When we have a coronavirus vaccine, what might its benefits look like? How quickly will people accept it and be willing to get vaccinated? And how will that affect our ability to end the coronavirus pandemic? Ronny Gal, Bernstein Research's US Biopharma Senior Analyst, joins our Co-Head of Investment Strategy, Beata Kirr, to discuss what the world might look like once we have a vaccine.
00:00 - 00:08
Hi, everyone, and welcome back to The Pulse, where we cover trends in the economy, markets, and asset allocation for long-term investors. I'm Matt Palazzolo.
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As part of our ongoing series to understand the latest developments around the coronavirus and the prospects for treatments and vaccines, Bernstein researchers' US biopharma analyst Ronny Gal once again joined our Co-head of Investment Strategy, Beata Kirr, to discuss what life might look like once we have a vaccine. Will anti-vaxxers and vaccine skeptics stand in the way of our ability to end the pandemic? What might the evidence for the vaccine look like and will people trust it?
00:40 - 01:15
Will we have a vaccine passport allowing us to move around freely? I think you'll find their conversation to be quite interesting. Let's talk about whether people want to get vaccinated. Let me just mention that you've published a really interesting piece on this in the end of July, and it was titled Could Anti-Vaxxers Sink the Recovery? And you cited a lot of interesting surveys here. I'm going to cite one of what I think is the most interesting to just kick off this conversation.
01:15 - 01:50
Apparently, 36 percent of Americans believe that aliens have visited the earth. 26 percent of Americans believe that astrology predicts future events. 13 percent of Americans believe vampires are real. And 10 percent of Americans believe the moon landing was fake. So all of those stats exist, and then next to that survey, it's stated that eight percent of Americans believe vaccines are unsafe for children.
01:50 - 02:22
OK, so first of all, where did those numbers come from? Oh, the survey on "vaccines aren't safe for children" data that was actually done in a quality way by the CDC, who wants to follow this. The other ones, we literally just went online and began to look for social media publications on those issues, more to give people a feel for how threatening the eight percent number is. And the short answer is that if you do surveys, you'll get eight percent to say anything to almost any position.
02:22 - 02:52
So the argument there is a big group of people who are very sharply against vaccine is probably not true. There's a bit of an element, there's a small group of, we used to joke that there's a dumbbell on the fringes. So there is a fringe on the far right that is against the vaccine as some sort of a government conspiracy to enslave us. And there is a group of on the fringes on the left, which is more around the purity of my body and vaccines being unnatural.
02:52 - 03:11
And it's evil for you, the same way the processed food is evil. So there's group on both sides, on both edges that is against vaccines on a policy level. And I don't see the risk/reward as being balanced in favor of vaccines. But that's a very small group To kind of fast track to
03:11 - 03:35
the next point is that is not the one you want, we want to worry about. Right. You want to worry about what's called the vaccine skeptics, which are people that, you know, with decent foundation, argue that you have here a new vaccine and to some extent new technology. And we want to be careful before we go out there and immunize everybody with those vaccines.
03:35 - 04:07
And that population, depending on how you ask the question, is, could be as high as a third of the US public. Let me stop you there for a second. So basically a third of the US public could feel not so great about getting vaccinated. Your point is that while eight percent are these hardcore anti-vaccine for a variety of reasons, there is a larger percentage of the population that, if asked differently around today's vaccine question, it's a more substantial portion of the population that's skeptical. Right.
04:08 - 04:27
And I've seen that data be supported with recent polls across the board. I actually thought it was even higher than 35 percent, but I just wanted to stop and clarify that's what we're talking about here in today's environment around the current views. OK, and so what do we do with that? Because that sounds like a pretty large percentage of the population.
04:28 - 04:51
We did a lot of work on this. We don't think that that skepticism is going to stop the US from being vaccinated and getting to what people think about is that herd immunity threshold where the disease will down itself. There is three or four reasons why. First, I
04:52 - 05:24
I would be skeptical about the vaccine as well until the full database is available. So one thing that will happen between now and the time that you are able to take the vaccine is that we will have databases for multiple drugs with 30,000 patients or more, that will show how safe the vaccines are. So if you ask me would I trust a vaccine that was tested in 15 or 20 people, the answer is no. Will I trust the vaccine that was given to 30,000 people, including people of my age, race, and comorbidities,
05:24 - 05:27
I will probably feel a lot, a lot safer.
05:27 - 06:01
So one thing to remember is we will have a lot more data by the time that the vaccine will be offered to the population. Second, everybody has an opinion, but there are people who are professional about this and they are at the FDA and they are at the National Institute of Allergy and Infectious Diseases. And they would look at this data very carefully and they will vouch for the quality of the data and the fact that these vaccines are low risk, certainly much lower than the benefits they provide.
06:02 - 06:28
And that does have weight, certainly with the medical community of people that know those people, that were typically the guys that were the best in their class in medical school and have gotten the best jobs and have the best careers and wrote the best papers. So the medical profession and the experts will have to vouch for those drugs to do it. This will have some effect. Certainly we will have a public effort to vaccinate the public, including public announcement.
06:28 - 07:00
The vaccines will be available for free and they'll be available at your doctor's office. In the past when the US has moved with a Vaccine for children program to make vaccines popular, we have seen both economic factors and the availability of the vaccines at the corners to have a big impact. So between the data available, the experts supporting it, vaccines available around the corner for lower cost, there will be, that will be a drive to vaccinate.
07:01 - 07:11
The last point I would make is, despite the skepticism, the US population does vaccinate its children fairly uniformly.
07:11 - 07:43
You need to do it to go into school. But in general, people vaccinate their kids because they see the risk/reward as worth it, even if they are a little bit skeptical of maybe there is a small chance something bad will happen. They see the benefit here. With vaccination, there clearly will be benefit that you will not have to worry about infecting your elderly relatives. If you are the elderly relatives, your risk near-term is much lower and probably less concerned about side effects that might emerge 30 years later.
07:45 - 08:18
Second, for travel, we probably will need to show vaccination. You want to go to France? The French will probably ask you to be vaccinated before you come. And there are some jobs where you will be very hard for you to go to your job without being vaccinated. And there might be businesses that actually argue that they want their employees vaccinated before they show up to work. Medical professionals are one, schools, gyms, and you can think about a restaurant that says, all our employees have been vaccinated, as an argument towards, as an argument for convincing people to come and dine.
08:19 - 08:51
So there will be some logic why people want to be vaccinated for the benefit of immunization, both from a health perspective and from a commercial perspective. So between those four, in our experience that people do vaccinate, especially the elderly, for example, do vaccinate regularly with with flu. We think that the risk that we will not get enough people vaccinated is low. So just to quote you a few a few numbers in terms of people who are vaccinated today.
08:52 - 09:04
Let's take away the childhood vaccines. But HPV for teenage girls in about 70 percent. And here is the idea is that you can avoid cancer later on in life; Hepatitis B,
09:05 - 09:28
92 percent of the US population gets vaccinated. Flu vaccine, typically 73 percent for children, above the age of 65, 68 percent of the population regularly gets vaccinated. And this is all data from the CDC. So if you kind of look at it, despite the skepticism, even with choice, the vast majority of the US population gets vaccinated.
09:28 - 09:58
And we believe that will be the case going forward. OK, now you've made a convincing case. So if I were to summarize, it's basically around the idea that while there might be a group of hard-core opponents to the concept of vaccination, and while there may be a broader skepticism today because of the speed of development or a variety of other reasons, you believe that, number one, the data and the magnitude of the trials will provide more comfort for people
09:58 - 10:33
in terms of the vaccine development, as you pointed out, if you see evidence on people like yourself, having confidence in that will help drive outcomes, as well as a concerted public advocacy campaign. And then I really think one of your most interesting points is this idea of a vaccine passport concept. Right. That with today's temperature checks and symptom screening that we're now used to being asked, right, and as we think about our kids going back to school in person, are really part of the day-to-day life right now in America.
10:33 - 11:03
That becomes a different day-to-day with the vaccine passport idea, because you could very well see the notion that schools say, just like they do with all the other vaccines, you can't attend school unless your immunizations are up to date. So the vaccine passport idea, I find to be the most interesting, even just within our borders. Right. Like not thinking about it to travel, but to think about it, to conduct your daily life in society. And let's see where that goes. Yeah, I think that that last point, I want to be a bit careful around.
11:03 - 11:35
So I don't believe there will be mandated requirements to get those vaccinations in 2021. I think it's a bit early for employer or even a school or even a hospital. There's simply, the vaccine was approved yesterday. We want you to be vaccinated today. I think the pressure to vaccinate will first be more moderate and will be a choice that is preferred. And somewhere in 2022 or 2023, as the vaccines do prove themselves to be efficacious and no side effects emerge,
11:36 - 12:02
we could see a movement towards essentially requiring vaccination as a condition for attending a workplace or participating in activity or traveling domestically. I think what could happen more clearly is, New Zealand, countries with low rates of disease today will probably move reasonably early to require foreigners to travel to them to be vaccinated. But I think within domestic requirements will come later.
12:03 - 12:24
Something we didn't cover, but it's probably worth just mentioning is there actually there is no right not to be vaccinated. The US, again, under the US law, you can be required to be vaccinated. There are some counter laws that give you some rights like the Equal Rights Act or different religions. But in general, the US government can require you to be vaccinated.
12:25 - 12:41
That is a 19th century decision that still holds that. So there is there is a long history for preference for public health over individual rights when it comes to vaccination. It is probably not going to be the first thing that happens, though, as soon as that thing gets approved.
12:42 - 12:46
Interesting. Interesting. Well, this has been really a great conversation, Ronny.
12:46 - 13:19
We've covered so much, where we are in development, and timeline, and then the controversies around vaccination. So I really appreciate it. And just with our remaining maybe two or three minutes, maybe we could take on a bit of a lightning round question with this idea of, we're recording at the end of August, and I don't know about you, but our kids' schools open on Monday. Now, open is a strong word because both of my kids schools are opening remote. They originally tried to open otherwise and then pivoted to remote for a number of weeks.
13:19 - 13:47
And as you can imagine, like the rest of the country, there's been a lot of controversy where it does feel like there is nothing that anybody can do right in this regard. So here's my lightning round question to you. If you were on a school board and looking at these decisions, how would you make those decisions about whether to open the school or not? And how comfortable would you feel sending your kids today? So one of my kids is going to be remote. My other kid will actually go to school. So I'm, I got both.
13:48 - 14:23
I'll say that way: I'm reasonably convinced that we will see an increase in the level of infections once the fall comes around. The data shows the kids are at least moderate carriers. They will get mixed a lot. So the infection, infection between the rates between them will certainly increase. And the experience we're seeing right now in Europe suggests that everywhere where they were able to suppress the disease using strong distancing measures, as soon as those are alleviated, you are seeing an increase in effect. So there will be an increase. The question is just how much?
14:23 - 14:47
So what I would tell school boards is, to the extent they want to open, it's got to be when they have facilities that allow them to isolate a small group of kids so they will not have an early infections if the entire school, that is, if infection happens, it happens in the small pond or small subgroup of the kids. And I will tell them to be ready to close if necessary.
14:47 - 15:07
And I will tell them to have vaccine testing available on a voluntary basis on the school premises. So if teachers or employees want to be tested every week or two, they can do that. If parents want the children to be tested, it's available right then and there, so you can catch the infection early on.
15:07 - 15:41
So that will be my immediate recommendation. The other thing we haven't discussed is how effective is the distance learning. I think to some extent with my kids. That was exactly what happened. My daughter was in school with ineffective distant learning. So they are moving into in-person. And my son was in school that actually had a pretty good program for distant learning and they 're staying with it. So that's the other side of the consideration, how far are the kids falling behind. But I will tell you right now, don't panic. If you see a spike up in cases, it's fairly recently going to happen. The question is how quickly, how sharp and can we get on top of it?
15:41 - 16:02
My personal feeling is, I'm kind of like holding my breath for November 1st and asking, like, can we just keep it low for two more months and then since we'll be here to help us. But I'm not being too optimistic we will not see anything. I think we'll see something. November 1st being because that's the vaccine trials that you're looking for the key data to come out. That's right.
16:02 - 16:37
I just want to differentiate that it has nothing to do with the election. No, no. Because that is a very common area of focus and because early November is also the election date. I think it's important to just clarify that what you're looking forward to is the data on the vaccine. And I will make one more point about this, since you mentioned the election. I hear people with the concern on the election issue. I don't believe we will get the vaccine approved that is not being properly vetted, one, and two, the data will all be public.
16:37 - 17:06
OK, so you and I can review the data for ourselves and figure if we are convinced about the efficacy and safety of those vaccines and the basis for their approval. So in the political season, especially this month, there is a lot of noise coming. But my personal take is that I'm far less concerned about unworthy therapies or vaccines making it to the market. Thank you. Thanks again, Ronny, for joining me today and thanks for listening. Appreciate it. Thank you.
17:10 - 17:40
Thank you again to both Ronny and Beata for that enlightening discussion and thank you to you, our listeners, for joining us today. If you enjoyed this episode and haven't yet subscribed to our podcast, please go to Apple podcasts or Spotify or wherever you listen to podcasts to subscribe and to rate us. Bernstein: Making money meaningful for individuals, families, and foundations for over 50 years. Visit us at Bernstein.com.
- Matthew D. Palazzolo
- Senior National Director, Investment Insights—Investment Strategy Group