‘Stuffed’: how Australia’s ‘unconscionable’ gamble on Covid vaccines backfired | Coronavirus


Eight months ago, Scott Morrison faced the cameras in a laboratory in Sydney’s eastern suburbs and promised hope after a torrid year.

“Today is another day when we can look forward to a much better 2021,” he said.

The cause of his optimism was the belated signing of a deal for 10m Pfizer doses and an as-yet unfilled agreement to secure Novavax.

The vaccines were to ensure Australia was “in the leading pack of the world” during the pandemic’s next phase.

Australia was, in fact, more than four months behind its allies in securing Pfizer.

The United States, United Kingdom, Japan and Canada had all struck agreements with Pfizer in July and August 2020, and the company was expecting to produce 1.3bn doses to satisfy global demand.

Not only was Australia late to the party, its order was minuscule. At two doses a person, the Pfizer order was enough to vaccinate one-fifth of Australia’s population, not accounting for wastage.

Vials of the Pfizer coronavirus vaccine
Vials of the Pfizer coronavirus vaccine. Photograph: AP

From his home in Connecticut, Pfizer’s former president of global R&D, John LaMattina, has been closely observing the global rush for vaccines, including Australia’s efforts to procure doses.

He says Australia’s delay in securing a deal with Pfizer, while “unfortunate”, was understandable, because the success in containing Covid-19 had afforded it more time than others.

But the amount Australia eventually secured in November was “clearly lacking” and “unconscionable”.

“Once the amazing and unprecedented efficacy of the mRNA vaccines was established, ordering a mere 10m doses was unconscionable,” he says. “When both Pfizer and Moderna demonstrated the potent efficacy of their vaccines, every country should immediately have reached out to these companies to place their orders.

“In the case of Australia, enough vaccine to inoculate its entire population over the age of 18 should have been done at once. Assuming that is about 20m Australians, this would have cost about US$780m … How much has Australia spent on Covid-19 relief packages?”

Instead Australia planned to make AstraZeneca and the University of Queensland vaccine the workhorses of its rollout. Both brought the valuable option of domestic production at CSL’s Melbourne facility.

Time casts those decisions in a poor light. The UQ vaccine failed to get out of the starting gate, scuppered due to its tendency to generate false HIV positives. AstraZeneca has had its own well-publicised problems, greatly inhibiting its use among younger Australians and sending the government scurrying for more Pfizer.

But was this just a case of bad luck? Are critics suffering hindsight bias? Or did our procurement strategy gamble too narrowly?

The former health department secretary Stephen Duckett believes the early procurement decisions have been one of the major, compounding failures of the rollout.

“If you think about it in terms of what business people call ‘portfolio theory’, you have to have a mixture of investments so you can mitigate your risk if one strategy doesn’t work,” he says. “One of the failures was this failure to diversify back in July.

“So when AstraZeneca fell over, when UQ fell over, they were stuffed.”

Australia remains almost the worst performing OECD nation on Covid-19 vaccinations, behind countries such as Costa Rica and Latvia.

A ‘sliding doors’ moment

The first sign of Pfizer’s eagerness to do a deal with Australia came in the middle of last year. A letter from Pfizer, dated 30 June, invited Australian government officials for discussions about its mRNA vaccine – at that stage still in development.

A meeting was scheduled within a fortnight. It was the first of a series of 11 formal meetings and ad hoc phone calls between Pfizer and Australian officials.

The first, on 10 July, has been the subject of intense controversy. In the room were Pfizer’s Australian executives and a group of government lawyers and senior health officials, including Lisa Schofield, the first assistant secretary in the government’s Covid taskforce.

“Pfizer said: ‘This is a vaccine that we are developing,’ ” Schofield told a Senate inquiry. “We said that we were interested in talking to them about potentially purchasing that vaccine, but that was it. No numbers or details were put on the table at that discussion on 10 July.”

But a different account has emerged in the reporting of Norman Swan, the host of the ABC’s Coronacast podcast. Citing unnamed sources, he reported that one Australian official was belligerent, tried to haggle over the price, and demanded access to intellectual property. The conversations continued but no deal was struck, in his account.

Then acting Victorian premier James Merlino has also spoken of a huge offer made by Pfizer to the Australian government at the time of the first meeting.

“Our nation had a ‘sliding doors’ moment last July,” he said. “Last July, there was an offer of Pfizer to the commonwealth government that would be enough for our country, and they didn’t take it up.”

NSW premier Gladys Berejiklian and health minister Brad Hazzard at the Westmead hospital vaccination hub in March.
NSW premier Gladys Berejiklian and health minister Brad Hazzard at the Westmead hospital vaccination hub in March. Photograph: Dean Lewins/AAP

The suggestion is flatly denied by the health department.

Schofield insisted Pfizer made the Australian government no offer in “any level of detail”. The government also insists that 10m doses was all that Pfizer had available for Australia when a deal was eventually struck in November.

Pfizer says it was responsible for proposing the 10m figure.

“Our discussions are confidential, however the supply of vaccine in Australia was developed following consultation with the Australian government and each agreement was based on the availability of doses and earliest schedule that could be provided at that time,” it told a Senate inquiry.

The government denies that it failed to build up a broad portfolio of vaccines, saying it secured five agreements that would provide 195m doses combined.

It also insists it entered into an advanced purchase agreement with Pfizer as soon as it could, acting on the advice of its science and industry technical advisory group.

“Recent media reports about the Department of Health’s engagement with Pfizer have been written without any input from the department,” the department said.

“While these are largely commercial-in-confidence discussions, the level of engagement with the company and categorisation of those discussions has been grossly misrepresented.”

Demand for Pfizer soars

Wherever the truth lies, it is clear that at the time of that initial meeting, Pfizer was not shy about making deals.

In July alone it reached agreement to supply 100m doses to the US, 120m to Japan and 30m to the UK.

Citing internal documents, Reuters reported that Pfizer also offered 500m doses to the European Union in July, which were turned down due to cost.

Australia eventually doubled its Pfizer order in February. By that stage global demand had gone through the roof – in November the company forecast it would need to produce 1.3bn doses, but by February that had risen to 2bn.

Pfizer soon began warning of delays to Australia’s shipments.

“We have had a huge number of requests for additional doses from around the world, and certainly that has scaled up even further after our clinical trials came out showing safety and efficacy,” Australian managing director Anne Harris said in January.

Three months ago, Australia ordered 20m more doses.

The move came late.

The Australian technical advisory group on immunisation (Atagi) had already recommended Pfizer as the preferred vaccine for under-50s.

Demand for Pfizer grew further when Atagi raised the age to 60, and again after a damaging war of words between the federal and Queensland governments over the safety of AstraZeneca for under-40s.

Many younger Australians are being told by their GPs to wait for Pfizer, but there is no firm date for when that will be for under-40s.

‘The Hunger Games’

Last week a nation once told it was at the front of the queue for vaccines was suddenly told it was at the back.

It came as little surprise to a fatigued public, or to state premiers who have begged for more Pfizer as they battle outbreaks and enforce lockdowns.

This week Queensland premier Annastacia Palaszczuk expressed fury at the state’s supply volume, saying it would be getting only about 65,000 Pfizer doses a week until October when the bulk of the supply is expected to arrive. The state has repeatedly warned it risks running out.

On Monday Palaszczuk told her constituents precisely where she thought the blame lay: “We’re waiting on the commonwealth supply so we can make sure that you get your dosage.”

On the same day, NSW health minister Brad Hazzard gave an equally frank assessment of the supply failings: “Until we get enough vaccine and enough GPs actually at the frontline able to provide that vaccine into arms, we will continue to have effectively The Hunger Games going on.”

The bulk of the mRNA vaccines Australia ordered is not expected to arrive until the third quarter of this year.

The federal finance minister, Simon Birmingham, said European countries and drug companies were responsible for the delay because they had favoured countries with high rates of Covid.

“[This] has put countries like New Zealand and Australia at the back of the queue in terms of receipt of some of those vaccines,” he said.

According to the latest figures provided by the federal health department, 3.2m doses of Pfizer have been administered, and 5m doses of AstraZeneca.

However, many more doses – 16.6m – have been “cleared” by the Therapeutic Goods Administration for distribution.

Of these, 12.3m have been distributed to clinics for use, and 620,000 doses of AstraZeneca have been sent to Timor-Leste and Pacific nations. The health department says 2.3m doses of AstraZeneca are held in contingency to cover second dose allocations.

That leaves 1.4m doses which are presumably about to be distributed.

For the past three weeks that the government has provided figures on vaccine releases, the average has been about 1m new doses a week.

The government’s recent document outlining the projected future availability of vaccines shows it plans to increase supply in July and August from about 1m a week to 2.85m of both vaccine.

In a recent press conference health minister Greg Hunt confirmed this target, saying he expected an average of 600,000 Pfizer doses to be available “over July”, compared with the 300,000 in the past few weeks.

On Friday, Morrison said Pfizer supplies would more than triple in the coming months.

“We have been working with Pfizer now for quite some period of time to bring forward our supplies and I commend minister Hunt and Prof [Brendan] Murphy and Lt Gen [John] Frewen for the great job [getting] those supplies brought forward,” he said.

Queensland premier Annastacia Palaszczuk expressed fury at the state’s supply volume.
Queensland premier Annastacia Palaszczuk expressed fury at the state’s supply volume. Photograph: Dan Peled/AAP

“That means we’ve gone from 1.7m in June, 2.8m this month and we will rise to a million a week from 19 July and we will get to 4.5m a month next month. So that’s ramping up.”

After Morrison’s statement, Pfizer said there had been no change to the 40m doses it planned to give to Australia.

“The total number of 40m doses we are contracted to deliver to Australia over 2021 has not changed,” it said.

Duckett says by October there will be about 2m Pfizer and half a million Moderna doses available each week. That is more than enough to cover the adult population, he says.

Duckett says the next step must be to fix the logistical problems that have held up vaccines, widen the distribution channels by setting up more mass vaccination hubs, extending clinic hours and tackling vaccine hesitancy.

“The government – and its army of rollout consultants – has had months to learn from its mistakes. The actual army has also been called in,” he and Anika Stobart wrote for the Conversation.

“The government has no excuse not to have all arrangements in place for an efficient vaccination program when the vaccines begin rolling in.”



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