Our analysis of what the biggest global companies in Switzerland are up to. This week: Big Pharma's R&D plans, coronavirus impact, and #cryptoleaks.
With the world in a panic over the coronavirus global health emergency, where are the pharmaceutical companies when you need them?
Earlier this week, a BBC story asked why more pharmaceutical companies aren’t rushing to develop a global vaccineexternal link to tackle the coronavirus as the number of cases and deaths from Covid-19 climb. “One would expect the major pharmaceutical firms to make millions, even billions, by rushing to develop a vaccine,” the reporter writes.
If only it was so easy. There are a host of challengesexternal link to developing a vaccine quickly in the middle of an outbreak and between the research and manufacturing costs combined with the approval process, it’s no wonder that some companies are inclined to stay away.
Swiss companies aren’t the biggest players in vaccines, but some are bringing other parts of the business to the table. Roche was the first company to develop a diagnostic test for the novel virusexternal link according to an interview with its CEO in January. However, it has played down optimismexternal link that it’s flu treatment Xofluza could work against the Covid-19.
The whole situation raises a much more fundamental and complex question about the current R&D model. The BBC story highlights how companies that developed vaccines for Ebola were saddled with hefty costs and no sales channel after the emergency waned. Similar problems are being found in the antibiotics business, which is suffering serious shortagesexternal link especially as antimicrobial resistance rises.
Juxtapose this with the gene therapy business, where companies are in a fierce battle to buy up the next big breakthrough and you can see where companies are putting their R&D resources. An in-depth data analysis by Swiss public television RTS found that 16 of the biggest pharmaceutical companies have acquired smaller companies to the tune of $1.2 trillion in the last 20 years. Many of these are for innovative cell and gene therapies for rare diseases that are expected to be big moneymakers for companies.
Roche and Novartis top the acquisition chart swallowing 49 and 45 companies respectively in the last 20 years. The research also shows that many of these smaller companies relied heavily on public and charitable funds in the early stages.
So, how will we solve the biggest health threats if there’s no money in it? Could this recent effort external linkout of Norway be an option? Tell me what you think firstname.lastname@example.org
In other news:
The coronavirus is not just putting pressure on the pharmaceutical industry. It is also impacting business continuity across transport, retail and manufacturing. Swiss International Airlines extended flight cancellations until the end of February, Nestlé shut 30 or so factoriesexternal link in China, Swatch cancelled its “Time to Move” watch fair, and engineering firm ABB has closed all its plants in its second-largest market.
The #cryptoleaks scandal has shaken Switzerland. There’s been a lot of talk here about what the revelations that the CIA and German intelligence used Swiss firm Crypto AG’s technology to decode other nations’ top-secret message means for the country’s foreign relations and reputation for neutrality.
But there are a host of other important questions about how much oversight the government has and should have over the activities of companies setting up shop in the country. What safeguards are really in place to ensure that companies aren’t using Switzerland’s “neutral” host status and loose regulations to do as they please in other countries?
More are demanding a formal investigation into how illegal gold from Venezuela arrives in Switzerland. As the economic situation in Venezuela deteriorates, more people are turning to illegal mining of gold that ends up in Swiss refineriesexternal link via third party country such as Curaçao or the Cayman Islands. Last year, Switzerland imported 2.5 tonnes of gold from Curaçao, which curiously enough doesn’t have any mines. FINMA opened an investigation into money laundering but so far, nothing open related to illegal trade.
Marc Ummel from the NGO SWISSAID told Swiss public television RTS that “the day when dirty gold doesn’t arrive in the Swiss market, illegal groups will cease to exist.”
Thanks for reading.