India’s Vaccine Makers Are Pandemic Profiteers, Not Humanitarians

The Indian government’s free-market approach to vaccine distribution has privileged profit over lives.

A Health Worker holds a Used Vial of COVISHIELD Coronavirus Vaccine at a Vaccination Center in Sopore, District Baramulla, Jammu and Kashmir, India on 03 May 2021. Serum Institute of India CEO Aadar Poonawalla has said that the production of COVID-19 vaccine Covishield is in full swing in Pune and he will review the operations once he is back in the country. (Photo by Nasir Kachroo/NurPhoto via AP)
A health care worker holds a vial of Covishield at a vaccination center in Sopore, in the Baramulla district of Jammu and Kashmir on May 3, 2021. Photo: Nasir Kachroo/NurPhoto via AP

In April, a deadly Covid-19 surge overtook India as the country’s overflowing hospitals and crematoria made global headlines. While new daily cases are now reportedly in decline, the overall death toll continues to rise — estimated to exceed official figures at well over 1 million. At the height of the surge, India’s vaccination rate began falling, and just 3.5 percent of India’s 1.3 billion people are fully vaccinated.

Most global media coverage has attributed the ongoing crisis to two key causes: the Indian government’s mismanaged pandemic response and Big Pharma. Over the last year, Prime Minister Narendra Modi and his far-right government engaged in superspreader theatrics rather than disaster mitigation. Meanwhile, by upholding patents on Covid-19 vaccines, pharmaceutical companies in the U.S. and Europe have denied low- and middle-income countries the ability to produce lifesaving vaccines, creating a system of global vaccine apartheid that devalues non-Western lives.

Amid the censure of the Modi government and Big Pharma, India’s health care capitalists have gone largely unnoticed. Aided at each step by the government’s free-market approach to vaccine distribution, India’s very own Big Pharma has used the pandemic to strengthen market shares, grow profits, and place vaccines behind a paywall unscalable for most people in a country riven with dire systemic inequalities.

“The Indian vaccine ‘market’ is held in a vise-like grip of a vaccine duopoly,” journalist V. Sridhar, who has written about the country’s vaccination failures for the Indian magazine Frontline, told me in a message. “What else would you call this duopoly but vaccine barons?”

Almost all of India’s vaccine supply comes from the country’s two largest vaccine producers: Serum Institute of India, led by CEO Adar Poonawalla, and Bharat Biotech, run by founder Krishna Ella. While both companies have repeatedly advertised their vaccines as the cheapest in the world, they seldom mention that those vaccines are also the world’s most profitable. For each dose sold to private hospitals, Serum makes profits of up to 2,000 percent — what Poonawalla might consider “super profits” — and Bharat Biotech up to 4,000 percent. In comparison, based on the estimated cost to make one dose, Pfizer’s and Moderna’s profit margins are 650 percent and 500 percent, respectively.

“Disasters are a fabulous business,” journalist P. Sainath writes in his recent piece on India’s widening wealth inequality. “There is always money to be made in the misery of the many.” India’s Covid-19 disaster is no exception.

The Prince of Profit

Poonawalla is one of India’s premier pandemic profiteers. He is the 40-year-old son of India’s eighth-richest man, from whom he inherited the world’s largest vaccine manufacturer. Among Western progressives, generics are often discussed as a public health solution to Big Pharma profiteering. Generics manufacturers like Poonawalla, however, are still businesspeople working for profit, not humanitarians motivated by the public good.

Pune-based Serum makes 1.5 billion doses of various vaccines every year and sells them across 170 countries. Poonawalla sees Serum, with its sizable production capacity, as “almost designed for [a pandemic],” and the company has seized on its “once-in-a lifetime opportunity.” In June 2020, Serum entered a partnership with British-Swedish company AstraZeneca through which Serum could produce the Oxford University vaccine in exchange for royalties. With the resulting vaccine — known in India as Covishield — Serum captured 90 percent of the country’s vaccine market share. The company also committed up to 200 million doses for export to the global vaccine-sharing initiative COVAX.

Adar Poonawalla, chief executive officer of Serum Institute of India Ltd., at the company's Hadapsar plant in Pune, Maharashtra, India, on Friday, Jan. 22, 2021. Serum, which is the world's largest vaccine maker by volume, has an agreement with AstraZeneca to produce at least a billion doses of Covishield, the local name for the Covid-19 vaccine developed by AstraZeneca Plc. and the University of Oxford. Photographer: Dhiraj Singh/Bloomberg via Getty Images

Adar Poonawalla, CEO of Serum Institute of India, at the company’s Hadapsar plant in Pune, Maharashtra, in India, on Jan. 22, 2021.

Photo: Dhiraj Singh/Bloomberg via Getty Images

Despite Serum’s lucrative licensing agreement with AstraZeneca, Poonawalla has been one of the loudest voices decrying global vaccine inequality and Western Big Pharma. In March, Poonawalla objected to U.S. President Joe Biden’s use of the Defense Production Act, which stipulated that U.S. companies manufacturing vaccine raw materials must prioritize U.S. government contracts. Poonawalla criticized the move and in April tweeted at Biden to “lift the embargo.”

Recent analysis notes how Poonawalla’s demand for raw materials “placed him at the heart of several heroic imaginations.” This was especially true once India’s Covid-19 surge became front-page news in April. Indian, global, and even socialist media picked up and amplified Poonawalla’s rebuke, pointing to U.S. hoarding of raw materials as a humanitarian concern right alongside India’s pressing need for oxygen and personal protective equipment. As activist and humanitarian pressure to release the raw materials mounted, Biden removed export restrictions on bags, vials, filters, and other materials. A White House spokesperson said in a statement that the U.S. had agreed to release “specific raw material urgently required for Indian manufacture of the Covishield vaccine.”

The spokesperson was mistaken, as was much of the global media. Poonawalla went on the record multiple times to clarify that his request was not for Covishield or indeed for any vaccine approved to inoculate Indians. Since January, Serum has had the capacity to produce around 5,000 doses of Covishield per minute. Rather, the raw materials Poonawalla sourced from the U.S. were for a new Covid-19 vaccine Serum is producing in commercial partnership with U.S. company Novavax. Poonawalla was able to benefit from activist outrage to secure vaccine raw materials that would do nothing to mitigate India’s public health crisis. Serum declined to comment on the record for this piece.

Media coverage has facilitated Poonawalla’s enterprising use of the gray zone between humanitarianism and commerce during the pandemic. While Serum has always emphasized its “philanthropic philosophy,” the company’s founding family has mostly been known for their ostentatious wealth — be it their majestic farmhouse where they hosted Camilla, Duchess of Cornwall; their luxury car collection that includes a one-of-a-kind Batmobile; or the refurbished aircraft that houses Poonawalla’s office.

But ever since Poonawalla became an early investor in the AstraZeneca vaccine, news stories have praised him as a “vaccine prince” — a risk-embracing entrepreneur with a moral mission. The media’s acceptance of how Poonawalla presents himself explains how easily he has been cited as an advocate for global public health rather than as a billionaire CEO advancing his company’s commercial interests. Journalistic sympathy for Poonawalla often comes at the cost of fair reporting. For instance, the media’s portrayal of Serum’s vaccine exports as a charitable “bid to protect the world” obscures the fact that Serum is charging poorer countries up to $7 for the same vaccine dose that the European Union is getting from AstraZeneca at $2.

Westward Expansion

Poonawalla has been cast in news coverage not just as a disinterested advocate of public health, but also as a decolonial challenger to Big Pharma seeking to “save the world from coronavirus — and then radically remake the international pharma landscape.” Poonawalla’s supposed desire to transform the global pharmaceutical industry is extrapolated from his opposition to vaccine patents, especially as calls to “free the vaccine” from intellectual property restrictions have found salience in Western leftist circles.

“We’re seeing a new system of vaccine apartheid coming into place,” says Tobita Chow, director of Justice Is Global, an initiative that campaigns to remove Covid-19 patents. Many public health experts agree that a temporary waiver of the World Trade Organization’s Trade-Related Aspects of Intellectual Property Rights, or TRIPS, provision is a necessary first step toward increasing vaccine production and access and creating a more competitive pharmaceutical industry worldwide. With sustained pressure from activists, last month the Biden administration signaled its support for a temporary TRIPS waiver, a measure initially proposed by the governments of India and South Africa.


The G7 Upheld Vaccine Apartheid. Officials From the “Global South” Are Pushing Back.

On the surface, Poonawalla has echoed activist concerns about pharmaceutical patents. But his fight against patents is not the same as activists’ fight for a people’s vaccine. Poonawalla’s interest in a TRIPS waiver comes from his admitted intention to poach competitors’ shares in Western markets. “Though we’re already in 165 countries, I will also expand our global reach: pushing into Europe and the United States — markets that we’ve never been able to enter as we’ve been blocked by Big Pharma,” he told GQ India last year. “These are the new and final frontiers.”

Serum has expanded into those frontiers. In 2012, the company acquired Bilthoven Biologicals from the Netherlands government and since then its European presence has only grown. In May, as Covid-19 ravaged India and the country’s vaccine supply dried up, Poonawalla sequestered himself in his $69,000-a-week rental mansion in London as the British government announced that Serum would invest over $330 million in the U.K. to create a new sales office, expected to generate business worth over $1.4 billion. If the clinical trials mentioned in the announcement are any indication, the vaccines developed as part of this deal might target European markets.

Serum’s global ambitions illuminate Poonawalla’s real problem with Big Pharma. It is not that Poonawalla is against the commercialization or patenting of lifesaving drugs; rather, he opposes Big Pharma insofar as it blocks his own access to Western markets. This is why, while campaigning against the hoarding of U.S. raw materials or supporting calls to waive U.S. drug patents, Poonawalla had also been working with then-President Donald Trump to escape the “stupid rules and regulations” that prevented him from selling his products in the U.S.

The TRIPS waiver might become yet another humanitarian response to India’s viral surge that enriches Poonawalla.

If these restrictions — raw material embargoes, patents, regulatory requirements — were waived for Covishield in Western markets, even at a price as high as $10 a dose, Covishield could easily outcompete the more expensive Pfizer, Moderna, and Johnson & Johnson vaccines while making a considerable profit. By undercutting competitors’ prices for Covid-19 vaccines, Serum could both expand its operations and trigger a race to the bottom, pushing other producers to consolidate or outsource to lower their prices. Back in 2016, Poonawalla had diagnosed that the pharmaceutical industry was experiencing “the lull before the storm” of acquisitions or mergers. If it succeeds in using the pandemic to break into Western markets, Serum could find itself riding the coming tidal wave of pharmaceutical industry consolidation.

The TRIPS waiver might become yet another humanitarian response to India’s coronavirus surge that enriches Poonawalla. The waiver could enable Serum to keep profiting from the AstraZeneca vaccine without paying royalties. Serum may also be able to develop a replica of the vaccine, the patent for which it could hold within India even as global patents are suspended. Several of the experts I interviewed saw the probability of such a vaccine monopoly emerging.

Poonawalla has done little to dispel these fears. Even as he stresses that Serum’s production capacity must increase to vaccinate the world’s poor, Poonawalla also maintains that there is no need to bring other manufacturers into the vaccine market to help increase supply.

Serum’s primary goal isn’t to equitably vaccinate the world or break down monopolies; it is to corner new markets while maintaining dominance within India. Without curbs on Serum’s power, the removal of global patents would not result in “freeing” the vaccine, only freeing streams of profit.

Krishna Ella, chairman and managing director of Bharat Biotech, holds a package of the typhoid vaccine Typbar-TCV during a press conference in Hyderabad on January 3, 2018. Indian biotechnology company Bharat Biotech has said its Typbar-TVC vaccine is the world's first clinically proven Typhoid Conjugate Vaccine against typhoid fever, and that it has received prequalification from the World Health Organisation (WHO) to be administered to children from 6 months of age to adults, and says the vaccine confers long-term protection against typhoid fever. / AFP PHOTO / NOAH SEELAM        (Photo credit should read NOAH SEELAM/AFP via Getty Images)

Krishna Ella, founder and chair of Bharat Biotech, holds a package of the typhoid vaccine Typbar-TCV during a press conference in Hyderabad on Jan. 3, 2018.

Photo: Noah Seelam/AFP via Getty Images

Immunity for Sale

Serum is not the only Indian company engaging in vaccine profiteering. Bharat Biotech, which developed Covaxin with public funds, has been charging Indians exorbitant rates for each shot — up to about $5.40 for states and about $16 for private hospitals — despite founder Ella’s early assurance that the vaccine would cost less than a bottle of water. Bharat Biotech has also been expanding commercial Covaxin exports despite India’s recent export restrictions.

Unlike Serum’s Covishield, Covaxin is not restricted by any Big Pharma patent. The Indian government controls part of Covaxin’s intellectual property rights, yet Bharat Biotech inexplicably monopolized production until a month ago, when the government finally greenlighted manufacturing of the vaccine in its own production facilities. Bharat Biotech declined to comment for this piece.

Throughout the pandemic, the Modi government has refused to curb pharmaceutical profiteering. Despite using taxpayer money to provide clinical trial support and sizable production advances to Serum and Bharat Biotech, the government has failed to ensure affordable vaccines for India’s people. Until May, the central government had procured all the doses for $2 each — a price at which the vaccine companies are reported to have made between 188 percent to 500 percent in profits. But they wanted more.

“When you’ve got low supply and high demand, what happens to the price? It skyrockets,” Poonawalla has said in describing how U.S. drug companies insulate themselves from competition with generics. Yet Poonawalla essentially politically engineered the same reality in India.

“By self-admission, India’s monopolistic vaccine producers were deeply unhappy with the ‘normal profits’ they earned at the regulated prices,” R. Ramakumar, a development economist at the Tata Institute of Social Sciences, told me in a message. “They lobbied to ‘free’ prices. Not surprisingly, vaccine prices more than doubled, even tripled and quadrupled, over just one week.”

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The Indian government enabled the rise in prices with its “liberalized” vaccine distribution policy, deliberately manufacturing a seller’s market. Starting May 1, the central government stopped procuring and distributing all the country’s vaccines as it and almost every other government in the world had been doing up until then. Instead, the central government began buying only half of the vaccine supply, leaving India’s 28 states and private hospitals to compete for the remaining doses on the private market — at prices set by the vaccine companies. The Indian health ministry did not respond to multiple requests for comment.

By distributing vaccines through the open market, the Indian government fractured its citizens’ collective buying and bargaining power, giving up all leverage to capitalists. With a quarter of the country’s vaccine stock reserved for private hospitals, and vaccine producers vocalizing their preference to sell to those hospitals at higher prices, India’s vaccination drive was designed to favor private-sector monopolization.

The resulting inequalities have been stark. Private hospitals have outcompeted cash-starved states: In May, just nine hospital chains had cornered 50 percent of all doses. While India’s states pledged to vaccinate people for free, private hospitals voiced no such intention. Absent price caps, most of India’s impoverished population has either been paying exorbitant amounts to get vaccinated at private hospitals or waiting for government hospitals to acquire scarce doses.

By distributing vaccines through the open market, the Indian government fractured its citizens’ collective buying and bargaining power, giving up all leverage to capitalists.

“Imagine if the vaccine is sold at $10 to a family of four and they each need two doses,” health journalist Vidya Krishnan says. “How are they going to be able to afford it?” The average person in India makes an estimated $50 a month. Add to the mix the Modi government’s disastrous economic policies from prior years, and vaccination becomes unattainable for most Indians.

India’s vaccination plan for almost one-fifth of the world’s people has been so alarming that even the country’s judiciary and Modi’s own allies have joined journalists, opposition politicians, and medical experts in asking: Why no price standardization or price ceiling? Why not go back to centrally procuring vaccines instead of making states compete? Why not, as Krishnan asks, use the decades-old public vaccination system that was used to eradicate polio? Why not, as experts I interviewed suggest, waive patents within India and issue compulsory licenses so that more than two big companies could make vaccines?

In response to months of public outcry, last week Modi announced a partial reversal of his vaccine distribution “experiment.” Starting June 21, the central government will procure 75 percent of the country’s total vaccine stock directly from the companies, which it will give to state governments to distribute to their residents for free.

The change reverses one of the most politically controversial aspects of the previous policy but still leaves plenty of room for profiteering. A quarter of India’s vaccine stock will remain reserved for private hospitals and, consequently, for the rich. Even with price caps at private hospitals, vaccine manufacturers’ rates of profit will reach over 1,000 percent. As Yogesh Jain, a founder of the rural health care nonprofit Jan Swasthya Sahyog, wrote on Twitter, India’s vaccination capabilities will remain “publicly provided, and privately guzzled.”

The Modi government has tweaked India’s profit-centric vaccine policy, but as Ramakumar says, what is needed is an overhaul. Instead of using the powers at its disposal on behalf of the people, the Indian government continues to privilege profit over lives.

Employees work on the production of line for vials of Covishield, the local name for the Covid-19 vaccine developed by AstraZeneca Plc. and the University of Oxford, at the Serum Institute of India Ltd. Hadaspar plant in Pune, Maharashtra, India, on Friday, Jan. 22, 2021. Serum, which is the world's largest vaccine maker by volume, has an agreement with AstraZeneca to produce at least a billion doses. Photographer: Dhiraj Singh/Bloomberg via Getty Images

Employees work on the production line to make vials of Covishield at the Serum Institute of India’s Hadaspar plant in Pune, Maharashtra, in India, on Jan. 22, 2021.

Photo: Dhiraj Singh/Bloomberg via Getty Images

Profiteering as the Public Good

The failures of India’s vaccination drive are reflective of the country’s overall pandemic response, characterized by the government’s strong support of private profiteering. India’s Supreme Court has repeatedly suggested that the central government has the power to speed up the manufacturing of oxygen and other essentials by investing public funds, which Indian cities like Madurai and states like Kerala have done successfully. But not only did the central government do nothing to increase its critically low oxygen capacity, it also allowed India’s industrial oxygen exports to rise by over 700 percent over the course of 2020 instead of redirecting oxygen production to medical needs. Unsurprisingly, the stock of oxygen corporations like Linde India shot up even as countless people gasped to death.

“The government of India has withdrawn from the central social responsibility of an enlightened welfare state,” Ramakumar told me. “It has also opened the floodgates for a vulgar form of predatory capitalism to take over the stage amid the raging human tragedy.”

Poonawalla has claimed that “even God” couldn’t have foreseen the gravity of the crisis, but India’s pandemic disaster was long foretold. Things did not have to play out this way. India could have had medical supplies, PPE, testing kits, and vaccines ready if public health dictated production and distribution, rather than profits. Wherever vaccines have been administered on a mass scale, it has happened because at key moments of reckoning, public health advocates challenged the profit motive. But in India, profiteering itself masquerades as the public good.

In India, 38 new billionaires were minted in the past year, while the combined wealth of the country’s 140 billionaires went up by 90.4 percent. 

Pandemics often exacerbate preexisting sociopolitical dynamics, argues Nivedita Saksena, a fellow at the Harvard School of Public Health. India’s current situation is no exception. With a public health system that has been starved of funds for decades, and no viable alternative to for-profit health care, India’s Covid-19 pandemic was bound to become an opportunity for profiteering.

India’s big businesses have even managed to use aid from abroad to make money — which is why private hospitals sold airlifted oxygen cylinders to desperate patients, why vaccine raw materials from the U.S. are being used for disaster profiteering, and why a global patent waiver will likely strengthen the power of Indian Big Pharma.

To win a world where human life is truly valued above profit, we must realize that the small handful of very wealthy people who stand in the way of the public good are dispersed across the world — as much in Pune as in New York City. Their numbers are growing, as is their power within their home countries. In India alone, 38 new billionaires were minted in the past year, while the combined wealth of the country’s 140 billionaires went up by 90.4 percent. During the pandemic, Poonawalla’s net worth rose by 85 percent in five months, as tens of millions of Indians descended into poverty. This is not a coincidence, as P. Sainath writes, in “a year when hundreds of millions of Indians were hungrier than they’d been in decades.”

“A wealth ‘surge’ usually rides on a misery surge,” Sainath says. The swelling wallets of India’s health care elites are directly linked to the bodies in the streets. Until we eliminate the profitability of misery, India’s nightmare has no end in sight.

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