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Slowdown in demand for Serum Institute of India, world’s largest vaccine manufacturer

The Serum Institute of India (SII) had positioned itself as the world’s main supplier of vaccines, cranking up production nearly fourfold over the past eight months.

But export restrictions imposed by the Indian government in April, an adequate stockpile of vaccines domestically and the availability of other vaccines globally have translated into a slowdown of demand for the world’s largest manufacturer of vaccines. Vaccine exports from India resumed only in October.

In fact, Pfizer and BioNTech, according to reports, are set to overtake AstraZeneca as the main Covid-19 vaccine suppliers to the Covax Facility – the World Health Organisation-backed vaccine distribution programme for developing countries – at the start of 2022.

The AstraZeneca vaccine is being manufactured locally by SII and is known as Covishield.

On Dec 7, SII chief Adar Poonawalla said that he would temporarily halve production till demand picked up as there had not been any fresh orders from the Indian government and there was low demand from Covax.

“I am actually in a dilemma that I never imagined… we are producing 250 million doses a month, but the good news is that India has covered a large part of its population and we would have completed all our orders to the health ministry in a week’s time,” he told CNBC TV18.

“When we could not export, other countries managed to get vaccine supplies from donations from the US and elsewhere, and we have lost a lot of market share,” he said.

India, underpinned by its manufacturing prowess in the pharmaceutical sector, had rolled out an ambitious vaccine export programme early this year.

But a devastating second Covid-19 wave in April and May triggered a rethink as the government banned exports to boost its domestic vaccination programme, which has gathered pace, with more than 50 per cent of the adult population fully vaccinated and the government having additional stocks.

Some 90 per cent of doses administered in India are Covishield.

Since lifting restrictions, India’s exports have also been low. In December, it exported to Bangladesh, Nepal, UN health workers, Cambodia, Rwanda, Mozambique and Indonesia.

A spokesman for Gavi, the vaccine alliance that co-manages the programme, told The Straits Times that a majority of the vaccines in Covax’s portfolio had now received World Health Organisation (WHO) approval, allowing it to tailor its offers to meet specific country demand and product preference.

More than 37 million doses of SII’s Covishield have so far been shipped by Covax.

“In 2022, it is likely that access to a broad portfolio of vaccines will be an important factor in breaking the hold the pandemic has over the world,” the spokesman said.

Responding to Mr Poonawalla’s comments that orders from Covax had slowed down, the spokesman for Gavi told ST that countries need time to plan their vaccination drives.

“As soon as SII exports were confirmed in mid-November, Covax began working with countries to allocate available volumes, put plans in place to administer these doses, secure necessary acceptances and approvals, and begin to ship doses to countries,” the spokesman said.

“Every care must be taken to ensure recipient countries are able to deploy the doses we send them, and this is why it is so important that all manufacturers provide as much transparency as possible as to when and in what quantity volumes will be supplied,” the spokesman added.

SII did not respond to questions from ST.

Ms Nissy Solomon, a senior associate for research at the Centre for Public Policy Research, said there is an urgent global need for vaccines, but added that the Indian government has limited capability to address it through donations of surplus doses, given its financial constraints.

“Only global financing and collective action from multilateral agencies such as the WHO and World Bank Group can generate demand of that scale,” she told ST.

“Fifty-six countries missed a WHO target of vaccinating 10 per cent of their population by September this year. This situation demands prioritising the need for vaccinating the poor and the need for a global financing and collaborative governance.”

Added Ms Solomon: “If the Indian government is transparent and sends out a clear message on its domestic demands and its export policy, the global market could respond and avail itself of the opportunity that SII presents.”

Virologist Shahid Jameel said: “The other effect of SII reducing capacity would be on other countries. Rich countries can buy and donate Covishield… It would be a win-win situation for everyone.”

In India, amid the ongoing vaccination programme, the focus is also on booster doses and vaccines for children.

Deliberations are ongoing within the government on administering booster shots. Reports in Indian media have quoted sources on experts’ views that a booster shot would have to be based on vaccine platform technologies different from vaccines that have so far been administered.

This news report was published in The Straits Times on December 18, 2021. Click here to read

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