After nearly two years of COVID, how is the pharmaceutical industry faring? In this episode of The Conversation Weekly, we explore where drug companies were before the arrival of COVID and how they performed financially during the pandemic. And we hear about the ongoing tensions between profits and equitable access to vaccines.
Before the pandemic, the reputation of the pharmaceutical industry was at rock bottom. In August 2019, a Gallup poll of Americans’ views about business put the pharmaceutical industry last, out of 25 sectors.
Ray Moynihan, assistant professor at the Institute for Evidence-Based Healthcare at Bond University in Australia, thinks pharmaceutical companies’ reputation was so low “because their marketing behaviour was just increasingly seen as out of control”. He says companies’ influence over doctors and medical science and “the exorbitant prices they were charging”, combined with some large fines for fraud, had driven down the reputation of the industry.
There are signs, however, that the successful race to make a COVID vaccine boosted the industry’s reputation. In a US survey by Harris Poll in February 2021, 62% of respondents rated the pharmaceutical industry positively – up from 32% in January 2020.
But what about the financial performance of the world’s biggest pharmaceutical companies? “The big picture is nuance,” explains Jérôme Caby, professor of corporate finance at Sorbonne Business School in Paris, France. While some companies have been very successful, others have lost a lot of money, he says. Caby looked at the profitability of the world’s ten biggest pharmaceutical companies for The Conversation. His analysis shows that the financial performance of these top ten companies was “impressive compared to other industries” in 2020.
Some vaccine manufacturers, such as AstraZeneca, initially committed not to profit from selling their vaccines – although it is now moving away from this model. Meanwhile, others, such as Pfizer, have reaped huge profits from their vaccine sales.
But it wasn’t just private cash pumped in these vaccines, but public money too. For example, nearly US$10 billion in US taxpayer money went into the development of Moderna’s COVID vaccine.
Now, the US National Institutes of Health is engaged in a legal battle with Moderna over who deserves credit for inventing a central component of the vaccine. Ana Santos Rutschman, assistant professor of law at Saint Louis University in the US, explains what’s at stake. “If there is co-ownership but it’s not acknowledged legally through the patent, the government cannot ultimately control licensure of the vaccine,” she says. She argues this means it has little control over whether the vaccine is distributed equitably.
Nicole Hassoun, professor of philosophy at Binghamton University in the US, believes that access to vaccines and medication would be much fairer if control over distribution is held by the public, rather than private companies. “I think if we pay for it, we should own it,” she says. Hassoun suggests one way to do this would be at an international level, perhaps under the auspices of a new pandemic treaty being discussed by the World Health Organization.