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When the chips are down


By Simon Gentry

The Prime Minister is spending time this week speaking to leaders on the Continent in an effort to persuade them not to seize UK-bound Covid vaccines.

The effort comes ahead of a European Council meeting on Thursday which may see the EU decide to ban the export of what they believe to be vaccine they had ordered.  The EU’s position is that it had placed orders with AstraZeneca and that the company has not delivered the ordered quantities.  The EU believe ‘their’ orders may have been diverted to the UK and they want that to stop. The fact that they have been, well, erratic - at best - in their attitudes towards the AZ jab is well documented but doesn’t solve the Prime Minister’s problem.

As with PPE at the start of the pandemic, there is now a worldwide scramble to secure vaccine supply.  Governments that succeed can expect their economies to bounce back. Those that fail, will suffer the fallout at the ballot box. And that may be putting it mildly.  Germany has a national election in September and the French Presidential election is looming. The prospects for the ruling parties in both countries are not good.

Boris Johnson’s prospects are better. There are some rebels on the Tory backbenchers who are agitating for an early end to the lockdown in England, but neither they nor the Opposition are achieving much traction with anyone outside the Westminster bubble.  He should be set fair.

The fact that the UK is dependent on other countries for its vaccine supply is, however, keeping the lights on in Downing Street.  And so it should. A ‘bump’ in production at the Serum Institute in India, which is manufacturing the Oxford/AZ vaccine for us and a host of other countries in addition to India itself, will see our vaccination rates fall in April. Alternative plants are located in the EU and supply from those factories could be snatched away if the EU Council want them (although they reportedly already have 14 million doses sitting unused). As they teeter on the edge of the abyss, no foreign government can be trusted not to use their domestic supply for their own people.

Until recently nobody gave much thought to where things came from.  In the heyday of globalisation it wasn’t supposed to matter.  It certainly mattered this time last year as NHS Procurement in Birmingham signed contract after contract for PPE supplies that never turned - up because they were auctioned to the highest bidder at the Chinese factory gate - or were of such poor quality that they were unusable. The same risks happening to vaccines in the coming months, but the stakes this time are even higher.

Ensuring domestic supply of products of strategic importance was in the wake of WWII considered a national priority.  Indeed, there was even a sophisticated and deeply corporatist pharmaceutical payment scheme which successfully resulted in the UK having a strong domestic medicines research and manufacturing base.   That scheme is now a shadow of its former self, but both AstraZeneca and GlaxoSmithKline are echoes of that policy.  Neither had significant vaccine manufacturing capacity in the UK before the pandemic which has left us exposed.  Orders may have been placed and contracts signed, but when a crisis occurs, its every government for itself.  The UK’s problem will be resolved in time because the government gave the greenlight – and the cash – to build more manufacturing capacity early last year.  A far-sighed decision that I hope they will get credit for in time.

Pharmaceuticals and PPE are not uniquely important.  There are many other products which in time of international crisis would damage or even paralyse our economy and society.  With the world now as unstable as it ever was the ongoing review of those dependencies and what the government does about them could not be more important.

Companies and industries would be well advised to study their own supply chains and consider how they might fill any gaps that might appear in a crisis.  They should also expect government to be quietly making discreet enquiries.  Right throughout government, across diverse departments, lessons are being learnt and new questions are being asked.