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A hard dose reality check on vaccines

“I think when people tell the public that there's going to be a vaccine by the end of 2020, they do a grave disservice to the public ... Let me just give you one data point. In the last quarter century, there have only been seven, truly new vaccines introduced globally at the clinical practice. Merck has four, the rest of the world has three.” - Ken Frazier, CEO of Merck

The level of optimism in equity markets and society in general regarding the progress on developing a vaccine for COVID-19 has certainly been increasing.

The world is desperate for vaccine updates and is putting the recovery of the economy and the reduction in the health crisis on the line. So much so, it’s like the vaccine is almost fully developed and trialled.

Personal experience with vaccines

I am not sure how many of this readership has been personally exposed to vaccines. Sure, the flu shot is common, but if people think the vaccine for COVID-19 will be like receiving a flu shot, they could be in for a very rude and thought-provoking wake-up call.

Not all vaccines are as simple and benign as the influenza virus.

Growing up in Papua New Guinea, my entire family was given the smallpox vaccination. My father at the time in the early 1970s was 35 and he took us to the doctors to get jabbed. The negative side-effects of the smallpox injection were known at the time but we had little choice as it was a legal requirement to be inoculated prior to travelling to PNG.

The impact it had on my dad was horrible. He spent four days in hospital and three weeks in bed. He was very, very sick. If this type of side-effect is what could be expected from any COVID-19 vaccination, how many people will want a vaccination and can the hospitals cope with the negative side-effects?

The global search

The search for a vaccine is front of mind in the pharmaceutical industry, with some 160 individual programmes under way. In recent times, Moderna Inc has been in the news with some positive results from a Phase 1 clinical trial across 45 healthy adults. All participants in the trial showed an antibody response.

Antibodies are the proteins the body makes to fight infection. Being safe to use in 45 people is not the same as being safe for say 20 or 200 million people that would need vaccinations in the US alone, but the market is rewarding Moderna.

Source: Morningstar Direct

A reality check on development time

Ken Frazier, CEO of pharmaceutical giant Merck, was interviewed recently by Professor Tsedal Neeley from Harvard Business School. If there was ever a rational discussion on the topic in my view, it was this.

I will summarise his interview with the following bullet points.

  • Developing a vaccine takes time, a lot of time. The fastest vaccine ever brought to market was for the epidemic parotitis (‘mumps’). It took Merck four years to produce this vaccine.
  • The most recent vaccine created for a large viral outbreak was for the Ebola virus, which took 5.5 years.
  • In the past 25 years there have been only seven truly new vaccines introduced globally. By new, that means that they were effective against a pathogen for which there had previously been no vaccine. Merck has developed four of those seven and the rest of the world three. There has been an enormous amount of work done in the field of prevention. Despite all this work, the world has been trying to develop a vaccine for AIDS since the early 1980s, and so far, without success.
  • Developing a vaccine requires vigorous scientific assessment. Vaccines must be safe, effective, and durable. No one knows if any of the 160 programmes will produce a vaccine that is effective. This vaccine must work on billions of people.
  • Lots of vaccines in the past have stimulated the immune system (just like the Moderna trial vaccine) but ultimately did not confer protection.
  • When politicians suggest there will be a vaccine available by the end of 2020, they are doing the public a “grave disservice”.
  • We do not want to rush the vaccine before rigorous science is done. We do not have a good history of introducing a vaccine in the middle of a pandemic. The swine flu vaccine did more harm than good.
  • While we are working hard on a vaccine, the best preventative measures to limit the spread and infection of COVID-19 are good hygiene, wearing a mask and social distancing.
  • The bigger challenge to developing a vaccine is distributing it to where it is needed most. In a time of ultra-nationalism, countries want to take whatever is available and use it in their own population first rather than offering it to populations globally at greatest risk.
  • Developing a vaccine for 7 billion people has never been done before. Delivering it to 7 billion people is an enormous logistical challenge, especially to those communities who cannot afford it.
  • This is a global pandemic. Unless all of us are safe then none of us is safe.
  • The mobility of the world’s society poses a real problem. The EU has barred Americans travelling to Europe for a reason. Americans are not doing the things required to suppress the epidemic. Americans value liberty. It has been a strong theme through US politics for 200 years, largely because the US has two big oceans protecting it. This virus does not care about liberties. If people exercise liberty at the personal expense of others, then we cannot control this pandemic.
  • America is 4% of the world’s population and 25% of the world’s infections. That’s scary.
  • We need politicians with enough integrity to tell the truth. This time next year we will still be experiencing what we are experiencing now. Be prepared for that.

With these sage words lingering in your mind, let’s hope that when a Phase 3 trial for the Moderna vaccine gets under way, a trial that will involve thousands of patients, the results of the safety and efficacy will be such that a reliable vaccine can be developed.

Just be conscious that it will be a miracle if it is developed before the end of 2020, and if you believe Ken Frazier, 2025 is a more realistic time frame. 

(The full video interview and transcript are here).


Rod Skellet is an Equities Investment Strategist at Mason Stevens. The views expressed in this article are those of the author as at the date published and are subject to change based on markets and other conditions. This article contains general information only and does not consider your individual circumstances.


July 28, 2020

Well, here is another comment by an unqualified observer.

In predicting the future, we look to see whether events are "precedented" or "unprecedented" - is there some comparable history we can use to base our forecasts on.

As a non medical person, I was interested to understand recently, that flu vaccinations (as an example of widely researched and utilised vaccines) have an "efficacy rate".
>> studies show that flu vaccination reduces the risk of flu illness by between 40% and 60% among
>> the overall population during seasons when most circulating flu viruses are well-matched to the flu vaccine.

Assuming a COVID vaccine has some performance parallels, then it is NOT going to be a silver bullet.
When it comes, a COVID vaccine is likely to offer significant benefits for large populations but no guarantees for individuals.

The future remains uncertain.

Dwayne Barry
July 27, 2020

Lost me at ....This is a global pandemic. Unless all of us are safe then none of us is safe.

When the facts change, I change my mind. And with a mortality rate of 0.0075% of world population, this is NO pandemic.

Since 1 January 2000, iatrogenic deaths globally totals over 16m. Now THAT'S a PANDEMIC that no one (including the lamestream fake media) wants to go near.

SMSF Trustee
July 27, 2020


and your qualifications to contradict WHO and every medical agency in the world are?

July 28, 2020


adjective: (of a disease) prevalent over a whole country or the world.

Clearly it's a pandemic, without question.

Mr T
August 15, 2020

Is that you Pete Evans??

July 26, 2020

I think we all need to remember that if someone chooses not be to vaccinated (against Covid), they are not putting others at risk. If a vaccine works, then those who are vaccinated have got nothing to worry about from those that aren't. If a vaccine is safe, even the elderly can be given it. Informed consent should always be obtained prior to medical treatment. Anything else is assault.

July 27, 2020

If someone chooses not to vaccinate, they are potentially putting those who can’t be vaccinated at risk. Looking out for your fellow countrymen should go towards that decision for consent. So if you can, but you won’t, don’t beat around the bush. Just acknowledge you’re selfish and stop making excuses.

August 09, 2020

To: Richard
You obviously did not read what Martin pointed out - it is only common sense. If somebody chooses NOT to be vaccinated against COVID, they ARE NOT putting others who have agreed to the vaccine at risk. If you think they are, then you obviously do not think the vaccine will protect you.

July 26, 2020

OMG, look at all of you (I suspect 65yr+) get on your high horses.

July 25, 2020

Well l hope Rod is wrong, and some of the enormous efforts and resources going towards creating a vaccine, are successful soon. AlanB, the reason covid deaths are low ( here) is because human/economic activity was shrunk. I believe we need people to have an economy and that the economy doesn’t exist without people.

July 24, 2020

The author is too negative. Never before has anything like this amount of effort been put into finding a vaccine. Historical references to how long vaccines took to develop do not take into account the cumulative scientific knowledge that is growing exponentially over time.

July 26, 2020

It is unfortunate that people with limited knowledge of human biology are naive enough to think that just 'resources' will fix things.
Where is the vaccine to HIV, Herpes Simplex and numerous other viruses which kill hundreds of thousands a year?
It is not that simple - only a small number of diseases are amenable to immunization.

July 24, 2020

Previous vaccine development was based on utilization of either live virus, inactivated virus or virus antigen. The new Covid-19 vaccine development utilizes RNA technology which could greatly shorten the development process. So you cannot compare the time frame required for vaccine development based on different technologies.

July 24, 2020

Personal liberty does not include the right to harm your neighbors.

July 24, 2020

Paranoia does not justify the removal of civil liberties from people who are causing no harm to others but simply trying to go about their ordinary life. Benjamin Franklin said those who would give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety. Giving in to an authoritarian state betrays all those who died in wars to give us the liberties we have now and which you would so readily have your neighbours abandon.

August 03, 2020

Personal Liberty? Harm neighbours? So why is smoking allowed by the selfish and ignorant. They are harming everyone around them. Second hand smoke causes more short term and long term permanent damage and decreases a neighbours life. It is a more serious assault to a neighbour than punching someone square in the face and causing GBH, as those wounds heal and do not decrease you life span. It all revolves around money from tobacco tax!

July 23, 2020

"If people exercise liberty at the personal expense of others, then we cannot control this pandemic".  What a naive statement for you to have made Rod.

Lets be clear - liberty isn't something to be exercised or permitted - liberty is to be taken - if necessary by force; just as it has hundreds of times over the course of human history when those with power abuse it to maintain a pliable status quo.  There is NOTHING more important than liberty and that includes sacrificing some lives, for giving up our liberties now (and entirely for arbitrary reasons that have little to do with our "protection" whatsoever) will most assuredly cost many more lives in the future when governments (read...dictators) who believe they have the best of intentions will use the precedence being set now simply to gain more power at our and our children's expense.

July 24, 2020

The mindset of antivexers are pests is medieval.
Please see link below to a Foreign Correspondent report on the damage anti vaccination has done to the spread of polio. The life of a child is hard enough. But the life of a child with polio is death by a million cuts.
Anti vexers and celebrities leading their charge should be corrected.

July 24, 2020

The mindset of pro-vaxers is that they have a simplistic world view that fails to comprehend or acknowledge any possibility of negative reactions. Vaccination good. No vaccination bad. I am happy to have my kids vaccinated but because of my own negative reaction to a vaccine cannot have another one for myself. Maybe one's views change when they have to be resuscitated by a panicked nurse shortly after being given a vaccination. It's rare but happens.

July 24, 2020

I can't believe you think liberty’s more important than lives. Very selfish. Obviously not medical as you would be risking your life looking after the people who don’t protect others or themselves.

July 26, 2020

Why is changing behavior as a group such a problem or seen as the slippery road to total loss of freedom. During a crisis where many people can die we should put our values on one side and take on collective values to achieve a result. Once done we can go back to how we were. Neither the Government or the People want lockdowns so NO they will not become some sort of permanent position. They are there for us to win the war and that seems to me more important than loosing it and feeling great about "Hey - No one tells me what to do" which is a useless position to take in this war. If you want to see how the two play out look at Australia and the US in the fight against C19.

July 27, 2020

Fallacious syllogism. The premise of this argument is that ‘liberty if valued more highly than human life.’
Most semanticians would argue in favour Of the alternative hypothesis ‘ life is valued above all other things’ . Life and liberty are balanced and prioritised in a pandemic. Let’s see you balance these values.

July 23, 2020

Yes always an emotional topic...that's how it is.
...and just to say I agree with AlanB, hard but is to me the only realistic way to go forward.
Citizens must be allowed to decide whether or not to have the vaccine and the no decision shouldn't be penalised.

July 23, 2020

sorry to hear what happened to your father, but that is an extremely unusual case.
Smallpox killed hundreds of millions in past centuries, including 90% of the native Americans !
vaccination has eradicated smallpox from the entire world which is a fantastic success story.
if people treated cars and airplanes with the same disdain they treat vaccination, then they would
surely be banned. think how many people die in car and plane crashes yet we don't blink an eyelid
at getting into one.
lastly, you can't be certain that your father's sickness was actually due to the vaccine rather than a
coincidental infection or illness he already had brewing in him. it happens frequently, but of course
people have to blame the vaccine....

Chris Jankowski
July 23, 2020

I think that the selection of arguments that the author put forward is heavily biased towards negative.
Moreover, he ignores several facts in the current development process of vaccine against COVID-19 that are unique and have never been in play in the previous vaccine developments. The most important among those are:
- Essentially an open chequebook given by the governments in US, EU and China to the extent that huge expensive manufacturing capacity is being built concurrently with the development process and even before testing. The governments do this for a reason. What is $13 billion allocated to vaccines compared with the current economic loses of the world economy due to COVID-19 that run well over $1 trillion a year.
- On the technical side, the latest genetic engineering methods are being used to create new types of vaccines - the RNA and DNA based vaccines. This has never been done before in human vaccine development.
Personally, I believe that safe and effective vaccine (and more likely multiple different vaccines) will be widely available by mid-2021 with production running at 300 million doses per month or more at that time and ramping up.

July 23, 2020

I agree there are almost insurmountable problems in developing an early and effective vaccine. In the absence of an effective vaccine we cannot continue to self-isolate and socially distance forever. Already the self-inflicted damage to the economy is far out of proportion to actual deaths. I have come to the view that we cannot run, we cannot hide, we should just let the virus run its course, divert medical resources where needed, accept that there will be deaths as there are every years from flus and then just get back to normal life. That is the only sensible way to deal with the pandemic, which has become a panpanic. On a personal note I also had a life threatening allergic reaction to a vaccine (yellow fever) requiring immediate medical intervention. Negative reactions are rare but do occur and should not be so readily dismissed.

July 24, 2020

Your last sentence stands on it's own.

It also makes a perfect argument against your other comments.

Let the other "rare" deaths occur unabated, but please recognize how terrible my "rare" reaction was... it could have killed me... that must not be dismissed!

July 24, 2020

You have not understood my comments so I will clarify. Deaths from Covid are low and do not justify suspension of the economy. Likewise, negative reactions from vaccinations are rare and do not justify suspension of vaccinations.

Sean Churchward
July 23, 2020

Excellent article and insights, thank you.

Alan Jones
July 23, 2020

If/when the vaccine is eventually available, should it be offered to anti-vaxxers?

David Landers
July 22, 2020

When is the past no longer a reliable predictor of the most likely future? The view expressed, while certainly respectworthy and credible, seems to pay no homage to the deluge of research innovation and tools developed across genetics and machine learning. Do the last 5 & 10 years of innovation (e.g. mapping of human genome, CRISPR gene editing) in these and other advanced fields account for nothing in terms of potentially accelerating vaccine development? Would be very interesting to see this specific question addressed i.e. have the preconditions underpinning vaccine development changed in any fundamental way over the recent past that suggests the possibility of an alternate scenario?


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