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January 28, 2021

Biden Could Force Drugmakers to Produce Approved Vaccines

Also, Gary Gensler can't wait to police this stock market

 

Jeff Zients, White House coronavirus response coordinator, speaks at a
press briefing on Wednesday. (White House via AP)

The Chief

Yesterday I joined a call from President's Biden's COVID response
team about the state of the vaccine rollout. Jeffrey Zients, the
response coordinator, led the call. And the big takeaway for me was an
indication that the White House is "actively exploring" the idea of
compelling other pharmaceutical manufacturers under the Defense
Production Act to produce approved coronavirus vaccines from Moderna and
Pfizer.

Until now the expectation was that the DPA was being used to accelerate
production of supplies, like syringes that can get six shots out of a
Pfizer vial, or material ingredients used in production of the vaccines.
Masks and test kits are also candidates for the DPA. But this was a step
beyond that. "Whether or not a factory can be retrofitted to produce
another vaccine, that's under active exploration," said Andy
Slavitt, senior adviser for the COVID response team. "We will not be
afraid to explore every option."

Zients reinforced that. "This is a national emergency," he said.
"Anything we can do to increase vaccine supply and timing of delivery
is on the table and we will execute accordingly."

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This is welcome and long-overdue news. Whenever I talk about getting
these plants converted I get snickers from people who say I don't know
anything about this type of production. But I can read a calendar. The
coronavirus genome was only mapped out in January. Production was
starting once the Phase 3 trials got going in September and October. We
know that, starting from scratch, you can get to production in far less
than a year. Since nobody expects the world to have every vaccine it
needs in that time frame, then there's really an imperative to do
this.

And the right frame is "the world." If developing countries are
still suffering with this it affects us. Even if you're just a crass
capitalist, it affects the goods you can sell into a country in a
lockdown situation. And it raises the possibility of a mutation and a
resumption of the virus, which as we've seen doesn't take much to
rocket around the world. We need everyone on the planet covered, and we
have a handful of vaccines that work and can allow us to live our lives
again
.
We need to make as much as we can now.

There's already a model for this. French drugmaker Sanofi has agreed
to produce Pfizer vaccines

at one of their facilities in Frankfurt, as the vaccine they've been
testing has hit delays. That's only for the European market, but it
shows that yes, you can retrofit factories to produce other vaccines.
But we shouldn't wait for drug companies to figure that out and build
partnerships; under the DPA we can compel companies to make that
changeover.

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And frankly we're way late to this. As soon as vaccines like Pfizer
and Moderna showed promising Stage 2 results, we should have moved to
this changeover. That could have given enough time to get more supply by
this spring. Even if one of the vaccines that you mass-produced washed
out, who cares? That small waste of money pales in comparison to the
economic loss from a slower vaccination campaign.

On Tuesday the White House announced

that it would purchase enough Pfizer and Moderna doses to cover every
U.S. adult over 16 by the end of summer. (The response team is not
including Johnson & Johnson, which is close to seeking approval, or
AstraZeneca in their calculations.) But there's less to that
announcement than meets the eye; it's actually just working to get
additional doses in the second quarter of the year. There's no
guarantee that Pfizer and Moderna have the capacity to produce.

(Speaking of no guarantees: two-thirds of the allotment in Oklahoma
earmarked for the CVS/Walgreens plan to get shots to nursing home
facilities are still frozen
.
Read Matt Stoller

on how monopoly pharmacies and others slowed the rollout.)

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Other news from that press call: Slavitt said that the federal
government will only maintain a "rolling inventory" of 2-3 days of
supply, getting as much out to the states as possible. They're
boosting allocations

by 16 percent and locking that in for three weeks, so states know how
much they're getting and can plan. (This was a major reason for the
slow rollout; nobody could make appointments with uncertain supply.)
There will be 100 "community vaccination centers" rolled out in the
next month, including mobile clinics; there will also be a partnership
with community health centers, which are located often in hard-to-reach
areas.

All of this costs money, and it's a big reason why we need to pass at
least the vaccine funding of the American Rescue Plan as soon as humanly
possible. As the Federal Reserve stated yesterday
,
this is the main determinant of the economy, and more important of
hundreds of thousands of lives. You can't throw enough money at this.

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Paging the New Sheriff

I couldn't help myself, and so I did a Gamestop take
.
I concur with good reads from Ryan Cooper
,
Zach Carter
,
and Doug Henwood
: this
escapade exposes the stock market for all its artifice and corruption.
Hedge fund types had market manipulation all to themselves for so long
and can't stand the competition; and "value" is an amorphous and
disconnected concept

that depends on what muscle is behind what gambling bet.

It does look like a lot of institutional players are making a lot of
money

off this uprising, most disturbingly Citadel
, which
manages order flow for the Robinhood trading app and is almost certainly
front-running the trades. And Robinhood is reportedly locking out
traders

in key stocks today, showing that their "democratize the market"
rhetoric was just that. This whole thing will require a rethinking of
the market and how schemes like pump-and-dump are regulated.
Fortunately, the person in the position most equipped to do that is Gary
Gensler
,
the incoming head of the Securities and Exchange Commission, who has
just the right attitude for the task. In his last go-round as a Wall
Street regulator, Gensler was unafraid of sticking it to the suits, and
he will have every opportunity to do so again. There may be a role for
Rohit Chopra's Consumer Financial Protection Bureau

specifically on Robinhood, too. The spotlight on the Wall Street casino
looms large; let's not waste this moment.

What Day of Biden's Presidency Is It?

Day 9. Executive actions today are focused on health care, mostly
opening up the Obamacare exchanges for enrollment.

We Can't Do This Without You

Today I Learned

* Executive actions are popular
.
People like progress. (Five Thirty Eight)

* Meanwhile this is the worst editorial ever
,
decrying "Executive action," literally the job description of a
president. (New York Times)

* The recovery is weakening

and delay of more relief is not an option. (Politico)

* The hunger crisis in America is particularly acute
.
One Biden executive action targets that specifically. (Washington Post)

* Arms sales with Saudi Arabia are temporarily frozen
.
Let's see if that holds. (Axios)

* Biden has not been afraid to clear the stables of Trump loyalists
.
Good. (New Yok Times)

* This particular action to replace the leading official

managing immigration courts is a good example of the dynamic. (Politico)

* Democratic judges are starting to retire

amid the hopes that Biden will appoint their successors. (HuffPost)

* Unrelated to Biden, but the "Philly Fighting COVID
"
story is one for the ages. (New York Magazine)

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