 Vaccine Research and Development (R&D) in the Asia-Pacific: the economics of vaccine R&D and policy recommendations to overcome market failures and promote R&D cooperationAntonio Postigo LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library Abstract: The COVID-19 pandemic has highlighted both the strengths and weaknesses of national, regional, and global vaccine research and development (R&D) systems. Translating public and private R&D efforts into effective vaccines in a timely manner requires not only sufficient financial and scientific resources but also a policy-driven R&D ecosystem that fosters innovation, public-private partnerships, and international cooperation. This paper outlines several supply-side and demand-side factors behind vaccine R&D that generate economic disincentives for pharmaceutical firms to invest in vaccine R&D and can lead to a market failure for vaccines targeting diseases in low-income countries. Most developing countries in Asia-Pacific not only lack the financial and technological resources to invest in vaccine R&D, but it is also not sensible to develop and replicate R&D capabilities in each country. Consequently, low-income countries are dependent on vaccines researched, developed, and manufactured by other nations that they must obtain through trade and international cooperation. The Asia-Pacific region accounts for the largest share of global R&D spending and large shares in publications and patents on vaccine R&D. The region is home to dozens of state-owned and private pharmaceutical firms and contract research organizations that conduct vaccine R&D. Global pharmaceutical firms have not only offshored part of their vaccine manufacturing to Asia-Pacific but also transferred some of their R&D activities. Countries in Asia-Pacific have used several supply-side and demand-side approaches to incentivize investments in vaccine R&D. For instance, high-income countries are major contributors to product development partnerships and philanthropic foundations and have launched programs to boost university-industry R&D ties. During the COVID-19 pandemic, many high- and middle-income countries in the region established advanced market commitments for vaccine doses. The COVID-19 pandemic also showed the possibilities and challenges of international cooperation in vaccine R&D. Pharmaceutical firms in some developing countries built their vaccine R&D capabilities through technological transfer from high-income countries. Regional institutions and intergovernmental organizations in Asia-Pacific have also helped promote and coordinate regional cooperation in vaccine R&D. This paper proposes policy actions to stimulate investments in vaccine R&D and promote regional cooperation along four dimensions, namely a) on the prioritization of targets in the vaccine R&D pipeline; b) on how to overcome market failures in vaccine R&D; c) on fostering partnerships between relevant stakeholders at the national and regional levels; and d) on increasing the preparedness and response of national and regional vaccine R&D systems. Keywords: Covid-19; vaccines; medical products; R&D; regional cooperation; Asia-Pacific (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:120304 Access Statistics for this paper More papers in LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library LSE Library Portugal Street London, WC2A 2HD, U.K.. Contact information at EDIRC. |
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