Realizing huge sums from public and private companies – The miracle of the vaccine

Public-private partnerships, not greed, have delivered the vaccine miracle

It is a cliche of the House of Commons that “your opponents sit opposite but your enemies sit behind you”. When Boris Johnson told his fellow Conservative MPs at an online meeting of the 1922 Committee of Conservative backbenchers that the success of vaccines was down to “capitalism” and “greed”, he must have realised that his eminently quotable remarks would quickly make their way to the front pages of the next day’s papers.

Many commentators were quick to point out the fundamental error in the Prime Minister’s assertion. The public sector has provided major funding and absorbed much of the risk for the development of first-generation Covid vaccines. Indeed, the Oxford/AstraZeneca vaccine, which accounts for the bulk of vaccinations here in the UK, is being produced at cost. An embarrassed Downing Street press team was forced into a hasty retreat, passing off the comment as a Prime Ministerial “joke”.

Gaffes, however, often resonate, precisely because they can reveal the real thoughts and assumptions of people in power. In the case of Mr Johnson’s latest slip of the tongue, it suggested a simplistic and misguided understanding of how the state and the private sector interact in our modern capitalist system. More worryingly, it showed a degree of naivety about how technological breakthroughs in respect of the major challenges of this century will be achieved.

As the economist Mariana Mazzucato and others have argued, the public sector’s role in driving past, present and future innovation has long been overlooked and under-appreciated. For decades, the state has played a crucial role in providing early-stage funding for scientific research where a market does not yet exist, and the private sector is reluctant to take the risk. Many transformative technologies that permeate our everyday life – the internet, GPS, lithium batteries, microprocessors, touchscreen displays – had their origins in publicly-funded research institutions and were subsequently nurtured in the private sector.

The success of Covid vaccines, together with the rapid progress on testing and diagnostics, continues that history. It has displayed, at its best, the full power of bringing together forward-thinking government priorities with private sector expertise to achieve a common good. Rather than perpetuating the lazy fiction of profiteering business driving all innovation, Boris Johnson should be loudly and proudly proclaiming the public sector’s achievement as a key facilitator of vital technological progress.

The reasons to do so are as much pragmatic as political. The public-private cooperation of the kind seen during the past year could be applied to a range of other pressing global challenges: from tackling climate change, to protecting ourselves from future pandemics. State funding for research and development, and creative partnerships with private enterprise, will be essential to accelerate progress in many such areas.

Other countries are ahead of the curve in leveraging public and private sectors to promote innovation in advanced technologies, thereby gaining a strategic edge over the competition. The US, often seen as the centre of global capitalism, routinely mixes public funding with private sector skills. President Biden’s mooted $3 trillion infrastructure plan is expected to provide a major boost to federal funding for research and development.

The United Arab Emirates, meanwhile, through its partnership with G42 Healthcare, has been hugely successful in building self-sufficiency in vaccine development and manufacturing almost from scratch in the past year. This week, G42 signed a deal with China’s Sinopharm to build the Middle East’s first vaccine production hub, capable of producing 200 million doses a year. The UAE-G42 partnership has also set its sights on developing the world’s first population-scale genomics testing programme aiming to rival the UK’s global leadership in this field.

For Britain to achieve its ambition of becoming a science and technology “superpower” by 2030 – and stay ahead of the competition – it must wise up to the role that public-private partnerships and public funding for research and development play in driving innovation. The newly launched Advanced Research and Invention Agency (ARIA), might prove to be a step in the right direction. Taking inspiration from the US-famed Advanced Research Projects Agency (ARPA), the new body is supposed to back high-risk, high-reward scientific research with a “fail fast” culture.

Yet the ARIA project, and others like it, will only succeed if senior politicians and their officials cast off their illusions about how innovation takes place in a modern globalised economy. They will need to commit real funding to this essential public research. For that reason, we must all hope Mr Johnson’s flippant tribute to Gordon Gekko was indeed nothing more than a Prime Ministerial joke.