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Modi government’s approach to vaccine policy

The financially stretched state governments stare at a massive expenditure for the Covid vaccination drive as the second wave of the pandemic sweeps the country, claiming the lives and livelihoods of millions. The raging pandemic has left in its wake a severe shortage of vaccines, medicines and oxygen.

The BJP government’s move to herald a liberalised and accelerated vaccination strategy from May 1 – making vaccine pricing, procurement and eligibility flexible – has thrown a gauntlet to the already challenged state exchequers.

As I had , New Delhi has claimed that the flexible pricing policy given to vaccine manufacturers will ensure more production. But state governments fear that the inequity in pricing and expansion of the demand base to encompass all adults will derail the already chaotic vaccination drive amid a severe shortage.

The devastating second wave has exposed India’s inadequate healthcare system, overwhelming the hospitals and mortuaries. India reported 3,32,518 fresh cases of infections on April 22, accounting for 36 percent of the world total. It has eclipsed every daily peak reported by other countries since the start of the pandemic. The country reported a daily death toll of 2,257 taking the total tally to 1.87 lakh.

The panic-stricken central government had taken a few decisions in quick succession, some being a complete reversal of its earlier stance.

On April 19, it decentralised the vaccination strategy and told the state governments and private hospitals to procure vaccines directly from manufacturers and importers, at a cost. It opened up the private market to help manufacturers incentivise their production. The government also approved a payment of about Rs 4,500 crore as advance to the two vaccine makers against future supplies, by relaxing bank guarantee rules. It also made everyone above 18 years eligible for vaccination.

A few days before, on April 16, the government fast-tracked the use of foreign-made vaccines, such as those made by Pfizer, Moderna, and Johnson & Johnson, that are already cleared by the World Health Organisation or regulators in the US, UK, European Union and Japan. It allowed pharma companies to bypass the mandatory clinical trials and told them to undergo a brief bridging study – meaning vaccines will be first given to 100 beneficiaries and they will be assessed for seven days for safety outcomes – under the new fast-tracked approval process.

On April 13, the government approved the Russian vaccine, Sputnik V, for emergency use in the country. Early this year, the vaccine maker had signed production deals with around a dozen vaccine contract manufacturers with idle capacity in India, and is set to produce 1.5 billion doses of the vaccine annually, much more than the combined production of the two others: the indigenously-developed Covaxin by Bharat Biotech and Covishield, developed by Oxford-AstraZeneca and mass-produced by the Serum Institute of India. Sputnik V is the third vaccine to be available in India.

The three sets of decisions came at a time when the healthcare infrastructure in several cities teetered on the brink of collapse. The state governments had sought more supplies of vaccines as they struggled to handle the increased demand amid the raging pandemic. As of April 22, the dropped to 65,133 across the country from over 1 lakh centres operational in February-March. More centres are facing a shutdown as a severe shortage in vaccine supply looms large.

When the daily demand at 10 million doses far exceeds the supply (Serum’s 2.4 million doses a day and Bharat Biotech’s 0.6 million, both claimed by their respective spokespersons), the mad scramble is unavoidable.

All the government’s decisions seem like knee-jerk reactions to the fast-spreading pandemic. It had not allowed the private market so far but did nothing to ramp up the production of vaccines in the country. Even when Russia swept up all idle capacities in India to manufacture Sputnik V, the government failed to see the devastation that the second wave had wreaked in other countries and act accordingly.

Instead, for several months, the government had cast a blind eye towards the from both Serum and Bharat Biotech for financial aid and requests to incentivise their production by opening up the private market. On April 19, the government finally signed a deal with them to supply 200 million doses and 90 million doses, respectively, to the government by July at a pre-agreed rate of Rs 150 per dose. Serum gets Rs 3,000 crore in advance while Bharat Biotech about Rs 1,500 crore.

As per the government circular, starting May 1, vaccine makers will supply 50 percent of their monthly Central Drugs Laboratory-released doses to the central government and will release the remaining 50 percent doses to the state governments as well as in the open market at a pre-declared price. Private vaccination providers have been told to transparently declare their self-set vaccination price. There is no ceiling set on the price.

Kerala’s finance minister Thomas Isaac was the first one to raise his voice.