTech and Moderna.

Outsourced production

And, as Pfizer and Moderna come under renewed pressure to share their vaccine technology, it was interesting to note the Covax experience on outsourced production.

AstraZeneca agreed a licensing deal with the Serum Institute of India, the world’s largest vaccine manufacturer, to make a billion Covid vaccine doses specifically for poorer countries. Covax had expected that to be the main supplier to its programme.

In the event, client countries sought only a half million doses of the outsourced vaccine as against 16 million from AstraZeneca’s European production run, even though the latter had a shorter shelf life. Both accounted for just a fraction of the 200 million doses supplied to poorer countries.

Outsourcing is of course different from technology transfer but the clear message seems to be that emerging markets have a preference for original source suppliers. The biggest challenge for all vaccine suppliers now appears to be hesitancy in those markets as the pandemic ebbs.

Pfizer remains bullish, forecasting $32 billion in vaccine sales this year while Moderna expects to sell $21 billion.