India may indemnify vaccine makers to speed up supply
Beneficiaries wait to get their vaccine in India. A third wave of the pandemic could have devastating consequences to the Indian economy. Which makes it critical for the GoI to enter into result-oriented discussions with vaccine makers.Courtesy: ANI

India may indemnify vaccine makers to speed up supply

SNAP ANALYSIS

The looming threat of a third wave of Covid-19 could once again derail the nascent economic recovery in India. The only antidote is to vaccinate the country’s entire adult population of 940 million. Vaccines makers want legal protection against compensation claims before they start supplies. Negotiations are on and a decision is expected soon.

As the second wave of the Covid-19 pandemic abates and experts argue over whether the third wave is already upon us, the Indian economy has been rebounding sharply. Second quarter corporate results look better, companies in sectors ranging from FMCG to automobiles to steel are recording smart recoveries in their sales figures and hiring numbers are also on the rise once again.

Corporate executives, analysts and economists are, however, wary as the third wave of Covid could still disrupt the nascent economic uptick just as the second wave spoilt the party as India was emerging from the first wave of the pandemic.

India has been reporting an average of more than 40,000 Covid cases every day, which is the highest since May 9, when the cases had topped 400,000. The case load is rising, albeit slowly, after falling consistently for about two-and-a-half months since May.

Over the last 24 hours, though, the country reported a relatively lower number of new Covid cases, at 30,549, than the weekly average.

With only 150 days left in the year, India will have to vaccinate its population at a rate of more than 9 million every day, including Sundays. That means it will have to vaccinate people at a rate faster than the world record for daily vaccinations it set on June 21 when it dispensed 8.6 million jabs.

At its weekly briefing, the Ministry of Health said 49.85 per cent of all new cases last week were reported from the southern state of Kerala, adding that the rate of covid transmission, or the R value, was more than 1 in eight states.

The R value is the number of people one Covid-infected person will pass on the virus to. Any value more than 1 indicates a rising rate of Covid infection.

The only antidote, say experts and the government, is en masse vaccination of India’s entire adult population of 940 million people. That’s 1.88 billion doses. Till August 1, India had dispensed 472 million shots, according to the website www.ourworldindata,org. This is about 25 per cent of the targeted vaccination levels.

This is the second-highest number of Covid-19 shots given by any country. However, the number of people fully vaccinated is only 104 million, or about 7.6 per cent of the population.

9 million jabs a day – till the year end

With only 150 days left in the year, that means India will have to vaccinate its population at a rate of more than 9 million every day, including Sundays. That means it will have to vaccinate people at a rate faster than the world record for daily vaccinations it set on July 21 when it dispensed 8.6 million jabs.

Nature had reported on June 9 that China had claimed a higher record of 20 million shots a day but there is no independent data to corroborate this claim.

The biggest challenge before the Indian authorities is the inability of vaccine producers to keep supply lines going at the required pace. According to official figures, the government expects 150 million doses of vaccines in August and another 200 million doses in September.

That means vaccine suppliers will have to supply 1.06 billion doses in the last three months of 2021, or an average of 350 million doses a month.

AstraZeneca's COVISHIELD vaccine on display. India needs to meet its vaccination target by considering the import of millions of doses of vaccines from abroad or allowing domestic drug makers to tie up with existing vaccine makers in the US and Europe to produce these in India on an emergency basis.
AstraZeneca's COVISHIELD vaccine on display. India needs to meet its vaccination target by considering the import of millions of doses of vaccines from abroad or allowing domestic drug makers to tie up with existing vaccine makers in the US and Europe to produce these in India on an emergency basis.Courtesy: Reuters

Imports only way out

The only way this target can be met is by importing millions of doses of vaccines from abroad or allowing domestic drug makers to tie up with existing vaccine makers in the US and Europe to produce these in India on an emergency basis.

To facilitate the increased supply of vaccines, India invited foreign vaccine makers to sell their vaccines in the country in April. In May, it scrapped norms for local trials of vaccines. Now, any vaccine that has been approved by regulators in the US, the UK and EU can be used/produced in India without the need for seeking local approvals.

We are examining this request on merit… In principle, they (foreign vaccine makers) expect indemnity to be given… They have supplied vaccines only after such indemnities have been given. This appears to be the fact. Companies have requested and we are in talks with them but there is no decision at the moment.
- Dr V.K. Paul, NITI Aayog

But vaccine makers like Pfizer, Moderna and Johnson & Johnson (J&J) are reluctant to supply doses to India unless they are given indemnity against compensation claims for any adverse effects arising from the vaccination.

In a written reply to a question in the Lok Sabha, India’s lower house of Parliament, the Minister of State for Health Bharati Pravin Pawar said the Modi government had formed a team on June 11 to discuss the issue with foreign vaccine makers.

India’s minister of state for health, Pravin Pawar has confirmed discussion with foreign vaccine makers - Pfizer, Moderna and Johnson & Johnson - over the issue of indemnity.
India’s minister of state for health, Pravin Pawar has confirmed discussion with foreign vaccine makers - Pfizer, Moderna and Johnson & Johnson - over the issue of indemnity.Courtesy: ANI

“This team is in continuous dialogue with Pfizer, Moderna and Johnson & Johnson to discuss and address various issues including the issue of indemnity,” she said.

Dr V.K. Paul, Member-Health at NITI Aayog, the government’s official think tank told the media last month that negotiations are ongoing.

Earlier, on 27 May, Paul had said: “We are examining this request and will make a decision in the larger interest of people and on merit… In principle, they (foreign vaccine makers) expect indemnity to be given…. Indeed, they have supplied vaccines only after such indemnities have been given. This appears to be the fact. Particular companies have requested, and we are in negotiation with them but there is no decision at the moment.”

Pfizer has been granted the legal protection it is seeking from India in the US, the UK and several other countries. The Modi government has, however, not given any vaccine maker this indemnity. Incidentally, the Serum Institute of India (SII), the world’s largest vaccine producer, which has a licensing deal with Astra Zeneca to produce its vaccine in India has also sought such an indemnity.

An aircraft from the US carries 50,000 vials of AmphotericinB arrives at Mumbai Airport. GoI officials believe that there is every chance of the government deciding in favour of legally indemnifying vaccine makers sooner rather than later.
An aircraft from the US carries 50,000 vials of AmphotericinB arrives at Mumbai Airport. GoI officials believe that there is every chance of the government deciding in favour of legally indemnifying vaccine makers sooner rather than later.Courtesy: ANI

Donations of US vaccines held up over legal protection

The issue of indemnity has also held up donations of vaccines from the US, according to the global COVAX vaccine platform through which such doses are routed. J&J said it is still negotiating with the Indian government.

“We are in ongoing discussions with the Government of India and are exploring how best to accelerate our ability to deliver our COVID-19 vaccine to India,” it told Reuters in an emailed statement.

In a separate report, Reuters, quoting three unnamed government sources said indemnity is likely to be granted soon. “Indemnity will be granted… If one company gets it then all of them get it,” it quoted one of its sources as saying.

“We seek the same kind of indemnity and liability protections in all of the countries that have asked to purchase our vaccine, consistent with the local applicable laws to create the appropriate risk protection for all involved,” a Pfizer spokeswoman told the agency on email.

With the economy once again at an inflection point, and with signs of green shoots visible across wide swathes of the economy, and the government determined to contain the third wave, officials said there is every chance of the government deciding in favour legally indemnifying vaccine makers sooner rather than later.

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