ET@Davos: Adar Poonawalla on Trump, Targets, and Transitions

Pleasure to be here and talk to you.

Well, you know, of course you can imagine there are alarm bells going all over the world. Because you see, a multilateral organization like WHO plays a very critical role in transnational standards and health standards, not just for vaccines but for medicines and so many other things. Now, of course, they must be deciding what to do and perhaps raise funds from other countries and do all of that. But these are very critical programs globally that WHO does, like health systems, testing, surveillance, research. I think whatever views the president has on WHO are of course his views, but this has certainly sent a shock to the system. Let's see what happens, but certainly it could slow down a few things that are going on in the world. My concern, and I hope it doesn't happen, is that vaccine pre-qualifications and getting vaccines approved globally, because WHO is that global standard that most countries go by, doesn't result in delays in getting new vaccines approved. For example, we recently got our malaria vaccine for the African continent approved by WHO, and as a result, a lot of these countries will be able to access this vaccine at a very low price and hopefully save a lot of lives. Things like this shouldn't get backtracked. I'm sure WHO has made plans to ensure that the most critical things still go on, but let's wait and see. It's early days, it's only been a few hours, so let's see what happens.

Well, again, something relating to WHO, they've been working on this thing called the Pandemic Accords, which goes towards bringing vaccine equity not just during a pandemic but perhaps during other times where registering and getting vaccines and other medicines approved across the board, so that companies don't have to go to every individual country to get that done, because that takes time and involves costs. There has been progress on that. It's still always good to have one multilateral organization like WHO to take the lead on that. We have focused on pricing our vaccines very, very low to maximize access to the poorest nations in the world, and that's why to reach the maximum number of children and adults to get them vaccinated, we continue to do that. I don't see that slowing down; in fact, it's doing quite well after COVID. Whether it's on testing, whether it's on surveillance, all of that, we're in a far better place than we were during COVID. So there has been progress.

Well, ever since COVID, we've invested $2 billion in capex, in research and clinical trials to get new vaccines. As a result, we've built facilities and are on the verge of licensing a bunch of vaccines. For example, the HPV and malaria vaccines are already licensed. We're looking at chickenpox and monkeypox in a year and a half's time. We're looking at a dengue vaccine in about two and a half, maybe three years' time. A lot of these mosquito-borne diseases that spread in India, South America, Asia, these sort of areas. A yellow fever vaccine as well. So we're focusing, as you said, on vaccines rather than other pharmaceutical drugs and monoclonals and other things at the moment. Most of our capital and our profits just go back into building capex in India. Now we've got two campuses in India, and our capacity is around 4 billion doses annually. Of course, that's not being utilized; we're only at a $2 billion dose capacity utilization. So let's see, with all these new vaccines coming, that capacity will be used up, because after COVID there was a lot of empty capacity. So we just retrofitted those equipments and things and made some more investments. The challenge still lies in getting clinical trials done quickly, because during COVID that was happening very fast, but now we're back to the usual way where it does take time to get those results. So we have to be patient, and in the next three, four years, you'll see so many more vaccines being licensed.

This has been over the last, I would say, five years, ever since 2020. The majority of this was invested during the pandemic and a little bit more after. I would say now most of our funds will go towards funding the clinical trials of these vaccines, because you have to do trials in India, Africa, so many other areas. The capex cycle, I wouldn't say is over, but I would say 80% of that is done. And then maybe after another few years, we may have to again put in another big investment to build more facilities for new technologies and messenger RNA. We're even looking at giving vaccines instead of needles through other devices, including patches. Now, that's going to take three or four years to develop, but this is very good because if you're talking about big campaigns and reaching a lot of people in outbreaks or a pandemic, even, you don't need a healthcare professional to give it. You just put the patch on, like you have with insulin or other things, and then that administers the vaccine. These are some of the new technologies. We're working on AI also, so we're investing there to be able to predict what kind of formulations or speed up clinical trials in a way that you save a lot of time and cost. That'll be very good for the vaccine and pharmaceutical industry. I've got some meetings here lined up to talk to some people who are doing that. Of course, with the challenge there is that regulators around the world have to acknowledge and agree with what the AI simulations have predicted and said is correct and will result in an effective vaccine. There has to be some acknowledgement there, because if a regulator doesn't approve your vaccine based on an AI tool, then you have to still stick to completing all the traditional ways of completing your trials and research. So in research and clinical trials, I think AI has an important role in our industry.

Well, it depends. It could be about $100 million to begin with, where you invest or co-invest with a partner to do that and develop a platform which can simulate these things. It will vary from vaccine to vaccine. So we haven't invested yet, but we have plans to do that over the coming years.

We do. For example, Bill Gates and his foundation have funded a lot of our trials, and we've co-developed some of these vaccines that way in terms of funding. In return, we've offered these vaccines at a very, very low price, which has been a win-win for a lot of the developing world countries. Depending on what the project is, we're always happy to have partners with us to share the risk. If we want to have three, four vaccines rolling out quickly, then we can't fund everything on our own, so you have to bring in partners.

I think that should happen in a few months, so that's on track. Again, now with the US policies, I don't know how the uptake of vaccines going from other countries to the US is going to happen. Again, very early days, they've just sort of taken charge. We'll have some meetings in the US, and I think we can talk about it a bit later once I know a bit more. So the price, quantity for supply, all that has not been found. We have no idea at the moment; it's still very early days.

Yeah, so we should be pre-qualified in 2026 by WHO, if everything goes well, and we're on track for that. Because after that, you can export these vaccines to other countries. This year and part of next year will be focused on trying to start supplying to the Indian government. We've already launched this vaccine to prevent cervical cancer in women, as you know, very important for young girls to take this, in India in the private market. So we'll see how that rollout also takes place. The Indian government is very eager to promote this and get this out into girls, because they understand, and with Prime Minister Modi's vision of protecting women, it's a welcome initiative and everyone's looking forward to that.

Yes, so that will happen this year. It's just being planned out, because when you roll out a new vaccine, the states have to be prepared to take it. So some states will start first, there'll be pilot areas or certain areas of the state which will start first. You don't roll out a vaccine completely nationwide like that; you do it in phases. So we're looking at what, calendar 2025?

So by the end of this year, hopefully we should have the national immunization program taking the vaccine and rolling it out. The volumes will pick up beyond, say, 40, 50, 60 million doses in '26, as I mentioned. So we just have to wait.

Yeah, the pneumonia. Now, you had the pandemic factory that was planned. Is it ready? Because the whole idea was to churn vaccines in record time.

So that's the facility that's added 2 billion doses to our capacity. God forbid there's another pandemic, but in the meanwhile, we're using those facilities to make all these other vaccines. India is far more self-reliant now, even more than it already was during the pandemic, because not only Serum but other manufacturers have also built and invested in more capacity. Our testing and surveillance infrastructure is also very good now. In fact, that's where you're seeing, I don't know if you saw the reports, but this pneumonia virus, it's been around for years, but because of our, it was the same even when monkeypox cases were detected earlier, we didn't have the tools and systems to detect it. So now, when some of these things, they will be obviously highlighted, and rightly so. We know and we're at a state of alertness. Of course, there's nothing to worry about now, but at least you know what's circulating, you know what to do, you have ways of testing, you can develop testing kits very quickly. So all that infrastructure that was built and capability that was built, both in India and across the globe after COVID, is there very much so. I think we're all that much more prepared in case something else happens.

No, no. Every vaccine strategy that we look at, before getting into a vaccine, it has to have a global demand. Because if it doesn't, the volumes and economies of scale don't justify it, and then it's a chicken or the egg. You can't then bring the prices down if you make 20, 30 million doses of a vaccine. If some vaccines are required only for certain regions or a country or two, then it's not economically viable or sustainable. So all of these vaccines, they always start off in India, and after protecting the national population and serving our nation's needs, then we go on to exporting it.