After more than a year of fighting the COVID-19 pandemic, the key to the world's economic recovery is in the hands of a very small number of apothecariefoto: Daniel Schludi
The vaccine production industry, thanks to the coronavirus, is billions of dollars. After more than a year of fighting the COVID-19 pandemic, the key to the world's economic recovery is in the hands of a very small number of apothecaries. It is not easy to find a new drug to treat a new virus: at every research stage, such as production, bottling, distribution, manufacturers have to overcome 1001 challenges. Is the anti-COVID-19 injection a product that complies with the law of supply and demand of the market?
· COVID-19 changed the face of the world pharmaceutical industry
Just one virus is enough to create the vast majority of diplomatic activities that have been conducted via videoconference for nearly a year. But, worst of all, last Spring, more than half of humanity was confined to their homes: the economy was paralyzed, factories had to close, supply chains were disrupted. The hospitality industry from restaurants to hotels, or social life and sports culture is everywhere shrinking.
In less than a year, from China to Russia, Europe and the United States have reached their destination in producing COVID-19 vaccine. While Russia is proud of Sputnik V, China massively exports vaccines from Sinopharm and Sinovac. On the other hand, the British and Swedish joint venture AstraZeneca failed to deliver vaccines on time to the European Union and the United States (US). There are three "jackpot-winning" vaccine manufacturers in the US: Moderna, Johnson & Johnson, and Pfizer/BioNTech. Especially Pfizer, this pharmaceutical giant has been in the market for more than 170 years and now has a team of more than 80,000 employees around the world.
Indeed, the development paradigm in the pharmaceutical industry is changing thanks to the advent of new inventions rapidly. Usually, a large firm acquires startups or buys out patents from small firms. However, this time, it is worth noting that a large and long-standing company like Pfizer did not buy back BioNTech's patents or buy BioNTech - this is a German firm that is not too small but relatively new in the industry. Instead, the two companies came up with a collaboration to accelerate global COVID-19 vaccine development. Therefore, it can be said that this is a new form of addition between American and German pharmaceutical companies. Another point to note is that of the four primary vaccine manufacturing companies that dominate the global market, Pfizer/BioNTech has created a vaccine against coronavirus with an efficiency level of 90%.
· The Goose that Laid the Golden Eggs
Finding the "elixir" to save humanity from COVID-19 has brought the most expensive rewards for pharmaceutical companies.
In more detail, Moderna - the company that has just entered the world pharmaceutical market since 2010 and has never been profitable, has become a "savior". According to the company annual report published in February 2021, it has announced more than 15 billion dollars in contracts to supply 310 million doses of vaccines to the European Union for 2020 and an additional 150 million for this year.
The journey of the COVID-19 vaccine created by a British-Swedish joint venture with the University of Oxford has not been smooth. However, AstraZeneca is expected to generate $1.8 billion in revenue in 2021 and $1.8 billion in revenue in 2021, with 2.7 billion next year. This is a feat for a pharmaceutical company that has never entered the vaccine manufacturing and manufacturing market.
Finally, Pfizer/BioNTech has just hit the jackpot: revenue this year is expected to reach $12.5 billion. Also, the corporation's profit is estimated at "25 to 30%" and possibly "even double” the prediction.
In short, it is difficult to say who is dominating or controlling the market because the COVID-19 pandemic is still complicated to make any prediction. As the pandemic raged across the globe simultaneously, the need for a vaccine was beyond the capacity of the entire world. This is a golden opportunity for some pharmaceutical companies in emerging their profits and economy of scale. Therefore, it is inevitable that pharmaceutical companies are doing well in difficult economic times compared to other industries. However, they are also facing demand pressure and price competition in conquering their customers with the quality of vaccines and the speed of vaccine production.
Johnson & Johnson website (www.jnj.com)
EU loses bid for speedier AstraZeneca vaccine deliveries (www.reuters.com)
Pfizer and BioNTech announce further details on collaboration to accelerate global COVID-19 vaccine development (www.pfizer.com)
Moderna reports (www.modernatx.com)