Forget ‘Play’, The Machine Needs To Be Scrapped

Context: The Centre must revisit its vaccine policy by procuring 100% doses which can then be equitably disbursed to States.

About Indian vaccine policy

• Differential pricing to instil a competitive market: Rationale is Centre can procure larger volumes than States/private sector, thus the difference in prices.
  • Covaxin and Covishield both are at Rs.154 for Centre and Rs.400 for States and Rs.1,200 for the private sector for Covaxin and Rs.300 for States and Rs.600 for the private sector for Covishield.
  • Centre takes 50% to give to States for 45-plus age group, States get 25% of total vaccine production for their use and rest 25% to be absorbed by the private sector.

Reasons to revisit vaccine policy

• Indefensible and out of line with international practice: In almost every other country, the only national government is buying vaccines.
• Incoherent and internally inconsistent: It alludes to liberalisation while the Centre is controlling both price and quantity for every State ignoring the infeasibility of liberalised policy at this time.
  • Still controlled by the Centre: The Centre fully controls Remdesivir market while initiating liberalisation of vaccine market which has just 2 suppliers.
    • Procurement quotas are in place, and the prices are informally negotiated by the Centre.
    • States are allowed only 25% of the procurement, and each State is “informed by the Central Government in writing about the number of vaccines it would receive.
  • Concerns with private sector procurement: Current private procurement levels less than 3%, and equity concerns it is urban-centric in nature, and poorer states are left out.
• Legal loopholes and obfuscating arguments: It is perplexing why Covaxin is not more widely licensed, given that much of the core work in de­veloping the vaccine was done at the ICMR-­NIV in Pune.
  • Impracticability of door-to-door vaccination was not considered and was insufficiently put forward.
• Inadequacy of global tender option: Centre has informed that global procurement is the Centre’s responsibility and talks going on since the third quarter of 2020, yet made no effective progress.

Way Forward: Balancing the revenue generation while ensuring equitable distribution.

• While actual prices of the vaccines are too high, revenue generation can be raised more simply by -
  • Increasing the Centre’s price, currently Rs 154.
  • Providing the comfort of large long­-term orders for 100% of India’s needs, enabling firms to invest more and sell globally.
  • Those who can afford to get them at the private and corporate sector rates shall go ahead.