The pharmaceutical industry has always borne its fair share of scrutiny. However, in 2020, COVID-19 has shone a light on the sector like never before. As the first wave of COVID-19 vaccines rolls out, there can be no doubt about the pivotal role played by pharmaceutical companies in fostering global public health and a resilient future economy.
So what is pharma’s role in a resilient future? Clearly it involves partnerships. The response to the pandemic has demonstrated that global access to the benefits of pharmaceutical products can be furthered when companies collaborate – both within the industry and with public, private and multinational organizations. There is before us now an opportunity for pharma players to leverage relationships in a transparent way to address societal needs. For investors looking to advance global access to medicine and pharmaceutical products, the utility of partnerships must become an important topic for future corporate engagements in the sector.
It’s no longer far fetched for industry players to work together
That collaborative future may have already arrived. Throughout the pandemic, many pharma companies embraced working collaboratively to manage manufacturing constraints on the road to COVID-19 treatments and vaccines. In fact, in a move that went unchallenged by the US Department of Justice, a number of companies such as Eli Lilly, AbCellera Biologics, Amgen, AstraZeneca, Genentech, and GlaxoSmithKline sought approval to share information with their competitors to expedite the production of safe and effective monoclonal antibody treatments for COVID-19. Players like AstraZeneca have also taken a global approach to distribution, working with other manufacturers around the world such as the Serum Institute of India. Another example includes an initiative launched by the Bill and Melinda Gates Foundation with Eli Lilly, as part of the COVID-19 Therapeutics Accelerator, where the company’s collaborators – Abcellera, Shanghai Junshi Biosciences Co., Ltd. and Columbia University – all agreed to waive their royalties on Eli Lilly therapeutics distributed in low and middle income countries.
The idea of sharing intellectual property, knowledge and information has long been a focus of pharmaceutical industry engagements by investors who believe in access to medicine as necessary in a fair and sustainable economy. Perhaps there is an opportunity to broach this issue with a greater likelihood of success given the receptiveness to partnerships displayed by companies during this pandemic. Given the undeniable benefits of collaborating to rapidly scale up manufacturing and distribution capabilities to address our recent global health concerns, it seems reasonable to expect that post-pandemic conversations on sharing knowledge and facilities would gain more traction.
Partnerships with non-industry players can further the access agenda
In particular, public-private relationships in the pharmaceutical sector have received significant attention during this pandemic. Many pharma companies received government funding for research and development to help spur the rapid development of COVID-19 vaccines and therapeutics; and through the establishment of national level advance purchase agreements. If these partnerships are fairly and equitably implemented, pharma firms should, in recognition of the public’s financial contribution, consider pricing their products in a way that facilitates accessibility and affordability.
Yet even as these relationships funnel resources towards specific public health needs, national level partnerships can create tensions around the need for global access to pharmaceutical products. Investors with an eye to furthering sustainable economies globally may consider pushing for greater insights from companies on how they plan to manage potentially competing national and global priorities. Agreements with multinational entities like COVAX (the global entity coordinating equitable distribution of COVID-19 vaccines) can help mitigate potential conflicts. Investors may wish to leverage the example of COVAX in post-pandemic engagements to encourage companies to consider the inherent limitations of national level partnerships.
Partnerships must be complemented by transparency
The pandemic has opened the door for investors to dialogue with companies on how a collaborative approach to the development, manufacture and distribution of pharmaceutical products can play an important part in facilitating access to medicine and pharmaceutical products. Engagements should seek to better understand the nature of agreements with government, multinational organizations, foundations, as well as between industry players. As responsible investors look towards a resilient economy, it will be important to seek appropriate disclosure on public-private agreements, to ensure that the public’s contribution is adequately recognized by the company, especially in light of the tensions that can exist among partners in pursuit of various commercial, national and global interests.
Expectations on transparency are shifting. Within the context of this ongoing need for enhanced transparency, the Global Health Innovation Alliance Accelerator has launched the Master Alliance Provisions Guide (MAPGuide) – a database of actual and template contractual provisions from global health alliance agreements “that addresses key principles on which partnerships are built”. It is likely that investor expectations of industry players will continue to move towards enhanced disclosure so investors can better understand these relationships and verify their intended impact on society.
Health is everyone’s business. For the benefits of these relationships to be fully maximized, stakeholders, including investors, must be able to hold companies accountable. The currently limited transparency on the workings of the pharmaceutical industry has been questioned by the public and investors during the pandemic, and should be considered even more pointedly in the post-COVID-19 world. In ongoing engagements with pharmaceutical companies, this is a timely opportunity for responsible investors to encourage companies to not only collaborate for social betterment, but to do so with maximum transparency.