Moneycontrol Pro Panorama | Vaccine shortage? Has India got the maths wrong?

Some states, including hardest-hit Maharashtra and Odisha, have complained of a scarcity of vaccines during the second wave that has forced some centres to turn away people. (Representative Image)

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Markets are trading flat today as concerns about the second wave of COVID-19 infections refuse to fade amidst reports of a vaccine shortage. At the time of writing, the Sensex was trading 20 points above its closing level of Thursday.

On Friday morning, India reported fresh COVID-19 infections of close to 132,000.  Although India has administered around 95 million vaccine doses so far, a few states have complained of shortages. The Maharashtra government, for instance, has said that its current stock of 1.5 million doses will last only for three days.

The Union government has said publicly that there are no vaccine shortages and that such allegations are politically motivated, but the fact is that a few vaccination centres had to close down temporarily.

A Times of India report said that India had only around 19.7 million doses left with another 24.5 million in the pipeline. At a run rate of 3.5 million vaccines a day, that is around 6 days of supply and another week’s supply in the pipeline. On the other hand, Union Health Minister Harsh Vardhan has said that 40 million doses of the vaccine are in pipeline.

In an interview, Serum Institute of India, the largest vaccine maker, said that it has capacity to make up to 65 million doses a month and that it has supplied 100 million doses domestically and exported 60 million so far.

The high volume of exports is raising questions about India’s vaccine diplomacy strategy and whether the nation miscalculated vaccine demand. Opposition leader Rahul Gandhi asked today  whether it was right to export vaccines and put the lives of countrymen at risk.

Now India has decided to stop exports of vaccines for the next month or so, Moneycontrol has reported. But that includes SII’s own commitments, government grants and the COVAX scheme of the World Health Organisation. Indeed, AstraZeneca has sent a legal notice to SII for not meeting its export commitments.

In another interview, SII CEO Adar Poonawalla said that it needed Rs 3,000 crore to ramp up capacity which the vaccine maker thought it could earn from higher profits on exports. Clearly, the Rs 150 per dose that the Union government is paying SII is not enough. If the government stops exports, will it compensate Poonawalla or subside fresh manufacturing capacity that is needed?

It’s a tricky question to answer. The COVID-19 vaccination could well turn out to be an annual affair and present a $60 billion annual opportunity to pharma companies. We have an analysis here.

Be that as it may, currently the numbers are stark. India has to ramp up vaccination to beat the second wave and further waves if they arrive. But there is quite a bit of uncertainty too: We still are not sure what the pipeline entails – in terms of the time it will take for the next set of doses – 40 million as stated by Harsh Vardhan -- to hit the market. There are also questions about the approval of other vaccines such as the Russian Sputnik which has been licensed by Dr Reddy’s Laboratories for local manufacture and how long will it take for fresh capacity to come on stream.

We had written earlier about how the government should be more transparent. Detailed numbers on vaccine capacity, expected timelines of capacity expansion about the vaccine stocks and the way ahead will help quell the rising alarm about vaccine shortage and enable people to meet the rising infection count with equanimity.

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Ravi Krishnan

Moneycontrol Pro