Pharmaceutical investors and shareholders should not determine global health


OWhat could go wrong when pharmaceutical company shareholders and investors shape the public health response to Covid-19?

Everything, of course, including perpetuating the pandemic with immense preventable suffering and death. And that’s exactly what happened last week at the annual shareholder meetings of Moderna, Pfizer and Johnson & Johnson.

Tedros Adhanom Ghebreyesus, the director general of the World Health Organization, has taken the unprecedented step of backing a shareholder resolution presented by Oxfam to compel companies to share the know-how and technology behind vaccines Covid-19 and enable manufacturers in low- and low-middle-income countries to supply their communities with vaccines, which would help reverse current vaccine inequities. Addressing Moderna shareholders in a pre-recorded statement, Tedros pleaded for urgent action to “save lives, reduce the risk of variants and reduce the economic cost of the pandemic.”


The companies’ shareholders decided they knew better than one of the world’s top public health officials how to tackle the lingering pandemic, which has claimed more than 6 million lives so far, and the toll continues to increase. Pharmaceutical industry executives and shareholders have argued that their companies are now producing enough doses to vaccinate the world, and that what I and others call “vaccine inequality” is more of a problem of so-called logistics. of the last mile.

This argument is akin to arguing that the solution to famines is for global corporations to increase food production. Famines, like vaccine inequality, are caused by unequal distribution linked to power dynamics and monopolistic control of production and distribution.


Ultimately though, while well-meaning environmental, social and governance activists and even investors may try to influence shareholders to do the right thing for public health, the key issue is that pharmaceutical companies and their investors should not be the ones with the power to decide on public health issues. Fund managers, institutional investors, bankers and most individual shareholders know little about public health or epidemic control.

Yet even though resolutions that would force companies to consider sharing their vaccine technology may have garnered significant support, the majority of shareholders voted against it, oblivious to Tedros and the many health advocates who rose up. outside company offices demanding to put people’s lives before profits. While this result is hardly surprising, the importance of this decision in terms of global health governance cannot be overstated. This painfully shows, once again, how the financial interests pursued by private companies, investors, asset managers and speculators eclipse informed decision-making by public health experts, even during the greatest health crisis. world of our time.

Let that sink in for a moment.

Financialization, a growing trend in the global economy that refers to the creation of value from purely financial transactions independent of the production of goods and services in the so-called real economy, has also captured vital areas like health. Today’s biotech and pharma sector, which we rely on for vital medical technologies like vaccines and drugs, is increasingly run by bankers, fund and asset managers and speculators – and not doctors or scientists. They seek opportunities for monetary return and shareholder value without considering their health impacts.

Despite a meticulously crafted public image of caring about health, improving health outcomes, or protecting public health, these are not part of the performance indicators of pharmaceutical industry CEOs. In fact, many examples show how the priority given to financial interests is contrary, even detrimental, to public health.

As well as retaining monopolies on Covid-19 vaccines and treatments – even if this compromises control of the pandemic – this includes charging exorbitant prices that prevent many people from accessing life-saving drugs such as anti-coronavirus drugs. HIV and hepatitis C, insulin, cancer treatments and therapies for rare diseases; or the over-marketing of potentially harmful drugs such as opioids and some mental health drugs. Meanwhile, pharmaceutical companies are using their above-market-average profits to pay generous dividends and buy back their own shares to further enrich shareholders, instead of investing in R&D for important unhealthy needs. satisfied, such as neglected diseases or antimicrobial resistance.

Recent years have seen the growth of a very lucrative financial market of early-stage medical R&D around biotech companies and startups – many of them from academia – which adds another layer of financialization to the sector. At the heart of this ecosystem is the ability to obtain patents on new and existing biomedical knowledge, capture it from the public domain and turn it into private, tradable and monetizable assets. A patent gives the holder the right to temporarily prevent others from using the patented object as a reward for investment and risk, but in exchange for public disclosure to allow for further innovation and dissemination. Originally designed as a policy tool to spur useful innovation, carefully balancing public and private interests, there has been a steady expansion in the scope, duration and geographic reach of what can be patented for the benefit of the patent holder.

Along with the explosion in the number of patents, the strategic use of pharmaceutical patents has shifted from a useful incentive for medical innovation to a market control tool, using monopoly power to charge high prices and create a artificial scarcity. Furthermore, intellectual property rights such as patents and know-how increasingly function as intangible assets whose primary role is to attract speculative capital investment in a market for biomedical assets and futures. in full growth. It creates value for investors long before and independently of any product reaching the market or even showing evidence of health benefits. As in other sectors of the financialized economy, the actual production and availability of drugs or vaccines – the real economy – has moved away from the financial transactions that are supposed to support their development, resulting in a growing disconnect from goals.

For global public health to truly benefit from scientific advances, decision-making regarding the availability of critical health technologies cannot be left to the whims of casino capitalism in which speculative investors bet on intangibles as the primary vehicle for financing health. medical innovation. Likewise, it should not be up to pharmaceutical shareholders to determine the course of a pandemic by seeking short-term financial gains at the expense of the public interest. Oxfam’s resolution is an important step in challenging this hegemony, but insufficient to turn the power dynamics into play.

It’s time to claim the pharmaceutical company’s goal of focusing on improving the health of people around the world. This will require a radical rethinking of how medical innovation is funded and governed and a resumption of public responsibility for ensuring that medicines and vaccines developed to meet people’s health needs are available as common goods.

Els Torreele is a Visiting Fellow at the Institute for Innovation and Public Purpose at University College London and an advocate for access to medical innovation. He previously worked with Médecins Sans Frontières, the Open Society Foundations and the Drugs for Neglected Disease Initiative.


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