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EXCLUSIVE: Kiran Mazumdar-Shaw asks govt to let companies use CSR funds to vaccinate employees

Her suggestion could possibly lessen the burden on the government, which is grappling to get a measure of the exact cost to vaccinate the entire country and getting the logistics and supply chain in place to administer the vaccine. It is estimated that it could cost a minimum of Rs 50,000 crore to vaccinate the country.

November 26, 2020 / 01:35 PM IST
Kiran Mazumdar-Shaw, Executive Chairperson, Biocon.

Kiran Mazumdar-Shaw, Executive Chairperson, Biocon.

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Kiran Mazumdar-Shaw, Chairperson of Biocon, asked the government to allow corporates to vaccinate their employees, using the Corporate Social Responsibility (CSR) funds.

Currently, corporates with a net worth of Rs 500 crore, or revenues exceeding Rs 1,000 crore, or net profit over Rs 5 crore, have to set aside two percent of their average profit over the last three years on CSR programmes.

According to KPMG, Indian corporates have spent Rs 8,691 crore in FY19 on CSR.

Mazumdar-Shaw’s suggestion could possibly lessen the burden on the government, which is grappling to get a measure of the exact cost to vaccinate the entire country and getting the logistics and supply chain in place to administer the vaccine.

It is estimated that it could cost a minimum of Rs 50,000 crore to vaccinate the country.


COVID-19 Vaccine

Frequently Asked Questions

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How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

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While there is no specific tax exemption on expenditure incurred on CSR, spending on several activities, including preventive health, may qualify.

In an exclusive interview to Moneycontrol, Mazumdar-Shaw said that in addition, the private sector can support the government in logistics, given their vast experience in handling cold-chain products such as human insulins and other biologic drugs.

Mazumdar-Shaw said her company is focussing on its core business, and contract manufacturing of COVID-19 vaccines may not be its priority, but added that Biocon's subsidiary Syngene has been working with international biotech companies on developing vaccines for COVID-19 in early stages, including advanced platform technologies such as mRNA.

She said that COVID-19 has created a level-playing field for innovation and research, and Indian government is aware of it, and is taking steps to invest in R&D of vaccines and raise the standards of clinical research in the country.

Below are the edited excerpts of the interview

How has COVID-19 changed the whole paradigm of research and innovation in Life Sciences?

I think the whole world is now focussing on biotechnology as a very important sector for future-proofing World Health Care. So I think from that point of view, India is doing the right thing. As you know, India is the largest vaccine producer in the world. But apart from the rotavirus vaccine, we really haven't funded new vaccine technologies. I think this is welcome investment in R&D, which will actually go a long way in furthering the vaccine industry and making India a much more innovative vaccine sector than what it is.

Why has India lagged behind on innovation?

It all starts with medical research. So if you look at what even a company like Biocon is doing, we have come up with two novel monoclonal antibodies, but not one of them is a great success in India as we developed it here. We have to license once of them to the US.

The first monoclonal that we developed we are still marketing in India, but the patent had expired, so we couldn’t licence it out of India. So what I'm trying to say is that there is no understanding of what novel biologics are all about. I think doctors are still not able to distinguish between mechanism of action and the difference between one antibody and the other. They just go strictly by what global pharma companies have to offer. They do not understand the superiority of products being developed here.

So, with that kind of an environment, where there is neither any incentive or investment in novel R&D, it is very difficult for companies to really start investing in novel programmes. So I think now it is the opportunity for us to really start seeing how India can become an innovator.

You are also advocating reboot of clinical research. What are your views about it?

I think it is also for the medical research community to start investing in research. Today, unfortunately clinical research is not at the level it should be. Today, we do clinical trials in India. When we do clinical trials in other parts of the world, I know what a huge difference there is in the quality of clinical trials that we conduct.

We are really not very well-prepared to conduct high-quality clinical trials. When we tried to conduct high-quality clinical trials -- the cost of conducting those clinical trials -- are almost as high as they are in other parts of the world that does not give us a competitive edge. So what I’m saying is that it is a huge opportunity for India. We must not stray from this opportunity that has been handed over to us by COVID-19.

Now, I think the government is also seized of the fact that this is an opportunity for us to completely revive and reboot clinical trials. Dr Balram Bhargava, who heads ICMR, is someone who believes this is an opportunity for us to reboot the whole clinical trial sector. And as you can see, ICMR has really sort of jumped in and said, ‘let’s do a lot of the clinical trials, the vaccine clinical trials. Let’s hope that this culture of clinical trials will now spread to new drug development.’

Is Biocon looking for any collaboration or partnership in vaccine manufacturing and distribution?

I think every company needs to focus on its own areas of strengths and interests. We have a large number of vaccine companies which are doing very well. Our own company Syngene is supporting vaccine manufacturers by providing vaccine development services at an early stage of discovery and development, but they are not into manufacturing vaccines. Syngene has partnered with international companies for some of the mRNA vaccines as well.

What is Biocon doing on the innovation front?

Biocon is investing a lot on innovation. We have created a new subsidiary, which is based in Boston, US. It is a company called by Bicara Therapeutics. We are actually developing exciting cutting-edge bispecific antibodies that were actually developed in our labs in Bengaluru. But, as I said to you, the ecosystem was so unconducive to develop the product in India that we decided to take it to Boston and develop it there and that's making progress.

That's gone into the clinic and we are really hopeful it will be a very exciting antibody. (Bispecific antibodies are artificial proteins that have promising applications in the field of cancer therapy, as they bind two targets on a cancer cell).

What would be the real cost of inoculating every Indian with COVID-19 vaccine and what are the challenges?

The kind of indicator pricing that I have heard is that most of these vaccines are double dose vaccines, which means one has to take a dose in three weeks apart, or four weeks apart, and they're estimating each dose will cost between $3 – $4 a dose. Let's assume it’s Rs 200 per dose. It means that two doses will cost you Rs 400, but that's just the vaccine. Then you will need the syringes, you will need the needles, you will need healthcare practitioners who can inject people. That’s the big challenge. Right?

It costs you at least Rs 500 per patient, if you don't add any administrative costs. That's what is going to cost you per person. Now, it has to be done on a mega scale. How are you going to map out the vaccination? How are you going to basically ensure that you have the cold-chain logistics? I understand the Ministry of Health has actually started the whole planning exercise and they’ve done a very elaborate exercise.

Whether it’s going to cost Rs 80,000 crore or 50,000 crore is anyone's imagination because it all depends on how many people we do vaccinate. Not everybody might be willing to get vaccinated. For instance, the last week we heard that the sero prevalence in many parts of the country is as high as 40 percent.

So it is going to cost us a lot and I would imagine the cost of at least minimum Rs 50,000 crore. But I think the government can answer that question more than I can and I think what will happen is the state governments will also have to pick up the tab.

What kind of role does the private sector, in general, and Biocon, in particular, can play in distribution and administration of the vaccine?

I've been recommending to the government that corporates should inoculate their own employees, but you should allow them to use CSR funds to do that and claim it over years. I think the support that a private sector can give is in the logistics. We do have cold-chain logistics going into villages, because of supplying insulin and such products. That's the kind of support we can provide. The government worked it out quite well to carry out such a large-scale vaccination even though that was not in injections, but they have transported vaccines on a large scale, although that was not meant for adult vaccination programmes, which is much larger than what they are used to. But having said that, the Health Ministry is in a state of preparation for mega-scale vaccinations.

They (Health Ministry) are basically talking about starting with 10 million, then maybe 50 million, and 100 million. So by the end of 2021, they expect that the vaccination programme will be at a very mega scale.
Viswanath Pilla is a business journalist with 14 years of reporting experience. Based in Mumbai, Pilla covers pharma, healthcare and infrastructure sectors for Moneycontrol.
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