Is a crisis for democracy is a crisis of concentration the bottom line. How should Drug Companies handle the coronavirus pandemic pharmaceutical firms rushing to find a vaccine could potentially make billions of dollars. What was be done to ensure they dont put profit before saving lives this is inside story. Hello and welcome to the program im Maryanne Demasi scientists around the world on our racing to find a vaccine and a cure for the corona virus governments are pledging millions of dollars of taxpayers money for research in both public and private funds the Global Vaccine Market is estimated to be worth nearly 60000000000. 00 annually pharmaceutical companies have been criticized in the past for being too slow in combating diseases like saws and it botha and charging high prices for a new drug treatments the president of the European Commission hopes of vaccine will be available vote later this year. In addition we are accelerating research yesterday i spoke to the managers of an innovative European Research company they work on a Promising Technology to develop a vaccine against the corona virus the European Union provides them up to 80000000 euros and i hope that with this support we can have a vaccine on the market perhaps before autumn. So lets bring in our panel joining us from here in london. Executive director for the economics and Country Risk Life Sciences practice at i. H. S. Market from miami Gerald Posner investigative journalist and author of pharma greed lies in the poisoning of america and also here in london andre spicer professor of organizational behavior at Cass Business School at City University of london a very warm welcome to you well thank you for joining us on the program so weve been speaking about the impact the coronavirus pandemic is having on businesses big and small theyre all taking a hit but there are some businesses and Industry Industries that do stand to profit perhaps none more so than the pharmaceutical industry gerald you have said that pharmaceutical companies now stand at stand to gain a once in a lifetime Business Opportunity from cove at 19 why have you said that its a cold calculus omarion no question and there are going to be winners and losers inside the drug industry the wearers are going to be among the 20. 00 to 26. 00 stroke companies and biotech firms that are racing right now to go back see there are billions of dollars that are really being funded from governments private Research Academic centers and those pharmaceutical companies the 1st one that crosses the line youre leading you talked about us believe this all of that its a year or 18 months that 1st when it crosses the line gets the fact. Seeing the government say thats the one we want were to deploy it literally hundreds of millions of people theyre going to be able to make a profit about that right so go starve and to starve let me ask you then your what are your thoughts on that how much profit do these Companies Stand to make just how lucrative could a covert 19 a vaccine medicine antiretroviral drugs before then. Well lets 1st be very clear that we have no guarantee that thats going to be the case whatsoever that we even get to having a vaccine or treatment here there are again most of us know inherent risks and developing treatment with a very very high failure rate and so therefore what we just simply dont know we were expecting to see Clinical Data fairly soon on some of the early activity that weve seen but in terms of the actual opportunity its fairly limited right so as its been highlighted here that itll be maybe 2 or 3 companies that most that might be able to succeed out of this and for them you know if i talk about vaccines which is a very specific kind of industry the margins are typically razor thin right its very hard to scale the production in any meaningful and profitable way and only a really handful of companies can actually do that and manage it. Under a tell me what have we been saying in terms of how investors have been reacting in the past few weeks to pharmaceutical companies the taking away those that say that working on vaccine and drug programs what are we seeing in the market i suppose what weve seen is that these companies are inherently risky but thanks to my Profit Margins the law just u. S. Drug companies have much like you know getting the same this is follow from many other companies those many ways a good bit the other thing to know is that these people often spend a lot of things money not doing research and development buying their own she is 21 calculation. I think more buying their own shit from i think up to 2007 pain in their heads on research and development and some of the. Nice things about the banks saying this isnt data types with them so you need to ask this question of whose money is being spent on research and development pashas a company but its often posh it public. And the question is who has been. In the public eye. Gerald the i suppose the gerald the problem with this is that running a company a Pharmaceutical Company is very expensive i mean i appreciate what andre saying there about perhaps these companies not spending as much on research and development a certain government funded agencies but we know that running these sort of companies is expensive and without a profit well they either shrink they are either sold to another company or they simply die. No question about look at support profit business i understand that the United States is the only country thats crazy enough of a plan to allow Drug Companies unfettered power in so your own crisis this crisis every other country has some form of because she should what professor spicer said is absolutely critical in the us for example the National Institutes of health which is a Public Health agency funded by taxpayer money has since the 1930 psi talk about this is a chapter called the coming democrat since the 1930 s. They have spent 900000000000. 00 on Public Research which pharmaceutical companies that then take it and put under patents and made billions of dollars the 1st h. I. B. Drug treatment a. Z. T. Was actually the result only it worked out at the federal level with federal money and government sponsorship the only thing burroughs who had the patent did was provide the underlying drug that they could need to make it because they werent producing it was a patent they held and it was illegal in production so what happened is they made billions of dollars of the u. S. Government Research Efforts of Academic Work none of that came back to the public for their Scientific Research best a big part of this is generally just just to get i mean so that the research and Development Side is crucial here when making a profit is important for research and Development Research in development is crucial for that to be scientific medical breakthroughs particularly at a time like this now how much does the industry spend on research and development. Is a great figure because the industry says that it spends about 20 to 22 Percent Research to develop it 4 percent. Less they spend on marketing and promotion of the United States and marion heres the real question that you need to ask gustav talked before about only a couple of winners and hes right in terms of the patent maybe on movie for the vaccine but then there are manufacturing firms theyre all Drug Companies the only ones able to do this are Drug Companies and whats our experience in the u. S. Its terrible because the only time since in modern history since world war 2 when a u. S. President joe Court Ordered a National Occupation program for all americans for the swine flu back in 76. 00 the for Drug Companies chosen by the governments of manufacturers of probably 100000000 doses the vaccine it will tell you why i mean gerald look they say i mean i think you had several pharmaceutical bosses testifying before Congress Last year i mean this is a long running issue it comes up again and again they were asked why did drugs in the u. K. Cost so much because like you said theres a big deferential how it works in the u. S. Compared to the rest of the world they are saying look it is the cost of research and development and not only that they pay well they argue they argue that america is shouldering that burden for the rest of the well thats true as well but you know what course i have is and im sure that goes up with professor spicer following this those of us who have a microscope on pharma we in the United States passed a congressional bill the of the day with the president 8300000000. 00 emergency funding there was a difference between the 1st draft and what was passed what was different the pharmaceutical lobby government took out 2 clauses one of the relating to limits on the amount of profit that they could make so that 3rd world developing nations could be fed a bit see with this vaccine and the other was that they worked in the program and then dropped out they want to keep their own intellectual property that government wanted to be shared by everybody they get to keep their intellectual property you know if we dont keep our eye on the ball now everybodys worried about the vaccine and hell they should be i understand this is a deadly virus but if we dont watch also the government level whats right to come but good to start let me come to you because i know you have a profit driven pharmaceutical i mean this is this is the Business Model isnt it this is the model that. Exist we desperately need these companies right now weve always risky relied upon vaccines and medicines you might say that the model is a weakness in in the Global Health system but it is the system that current exists its a profit driven model. It is a profit driven model but lets also be clear that the us has been mentioned here is really kind of the exception right that the u. S. In terms of its Health Care System is very unique and has a lot of very complex and multifaceted characteristics that you just dont see almost anywhere else. Over here and in europe for example and most other countries around the world you have a negotiated price and if the manufacturer of the government cannot agree on a price the drug is not available and there are many cases of that when i say that needs to be more regulation will price controls. In the harasser because yes he is saying there needs to be more regulation will price controls in the us how would that affect the development and distribution of a vaccine for corona virus i dont think its my place to say what what what exactly should and shouldnt do that there are all sorts of reasons why of course if them are built the way there are there are plenty of problems with what Healthcare Systems outside of. The year are but read about all that have been built lets be very clear is very successful and we have successfully converted many deadly diseases into what were previously deadly diseases into chronic illnesses and for example part of the of that is a very good and very very obvious route of that into a different way of looking at this perhaps is that when when drugs do get expensive does it troll more product to market the more expensive they become the more profits you see the more investors that troels and and its its kind of like any other commodity that it would hope for the more innovation is not the rationale. So in many ways is the kind of it when it takes all markets so you have to take very long term debts on mrs diseases so you make a calculation this disease with solving which normally means its a 1st world disease with isnt it governments or individuals with the money to pay for it then you take a bit over a 1020 year period im going to develop thanks scenes around over you know products around that and then most of those dont work out so that that money is gone but the model sort of those become big blockbuster drugs which weve been funded me thing else so you have to take a long time horizon and the other thing to note here is that and this is an increasingly. Looking for kind of the the east which is an environmental social and governance returns on it so that looking to stay portfolio and theyre saying how is this performing in a socially responsible way so if Drug Companies can show that doing socially responsible things its likely that people providing capital which is our pension fund that citroen. And likely to be more favorable to give it give that money to companies this is anthonys or that it needed to respond i mean gerald really how far does that apply right now because if you i suppose if you break it down in a simple way no company is going to run Clinical Trials for something where they dont stand to make any money so even if i mean even if the scientists said ok lets get together and do this research and do this on our own set up our own company they still have to get the funding from venture capitalists or or whatever so you cant get funding unless theres a return to be made on the investment but heres where the return is i to get away mariet which is interesting for some of the Drug Companies and im talking every day by the way to approach this disease experts were former pharma executives before they got out of their own back to research if a company gets involved and gets public funding for this with this flood of money that will be coming from seppi and from the u. S. Government and for others involved in the research they dont get a product they dont get part of a lot they dont develop that real vaccine that she was they still are able to keep the intellectual property from that that they do with public funding that might help them develop a vaccine viral and other matters we go here to help see what its for you know. 1 talking about is one of the Great Success stories both in terms of profits and in terms of helping people is that type of information they need for the rest of their drug like that they may have to get some help with antivirals they get involved in this research and they get paid for by the government or private institutions its a win for them even if they dont get into the final right to have i mean these are Public Companies they are really there to serve the shareholder i mean what are we saying that they should necessarily be public i know i know you dont want to make you know broad sweeping statements on what governments or what should or shouldnt happen but when you are looking at something as severe as as finding a vaccine or a medicine or some kind of treatment to manage an illness that. Created the crisis that we have now i mean is this precisely the sort of research that governments should be should be funding you cant just leave it to pharmaceuticals well i dont think that a drastic solution like what youre proposing there is really on the cards or or really what what anyone would really want out of this including those who are very critical of the pharmaceutical sector right that theres a reason why weve had so many successes and whether its on college or your about if the your h o v as in terms of. You know improving patients lives and and i do during. And to be in a position where we can and with a degree of confidence say that were probably going to have a successful vaccine or treatment for covert 19 probably by this Time Next Year which would be absolutely unprecedented in the history of of of health care right be able to identify that decision of the genome sequence of this disease which is done in early january and a year later to effectively have 20th he added and not have the problem of scaling up of distribution is it going to be is it going to be excessive all of that i mean i suppose if we look at the time scale and kissing you you said that probably the expectation is that we could see something. Next year and that is that is the key question how long it could take to develop a code 1000 vaccine and when mice it be ready gerald what are your thoughts on that gustavs absolutely right 1st of all a year to 18 months may sound so to the lay public its a seat record sums of companies for a vaccine like this and he also said early on we are all assuming the texas heap i speak today believe they will get a vaccine out this remember it was just last year 29 t. When the f. D. A. The flu Drug Administration signed it grew to vaccines for all 46 years after course lists it discovered and so why did it take. Xo long is it getting harder to find vaccines for Infectious Diseases times its hard why dont we have a vaccine a day for a show be or is out from the 1980 s. Because its hard to necessarily develop a vaccine for a virus that doesnt have so many side effects the dont want to distribute or not kill a mass groups of people but in this case on this particular virus i do believe that it will be able to come up with a vaccine its related to that sort of a chemical way that you know microbial way to what we had in h one n one in 2000 and neither stopped actually research about because it went away in the next season but this time i think they will find. Hearing earlier in the program that andre that 2 or 3 companies are likely to benefit from this well. Which companies and whereabouts in the wild d. N. A. You watching very closely who might be best placed or best positioned to come up with a solution. This is a range of companies that are in the race so you have an off the track i think french is a small biotech firms that in the us will dana youve gone to chinese firms so desperate across the world the other thing to note which is interesting is that that well theyre kind of racing each other because a lot of networks with this kind of information sharing going on so despite the fact that large pharmaceutical firms will hunt for ticks information and pains they have they also share a lot of that nation so for instance p. S. K. A big u. K. Firm had shipped some of you know some some information which to the patients and so forth which would be very useful for developing the vaccine so from Suitable Companies arent just these kind of hoarders that information and profiting off it often theyll share information particularly when you have these kind of big global races how are you not in yet and im going to let me get your thoughts on that gerald it seems as though were seeing evidence of information sharing on this yes pharmaceutical companies in a race yes they want to maximize their profits but at the same time it is the coordination between them will be crucial to expediting some sort of vaccine yet what do you just say what professor so i support a subsidy critical that have to share information on this separate the International Organization that supposed to support a fact seems backed off that position a little bit but theyre trying to push that now and we all have to remember that in the greatest single where the greatest smart inventions in pharmaceutical history penicillin saved hundreds and millions of lives stopping infections across the board that was the result of a crash effort between the british team that offered that it really worked out and the u. S. Government that put it on right behind tomic promise of world war 2 priorities for intel pharmaceutical firms that share all the information there was no holding back tell me jerrold whats happening now because obviously you know we have this Global Pandemic are we saying regulate has come. Aberrate with vaccine for jus says is enough action being taken to exaggerate the timeline now unfortunately not i dont see it maybe goes off professor spicer said i dont see it remember that recently only recently that its kind of sullen we were in the middle of the war theres no better sense of the hot war were in a war now its this micro but thats different people feel scared theyre anxious and theyre very nervous but its different in the hot war so what worked it was the impetus to do that i would make it here on this theyve done that but were not here yet. And tell me stuff how important are partnerships to developing and manufacturing vaccines and medicines for the public Public Private partnerships oh it is absolutely critical right and you know one point i want to read here is that there is a reason why it takes sort of 67 years right to develop a drug successfully and theres a really important reason for that it takes that long to understand what the experimental treatments are safe and effective right that what you see in the early testing data is not some quirk in the data or that if side effects emerge much later on that you would have captured after years of testing right so theres a reason why we rarely if ever sort of approved new treatments when jordan andrina not so its a really good point andre then what do you what are your thoughts on that because that the challenge is for developing and developing a vaccine and as weve heard theres no guarantee that theres going to be any Silver Bullet to this but you need to think about long term and unity protection against mutations thats so much we dont know about this phenomenon is it going to go away will it become seasonal its many challenges lie ahead. Ok stu 2 points one when you do it in a big project with its and farmer or if the structure of what event you dont we have a kind of what we call a trial in a so 3 things you have to trade off one is speed one is cost and 1. 00 is that of safety or quality so and the point is that most of the time you can only have 2 of those 3 things so the questions really going to be with that with the next scene is whats the trade off which one of the going to be willing to sort of go backwards on the 2nd point is the way pharmaceuticals actually do they work in operate the way they build vaccines ive changed quite a lot in the last few years particularly with the rise of big data so not just relying on Clinical Trials or if it in an increasingly theyre relying on patient records so having access to those patient records to see what the results are is critical about how theyre actually developing these i want to get a final thought from each of you on the question as if and when we see a vaccine a medicine some kind of treatment to manage this illness is it going to be widely available excess of will and affordable. Well i think you think 2 phases of it right there and thats really the fingers crossed hope that we get to that stage where we actually have a treatment that proved to be affective right over the 1st days or be focused arm that risk populations you know that the frontline of the Health Care Workers and clearly older and vulnerable populations of better that are going to be the 1st phase and then wider sort of map mobilization what happened after that and you can kind of scale that up separately gerald. You know i think very across the western world and the rest of the world ration africa everybody is separate from this time to review those not infected Airline Industry cruise industry travel businesses give a workout were all having to make a sacrifice and what im saying is i think the pharmaceutical industry doesnt have to lose money but they have to make a bit of a sacrifice as well they have to share this epidemic by now developing antivirals that will adapt and treat those before they have a virus or have a vaccine one please have the vaccine let them make a profit but let them have it as small a property as possible this isnt the pandemic on which to make a ton of money and i hope that they follow that and serve the public good of us andrzej. So the companies are sparking a lot of capitalism for the public good and heres an opportunity to show that in practice that they can actually used a mechanism firm in the Financial Markets to make she do public good and just withdraw value for themselves the shareholders and theres the ridiculous all right well thank you very much raney appreciate the time of our guest today. Executive director of the economics and Country Risk Life Sciences practice that i attest market from miami gerald apos now and then also here in london under a spice a joining us from the City University of london thank you very much gentleman and thank you as well for watching you can see the program again any time by visiting the website aljazeera dot com and then the discussion and debate you can go to the Facebook Page thats facebook dot com for what sasha a. J. Inside story and then of course as always twice how you can join the conversation there as well battle is at a. J. 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