It was March 2020, and nothing was breaking right for the incumbent president of the United States. As the November polls drew closer, the coronavirus was spreading across much of the country. Having failed to control the pandemic, Donald Trump was promising salvation through the development of miraculous drugs and vaccines.
“We are going to come up with some really great solutions,” he declared at a rally in North Carolina. “The United States is right now ranked by far number one in the world for preparedness.”
This was a preposterous claim. In dismissing the threat of the pandemic as fake news, Trump had effectively sabotaged the workings of the American public health infrastructure, leaving the United States far down whatever standings for preparedness one might imagine. As he spoke, the country was registering about two dozen new COVID-19 cases per day. By the end of the month, the number would approach twenty thousand. In an effort to engineer a comeback, he had gathered before him, in a conference room at the White House, the heads of some of the world’s largest pharmaceutical companies.
The meeting included representatives from a half dozen companies that were developing vaccines, including Pfizer and Moderna. Trump took special interest in the man seated directly across the table from him—Daniel O’Day, a Davos Man aspirant who ran a biotechnology company called Gilead Sciences.
Vaccines would take many months and perhaps years to produce. Gilead was working on something immediate—a therapeutic called remdesivir. As O’Day explained it, the drug was an old antiviral that had been developed more than a decade ago for use against other coronaviruses.
“We’re hoping it has effects now against COVID-19,” O’Day told Trump. “We know, in vitro, that it has very high effect.”
Trump cut in excitedly, as if catching word of a magical reelection potion.
“So you have a medicine that’s already involved with the coronaviruses, and now you have to see if it’s specifically for this,” he said. “You can know that tomorrow, can’t you?”
With trepidation, O’Day delivered the news that tomorrow was not a possibility.
“The critical thing is to do clinical trials,” he said, detailing the tests that were underway.
Trump nodded impatiently, clearly uninterested in hearing why he had to wait for a bunch of scientists to check off formalities like human safety before he could get his hands on the elixir.
“Any response yet?” Trump asked. “When will you know if it works? I mean, you already have this medicine.”
Preliminary results would be available the following month, O’Day replied. Gilead was already preparing to manufacture the drug. “We’re moving as fast as we can,” O’Day said.
“Get it done, Daniel,”1 Trump implored. “Don’t disappoint us, Daniel. Do you understand?”
O’Day would get it done. Though the trials would reveal that the drug was of little consequence in limiting deaths from COVID-19, and though the advent of vaccines would fail to rescue Trump’s doomed presidency, remdesivir proved dramatically successful as a therapeutic for Gilead’s balance sheet.
By early 2021, Trump was gone, but remdesivir was forecast to register $3 billion in sales over the course of the year.
The pharmaceutical industry was a uniquely rewarding parcel of Davos Man’s preserve, a landscape teeming with delicious prey, much of it stocked by the public. Drug companies exploited research financed by taxpayers to generate marketable new drugs. Then they priced their wares to maximize returns for shareholders, frequently beyond reach of much of humanity.
The pandemic amplified the stakes, supplying the Davos Men who were running pharmaceutical companies with additional incentive to prioritize profits for shareholders over societal needs.
The global spread of the coronavirus also exposed the pitfalls of the inequality that had been widening for decades. The backlash to Davos Man’s monopolization of wealth had placed belligerent nationalists like Trump in power, just as international cooperation was critically needed.
As nations struggled to secure medicines and protective gear, they confronted serious disruptions to the supply chain, resulting in part from Trump’s trade war. From Europe to India, governments sought to bar exports of critical goods, threatening the availability for all.
The consequences of this spirit of rivalry intensified as vaccines became available in early 2021, bringing a new and defining form of inequality: those with access, and those without.
Davos Man’s companies harnessed world-class research capabilities to yield effective vaccines in a fraction of the time most experts thought possible. But the pricing for these lifesaving products left most of the world’s population unable to partake.
In a nationalist free-for-all, the United States, Britain, and other advanced economies preordered many more doses than their populations needed. Poor countries were largely shut out, dependent on handouts from organizations that distributed more press releases than doses.
From South Asia to Africa to Latin America, billions of people were likely to go without vaccines for several years.
There was but one certainty: Davos Man was going to cash in.
Like many drugs, remdesivir had failed in its original incarnation. Six years earlier, Gilead had entered it into trials as a treatment for Ebola. Those tests had proved unsuccessful, leaving the product on the shelf. Then came the pandemic. Suddenly, any conceivable way to attack a virus was worth trying.
Gilead had supplied remdesivir to the authorities in China for testing as a treatment for COVID-19. A World Health Organization panel2 had concluded that remdesivir was “the most promising candidate” among potential therapeutics. Clinical trials had begun in the United States.
Four days after O’Day participated in the meeting at the White House, he went to Capitol Hill as part of a contingent of industry executives assembled by the leading trade association, the Pharmaceutical Research and Manufacturers of America—better known as PhRMA. At a press conference, he touted remdesivir’s potential, asserting that Gilead had spent “billions of dollars trying to develop this medicine.”3
But he omitted mention of a crucial investor—the American taxpayer. The Centers for Disease Control, the U.S. Army, and the National Institutes of Health had all financed research projects4 that had laid the ground for the development of the drug.
Later that month, Gilead received another gift from the taxpayer, as the company secured approval from the Food and Drug Administration to register remdesivir as a so-called rare disease treatment. That designation brought a treasure trove of benefits—a seven-year monopoly on sales, free from the incursion of generics; tax credits for research and development costs; and a faster review time for regulatory clearance.
Congress had created this categorization in the early 1980s as a means of spurring research into diseases that afflicted so few people they might otherwise be ignored. The designation was limited to diseases that affected fewer than two hundred thousand patients. Technically, COVID-19 qualified because—at the moment of Gilead’s filing—the United States had about fifty thousand cases. But this was like arguing that the beach was an unpopular destination because no one went there on the coldest day of winter. COVID-19 was in no danger of being passed over by the market. By the fall of 2020, the United States alone had registered more than 8 million cases.
“This is an unconscionable abuse5 of a program designed to incentivize research and development of treatments for rare diseases,” declared a letter sent to O’Day from fifty-one consumer advocacy groups led by Public Citizen. “Calling COVID-19 a rare disease mocks people’s suffering and exploits a loophole in the law to profiteer off a deadly pandemic.”
Taxpayers had already paid for the drug through “at least $60 million in grants6 and innumerable contributions from federal scientists,” Public Citizen noted. A broader study identified $6.5 billion’s worth7 of federally funded projects that had contributed to remdesivir.
This was standard Davos Man operating procedure. The taxpayer had long served as the ultimate angel investor8 for blockbuster drugs. Between 2010 and 2019, the Food and Drug Administration approved 356 new drugs. Each was aided by public research, including $230 billion in grants from the National Institutes of Health.
On its face, this was positive. The United States possessed unsurpassed research capacities. The public was harnessing this acumen to yield lifesaving medicines. But shareholders like O’Day and his Gilead forebears were hogging the benefits.
Between 2000 and 2018, thirty-five of the largest pharmaceutical companies reported total revenues of nearly $12 trillion9 and profits of almost $2 trillion. They achieved these gains in part by pricing their medicines beyond reach of ordinary people. Insulins, for example, had nearly quadrupled in price10 over the previous decade, while multiple sclerosis drugs had risen more than fivefold. One in four Americans11 reported struggling to afford prescription medications.
Drug company executives tended to defend themselves against charges of profiteering by arguing that monumental gains were a requirement for developing vital medicines.
“Those who are bold12 and go out and innovate like this and take that risk, there needs to be more of a reward on that,” Gregg H. Alton, Gilead’s then vice president of corporate and medical affairs, had once declared. “Otherwise, it would be very difficult for people to make that investment.”
But this notion exaggerated the degree to which drug companies were plowing their winnings into societally useful investments.
Between 2006 and 2015, eighteen large American pharmaceutical companies distributed 99 percent of their profits13 to shareholders via dividends and purchases of their own shares. The $516 billion they collectively lavished on shareholders exceeded the $465 billion they dedicated to research and development.
Pharmaceutical companies spent much of their money on marketing campaigns. They paid dues to trade associations like PhRMA, which, in 2019 alone, had spent a record $29 million14 lobbying Congress as it fought off attempts to regulate prices for prescription medicines.
Gilead was an astonishing gusher of wealth. Over the course of two decades the company’s chief executive, John C. Martin, had taken home more than $1 billion in compensation15, most of this haul in the form of stock grants.
These gains reflected Gilead’s success as an enterprise that operated more like an investment bank than a laboratory. In 2011, Gilead paid more than $11 billion to take over an Atlanta-based biotechnology startup, Pharmasset, which had developed a promising means of treating hepatitis C. Two years later, Gilead secured the Food and Drug Administration’s approval for the resulting drug, which it branded Sovaldi. It was soon selling a twelve-week course for $84,000—about $1,000 per pill.
In 2014, its first year on the market, Sovaldi racked up sales of $10.3 billion. But its price was so high that state governments—which covered much of the bill for Medicaid patients—were prescribing it only for the most serious cases16. Roughly seven hundred thousand Medicaid patients suffered from hepatitis C, but less than 3 percent17 were able to obtain the drug.
The next year, Gilead sold nearly $14 billion’s worth of another hepatitis C drug, Harvoni, which had a price tag of $94,500, for a twelve-week course.
These two blockbusters largely explained how Gilead was able to direct more than $26 billion into buying back its own shares between 2014 and 2016, just as needy patients were being priced out of affording its medicines. Gilead was exploiting tax loopholes18 to stash its lucre overseas, neatly avoiding taxes on nearly $10 billion in profits.
In January 2017, Gilead’s then-CEO John Milligan flew to Switzerland for the World Economic Forum, where he participated in a panel discussion entitled “Rebuilding Trust in the Healthcare Industry.”
The panel was moderated by Sara Eisen, a television anchor for the financial news channel, CNBC. She rattled off recent examples of pharmaceutical executives looting the public interest for private gain. There was the case of the “Pharma Bro,” Martin Shkreli, a former hedge fund manager who had taken control of a drug used to treat a life-threatening parasitic infection. He increased the price from $13.50 per tablet to $750, forcing patients to spend upward of hundreds of thousands of dollars a year. A company called Theranos had touted a revolutionary blood-testing technology that had been exposed as a fraud.
These stories had “left many wondering whether there’s a trust problem when it comes to health care,” Eisen said as she opened the discussion. She invited her “distinguished panelists” to provide “forward thinking” on how to regain faith.
This setup adhered to the central Davos masquerade, in which every participant gets to pose as a concerned citizen. Rather than critically questioning people who had profited from a system that treated patients like suckers, Eisen invited her panel of pharmaceutical executives to offer counsel as those dedicated to Improving the State of the World.
Milligan, whose compensation that year exceeded $15 million, was asked about controversy over Gilead’s pricing of hepatitis drugs. He acknowledged trouble, but cast it as a messaging problem—not the result of an exploitative business model.
“We didn’t deal with it well,” he said. “We didn’t talk about it enough.”
This was a classic Davos Man maneuver, minimizing his role in human suffering by confessing to communications mishaps, or a misunderstanding. This rendered greater communication the solution to all problems—an implicit affirmation of the very activity he was engaged in. He struck a pose of candor and even capitulation, accepting blame for the lesser crime of poor word choices, while diverting attention from far more serious issues of patients dying for a lack of affordable medicines.
Milligan portrayed Gilead as the victim of an overly complex system—one rife with insurance companies and medical providers on the make, each seeking a good deal, and unwilling to publicize the terms for fear of undercutting their bargaining position.
“There’s a lack of transparency,” he said. “There are always going to be opportunists.”
This was like the owner of a skeevy casino bemoaning the drunkenness that accompanied gambling. Just as Schwarzman feasted on the vulnerability of emergency room patients who were unclear on the particularities of their insurance policies, Milligan’s company exploited the confusion that characterized his industry. Lack of transparency was not something for Gilead to lament; it was how the company was making billions.
Gilead had applied similar shamelessness in extracting profits from the HIV epidemic. It exploited a technique developed by the Centers for Disease Control that blocked transmission of the virus. The government had patented the technique in 2015, and Gilead had used it to develop a drug, Truvada, that it was selling for $20,000 a year. Its sales had reached $3 billion in 2018, but Gilead was not paying a dime in royalties19 to the government, while arguing that its patent was invalid. The government eventually sued Gilead to try to collect a return.
Most of this history predated O’Day, who became CEO in December 2018. Yet almost immediately, he found himself having to answer for his new employer’s unsavory reputation.
At a hearing before the House Oversight and Reform Committee in May 2019, members of Congress grilled him on the extortionate price of Truvada. There, O’Day adhered to the industry line that the world could have reasonable prices or lifesaving drugs, but not both.
“If we had lowered20 the prices of our medicines a decade ago, we wouldn’t be sitting here with the innovations that are changing the face of HIV AIDS,” O’Day said.
But business as usual was an especially perilous stance in the midst of a global pandemic. The outrage over Gilead’s success in certifying remdesivir as a rare disease treatment was so potent that the company rescinded its application. O’Day soon announced that the company would donate its stockpile of remdesivir—1.5 million doses—to medical providers, gratis.
This gesture of generosity was limited. Gilead was ramping up its manufacturing capacity, aiming to produce enough remdesivir for one million patients by the end of 2020. By then, it would be charging for the medicine.
The National Institutes of Health soon announced results from a clinical trial of remdesivir. The drug shortened the time that severely afflicted patients had to remain in the hospital, but its benefits in limiting death21 were minimal. Trump publicly lobbied the Food and Drug Administration to cease fiddling and get the drug into the market. The former reality-television star grasped that the announcement of a new drug for COVID-19 was ratings-boosting content.
“I want them to go as quickly as they can,”22 Trump told reporters.
Two days later, the FDA cleared remdesevir on an emergency basis. O’Day appeared with Trump at a White House press conference.
“We feel a tremendous responsibility,”23 O’Day said. “We’re fully committed to working, Mr. President, with you and your administration to make sure that patients in need can get this important new medicine.”
Once upon a time, the American government was in a position to guarantee that outcome. In 1989, the National Institutes of Health declared that it would demand “reasonable” prices for drugs24 produced through the aid of government research. But the pharmaceutical industry lobbied fiercely to scrap that rule, wielding the argument that astronomical drug prices were a requirement for innovation. Either Davos Man got paid or people died.
In 1995, with the government led by corporate fund-raiser par excellence Bill Clinton, and with pharmaceutical industry contributions flowing liberally, the NIH rescinded its rule25.
In freeing drug companies from the legal requirement to extend reasonable prices, the American government ratified the triumph of Davos Man thinking. “Eliminating the clause26 will promote research that can enhance the health of the American people,” the NIH declared in a press release.
Five years later, members of Congress tried to revive the reasonable pricing rule with an amendment attached to a broader bill. Eight Democrats joined with Republicans to defeat it in the Senate—among them, a senator from Delaware27 named Joe Biden.
Two decades after that, on June 29, 2020, Daniel O’Day released a letter disclosing Gilead’s pricing for remdesivir.
The medicine appeared to shorten hospital stays by an average of four days, he noted, a benefit that was worth $12,000 per patient. Gilead could, on this basis, justify charging $12,000. But the company, “with the aim of helping as many patients as possible,”28 was selflessly leaving money on the table. It would charge governments in wealthy countries $2,340 per patient for a five-day course. Private insurance companies would pay $3,120.
By that reasoning, a toothbrush could fetch upward of $1,000, given that it could prevent root canal therapy. Gilead could have charged29 as little as $10 for a course of remdesivir and still made money, one analysis concluded. But that would have withheld the bounty of remdesivir from the key stakeholder—Daniel O’Day and his fellow shareholders.
The Trump administration announced that it was purchasing nearly all of the company’s supply of remdesivir at its announced price and would distribute the drug to hospitals.
Across the United States, a bipartisan coalition of attorneys general representing thirty states urged the Trump administration to use its powers to invoke so-called march-in rights30, permitting other companies to make generic versions of remdesivir to boost the supply and lower the price.
Gilead pronounced itself “deeply disappointed” by this questioning of its benevolence. The company urged the Trump administration to maintain “incentives for Gilead and others to continue to invest in developing much needed treatment and vaccines.”
Gilead had nothing to fear so long as long as Trump remained in office.
In October 2020, the month before the presidential election, Trump contracted COVID-19, and was administered the drug—a useful bit of product placement in the final season of his show.
A rapidly spreading coronavirus operating across borders demanded international cooperation. But decades of Davos Man’s plunder had sown distrust and dysfunction, elevating tribalists who viewed collaboration as a threat to national interests.
As the first wave of the pandemic swept around the world, national governments banned exports of virtually anything that could prove useful—surgical masks and gowns, raw material for pharmaceuticals, and parts for ventilators. By April 2020, nearly seventy countries31 had imposed such bans, including several members of the European Union. Given that raw materials and parts were drawn from a global supply chain, such barriers threatened the availability for all.
Two countries played especially critical roles in the global supply chain: India was the world’s largest producer32 of generic drugs, from antibiotics to painkillers; Chinese manufacturers supplied India with nearly 70 percent of the raw materials for pharmaceuticals. Both were ruled by leaders who habitually stoked nationalism as a means of rallying popular support. And by the summer of 2020, these two countries were engaged in a violent border skirmish that severely curtailed their trade.
India’s prime minister, Narendra Modi, was a Hindu supremacist who demonized the minority Muslim population. He sold himself to international investors as the supposed mastermind behind an economic miracle in his home state of Gujarat, while leaving out his alleged role in fomenting a massacre of Muslims there in 2002.
Intent on penetrating a marketplace that was home to more than one billion people, Davos Man joined the Modi parade.
“Wonderful to be with Prime Minister Modi in Davos,” Benioff tweeted from the Forum to his one million followers in January 2018, posting a photo of himself beaming as he shook the Indian leader’s hand. “The transformation of the Indian economy is very impressive. He has an open hand to business.”
Never one to be outdone, Klaus Schwab used a blog post33 to praise Modi for presiding over a nation that possessed “a robust institutional mechanism for deftly counterbalancing pervasive diversity while projecting a single identity.” His piece was published shortly after a politician from Modi’s party was caught offering to pay a bounty34 of $1.5 million to anyone who beheaded the star and the director of a Bollywood blockbuster who had supposedly distorted a Hindu legend.
In reality, Modi distinguished himself as a ham-handed incompetent, presiding over an economic slowdown while his government doctored the books to hide the extent of joblessness.
The pandemic supplied Modi a fresh opportunity to employ nationalist machismo as a diversion from his disappointing economic performance. He restricted exports of more than two dozen medicines and raw materials, including hydroxychloroquine, an antimalarial drug that had shown initial promise as a potential treatment for COVID-19.
China’s paramount leader, Xi Jinping, was intent on using the public health emergency to demonstrate his country’s revived status as a superpower—self-reliant at home, and capable of supplying countries around the world with vital medicines and vaccines.
At the same time, the Trump administration seized on the pandemic as a chance to blunt China’s rise by forcing American manufacturers to abandon the country.
Nearly three-fourths of the suppliers of ingredients used to make pharmaceuticals in the United States were located overseas, including 13 percent in China35. More than half of all face masks worldwide were made in China. And China was the source of 90 percent36 of the core chemicals used to make the raw materials for a vast range of generic medicines used to treat people hospitalized with COVID-19.
Trump put his trade adviser, Peter Navarro, in charge of mobilizing American industry to produce face masks, ventilators, and other vital equipment. In March 2020, Navarro began preparing an executive order directing federal agencies to purchase drugs and protective gear from American suppliers.
Navarro claimed the order was not targeted at any particular country, but this was clearly nonsense: he had accused China37 of creating the novel coronavirus and intentionally unleashing it on the world.
There was logic to the idea that the United States should lessen its dependence on foreign suppliers for medicine and protective gear. But it was folly to press for such an outcome in the middle of an emergency, while antagonizing the one country in position to satisfy the need.
Much of American industry was locked down. Europe was in a similar state. Having suffered the virus earliest, China was already reopening. Its factories were able to produce what the world required.
“It’s not that we are buying this stuff from China that’s made us vulnerable,” said Chad Bown, a trade expert at the Peterson Institute for International Economics in Washington. “It’s that we are buying this stuff from China, and we decided to start a trade war with them.”
Even Trump appeared to grasp this. He held off on signing38 Navarro’s order. When he finally did sign, in August, it read more like a directive to prioritize American suppliers39 than a prohibition against foreign sources.
Nearly two decades earlier, when China was ravaged by another coronavirus known as SARS, the American Centers for Disease Control deployed its people to Beijing to help the government contain the threat. In the years after, Chinese and American authorities pooled their expertise to help contain epidemics in Africa.
But even before COVID-19 emerged, scientific cooperation had been a casualty of the geopolitical refashioning. In the two years before the pandemic, the Trump administration steadily pulled scientists out of Beijing.
“Given the overall sentiment that any scientific research will be helping China, the United States is really trying to reduce any collaboration with China,” Jennifer Huang Bouey, an epidemiologist and China expert at the RAND Corporation, told me. “That really hurts global health.”
In a relentlessly dark time, vaccines were the ultimate ray of hope—the key to life returning to normal. Yet scientists cautioned that expectations were in danger of being disappointed.
In the course of medical history, the fastest a vaccine had been conceived and delivered to market was four years. No one wanted to wait that long for a fix to COVID-19. With people dying around the world, children denied access to schools, livelihoods decimated, and hunger spreading, an extraordinary effort was underway to produce vaccines as quickly as possible.
By the fall of 2020, forty-five potential candidates were undergoing clinical trials on humans around the globe, with more than ninety in some phase of testing on animals.
The urgency was appropriate, but the spirit of national rivalry was alarming. It suggested that money and power would dictate who gained access to the lifesaving creations.
Trump had underscored this threat in the first months of the pandemic with a bold move to effectively seize control of a German company that was developing a promising vaccine candidate.
The company, CureVac, was based in southwestern Germany, but also had an office in Boston. Its chief executive, Daniel Menichella, had attended the same White House gathering where Gilead’s CEO had touted remdesivir.
“We believe we can develop the vaccine for COVID-19 very, very quickly,” Menichella told Trump. “And we have the wherewithal to manufacture it.”
Days later, Trump reportedly offered CureVac $1 billion40 to move its research and eventual production of its vaccine to the United States in a bid to lock up the resulting supply for Americans.
When the news broke, the company denied Trump’s entreaty, and the White House insisted that it had always intended to share the fruits of any research with the world. But German officials divined the issue as a matter of national security. They crafted a counterbid41 that kept the company on its home soil. The company eventually produced a vaccine that was only modestly effective.
Trump’s reach to capture CureVac’s output resonated as a signal that governments either had to take matters into their own hands—marshaling industrial efforts to develop and manufacture vaccines—or risk watching their people die while more aggressive nations wound up with the goods.
Britain, looking past Brexit, rejected an overture from the European Union42 to cooperate on efforts to develop and distribute vaccines. Boris Johnson’s government bet on the eventual success of a promising candidate developed at Oxford, combined with mass orders of other leading vaccines. That proved wise. Britain inoculated its people aggressively during the first months of 2021, dramatically reducing the spread of the virus, while Europe initially fumbled its own campaign through bureaucratic confusion.
Trump harnessed a little-known unit within the Department of Health and Human Services to dispense grants to companies toward speeding their vaccine development. These grants came with a vital requirement: recipients were required to supply the United States with a stockpile of any resulting vaccines. By October, various arms of the federal government distributed more than $1 billion to spur domestic production43 of medicines and vaccines.
The extraordinary push for vaccines soon produced three highly promising candidates—one from Pfizer in partnership with German company BioNTech, a second from Moderna, and the third from Oxford, in partnership with the Swiss-British company AstraZeneca. Russia and China produced vaccines that—while relatively less effective—helped contain the spread of the virus.
That humanity could so quickly formulate lifesaving vaccines was nothing short of miraculous. That Davos Man would largely dictate who gained access was alarming. It all but guaranteed that the world would emerge from the pandemic more unequal than ever.
Making vaccines was a relatively slow undertaking, ensuring scarcity. Limited supplies of basic elements like syringes, glass vials, and bioreactor bags along with key chemicals were certain to constrain how quickly the industry could produce supplies. The leading vaccines from Pfizer and Moderna relied on a new technology that required specialized know-how.
For pharmaceutical companies, scarcity was a benefit. They were making their products in the ultimate seller’s market. Governments were desperate to procure doses and willing to pay whatever it cost.
AstraZeneca announced that it would forego profit for as long as the pandemic endured. But Pfizer continued to pursue the same model that had supplied its CEO, Albert Bourla, with a pay package reaching $21 million in 2020. The company charged as much as the market would bear.
Bourla was another signatory to the Business Roundtable’s stakeholder capitalism pledge. Yet his company was catering to shareholders above any sense of civic responsibility.
In February 202144, as vaccines began reaching humanity, Pfizer was anticipating revenues of $15 billion from its COVID-19 vaccine over the course of 2021. Only three months later, as national governments engaged in a bidding frenzy to secure vaccines, Pfizer said it expected to sell $26 billion’s45 worth of COVID-19 vaccines before the year was done. The company anticipated that sales would continue to grow as wealthy nations amassed extra stocks of its vaccine for booster shots. It already had a deal with Canada46 to supply doses as far out as 2024.
Bourla was cannily playing off the governments of the wealthiest countries against one another, driving the price higher. “It was a constant negotiation,”47 he said. “Everybody wanted it of course earlier.”
He cashed in on the desperation of Israeli prime minister48 Bibi Netanyahu, who was eager to repair his tattered reputation in the face of multiple corruption charges. Pfizer extracted a deal to supply Israel with an enormous stock of vaccines at prices that were reportedly 50 percent higher49 than what the United States was paying. Israel initially vaccinated its population faster than any country on earth—though it largely denied access to Palestinians50 in the occupied territories.
The United States procured more vaccine doses than it needed51, via contracts in which the pricing was cloaked from public view. Europe and the United Kingdom locked up more than enough doses to inoculate their populations in a series of opaque deals. The oil-rich countries of the Persian Gulf all secured substantial stocks.
By early 2021, as the worst of the pandemic ravaged the globe, people in wealthy nations could glimpse the potential outlines of an ending as vaccines reached the bloodstream. But those in poor countries were likely to wait until 2024 before their governments could get their hands on ample doses.
The Indian government promised to sell its vaccines at affordable prices to scores of countries in the name of balancing the lopsided distribution. “India is ready to save humanity,” 52 Prime Minister Modi declared in January 2021. But two months later, as India absorbed one of the world’s worst waves of infection—recording more than fifty thousand new cases a day—Modi all but cut off exports53. That deprived poor countries of hundreds of millions of doses they had expected to receive from India’s largest vaccine manufacturer, the Serum Institute.54 Nepal halted its vaccine distribution55, citing an inability to procure doses from India, while Morocco and Brazil both girded for delays.
The loss of exports from India also dealt a fresh blow to an already troubled international effort to ensure the equitable distribution of vaccines, an undertaking known as Covax.
Covax had been launched by Gavi, an immunization alliance forged at Davos in 2000 along with the World Health Organization. It was supposed to function as a global clearinghouse for vaccines, a rational arbiter of the world’s needs, ensuring that the most critical populations in every country—the elderly, the infirm, frontline medical workers—received immunization first. It was engineered to prevent the very scenario that was unfolding: young, healthy people in the United States and Britain gaining full vaccination even as medical caregivers in sub-Saharan Africa and South Asia continued to treat COVID-19 patients without inoculation.
Covax never had a chance. Governments from Washington to London to Tokyo bypassed the queue to buy doses for themselves directly, while American and European pharmaceutical companies cashed in on their creations by selling to the highest bidder. That reduced Covax to something smaller and less promising, though still vital—an essentially charitable operation that aimed to deliver vaccines to countries that could not afford to buy doses on the open market. Promised contributions from donor nations fell woefully short, even as Covax issued a flurry of announcements laying out impossible distribution targets.
“Most people in the world live in countries where they rely on Covax for access to vaccines,” Mark Eccleston-Turner, an expert on infectious diseases at Keele University in England, told me. “That is an extraordinary market failure. Access to vaccines isn’t based on need. It’s based on the ability to pay, and Covax doesn’t fix that problem.”
In January 2021, the director general of the World Health Organization, Tedros Ghebreyesus, excoriated wealthy countries for hoarding vaccines.
“I need to be blunt,” he said in a speech before the body’s executive board. “The world is on the brink56 of a catastrophic moral failure, and the price of this failure will be paid with lives and livelihoods in the world’s poorest countries.”
His words were powerful, yet not blunt enough. The problem went beyond governments in wealthy nations monopolizing stocks of vaccines. The trouble was how these transactions were structured—with the understanding that, above all, Davos Man would get paid.
Less than two miles from the World Health Organization’s headquarters in Geneva, another proceeding was underway at the World Trade Organization. Developing countries, led by South Africa and India, sought a waiver from patents protecting the vaccines, supplying them legal authority to manufacture generic versions at affordable prices. They hoped to use this threat to force the pharmaceutical companies to supply them at affordable prices.
“The question is really, ‘Is this a time to profit?’”57 a councilor at the South African mission, Mustaqeem De Gama, told me. “We have seen governments closing down economies, limiting freedoms, yet intellectual property is seen to be so sacrosanct that this cannot be touched.”
The WTO operates on consensus, meaning nothing happens unless the whole membership agrees. For months, the United States, Britain, and the European Union blocked the proposal—not out of some abstract faith in the sanctity of intellectual property, but because of the power of Davos Man. Giant companies like Pfizer financed lobbying groups like PhRMA that expertly deployed campaign cash to secure favorable policies.
The industry parried the attempt by developing countries to set aside patents by wielding a time-tested Davos Man argument: extravagant profits were inseparable from lifesaving innovation.
“The only reason why we have vaccines right now was because there was a vibrant private sector,” Bourla, the Pfizer CEO, said in early 2021, leaving out another key reason: publicly financed research. “The vibrancy of the private sector, the lifeblood is the IP [intellectual property] protection.”58
The hollowness of that depiction was evident from a previous major argument over patent rights: the battle over access to antiretroviral drugs used to treat HIV in the 1990s. Therapies approved by American regulators in the middle of that decade yielded a plunge in deaths in the United States and Europe, where people could afford the lifesaving products. But deaths continued to soar unabated across sub-Saharan Africa for years after.
In 2001, the WTO agreed to allow pharmaceutical manufacturers to set aside patents and produce generic versions of the antiretrovirals, prompting horrified talk from the industry that incentives for research and development were being jeopardized.
Somehow, the industry survived, continuing to churn out a vast array of life-extending, money-harvesting products.
“At the time, it rattled a lot of people, like ‘How could you do that? It’s going to destroy the pharmaceutical industry,’” said Dr. Anthony S. Fauci, President Biden’s chief medical adviser for the pandemic. “It didn’t destroy them59 at all. They continue to make billions of dollars.”
Four days after the warning from the head of the World Health Organization, Pfizer announced that it was joining Covax, making 40 million doses of its vaccine available during 2021.
“At Pfizer, we believe that every person deserves to be seen, heard and cared for,” said Bourla, the company CEO, in a press release. “We share the mission60 of Covax and are proud to work together so that developing countries have the same access as the rest of the world.”
The same access was a shameless piece of Davos Man obfuscation, a lie wrapped up as a gift to humanity. Less than two weeks later, Bourla would tell stock analysts that Pfizer was on track61 to deliver 2 billion doses worldwide by the end of 2021. Pfizer’s sales to Covax—at undisclosed terms—represented a mere 2 percent of this production.
In early May 2021, President Biden broke with the pharmaceutical lobby62 and lent American support to the WTO initiative to set aside patent protections on COVID-19 vaccines. On its face, this was a stunning development. The pharmaceutical industry was especially powerful in Washington, and Biden had long leaned heavily on its contributions in financing his campaigns. But the announcement was more of a headline grabber than a meaningful alteration of reality. Europe continued to oppose the initiative, led by Germany, which was intent on protecting BioNTech’s market. Just as Chancellor Merkel had prioritized the balance sheets of German banks over European solidarity during the debt crisis a decade earlier, she now gave primacy to the profits of a domestic pharmaceutical company over global public health. Biden showed no signs of applying pressure on Merkel to alter that stance.
By themselves, patent rights were of dubious value anyway. Substantially boosting the supply of vaccines required that existing manufacturers share not only the recipes for their wares but also their production processes through so-called technology transfers. Europe was supposedly in favor of that, but on a voluntary basis—a benevolent sounding construction of the status quo. Major pharmaceutical companies were at least rhetorically in favor of forging partnerships around the world, but they mostly maintained that they had already done as much as they could, exhausting the supply of factories possessing the required expertise and standards.
Some experts argued that the debate at the WTO amounted to a dangerous sideshow, like arguing over the organizational chart at the fire department during an inferno. The world’s productive capacity was dominated by multinational corporations that answered to shareholders. Whether this was desirable or lamentable was a conversation best scheduled for a calmer day. Governments should simply permit companies like Pfizer to carry on unhindered and produce as much vaccine as possible. The rest amounted to a distribution problem.
But others countered that paternalistic deference to the pharmaceutical industry was precisely what had created the crisis. The pandemic was not a one-off emergency, but part of a historical continuum. From the era of colonialism through the crafting of modern trade agreements, leaders in wealthy countries tended to regard the rest of the globe as sources of raw materials to be mined and low-wage laborers to be exploited, and not as places where fairness and equality required more than nominal consideration. Coronavirus variants were already threatening new waves of infection, and booster shots would be needed—potentially for years—necessitating greater supply. Other pandemics might follow, bringing a repeat of the situation at hand. Against that backdrop, it was both immoral and unrealistic to expect that developing countries would sit and wait for wealthy benefactors to swoop in and save them from the pandemic. They had to be able to make what vaccines and medicines they needed for their own people, rather than depending on the good graces of Davos Man.
From Indonesia to Bangladesh to South Africa, pharmaceutical manufacturers professed readiness to make vaccines, if only the existing manufacturers would help them. That would not happen through magnanimous gestures or stakeholder capitalism. The woeful performance of Covax proved that.
By the middle of August 2021, Covax had delivered63 a mere 196 million of the 1.9 billion doses it had promised to distribute over the course of the year. Only 2 percent64 of Africa’s 1.3 billion people had been fully vaccinated against COVID-19, compared to 62 percent in the United Kingdom, 59 percent in Germany, and 51 percent in the United States. This divide was about to be widened, as wealthy nations added to their vaccine stockpiles in anticipation of booster shots.
“As some richer countries hoard vaccines, they make a mockery of vaccine equity,”65 declared the World Health Organization’s Director for Africa, Dr. Matshidiso Moeti.
There was truth to that characterization, but it was an incomplete account. The gaping disparity in vaccine distribution was not merely reflective of which countries had the most power but also which interests retained primacy within countries. Same as ever, Davos Man was dictating the course of policy in the service of Davos Man. The result was a humanitarian tragedy in poor countries—a wave of unremitting death—along with the potential prolonging of the pandemic everywhere. So long as some countries lacked vaccines, the coronavirus was supplied a chance to yield variants that would require additional immunization. The protection of Davos Man’s profits took precedence over the saving of lives.
By the summer of 2021, Biden’s pledge to set aside patents on COVID-19 vaccines seemed like a distant memory. Seeking to mute the talk that the United States was doing little while most of the world suffered the worst of the pandemic, Biden announced plans to purchase 500 million doses of Pfizer vaccine and donate them to countries in need, primarily through Covax. The donation would involve a $3.5 billion purchase66 of Pfizer’s vaccines by American taxpayers. That price equated to about $7 a dose, compared to the $20 the company was fetching on those administered in the United States. Pfizer said this was a “not for profit” price67. But outsiders were in no position to verify the veracity of that claim.
Five hundred million was an eye-catching number, yet it was only enough vaccine to fully immunize about 3 percent of the world’s population. And most of those stocks would not be distributed until the middle of the following year.
Meanwhile, Pfizer was ensuring that its profits would be more robust than ever.
In its contracts with the European Union, the company raised the prices68 for its COVID-19 vaccine by 25 percent. In the United States, Pfizer lobbied the Biden administration to move faster to authorize booster shots, even as many scientists questioned whether the data supported that course. The spread of the so-called Delta variant in the fall of 2021 raised the prospect that boosters might indeed be required, but it was troubling that the company best positioned to profit from additional shots was the one dispensing the advice. Pfizer was telling stock analysts to expect a third more revenue from vaccine sales than previously anticipated—more than $33 billion69 for 2021.
The story of vaccine distribution adhered to the tale of pretty much everything.
Davos Man aspirants like Pfizer’s Bourla were getting richer, while humanity remained vulnerable to the continued spread of the coronavirus, given the patchwork of protection. Poor countries were left to manage profound problems largely on their own, save for token donations and sound bites of concern from the wealthiest, most powerful people on the planet.
Many developing countries were in fact seeing their meager resources stretched further as they confronted impossible debts, and as Davos Men like Larry Fink squeezed them to pay up.