Building greater resilience in vaccine manufacturing

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Public-health crises have vaulted to the top of national agendas over the past two years. Even as COVID-19 enters the endemic stage in the United States and Europe,1When will the COVID-19 pandemic end?,” McKinsey, July 28, 2022. the monkeypox outbreak has been declared a public-health emergency of international concern by the World Health Organization (WHO).2

Preparing for the next pandemic is a priority for many national public-health leaders and requires them to lay the groundwork to mount an effective vaccine response. COVID-19 laid bare the gaps in the global vaccine supply,3 shifting expectations of what is possible in development and manufacturing and highlighting immunization as a viable path to protect populations quickly. This suggests that creating more resilient vaccine ecosystems—ones that allow a country or region to develop and trade expertise and resources and collaborate with partners to secure enough vaccine doses when they need them—is likely to play a critical role in readiness in the future. The US government, for example, recently launched an initiative aimed at ensuring that biotechnology manufacturing capabilities are available in the country.4

There are no safe bets in vaccine development—and our analysis shows that investments have abated following the surge of capital during the initial COVID-19 crisis, in 2020–21. But the developmental paths of the major COVID-19 vaccines suggest that future vaccines can achieve a radically shortened time to market if there are many candidates and modalities to work with. Vaccine production capacity has expanded significantly, and many countries have started to reverse previous trends toward offshoring. The current challenge for public-health authorities is how to combine insights from the first two years of the pandemic with analysis and actions to produce more robust national and regional vaccine ecosystems for future pandemics and epidemics.

Decision makers could set the stage for vaccine resilience by defining what their countries and regions need; assessing the local capacity to scale production of vaccine doses; identifying gaps and weaknesses in their national and regional vaccine value chains (across multiple technology platforms, such as mRNA and viral vectors); building coordination capabilities; and identifying and sizing the strategic investments required. While the task ahead may be daunting, the payoffs for public health could be significant.

A transformed vaccine landscape

The rapid development of COVID-19 vaccines has reframed expectations for immunizations in four significant areas: time-to-market horizons, competition, production capacity, and onshoring.

Radically shorter time to market

The COVID-19 vaccine was developed in 11 months—a dramatic acceleration compared with the more typical ten years.5Fast-forward: Will the speed of COVID-19 vaccine development reset industry norms?,” McKinsey, May 13, 2021. This swiftness showed that with the right basic research, the right investments, and concerted cross-sector collaboration, the vaccine industry can dramatically shorten the vaccine development timeline.6Fast-forward,” May 13, 2021. This precedent has inspired some organizations to try to reduce time to market to 100 days.7

Of course, maintaining robust vaccine development, let alone achieving a regulatory-appproved product in 100 days or less, requires a large and diverse portfolio of modalities and partnerships with a wide variety of producers. Existing research will likely prove critical, as will a willingness from stakeholders across sectors to make investments that may not pay off.

Technological advances and the COVID-19 pandemic have motivated start-ups and established companies alike to strive for the next innovation in vaccines.

Heightened competition

Technological advances and the COVID-19 pandemic have motivated start-ups and established companies alike to strive for the next innovation in vaccines. Consider that effective COVID-19 vaccines came from Moderna, a biotech with no prior commercial launches, and AstraZeneca, a pharmaceuticals company without a broad portfolio of vaccines.

These successes demonstrate that effective vaccines can emerge from a wide variety of modalities and producers. And indeed, more developers are pursuing vaccines. For COVID-19 alone, 276 vaccines were in active development as of July 2022, and several have now gained full regulatory approval in multiple markets.8 The implications for new entrants are significant. McKinsey analysis shows that in 2019, the four largest vaccine manufacturers accounted for about 90 percent of the market by revenue. Following the entrance of new players into the vaccine market with the advent of multiple COVID-19 vaccines, it is likely that the top four manufacturers’ share of the market will diminish. Industry analysts predict this trend will continue over the next five years, with a variety of players capturing increasing proportions of market share.9

Increased production capacity

For vaccines with regulatory approval, unprecedented production capacity awaits even though capital expenditures inspired by the initial COVID-19 crisis have started to wane.

By February 2021, more than $10 billion—most of it from the public sector, with contributions from global philanthropic and multilateral organizations10—had been invested in production capacity for COVID-19 vaccines. This push extended the annualized global capacity to up to 24 billion doses by June 2022.11 The result has been an estimated 12.66 billion doses administered globally,12 almost three times the volume of vaccines distributed in 2019.13 This increase in capacity is unprecedented and may be advantageous to retain.14

Biosecurity and the onshoring of vaccine capabilities

The COVID-19 pandemic has made vaccine manufacturing a biosecurity matter. Because infectious diseases can emerge from all parts of the globe, multiple countries, including the United States, have announced their intentions to scale their domestic vaccine production capabilities.15

This is a reversal of prepandemic trends in biopharma manufacturing and requires a careful examination of the supply of vaccine inputs.16 During the initial phases of the COVID-19 pandemic, supply bottlenecks for critical vaccine inputs such as bioreactor bags arose because manufacturing capabilities were concentrated among a small group of suppliers that struggled to keep up with rocketing global demand.

Potential steps toward resilient vaccine production

Developing a resilient ecosystem for vaccine production means balancing current needs, short-term pressures, and long-term objectives. National public-health leaders could start by translating vaccine-manufacturing resilience into concrete requirements and then use that information to assess local manufacturing capacity. Next, they could assess the value chain to identify strengths and weaknesses and to coordinate stakeholders throughout the ecosystem. Finally, they could evaluate the options for investment and collaboration against their ability to contribute to local vaccine manufacturing resilience.

Define vaccine resilience

As a starting point, leaders could quantify and define what a resilient in-country vaccine ecosystem should be able to accomplish. For example, decision makers could determine the number of doses needed to elicit a short-term immune response. From there, they could calculate their country’s vaccine requirements. Using the COVID-19 pandemic as a model, a hypothetical country with a population of 40 million people may need more than 80 million doses in a similar pandemic if the population followed a two-dose vaccine regimen.

But in a pandemic, timeliness is paramount. A country of 40 million people would need to distribute more than three million doses per week to achieve full vaccination within six months. With such scenarios in mind, countries could use data from the COVID-19 pandemic on the responsiveness of their vaccine distribution systems to estimate how quickly they could scale up distribution when needed.

Evaluate the local manufacturing base

To assess the local manufacturing base, decision makers may need to evaluate the ease of access to available capacity and determine the flexibility of the manufacturing base in scaling up vaccine manufacturing. Both assessments will likely require a nuanced approach because they involve analysis of the constraints on the domestic vaccine-manufacturing capacity, which comes with technological and regulatory constraints. Strong working relationships between manufacturers and sophisticated regulators will likely be key, and regulators might vary their approaches according to vaccines’ technical requirements. For instance, protein-based and attenuated-virus vaccine technologies are relatively well established, while mRNA-based vaccines saw commercial application for the first time during the COVID-19 pandemic.17

High-level decision makers could assess their domestic manufacturing capabilities through the lenses of accessibility, reliability, and scalability.

An emphasis on potential constraints on the national vaccine ecosystem’s ability to scale up production may be important. Specifically, not all capacity will be accessible for a timely response, partly because some capacity cannot be shifted from other therapeutics. Reliability may also be an open question because not all capacity comes with the processes and capabilities required to ramp up rapidly. And additional time would likely be needed to accelerate production, which involves both access and technology transfer (exhibit).

Building greater resilience in vaccine manufacturing

After the active ingredient or drug substance is produced, the process of making the drug could encounter supply chain snags. This step involves combining the drug substance with other materials such as adjuvants (which enhance immune response to antigens) and excipients (inactive ingredients that carry the drug substance) or lipid nanoparticle compounds for mRNA vaccines, all of which have experienced an unprecedented surge in demand.18

The final step of manufacturing, “fill and finish,” could also encounter hurdles. This step prepares the final medical products for distribution. Utilization of fill-and-finish capacity is often high, partly because not all capacity is interchangeable. The risk of bottlenecks can therefore be even greater in times of heightened demand.19

Experience from previous epidemics suggests that leaders will need to make strategic trade-offs. As far back as 2016, in the wake of the Ebola epidemic, industry leaders recognized that there was almost no excess capacity in global vaccine manufacturing.20 While this situation improved after the initial COVID-19 crisis,21 responding to future outbreaks will likely require sustained investments in preparation, as well as strategic sales and operations planning. For example, it may be important to ensure a minimum level of “warm capacity” that is consistently used and ready to be redeployed quickly. Consider how manufacturers found novel ways to release capacity during the COVID-19 pandemic, such as accelerating advance production of some medicines with long shelf lives to free up capacity for potential vaccine production.22The race to create a vaccine: A conversation with Frank D’Amelio,” McKinsey, December 10, 2021.

Identify capabilities and gaps in the domestic vaccine-manufacturing ecosystem

Few countries and regions have the capacity for end-to-end vaccine manufacturing, which encompasses everything from R&D to final distribution and administration. This scarcity of global capacity suggests that many countries could create more resilient vaccine ecosystems by gaining access to more segments of the vaccine value chain and by strategically focusing on different areas.

Beyond manufacturing, countries could develop the institutional and human-capital infrastructure needed for a robust R&D and innovation pipeline as well as the capabilities to run and process large clinical trials. Both could be worthy medium-term goals.

Countries with strong institutional and intellectual infrastructure—as well as reporting capabilities—may be more responsive to new pathogens. The first coronavirus sequence, for example, was published less than a week after WHO announced the discovery of what was then understood as a new kind of pneumonia.23 This kind of speed requires the capability to collect and transport samples and to sequence whole genomes. It also requires credible ways to disseminate findings to academic and research communities.

Equally important is experience in vaccine development from early-concept platforms to full candidates ready for clinical trials. Oxford’s Jenner Institute and partners, for example, had been focusing on the development of a viral vectored candidate to combat Middle East respiratory syndrome (MERS) before switching their focus to the novel coronavirus. Fostering innovation could increase the chances of having a candidate product (or forging a development collaboration with other countries) and developing and attracting key talent. The ability to recruit, scale, and process data from large clinical trials is also critical for delivering safe products.

Build capabilities to coordinate ecosystem stakeholders

Connecting the public, private, and academic sectors for collaborations is a critical enabler to ensure access to investment and develop domestic capabilities. Both the United States and the United Kingdom brought together leaders from vaccine manufacturers, industry associations, technical experts, public-sector stakeholders, and private-sector experts in adjacent areas as a response to the COVID-19 pandemic. Countries with less access to resources could consider modeling their stakeholder engagement on coalitions such as IDA Ireland and the Economic Development Board in Singapore.24 Of course, multiparty engagement is critical in building the vaccine value chain, even in non-pandemic times.

Building a domestic talent pipeline is also key to success. Years of global optimization in R&D and manufacturing have led to talent clustering in a handful of locations, effectively locking the rest of the world out of the vaccine ecosystem. Leaders in countries that do not have such talent pools could deploy a range of incentives to attract, develop, and retain highly skilled individuals.25Africa needs vaccines. What would it take to make them here?,” McKinsey, April 14, 2021. In the longer term, investments and changes to education systems may be required to sustain a pipeline of workers in the vaccine ecosystem.

Connecting the public, private, and academic sectors for collaborations is a critical enabler to ensure access to investment and develop domestic capabilities.

Though vital, tech transfer could be another major obstacle for countries and regions that have historically imported vaccines instead of manufacturing them. Because some local manufacturing capabilities are necessary, these countries could focus on building the infrastructure and capabilities to meet the safety and quality requirements of products that, while potentially lifesaving, have a high bar for efficacy.

Finally, advanced capabilities in data and analytics could support the discovery and development of vaccine candidates. Sharing pathogen information such as outbreak sites and genomic sequencing requires advanced capabilities to gather and analyze data and distribute the resulting insights for the development process. Other than talent, initiatives such as the Three Million African Genomes project26 and the Fiocruz Genomics Network in Brazil can serve as models for data infrastructure.

Invest and collaborate

Since most countries cannot handle end-to-end vaccine development within their borders, investments and collaboration with other countries will likely be important.

Potential avenues to explore in investments, for example, include international development funding, philanthropic funds, public funding, and incentives. Historically, incentives such as tax credits, capital write-offs, R&D tax incentives, subsidies, and commitments to purchase set amounts of products in advance have been associated with thriving biopharma industries. Dedicated partnerships between the public and private sectors and leadership from public-sector stakeholders may help countries create deeper connections with the vaccine manufacturing industry and strengthen their vaccine ecosystems. Additionally, planning and advance commitments could help assure access to vaccines.

Partnerships among countries are also likely to play a critical role. For instance, the Access Consortium—which predates the COVID-19 pandemic and includes regulatory authorities from Australia, Canada, Singapore, Switzerland, and the United Kingdom—became a source of strategic information during the pandemic and presented an opportunity to improve operational alignment and efficiency. The member countries have agreed to align regulatory approaches and policies to coordinate efforts and resources in developing and manufacturing vaccines, a move that would benefit the members’ 150 million total residents.27

Beyond sharing the load, international collaboration may make it easier to forecast demand for vaccines of all kinds by pooling data. Better forecasting can be of outsize value to low- and lower-middle-income countries, which are more likely to see changes related to demographic shifts and increasing vaccine uptake. International collaboration can also improve supply chain transparency and help ensure steady supplies, especially when it involves cooperation between public and private sectors. Finally, countries and regions that collaborate can form their own purchasing blocs, aggregating demand and gaining greater bargaining power than individual countries might have on their own.

COVID-19 highlighted a broad lack of readiness and caused major societal disruption, but national and regional leaders now have the opportunity to harness the lessons they’ve learned to build more resilient vaccine ecosystems. If effective, these ecosystems could ensure that when the next pandemic takes hold, nations will be better prepared.

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