Francis Pike

Has Britain fallen victim to the Asian vaccine war?

Has Britain fallen victim to the Asian vaccine war?
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The success story of Britain's vaccine rollout has hit its first major obstacle: five million doses of the AstraZeneca vaccine will be held up for a month. But how many of us knew it was India, not manufacturing plants in the UK or Europe, that was supplying a considerable amount of our vaccine needs? And does the delay show that Britain is now caught in the middle of an emerging vaccine war in Asia?

The delayed jabs are being manufactured in the Indian city of Pune (pronounced Poona). Sometimes known as the ‘Oxford of the East’, the city – already famous for the manufacture of car parts – is about to become better known as the ‘vaccine capital of the world’ as the Serum Institute ramps up production of Covishield, its licensed version of the Oxford-AstraZeneca vaccine.

The privately-owned Serum Institute was founded in 1966 by a Parsi businessman, Cyrus Poonawalla. By 2020, the company was already the world's largest producer of vaccines with a manufacturing capacity of 1.5 billion doses; some 65 per cent of the world’s children have been vaccinated by the Serum Institute’s vaccines in 170 countries. The multi-billionaire Poonawallas, now led by the founder’s son Adar, thrived by selling vaccines for diseases such as polio, diphtheria and hepatitis at margins that undercut multinational pharma companies like Sanofi, France’s vaccine champion.

At the beginning of the Covid lockdown in 2020, the Poonawallas made two critical decisions. Firstly, they took the risk to increase their annual vaccine capacity from 1.5 billion units per year to 2.6 billion. Added to their own investment of £270m, the great American philanthropist Bill Gates, a long-time ‘Cassandra’ on the risks of global pandemic, was quick to make a £120m investment to co-finance vaccine production. Secondly, Adar Poonawalla took the decision to go into partnership with Oxford-AstraZeneca; the first vial of the cellular material for the vaccine arrived in Pune in early May 2020. A follow-up deal has also been concluded to produce the US Novavax Covid vaccine.

By its calculated risk-taking, the Serum Institute has put itself and indeed India at the heart of Asia’s and arguably the world’s rollout of Covid vaccines. While Europe and America have thus far been at the epicentre of the vaccine story, the centre of action is about to move to Asia.

In part this reflects the success of Asia’s handling of the pandemic. New Zealand has recorded just 25 Covid deaths; Vietnam and Singapore, which also imposed strict border controls, have suffered just 35 and 29 deaths respectively. It is a story replicated across the continent: between them, Asian countries with a population of 4.1 billion people have suffered 204,000 deaths (of which India has accounted for 70 per cent); by comparison Europe and the US, with a combined population of less than a quarter of the West’s (846 million), have recorded almost 70 per cent higher deaths (1.42 million).

However, while Asia’s restrictive ‘I’m alright Jack’ travel entry policies have, to much international applause, helped them to restrict the transmission of Covid, the countries of the region have woken up to the fact that, without vaccination, it will be unable to fully re-engage with the world. Having won the war, Asia is in danger of losing the peace. Laggardly in their vaccine procurement and rollout plans, Asian countries are now rushing to acquire vaccines. As we have seen this week, the fight for vaccines in Asia could well restrict supply to Europe; this is a war that is likely to become as nationalistic and dirty as that which we have witnessed between European countries over the past two months.

The Serum Institute is the critical producer for Asia. Not only does it have the capacity, but at £2 ($3) for a dose of Covishield, the company is hugely undercutting competitors. Russia’s Sputnik-5 costs £7 ($10) per dose, while Pfizer-BioNTech charges £14 ($20). Even that is a snip compared to China’s Sinovac jab at £21 ($30) or Moderna’s £25 ($35) dose.

As these vaccines and others sweep the market over the coming months, the advantage will inevitably fall to the Serum Institute, the lowest cost producer. One imagines that the Poonawallas are getting round-the-clock calls from Asian heads of state pleading for supplies; have AstraZeneca supplies to the UK been diverted elsewhere?

It is early days, but Serum’s Covishield is already proving to be very popular. Serum has emerged as the leading supplier to Covax, the UN backed gifting program to supply vaccine to poorer nations. The UN has raised more than £2billion ($3bn) (mainly from the US, Germany and the UK) for 90 low and middle income countries. Covax’s money goes further with Covishield.

Around the Bay of Bengal, Bangladesh (with 30 million doses of Covishield on order), Myanmar and Sri Lanka are all going primarily for Covishield in spite of Europe’s constant sniping at its dangers and efficacy. Even India’s big rival, Pakistan, will receive 45 million Covishield doses from the UN-Covax programme by June. However, Pakistan has thus far refused to order Covishield directly from India. The Pakistan government’s preference appears to be for two Chinese vaccines which it has approved, as well as Sputnik-5.

Meanwhile, rich Asian countries like Japan and South Korea are plumping for Pfizer-BioNTech’s pricey German-American alternative. Similarly, wealthy Singapore has also started its vaccination roll out with the Pfizer-jab. It is clear that in Asia Pfizer-BioNTech has established itself as the premium Covid jab.

What about China? As ever, the country's involvement in the vaccine race has been tuned to its geopolitical interests. Reflecting their geopolitical shift towards Beijing, former US ally, Thailand is going with Sinovac; it is quite possible that these vaccines have been gifted or heavily subsidised by China. Although Thailand has also already received 117,300 doses of Covishield, misinformation about the reported risks of blood-clotting has caused some unease.

The Philippines is also splitting its procurement between China and the West. Some 2.6 million doses of AstraZeneca have been acquired, while 25m doses of Sinovac are expected by March. Cambodia has received 600,000 doses of Sinopharm from China; and Indonesia, whose 270 million population has had the highest rate of Covid infection in South East Asia, has received the first three million doses of 125 million ordered from Sinovac.

Vietnam meanwhile has overlooked Chinese-made vaccines in favour of Covishield. Is this a reflection of souring relations between Hanoi and Beijing? Over the last year, its relationship with China has gone from bad to worse. Numerous border, investment and fishing disputes have soiled China’s reputation. And on his recent tour of ten Asian countries, China’s foreign minister Wang Yi missed out Vietnam. As Hanoi resident, Hoang Cam Hang, recently made clear, Chinese vaccines would only be acceptable ‘if there is no other choice’.

There is similar tension elsewhere: somewhat typically, given its recent harassment of Taiwan, China has apparently thwarted their supply of the Pfizer-Biontech; a petty niggle has thus added to the litany of grievances that the Taiwanese people have against a Chinese regime that claims to represent them as part of Greater China.

So in this Asian vaccine war, could India emerge triumphant over its geopolitical rival China? Unless Europe, Russia and China successfully put the boot into Oxford-AstraZeneca’s vaccine on the grounds of efficacy or safety – and you can bet that Chinese and Russian social-media propagandists are working overtime on this – it seems highly likely. In the frenzied mêlée to bag Covid vaccines in Asia, AstraZeneca and the Serum Institute in Pune should come out as winners. Why? Because capacity and price favour India not China for once – a David versus Goliath moment indeed.