Covid-19: Lessons Learned Should Not Be Lessons lost

by Rohan Shah

Rohan Shah

Princeton ‘20

Gripped in the throes of the coronavirus pandemic, our world has been upended as we have faced an enormous loss of life, prolonged social isolation, rampant racial tensions, and economic despair. Unlike several other countries, however, the United States has continued to struggle to contain, trace, and treat the novel coronavirus. At the time of writing this essay, the United States has been besieged by nearly 7 million confirmed cases and 200,000 deaths—an incalculable and bewildering loss. As a result, the pandemic has left many Americans distrustful of the government’s ability to safeguard public health, and rightly so.

Beyond the headlines, however, the coronavirus pandemic is rewriting and reshaping American healthcare broadly. In the pursuit of universal treatment, we are experiencing a rare moment of mutual aid, assistance, and collaboration across the entire healthcare continuum. Big pharmaceutical giants like Eli Lilly, Pfizer, and GlaxoSmithKline have established partnerships with exciting biotechnology start-ups like AbCellera, BioNTech, and Vir Bio to accelerate the search for effective disease interventions. Likewise, payers, providers, and drug companies have forged alliances to share medical data to improve care for coronavirus patients across the healthcare continuum. We should be energized by the extent of private sector collaboration, but any keen observer knows that this sort of partnership has long been the cornerstone of American healthcare. (1, 2) A more surprising phenomenon is the extent to which the federal government is collaborating with the private sector. This is a true embodiment of public-private partnerships and, importantly, a model that should not evaporate once the coronavirus passes.

The most paramount and surveilled collaboration centers around Operation Warp Speed—a government effort to accelerate the discovery, development, and distribution of Covid-19 vaccines, therapeutics, and diagnostics. According to the U.S. Department of Health and Human Services (HHS) (3), Warp Speed’s official charge is to have “300 million doses of a safe, effective vaccine by January 2021, as part of a broader strategy to accelerate the development, manufacturing, and distribution of Covid-19 countermeasures.” Launched in April, the $10 billion effort is led by Moncef Slaoi, the former chair of vaccines at GlaxoSmithKline, and involves federal agencies ranging from the CDC to the Department of Defense. Importantly, the effort aspires to unite the vast resources of the government with the ingenuity and agility of the private sector. In doing so, the government has, for perhaps one of the first times, opted to fund solutions that are “ready for primetime” as opposed to basic research to have a more immediate impact on patients—a model that could be applied long after the pandemic to neglected but highly prevalent diseases.

Operation Warp Speed has not only plowed capital into novel solutions but has also provided strategic support for companies. Highlighting the scale of the effort, the operation invested $204 million for Corning glass vials, $1 billion to support manufacturing of Johnson & Johnson’s vaccine candidate utilizing a tried-and- true technology, and an eye-popping $2 billion for Pfizer/BioNTech’s experimental vaccine leveraging novel RNA technology, to name just a few partnerships. According to Helen Branswell and Matthew Herper of STAT News, Operation Warp Speed has “spent about $10 billion to help vaccine makers develop their candidates and build out production capacity to make vaccines at commercial scale.” By investing in a variety of technologies and companies, the effort has “taken more shots on goal” to diversify and increase the probability of achieving successful COVD-19 countermeasures. Though not a guarantee, the strategy seems poised to blunt the second wave and eventually end the pandemic. At this moment, it feels overly pessimistic to believe that you and your loved ones will not be immunized by or before this time next year.

Assuming Operation Warp Speed will be successful, the American healthcare system should adopt and integrate, not forget and neglect, this model of accelerating solutions for unmet medical needs. What exactly is this model? Through Operation Warp Speed, the government has demonstrated the ability to effectively triage, support, and invest in late-stage clinical assets (those considered to be nearing regulatory approval pivotal clinical trials) emerging from the private sector. Although Covid-19 immediately perils the United States, other prevalent but under-resourced conditions such as Alzheimer’s disease, Hepatitis B, antibiotic resistance, among many others present an equal, if not greater, threat to the American future.

As an example, consider Alzheimer’s disease, the greatest unmet medical need in human history. In addition to over five million suffering from the condition, there is no way to prevent, cure, or even slow the course of its progression. Astonishingly, Alzheimer’s will cost the American public $305 billion in 2020 and that number will skyrocket to $777 billion by 2050 as the populace ages, bankrupting Medicare and Medicaid. (4) Moreover, most of the life sciences industry has retreated from tackling the disease, citing failures and setbacks, and leaving evident gaps in not just research but also clinical development. Advancing promising clinical candidates for Alzheimer’s through direct investment and support would be a meaningful, transformative, and commonsense enterprise for the federal government.

Some may question whether the private sector is not already supporting biomedical innovation. The answer is complicated. Since American capitalism rewards investment in innovation with a chance to profit, companies and investors likewise have an incentive to discover, develop, and fund the most profitable biomedical advances. While there is a deluge of funding for promising, late-stage assets in profitable diseases like cancer, that funding well dries up for conditions like Alzheimer’s abandoned by industry, leaving even sufficiently de-risked clinical candidates waiting in the wings. Why? The principal reason remains the cost of capital. Drug development is an expensive and risky business, to say the least. 95% of drugs fail and, on average, a successful medicine requires $1.3 billion and upwards of a decade to make it to market. Life sciences companies have to either continually raise capital via equity offerings or issue debt amid evident business uncertainties. On the other side, investors have to absorb significant risk over long periods. In fact, these uncertainties are intensified given that chronic conditions like Alzheimer’s develop over decades. Very few companies are game to fund a preventative, prophylactic trial in healthy adults thirty years before the onset of Alzheimer’s. Taken together, the myriad of scientific and market risks exacerbates the funding chasm for diseases like Alzheimer’s or antibiotic resistance.

Recognizing this chasm, investors, consortia, and philanthropists have recently tried to cobble together the scale and resources needed to concentrate onconverting late-stage, clinical assets into commercial products. In July, Blackstone Life Sciences, an institutionalized private equity firm, raised $4.6 billion, the largest life science fund ever, to explicitly, “invest in products with a high probability of [both] approval and of changing clinical outcomes.” Big Pharma banded together and poured $1 billion into the AMR Action Fund in August to prevent the collapse of antibiotic resistance research. Though these efforts attempt to bridge the aforementioned chasm, they remain beholden to short-term investment returns, commit far too little inflection capital, or play only in a small slice of the overall healthcare environment.

Long underappreciated, the federal government is uniquely positioned to supersede such limitations to effectively support late-stage, clinical assets for neglected diseases. Operation Warp Speed has demonstrated, importantly, that the government has vast financial resources, the strategic “know-how”, and the incentives to reduce healthcare spend and accelerate promising healthcare “products” to patients. Of the $45 billion the government spends on healthcare research and development alone, a small proportion, such as $2 billion, could be allocated—alongside private investment—to accelerate treatments for prevalent yet underfunded diseases, like Alzheimer’s. Experts in HHS, FDA, NIH, and other organizations could be reshuffled to help execute late- phase clinical development, commercialization, and broad distribution. Instead of assuming debt or equity, the coordinating government organization could negotiate for a lower price on the product for Medicare and Medicaid if approved by regulators, ultimately reducing healthcare expenditure across the board. By participating directly in drug development, the government, unlike private industry, could serve a utilitarian end: bringing more and better drugs to patients for a lower cost.

Lessons learned should not be lessons lost. The coronavirus pandemic has spurred the United States government into action that few of us (or our parents) have seen in our lifetimes. Although it is a difficult pill to swallow for proponents of limited government, urgency and immediacy should not be the sole criteria for action. Diseases like Alzheimer’s, Hepatitis, and antibiotic resistance threaten America today and will cause an immeasurable loss in the near future. Even if the eventual damage of such diseases is protracted, we should not fall into myopic amnesia over the long- term consequences. We may not be able to rewrite the narrative for the coronavirus pandemic but it’s not too late for leaders in industry and government to right the ship for diseases that continue to jeopardize the American future.

1- “Pharma-Payer Partnerships Seek to Prove Effectiveness of Care” https://www.ajmc.com/view/pharma-payer-partnerships-seek-to-prove-effectiveness-of-care

2- “Collaboration Among Health Care Organizations: A Review of Outcomes and Best Practices for Effective Performance” https://www.ncbi.nlm.nih.gov/books/NBK241297/

3- “Fact Sheet: Explaining Operation Warp Speed” https://www.hhs.gov/about/news/2020/06/16/fact-sheet-explaining-operation-warp-speed.html

4- “Costs of Alzheimer’s to Medicare and Medicaid” https://act.alz.org/site/DocServer/2012_Costs_Fact_Sheet_version_2.pdf?docID=7161