Shares in major pharma companies fall in wake of US decision on vaccine IP

Shares in major pharmaceutical companies fell sharply on the news that the US supports waiving intellectual patent protection for Covid-19 vaccines.

US Trade Representative Katherine Tai made the announcement on Wednesday afternoon in light of the ongoing global health crisis and the need for a much more robust rollout of vaccines around the world.

“The extraordinary circumstances of the Covid-19 pandemic call for extraordinary measures,” she said in a statement.

While the administration believes strongly in intellectual property protections, she argued that in the service of ending the pandemic, the US government supports the waiver of those protections for Covid-19 vaccines.”

Pfizer, Moderna, BioNtech, and Novavax share prices all plunged to session lows on the news.

Moderna was down more than six per cent, BioNtech more than three per cent, Novavax almost five per cent, but Pfizer much less so.

The statement only mentions vaccines and not other Covid-related products as was originally proposed. Further to that, passing the waiver requires consensus from Switzerland, the EU, and the UK. This may take some time.

Despite the news, the Dow Jones closed at a new record high of 34,230.