Was interviewed by Malaysiakini on this important issue concerning vaccine procurement and the trend of using NDA by the pharmaceutical companies.
Below is my full response to the questions asked:
1. Why do pharmaceutical companies impose NDAs in the first place? What advantage do they seek?
CH: In the current world, the COVID-19 is still ravaging, and many countries can barely keep it under control. Therefore, the demand for COVID-19 vaccine is tremendously high, no one producer or manufacturer could ever meet the demand in a short period of time. Some vaccine products are frontrunners, many countries are rushing to make deals. Because of the scarcity of vaccines, and the legal monopoly of the technology in the hands of patent-holder pharmaceutical companies, the bargaining power is not in the hands of the government especially those from smaller countries.
Usually vaccine would require about 2 years to complete the 3 phases of clinical trials; what's more a few leading vaccine products right now are using new technology such as RNA and DNA-based vaccines. Even if the vaccine is using traditional 'old method' such as inactivated virus, injecting foreign objects to muscle or bloodstream would have risk of side-effects when triggering immune overreaction. Furthermore, currently many of these vaccine products are still undergoing phase 3 clinical trial. The first one who actually published the result is Pfizer, but the result is only as good as for short term protection, no one knows for sure how long is the protective effect of the vaccine.
Thus, given the background above, it would be clear that the company would like to protect their interest. There are a few things they do not want the governments to compare with each other, or disclosed to public: i) vaccine procurement pricing, ii) non-indemnity for any health risk arises from the vaccine injections, iii) non-guarantee of delivery timing and volume (perhaps in small print).
For (i), it is pretty straightforward. They still practice differential pricing in different markets like what came before for many patented medicines. For (ii), even a WHO-backed COVAX facility could not get the manufacturers to agree to be liable for any adverse events in some recipients, this does not inspire confidence among the public about the safety of vaccine application. Clearly the manufacturers do not want to take upon any unforeseeable and unpredictable risk, (but there will be even for a very small fraction of recipients).
The question is not about the legal viewpoint alone on trade secrets stipulated in the NDA contract but should deal with the problem of exorbitant pricing of vaccine by companies, that secrecy protects unconscionability. What's more in a situation where public money has been pumped into the development and production of the vaccine, which is internationally recognised as a public good for a prevalent disease like COVID-19. People should deserve at least to know about the vaccine pricing the government is paying using taxpayers money for public good as such, this information should be disclosed but not necessarily the entire NDA.
2. Is this common practice in drug procurements? Or there is something special about Covid-19 vaccines that makes it more desirable to impose NDAs?
CH: It is common practice - price transparency is something that the pharmaceutical industry resists strongly (how much they actually spend on R&D for a medicine, the production cost and the prices that they negotiate with governments when their product is the only one available in the market of a country).
In Malaysia we understand that MOH does not agree to NDAs for normal procurement. If the drug procurement is done through public open tender, like what is normally practised by the MOH, then there will not be NDA or any strings attached. The duration and total cost of the awarded contract is available on the website of the Ministry of Finance. It is not desirable for the government to agree to an NDA, but it would be the will of pharmaceutical companies to impose nevertheless, to protect their best interest.
NDA goes against what some often tout 'Free Market' and 'Fair Trade'. Without information transparency, the market competition is neither free nor fair, and this would work against the people's interest.
3. How do other countries grapple with the need for transparency vs NDAs, and what are some best practices we might adopt?
CH: Other countries are known to sign NDAs in normal drug procurement. For COVID-19 vaccines NDAs have become the norm. If more countries come together and pool their demand, then perhaps the bargaining power would be higher, then they could set the terms for negotiation. As long as the countries do not panic and become desperate, they should be patience and seek for the best deal conditions with public interest guarded. This is what COVAX facility was supposed to do but the wealthy countries have taken a very selfish approach. The US is not participating in COVAX and as we see are buying directly - the Trump Administration has even been pressuring US companies like Pfizer and Moderna to sell all the production to the US first. The EU is also buying directly from the companies and donated some money to COVAX to buy some vaccines for 92 low income countries (but everyone one knows there will not be enough so these 92 countries may be left behind). Middle income countries like Malaysia have to join the race to pay for ourselves and hope to get enough vaccines - how long it would take is not known as the terms of the purchases are secret.
4. How do NDAs affect Malaysia’s efforts to get a good deal when procuring vaccines?
CH: It could affect greatly, due to non-symmetry of information. Government would not know what is the best price as well as the deal's terms and conditions, if the company also signs NDA everywhere they go. We might very likely end up paying at the prices the level where developed nations are paying as well. Remember, given other vaccines coming soon in the market, and they are enjoying pioneer advantage, it would not be surprising that pharmaceutical companies adopt the strategy of maximising profit.
The Malaysiakini interview article link: Explaining non-disclosure agreements in Covid-19 vaccine procurement
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