Hundreds of pages of Government documents shed light on the vaccine purchasing effort, from the hopes of making vaccines in New Zealand to the realisation we might be at the back of the queue
Special report, part 1: 2021 was supposed to be the year of the vaccine.
That was what Prime Minister Jacinda Ardern promised in her her first speech of the year, at a Labour Party caucus retreat in Nelson.
New Zealand is now one of the most vaccinated countries in the world, but that only happened after a sluggish immunisation programme in the first half of the year. The major stumbling block in the vaccine rollout has been supply of jabs: While thousands of vaccinators were trained and ready to go as early as April, it wasn't until millions of doses began arriving in August that the rollout actually took off.
While 2021 may have been the year of the vaccine, previous speculation has held that these supply woes were linked to decisions made in 2020, when the Government negotiated to buy vaccines in the first place. Critics argue that New Zealand was slow to negotiate with vaccine manufacturers and slow to secure purchase agreements.
The Government has responded that it acted earlier than most countries, that it obtained the best terms and most doses that it could and that delivery timetables were based in part on relative need, which meant New Zealand was inherently disadvantaged.
Due to the restrictive secrecy provisions around the vaccine contracts and associated documents, which remain unreleased, little of either argument is publicly substantiated.
But a review of hundreds of pages of Government documents – some released independently by Cabinet and other never-before-seen papers obtained under the Officials Information Act – alongside discussions with multiple people close to the Vaccine Strategy Task Force allows for a more in-depth exploration of the question of whether New Zealand was too slow to order vaccines.
The first of a two-part investigation into the vaccine purchasing effort finds officials raised warnings that we were being outpaced in negotiations by other developed nations and that we were slow to respond to early overtures from pharmaceutical companies and their representatives in New Zealand.
But it also shows that few other countries in New Zealand's position, with low levels of Covid-19 in the community, managed to do better in securing early access to vaccines or reaching such high levels of community immunity.
Hindsight is 20/20
Individuals involved with the purchasing effort say it's easy to judge in hindsight, but that the negotiating teams did the best they could in the circumstances they faced.
For the early months, the entire operation was shrouded in a sense of dread.
New Zealand had just conquered the coronavirus when the vaccine team got on its feet in May and June of 2020. New Zealanders were enjoying freedoms that were almost unique, worldwide. And this was with fewer than 25 Covid-19 deaths and no active transmission of the virus in the community.
But those working on the vaccine project were preparing for scenarios in which vaccines were barely effective, only blunting the illness, hospitalisations and deaths that were to come – or in which vaccines were never successfully developed.
The World Health Organisation and the United States' Food and Drug Administration both said a vaccine that was only 50 percent effective would still be worth using.
One briefing to ministers from the vaccine task force noted that even a "marginally effective" vaccine would be useful to countries with "uncontrolled spread of Covid-19" because it would "likely be an improvement on their status quo".
In the early days, officials on the Vaccine Strategy Task Force occasionally discussed their worst fears with one another: That the coronavirus just couldn't be vaccinated against. In either of these scenarios, New Zealand's massive effort to eliminate the virus would have done little more than bought time. Eventually, we would have to open up and suffer the same grievous health consequences as the rest of the world.
Even if a safe and more effective vaccine came along, there was no guarantee we'd have access to it.
"Experience with access to testing kits and other essential medical supplies has shown that governments have not hesitated to restrict exports to maximise supply for domestic populations," officials wrote in a May 2020 briefing. The same could apply to vaccines if supplies were short.
"The global environment is likely to change further between now and the time a vaccine becomes available. The deep and wide-ranging economic effects of the pandemic on the global economy could well flow on to more significant political and economic shifts that would affect access to a vaccine. Our approach needs to be able to manage this complexity and uncertainty.
"In these circumstances there is a significant risk is that countries that control manufacturing will seek to ensure their own supply first before releasing vaccine to the global market. This would be consistent with how countries have controlled exports of PPE to date, and also with actions taken to manage vaccine supplies during the H1N1 influenza epidemic in 2009."
Buy NZ Made
Early advice to Cabinet focused on a solution to this issue that New Zealand didn't end up undertaking: Manufacturing vaccines domestically.
"The best insurance against this likely global supply constraint is the ability to manufacture in New Zealand. We have already identified at least two companies that appear to have the capability to produce some of the likely vaccine candidates," officials wrote.
These two firms, South Pacific Sera and BioCell, "do have experience contract manufacturing animal vaccines for demanding European or North American markets. Both operate facilities that have a degree of flexibility that may allow them to be reconfigured for human vaccine production".
By July, BioCell had received nearly $3 million from the Government. South Pacific Sera has since teamed up with local vaccine researchers as part of a $35 million project to develop and manufacture a Covid-19 vaccine in New Zealand.
In September, an independent report found New Zealand could produce more than 2.5 million doses of Covid-19 vaccine annually by 2022 and more than 10 million a year by 2023. The ability to produce mRNA vaccines like the Pfizer jab was still five years away.
A spokesperson for the Ministry of Business, Innovation and Employment (MBIE), which hosted the Vaccine Strategy Task Force, said work with BioCell on domestic manufacturing remained ongoing.
"This has proved to be a long process, dependant on securing technology transfer support and interest from international vaccine developers," the spokesperson said.
MBIE "remains committed to this investment in Biocell and the capability is being put in place over the coming year which will allow it to produce human vaccines, provided it can reach agreement with a vaccine developer and meet the appropriate regulatory requirements."
Making vaccines in New Zealand was never going to be a cure-all, but it represented the Government's efforts to diversify both the risks and opportunities for vaccines.
The COVAX red herring
The bulk of the country's vaccines, in the near-term at least, were always going to come from overseas.
"Purchasing from an overseas manufacturer is emerging as the quickest and most likely route to securing a safe and effective vaccine for use in New Zealand," officials concluded in a July 2 briefing.
"This might be done either directly, as part of a bloc of countries, or through a global pooled facility."
In the first phase of the purchasing effort, New Zealand pinned some hopes on the COVAX facility. This was an international effort to pool the cash of developed countries to equitably distribute vaccines between all of the world's nations.
When it was designed, it was meant to be the main way that every country obtained its vaccines. Developed countries which paid in would receive enough doses to immunise half of their populations, while developing recipients would get enough to vaccinate 20 percent of theirs. The rollout would happen at the same pace around the world, starting with frontline workers, then moving to the vulnerable and then the general population.
Within months of the COVAX facility launching in April 2020, rich countries had already begun to go behind its back and negotiate directly with vaccine suppliers.
As early as May, the United States and United Kingdom had secured hundreds of millions of doses from AstraZeneca. But it took some time for New Zealand to catch on to the shift.
In the July 2 briefing, officials entertained starting a bloc with Australia and other countries in similar straits to purchase directly from suppliers, "but we need to be careful this does not undermine a broader global approach if that attains critical mass".
Chris Bishop, the National Party's Covid-19 Response spokesperson, said this shows New Zealand was too late to pivot from the COVAX approach to direct negotiations.
"The timeline is pretty clear that from May, June, we were expecting to participate in a kind of global, multilateral vaccine effort. That was probably naive, I think, of both officials and ministers. It was pretty clear reasonably early on in the process that it was a race, basically, by countries to negotiate bilateral arrangements with manufacturers," he said.
Although New Zealand was still looking at the COVAX route in early July, that changed rapidly. In a July 10 briefing to ministers, the task force was much more clear-eyed about the way forward.
"The COVAX pooled multilateral approach is a very cost-effective investment, but is expected to meet only 20% of our immunisation needs," officials wrote. "We need to explore other pathways quickly."
Pivot to APAs
There was now a sense that time was running out.
"Advanced economies around the world are taking action now to secure access to potential COVID-19 vaccines as they are developed, including through Advance Purchase Agreements (APAs). New Zealand should take a similar active approach and engage early rather than late, otherwise there is a risk we will not be able to address our immunisation needs."
Supply problems could be expected, the vaccine team said.
"Even when a successful vaccine is developed (provided it can be), then the global demand for doses of that vaccine will be fierce," they wrote.
"There is no guarantee that New Zealand will be among the first to receive the doses we seek, especially if there is some prioritisation based on assessment of need, given our COVID-free status and good health care system. Taking early action now mitigates this risk to some extent."
Already, the Government had received a missive from Pfizer on June 30 about the Covid-19 vaccine it was developing. The MBIE spokesperson said officials only responded to the letter on July 22 and only managed to hold a meeting on August 14 – six weeks after the initial outreach from Pfizer.
Some overtures from the pharmaceutical industry came even earlier. Medicines NZ chief executive Graeme Jarvis told Newsroom he had reached out to the Government as early as April and May.
"There is no harm in early discussions. We certainly, as an association, reached out to multiple government agencies as early as March and April 2020," he said.
"It was simply to say, 'Look, the industry is here. We're aware of what other countries are doing. They are starting to reach out to the companies and talking to them about not only the possibility around vaccines but also how can we collaborate?'
"Even in May 2020, you had countries like the UK committing to doses of the Covid-19 vaccine at that early stage. That's when we again reached out and contacted people at MBIE and the Ministry of Health to say, 'We need to start expediting these discussions because other countries are having these discussions ongoing now and they're committing to these things. We need to be thinking about that for the benefit of New Zealand and the Pacific Island territories for which we're responsible.'"
First-come, first-serve
Timelines are important here because vaccine delivery schedules may well have been arranged on a first-come, first-serve basis. That's what Pfizer's global CEO Albert Bourla has said in the past and Jarvis believes it holds true for us as well.
"It's not just Pfizer. When you've got global supply chains and you've got complicated manufacturing processes, it becomes a bit like a production line or a conveyor belt. You can't just turn the tap, it has to be programmed into the production and then the logistics and distribution, which during normal times is complicated enough. It was first-come, first-serve.
"It's been well-established that New Zealand wasn't at the front of any queue. The start of the collaborative discussions was probably too delayed for my liking."
In the end, New Zealand only signed its first APA in early October – and even this was technically a Heads of Agreement, not a final contract.
This is the sort of thing that the Government's critics point to when they say New Zealand was slow to purchase vaccines.
"We took a long time to get going in terms of negotiating with Pfizer, and that has had a flow-on impact in terms of our delivery schedules," Bishop said.
But ministers and officials defended their record in comments to Newsroom.
Research, Science and Innovation Minister Megan Woods, who oversaw the vaccine purchasing effort, disagreed with the first-come, first-serve basis comments from Bourla.
"We never had any indication from Pfizer that New Zealand’s access could have been made faster. As Pfizer itself has acknowledged, New Zealand was not slow in its ordering of Covid-19 vaccines," she said, pointing to comments from February in which Pfizer's managing director for Australia and New Zealand said we weren't slow to negotiate.
Asked for comment on the apparent discrepancy with Bourla's comments, a Pfizer spokesperson said discussions with the Government were confidential.
"However the supply of vaccine in New Zealand was developed following consultation with the New Zealand Government and each agreement was based on the availability of doses and earliest schedule that could be provided at that time," the spokesperson said.
'Bottom of the queue'
Woods also insisted New Zealand was fast enough to begin negotiations with vaccine manufacturers.
"In mid-2020 New Zealand moved swiftly to establish a multi-faceted vaccine strategy. At the time there was widespread uncertainty about the pandemic and vaccine development, safety and efficacy. Despite this, the Government took steps to ensure we had significant resources deployed to ensure New Zealand was well placed for the next steps," she said.
"The response was unprecedented and led to extensive negotiations with multiple vaccine developers as well as significant support towards international collaborations and New Zealand-led initiatives. It’s important to emphasise that when we took these steps, there was no clear consensus on which vaccine candidates would prove safe and effective."
Those close to the vaccine purchasing effort have also pointed out that most elimination countries received their vaccines on similar timetables as New Zealand did. Whether that was due to complacency in nations which weren't undergoing high daily death tolls or because manufacturers really did prioritise based on need remains unclear.
The countries that rolled out vaccines the fastest – like the United States, the United Kingdom and the European Union – also bankrolled vaccine research and development and had local manufacturing capacity. It may have been less about the timeliness of the negotiations than the preexisting relationships with manufacturers.
An MBIE spokesperson also sought to explain why negotiations weren't launched immediately after officials advised that New Zealand needed to engage with manufacturers in July.
"The advice to Ministers in July set out options on which vaccines to purchase bilaterally, to establish a negotiation team and appropriate funds for bilateral purchases direct from vaccine manufacturers; all of which got underway and resulted in agreements on strategy, resources and a mandate," the spokesperson said. "The procurement process was entirely novel. It took time to design and resource this work and the final negotiations have proved successful."
This is despite an explicit warning from those officials that New Zealand faced relegation to the "bottom of the queue".
In that July 10 briefing, they wrote: "We do not consider doing nothing to be a viable option. Other countries are already entering into APAs with pharmaceutical companies, and we will quickly fall to the bottom of the queue if we do not pursue our own arrangements.
"We will have to make decisions early based on incomplete information, as are other countries. There is a real possibility that none of the supported candidates will be successful. However, the value of earlier access to a vaccine is enormous, in terms of lives protected and economic damage avoided. This makes the risk worth taking."
A month later, officials urged Cabinet to quickly sign off on funding for vaccines and a purchasing strategy and negotiations team.
"We urgently need to take action to secure a wider set of advance purchase arrangements," they said.
Every month at Level 1 was costing the economy $1.9 billion – and an unvaccinated population raised the risk of having to escalate the alert level.
"Our current situation is costly and unsustainable, and there is a risk of quarantine being compromised which would lead to a raising of alert levels," officials wrote.
Cabinet signed off on the formation of a negotiating team on August 10. The next day, four new cases of Covid-19 were identified in Auckland, plunging the city into Level 3 and the rest of the country into Level 2. Two days after that, formal negotiations began with Pfizer, Inc.
The second part of this investigation into the vaccine purchasing effort, covering the negotiations with pharmaceutical companies and how New Zealand moved from seeking 20 different vaccine candidates to going all-in on Pfizer, is available here.
