Paying for Sustained Private-Public Vaccine Co-Development: COVID-19 and Beyond

23 Pages Posted: 5 Aug 2020 Last revised: 19 Aug 2020

See all articles by Curtis McLaughlin

Curtis McLaughlin

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School

Date Written: July 29, 2020

Abstract

The United States is pursuing a vaccine for COVID-19 with a bottom-up, mission-based private-public industrial policy. This is a pivot from its earlier industrial policy of supporting the global vaccine development ecosystem. With so much development cost already borne by governmental investors, there should be opportunities to recycle revenue from successful vaccines to strengthen ongoing support for vaccine preparedness. Sooner or later the U.S. will return to the vaccine ecosystem support mode. Methods of pricing the vaccine and recouping revenue to support that ongoing research are presented. Because development is a process of uncertainty reduction, the initial co-development contracts should use differing payment mechanisms at different stages of co-development, the final portion of which is the allocation of revenue to both public and private investors. The public part can be recycled into future vaccine preparedness.

Keywords: vaccine, COVID-19, coronavirus, industrial policy, pharmacoeconomics

Suggested Citation

McLaughlin, Curtis, Paying for Sustained Private-Public Vaccine Co-Development: COVID-19 and Beyond (July 29, 2020). Available at SSRN: https://ssrn.com/abstract=3663454 or http://dx.doi.org/10.2139/ssrn.3663454

Curtis McLaughlin (Contact Author)

University of North Carolina (UNC) at Chapel Hill - Kenan-Flagler Business School ( email )

McColl Building
Chapel Hill, NC 27599-3490
United States

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