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As the new coronavirus pandemic continues in the U.S., people yearn for a victory after Washington’s spectacular failures to secure adequate supplies of test kits and personal protective equipment. Success depends on whether any of the candidates for the fast-track Covid-19 vaccine with the support of nearly $ 10 billion Operation Warp Speed funded by federal funds will save the day. With the goal of receiving 300 million doses of safe and effective vaccines delivered by January 2021, the challenge is enormous.
This period of months instead of years poses many problems. A strategy of focusing only on the fastest methods may, in the end, not produce successful candidates. With funding focused on faster development, slower solutions to develop have been rejected. The priority should be to finance a balanced portfolio of vaccine prospects that may take longer to develop.
The tuberculosis vaccine took 13 years, rotavirus 15 years and chickenpox 28 years. Clearly with Covid-19, which has already had devastating economic and social consequences, that would be too long. The world has not seen a pandemic on this scale since the 1918 flu. This time, scientists are armed with advanced methods, including insights from gene and viral vectors for vaccine development. However, Dr. Gregory Poland, a leading immunologist at the Mayo Clinic, cautions that the United States is in a “hare and tortoise” race that doesn’t end until a vaccine is proven to be safe, effective, and scalable.
At face value, Operation Ward Speed has a sense of national pride and has the potential to end the pandemic. However, the nationalistic element that prevents international cooperation is particularly alarming. Washington has made numerous missteps in its faltering battle with Covid-19. The most fateful was perhaps the month lost between February and March 2020, during which the Centers for Disease Control and Prevention attempted to develop their own coronavirus test despite the availability of a German-designed test that had been used more than 250,000 times worldwide. There is no reason to believe that the same error will not happen again.
As of this writing, researchers around the world are developing more than 155 Covid-19 vaccines. Most of them belong to one of four types: genetics, viral vectors, protein-based and complete viruses. Operation Warp Speed selected a portfolio of eight vaccines: four of them are viral vectors (developed by Johnson & Johnson, AstraZeneca, Merck and Vaxart), three are genetic (developed by Pfizer and BioNTech, which rejected federal funds; Moderna; and Inovio), and one is protein based (developed by Novavax).
Why is there no support for complete virus vaccines? The short answer is that they are antithetical to the “strain rate”.
Complete virus vaccines use a mature technology that has been licensed for commercial use for over 70 years. Once verified as safe and effective, they can be produced with existing manufacturing facilities worldwide and managed with minimal technical hurdles. The capture? The development of complete virus vaccines can take many years because scientists need to find an ideal amount of virus that protects people without making them sick. The fastest record of developing a complete virus vaccine is for mumps, which took four years. Therefore, the “warp speed” is creating distorted incentives: it discards those entire virus vaccines deemed too slow to develop.
Because Operation Warp Speed has a pre-specified deadline, it is clear why seven of the eight vaccines funded by the United States are viral vectors and genetic candidates. These two types move rapidly in the development process and, if their success is demonstrated in phase III clinical trials, they have some chance of meeting the January 2021 deadline. However, no genetic vaccine has been approved. for human use, and viral vector vaccines have been used for animals and in some cases have been shown to be safe for human use, but have not yet been determined to be effective.
Without a proven track record, there is a real chance that none of these candidates will make it, especially in this artificially short time frame. Merck CEO Ken Frazier has said that promising a vaccine by the end of 2020 is “serious harm to the public.” Even if one of the seven accelerated vaccines is safe and effective, increasing the volume and distribution will be a major challenge. Viral vector vaccines face significant manufacturing hurdles, given the need to build new vaccine production facilities. Genetic vaccines have their own challenges, including requiring very different delivery systems and strict cold chain management requirements.
By making investment decisions, risks are reduced by investing in a balanced portfolio of stocks. Investing in Covid-19 vaccines with remarkably uncertain safety, efficacy, and scalability must follow the same logic. Unfortunately, Operation Warp Speed is now betting on vaccines built with untested technologies, which is highly risky. This strategy lacks diversification and does not combat underlying risk because these methods share a common set of uncertainties. The large number of unknowns requires a more prudent portfolio selection, one that involves a balanced portfolio to prepare for the unexpected.
A safe and effective Covid-19 vaccine is considered by Dr. Anthony Fauci and his scientific colleagues to be “an absolute necessity”. However, this federally funded program is creating distorted incentives for vaccine development. In fact, some fear that Washington may declare victory prematurely without fully understanding the side effects of the chosen vaccine. It is important for policymakers in Washington to realize that the success of vaccination, like the coronavirus tests, requires more than a rapid development process. Failure at any stage (verification, delivery, or administration) can mean failure of the entire effort.
To win the vaccine race, diversifying the portfolio should be a mandate. Haste can actually be wasted.
Tinglong Dai is an associate professor of operations management and business analysis at the Johns Hopkins University Carey School of Business. Christopher S. Tang is a distinguished professor at the university and President of Edward W. Carter in business administration at UCLA Anderson School of Management.
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