They were not surprising, the annual figures of pharmaceutical giant Pfizer. Yet they sparked a new wave of criticism. Not everyone thinks it’s ethical to make billions from a global health crisis.
Last year, Pfizer sold 32 billion euros worth of vaccines, as it turned out last week during the presentation of annual figures. The company (which also sells other medicines) made a total profit of 19 billion euros. Shareholders were paid 7.6 billion euros. The annual figures of BioNTech (partner of Pfizer) and competitor Moderna are not yet known.
Never in a year has so much been earned on a drug or vaccine. Such gains are common in the oil and tech industries, but rare among pharmaceuticals.
In addition to appreciating the role Pfizer played in the pandemic – bringing the first and most successful vaccine to the market – there is also strong criticism. According to Global Justice Now, the annual figures show that it is a “Big mistake is to put pharmaceutical giants in charge of global vaccination campaign”† The director of the British NGO wrote that this month in The Guardian† He pointed out that Pfizer’s total turnover (EUR 71 billion) is more than the gross domestic product of many countries. According to Oxfam Novib, Pfizers show annual figures how the company “used its monopoly to enrich shareholders at the expense of nearly half of the global population, who still lack access to vaccines.” It is the moral equivalent of “profit in war,” wrote a former director of the US Center for Disease Control on Twitter earlier†
American historians pointed out in the sheet Politico on that governments in past crises broke open patents, or imposed a maximum on profits that companies made. Others point to the inventor of the polio vaccine, who in the 1950s chose not to patent his vaccine.
Price based on ‘value’?
In the vaccine race of recent years, Pfizer became the big winner. Where other vaccine makers struggled, Pfizer was best able to quickly produce large quantities of vaccines that work well and are safe. Thanks in part to the company, many countries can ‘open’ again, lives have been saved and entrepreneurs can earn money again.
It is not known how the price of a Pfizer vaccine came about. The company denies that prices are determined on the basis of ‘value’. The industry is used to value based-prices, in other words: asking the maximum amount one is willing to pay. Pharmaceutical companies think this is logical because they run a lot of risk; many candidate drugs never reach the market.
Although the ‘value’ was not decisive according to Pfizer, the British newspaper discovered Financial Times that Pfizer initially had a significantly higher price in mind† The business newspaper spoke to more than 60 people for the article. Pfizer turned out to have asked 100 dollars per shot in the first negotiation phase in the US, or 200 dollars per American. After Moderna (which had accepted government support for the development of the vaccine) agreed to a much lower price, Pfizer also gave in. The Americans eventually paid $19.50 per shot, in the EU that was €15.50 (last summer the company increased it to 19.50).
Critics point out that the idea of the mRNA vaccine does not come from Pfizer at all, in fact mRNA vaccines are a very public concept
Competitor Moderna, which has a comparable vaccine but manages to produce less large quantities, eventually arrived at a price of 21.50 euros. Pharmaceuticals AstraZeneca and Johnson & Johnson have promised to offer the vaccine for (approximately) cost during the pandemic, coming in at a few euros (Astra) and up to ten euros (Johnson).
Critics point out that the idea of the mRNA vaccine doesn’t come from Pfizer at all. Actually, mRNA vaccines are a very public concept. science magazine Nature published a study on the history of mRNA: Such vaccines have emerged from the work of hundreds of researchers, over a span of more than thirty years.
This vaccine was eventually invented by the German BioNTech, which shares in the profits from the vaccine. Pfizer has never wanted to receive a government subsidy for the vaccine, but BioNTech had already received 375 million euros from the German government.
Fast approval and production
What Pfizer then did cleverly was to ensure that the vaccine could be approved by the authorities in an emergency. This requires major studies and Pfizer, which has been around for more than a century and a half, has a great deal of expertise in this field.
Pfizer was also very successful in the field of production. Together with BioNTech, it has nine own facilities where the vaccines are being worked on, and twenty contract factories, according to the Financial Times. To properly cool the vaccines, it built its own dry ice factory.
Despite all these efforts, there were insufficient vaccines for many parts of the world. Other factories are not allowed to copy the vaccine. The company does not want to give up its intellectual property.
Critics say Pfizer operates a shadowy queuing system that determines which countries can place large orders. Western countries in particular succeeded in excluding future shortages with gigantic orders. Government leaders often had direct access to Albert Bourla, the CEO of Pfizer. Ursula von der Leyen of the European Commission exchanged text messages with him and then Israeli Prime Minister Benjamin Netanyahu is said to have called Bourla thirty times, according to the Financial Times. US President Joe Biden called “Albert” his “good friend†
Vaccine Inequality
Pfizer offers a considerably lower price for poor countries. At the same time, it was difficult for them to get a foot in the door. A Zimbabwean negotiator complained to the Financial Times that he thought he had an agreement with Pfizer about an order to vaccinate healthcare workers. But for months he was not sent a contract, while the pharmaceutical giant in the meantime concluded a mega deal with the EU. “We had to tread water,” he tells the newspaper, “until we drowned.”
Pfizer regularly points to poor countries themselves as the cause of vaccine inequality. “In the beginning, we saw middle and low-income countries place orders with other vaccine makers,” a company spokesperson wrote. He also points to „shortcomings in the cold chain [mRNA-vaccins moeten zeer koel bewaard worden] and services” in poor countries. According to Pfizer, it has now delivered 1.1 billion doses to 101 low- and middle-income countries.
The dominance that Pfizer has ultimately achieved in the world market is great. For example, the European Commission ordered 2.4 billion vaccines from Pfizer (five times as much as from competitor Moderna), with another option at 900 million. Competitor Sanofi also seemed to be successful with an mRNA vaccine against corona. But because, according to the company, the market is already saturated with the vaccines from Pfizer and Moderna, development stopped last fall.
Also read: In Timboektoe only the expats got a shot
‘It is better to buy off a patent’
Marcel Canoy, professor of health economics at VU University Amsterdam, believes that Pfizer delivered an impressive performance by bringing a good vaccine to the market faster than experts thought. However, he also feels uncomfortable with the amount that Pfizer will earn from the vaccine now and in the coming years. “It would be better if such a patent could be bought off. Then we say to Pfizer: a wonderful vaccine, thank you. What do you want for it? 10 billion? Okay, but after that it’s done too. This way we prevent that we remain dependent on the company in the future.”
Canoy points out that drug companies collectively spend billions a year on legally protecting their drugs. “They lobby, try to stretch patents, conduct lawsuits. It’s a situation that doesn’t help anyone.”
Nick Dearden, the director of NGO Global Justice Now, thinks it’s “just wrong” that Pfizer and a few companies “be on this mRNA technology for the next 20 years.” According to him, pharmaceutical companies are increasingly becoming a kind of ‘investment funds’. “Many people think: pharmaceutical companies make too much profit, but they do invent life-saving medicines. But: they hardly ever do. They mainly buy up small companies, or use public research.” A 2018 analysis concluded that Pfizer has developed less than a quarter of its drugs itself.
corona pill
In addition to the vaccine, Pfizer was also successful in the crisis. Last month, a corona pill from the company was approved. This pill (or actually a course of pills) protects against a serious course of disease. The US government has already bought millions of treatments at Pfizer, for more than $500 per person. The company expects a turnover of 19 billion euros on these pills this year. Yet Pfizer chooses a different path here. Other companies are allowed to copy these pills with licenses. And in the low-income countries, Pfizer will not receive any royalties. “We know that these efforts will only be truly impactful if they can reach those most in need,” said a Pfizer spokesperson about the pills.
A version of this article also appeared in NRC Handelsblad on 19 February 2022
A version of this article also appeared in NRC on the morning of February 19, 2022
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