The Covid-19 Vaccine Club: How the World’s Biggest Producers Depend on Each Other

Data compiled by Airfinity Ltd., a science and healthcare data company, shows that five club members accounted for 95% of all Covid-19 doses produced in the world through March. Smaller players including Argentina and Brazil are expected to start contributing shots later this year.

The members of the vaccine club, though, source on average 88.3% of the imported ingredients used in vaccine production from other club members, according to economists led by

Simon Evenett,

professor of international trade and economic development at the University of St. Gallen in Switzerland, who have mapped trade flows between the world’s major vaccine producers.

Limiting vaccine exports to another major producer would therefore risk retaliatory action that could undermine production, threatening the mass vaccination drives that are the key to ending the pandemic, Prof. Evenett said.

“Everyone has a gun to each other’s heads,” he said.

So far, sporadic curbs on exports of vaccines by countries including India and EU member states haven’t yet led to an all-out conflict. But it is an uneasy peace, Prof. Evenett and colleagues wrote in a March report for the World Bank.

“Our analysis of the incentives created by the Vaccine Club imply that the status quo is unstable, susceptible to policy overreaction to cross-border shipment delays. If Covid-19 vaccines are equitably distributed worldwide without a significant outbreak of vaccine nationalism, it will be by luck not design,” the report said.

The EU and the U.K. have sparred over access to doses of the shot developed by

AstraZeneca

PLC and the University of Oxford, with Italy impounding some 250,000 doses destined for Australia.

More significant for global vaccine supply was the decision in March by India to temporarily halt exports to expand its own vaccination campaign amid a deadly wave of new infections. The country’s vaccine exports have slumped, official data shows, hurting in particular supplies destined for poorer parts of the world that are relying on Indian-made vaccines.

Modeling by Airfinity suggests the disruption could set back vaccination drives in Africa and parts of Asia by months. Epidemiologists and public-health experts warn that gaps in vaccination coverage world-wide will give the virus a chance to survive and mutate, potentially leading to future outbreaks.

The Serum Institute of India, which manufactures the AstraZeneca vaccine for large parts of the world, has said it hopes to be exporting again by June.

India, though, isn’t alone in limiting vaccine exports. The U.S. and the U.K. have reserved all or nearly all of their homemade doses for domestic use, according to data compiled by Airfinity, though the U.S. this week said it would share 60 million doses of AstraZeneca’s vaccine with India and other developing countries combating surging infections.

Trade experts say the best way to ease tensions would be to increase vaccine production. In an open letter to President

Biden,

a group of former heads of government including former U.K. Prime Minister

Gordon Brown

urged the U.S. and others to agree to temporarily suspend Covid-19 vaccine patents and to press drugmakers to share technology and know-how in an effort to turbocharge global manufacturing of the shots.

Global vaccine production is already accelerating. Analysis by Airfinity suggests U.S. vaccine makers will have produced sufficient doses to inoculate the whole U.S. adult population by June, resulting in a surplus of around 500 million doses by September if production goals are met.

Data compiled by Unicef shows production capacity for approved vaccines is expected to increase by 7.9 billion doses in the second half of the year. Manufacturers are expecting to produce almost 19 billion doses in 2022. That would, in theory, be enough to inoculate everyone on the planet, but production targets haven’t always been met.

Write to Jason Douglas at [email protected]