Why did the UK do so well on vaccines, and what does this tell us about Industrial Policy? Short answer… I am not sure
COVID has generated many unanswered questions. One fun one was recently asked by Stian Westlake on Twitter.
Looking at the replies Stian received it doesn’t seem like anyone has any good ideas why. This isn’t that surprising as industrial policy is not well understood, and it is still not clear how to make it work at the best of times, or even if it does work.
This lack of understanding around the impact of industrial policy was made clear in a recent literature review of the area which described the empirical evidence for it as “ not in fact mixed. It is often vacuous”.*
So to make the question easier for myself I want to offer a list of hypotheses to the following narrower question:
What are some possible reasons did the UK do so well at vaccine procurement and development? (assuming that we all agree it was successful)
Historical R&D investment
Will Tanner, Ex Deputy Head of Policy at № 10 under Theresa May, wrote an article claiming that the Life Sciences Industrial Strategy provided the bedrock for the UK’s vaccine success.
Three years on from that strategy, and each of those decisions is proving critical to Britain’s vaccine story. The CGT Catapult is accelerating the time taken for new treatments to be delivered and is adding manufacturing capacity through a manufacturing site in Braintree, Essex. The ATTC network is supporting work in hospitals to identify and treat patients requiring intensive treatment. The VMIC, when it opens this year, will be able to produce up to 70 million vaccine doses in four to six months using a formula created by AstraZeneca, the industrial saviour that was nearly lost in a tax evasion deal. Prudent intervention by government has paid dividends.
To put it simply if this is the best argument he can make for the strategy I have strong doubts that the policy made any impact. Some marginal increase in manufacturing capacity, a site that is not even open yet, and a highly unspecific claim that a government Catapult site reduced time to vaccine delivery….. this is some weak sauce and an implicit statement that it wasn’t the cause of the good response we have seen.
AstraZeneca as a National Champion
The article by Will Tanner also mentions the blocking of the purchase of AstraZeneca in 2014**. The argument is that by having a national champion we were able to use a strong manufacturing base in vaccines to kickstart the demand.
From this article by the FT this argument doesn’t seem to be true. We had a miniscule manufacturing base for vaccines to start from.
Britain had just one plant in Liverpool making seasonal flu jabs and another in Scotland making a niche product, Japanese encephalitis vaccine. Everything else was imported. Now four companies are making, or preparing to make, Covid-19 vaccines in the UK. In addition, two rapid response centres are under construction and should be ready by the end of the year to produce vaccines against coronavirus or any new pathogen that threatens another pandemic.
Not only did the UK manage to kickstart a large manufacturing base for vaccine production in a short space of time it did it across 4 different vaccine brands: Oxford/AstraZeneca, Valneva, Novavax and CureVac. Even more than that the Pfizer vaccine is not being produced in the UK, and was the first vaccine injected in the UK.
However it is currently not known how much of each vaccine is currently being supplied. And it should be emphasised that the only UK company with a vaccine did decide to manufacture in the UK, perhaps helping the UK accelerate our vaccine distribution.
The counterfactual to this is that we are still out vaccinating the US and Europe, both of which are also producing vaccines locally. Therefore local manufacturing is not the only answer.
Starting Early and Political Necessity
Maybe industrial policy has nothing to do with it, and more mundane factors specific to the policy are the cause. That is certainly how the BMJ frames it in this article which has the first and primary reason the UK has done so well is that we started earlier than others.
They’ve got ahead on ordering vaccines and they’ve got [the doses in hand] to give,” says Simon Clarke, associate professor in cellular microbiology at the University of Reading. “It’s as simple as that.
Can the answer be as simple as this? The UK government put everything behind getting a vaccine ASAP, perhaps due to earlier COVID blunders. This led to us outperforming the rest of the world? We did sign contracts earlier than entities such as the EU, which notably got fairly angry and had a fairly public fight with AstraZeneca over vaccine contract clauses.
People
Another mundane argument is that it is as simple as having the right people with the right skills leading the charge. In this argument steps Kate Bingham, a biotech VC with the right political connections in the Conservative party to get things done.
This is possible, but I would need a lot of evidence to be persuaded of this line of argument. Evidence that is currently lagging.
High performing UK regulators
Finally another non industrial policy argument is our regulators were simply better, aided along by government support. The MHRA approved the vaccines in the fastest time ever under temporary use authorisation, while the US and European medical regulators were noticeably slower than they could have been.
This argument would feed into the head start hypothesis, but does raise some future fun thoughts around industrial policy opportunities. Maybe the UK shouldn’t focus on specific funding for projects, but making the best* regulatory environment for high tech industries to operate in.
Luck
If Matt Hancock hadn’t watched the film Contagion would we be without vaccines? Maybe no theory or argument is needed. The only policy takeaway we should have is that we need more existential risk focused movies on Netflix.
Maybe we got lucky by betting on the right vaccine horses, even if we did spread our bets fairly widely?
*This comes from The New Empirics of Industrial Policy by Nathaniel Lane. I was directed here by the ChinaTalk podcast with Jose Luis Ricón (hosted by Jordan Schneider).
**Unsurprisingly for Conservative Home it isn’t mentioned that it was Vince Cable in the coalition that drove the opposition to the takeover.
***Please don’t make me define best, I have no idea.
