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‘Great Expectations for vaccines threaten more Hard Times’

The Vaccine Swindle – Part 2:

Part 1 -

There is a widespread and dangerous assumption that a return to normality will only be possible with - and will immediately follow - the approval of a SARS-2/COVID vaccine. Economic destruction from needless lockdowns was a direct consequence of the initial misdiagnosis of COVID as a second “Spanish Flu”. Now in the absence of a credible escape route from their COVID infection suppression policy, the same blundering governments - led by the wrong scientific advisors - look to a vaccine as an alluring overnight solution. This is at best naïve, probably preposterous, and in the hands of policy makers - deep in a lockdown hole of their own making - invites further disaster. In short, these great expectations for vaccines threaten more hard times ahead.

COVID has always been uniquely unsuited to a vaccine solution: it is relatively harmless for most of the population (hence the dubious necessity for mass vaccination) but poses a statistically significant mortality risk for a small cohort of the population with impaired immune systems, evidenced not only be the median age of death (82 years) but more significantly, the presence of comorbidities (90%+ cases)1. Vaccines are designed to elicit a specific antibody response from the immune system: it is widely recognised that their efficacy is significantly diminished in the old and sick2. A COVID vaccine has therefore always been most likely to boost the immunity of the population who were only ever at risk of an asymptomatic infection, with the additional risk for previously healthy adults and children of unknown potentially severe vaccine side-effects, particularly antibody dependent enhancement (ADE)3. Although I do not consider myself an “anti-vaxxer”, I will be content to be at the back of the queue for any SARS-2/COVID vaccine.

Vaccines have been successful in eradicating Smallpox and Polio (ex-Africa). They may go on to eliminate other diseases such as Measles, Mumps and Rubella4. But the process of eradication is slow, spanning decades, even with a trusted, generally efficacious vaccine. None of the SARS-2/COVID vaccines currently under development even have total resistance to infection as a primary end point, nor is any vaccine 100% effective. The recent moronic calls for “Zero COVID” illustrate that what constitutes a successful vaccine is currently woefully ill-defined and seemingly wholly misunderstood by leading politicians and the public at large. Success, according to Sarah Gilbert, who leads the Oxford University/Astra vaccine, would be “a vaccine with a high level of efficacy against diseases, which also has a significant impact on virus transmission. It doesn’t need to cure you…We want to stop people from going to hospital and dying. If you can do that, I think people will be pretty happy”5. In other words, success, if achieved, is mitigation, not eradication.

We have not yet heard reports of tribes in the Amazon developing promising SARS-2 antigens but the race for a COVID vaccine is already a crowded competitor landscape. There are currently an astonishing 321 SARS-2/COVID vaccines in development (see Fig. 1) of which only 6 are currently in advanced Phase 3 trials, which unusually - overlooking safety and capital discipline - are being allowed to run in parallel to existing earlier stages, irrespective of affirmation, to accelerate development. Governments have also pre-committed - with payment understood to be contingent - to purchase over 2 billon doses of leading, but still unproven, vaccine candidates, to ensure stockpiled supplies ready to distribute immediately on regulatory approval. This initial politically motivated “whack-a-mole” scramble to cover all vaccine bases means that even before a vaccine has been approved, now is as good as it gets for the vaccine companies: inventory has already been built and pricing is already significantly diminished from the $35 per dose Moderna executives boasted they could charge in August6. Industry dynamics do not suggest a competitive landscape where a single company (certainly not a handful) will sustain any competitive advantage allowing them to generate supernormal profits.

Fig 1. COVID vaccines currently in development7

COVID vaccines currently in development

The coordination of vaccine development is being led by the US government’s Operation Warp Speed (OWS) which has provided nearly $10bn of pre-funding, supporting up to eight vaccine candidates on four different technological platforms:

1. mRNA - Moderna and BioNTech/Pfizer (both already in Phase 3)

2. Viral Vector (including replicating and non-replicating) – Oxford/Astra (P3) and Janssen (J&J) (P1/2)

3. Protein based (including recombinant protein, virus-like particle, peptide-based) – Novavax (P2) and Sanofi/GSK (P1/2)

4. Inactivated Virus – TBA8

The three other vaccines in Phase 3 (not supported by OWS) are Chinese (2 – Sinopharm and Sinovac)9 (Inactivated virus) and Russian (1 - Gamaleya) (Viral vector) 10.

There has been growing speculation of a push to approve a vaccine before the Presidential Election (November 3rd) in view of Federal health officials (CDC) notifying states to be ready by November 1st11 to distribute vaccines and the scheduled Food and Drug Administration (FDA) meeting, specifically to discuss COVID vaccines, on October 22nd12. Only the OWS sponsored vaccines already in Phase 3 Trials (Moderna, BioNTech/Pfizer, and Astra/Oxford) could possibly be considered for approval on October 22nd, but any pre-Presidential Election approval, as we will discuss, remains extremely doubtful.

COVID vaccines in development are all highly experimental: the technology platform for the three leading candidates, mRNA or Viral vector, has never had a single vaccine approved. We currently only have data from preclinical trials in mice and monkeys and small-scale Phase 1 human trials where the data is not statistically significant owing to tiny population samples. Nevertheless, the Phase 1 data has demonstrated that vaccine developers can (generally after 2 doses) generate an antibody response in healthy adult volunteers equivalent or superior to that found in recovering COVID patients with mostly tolerable side-effects that can be mitigated by painkillers such as paracetamol.13

As cynical observers of drug trial design will testify, however ,it is always more interesting to note what the trial data has not demonstrated: in this case, the duration of the antibody response (which separates a vaccine from a therapeutic treatment) is unknown and likely to significantly diminish, meaning that a vaccine may only work for a few weeks14; we do not know what level of antibody response would be adequate or crucially whether the antibodies generated confer any protection from either SARS-2 infection or COVID symptoms; and we do not know the degree to which the side-effect profile will become less benign as Phase 3 trials are carried out with 30,000 volunteers in wider age cohorts, rather than just sub-100 population groups of healthy 18-65 year olds. In view of the suspicion of serial false positives from COVID testing15 - which could render accurate positive tests statistically meaningless - it is also important that both the control arm and the vaccinated arms apply a consistent and accurate positive case verification process, including at least one recognised symptom.

The trial data on antibody responses amongst over-65s has to date been scarce. Moderna has claimed that their (Phase 1) antibody response increased in the higher age cohort, though this was so illogical and based on such a low population sample that it was met with incredulity16. BioNtech (Phase 1) data saw, as expected, a statistically significant fall off in antibody response its older population group17. Phase 3 data should be more enlightening, though we might be cynical that any over 65 population cohort in trial data will be stuffed with 66-year-old fitness fanatics, rather than the population actually at risk from COVID mortality (although it would be considered unethical to accept any volunteers into trials actually suffering from significant comorbidities).

Phase 3 trials are still recruiting volunteers and expecting massive population samples of up to 30,000 volunteers. The best test for any vaccine candidate would be a “human challenge trial” whereby the vaccinated group is subsequently injected with the SARS-2 virus but it is not yet clear whether these will be sanctioned on ethical grounds18. Instead, the studies will compare vaccinated groups with a control arm (either a placebo or another vaccine). There are a number of important factors which are likely to inhibit a quick result: the trials rely on large numbers for statistical significance so need enough volunteers in the right population groups to sign up quickly; the duration of the antibody response needs to be long enough to prove vaccine efficacy; and crucially, enough of the control group has to become naturally infected by COVID to have a proper comparison with the vaccinated groups. If, as seems likely, this does not occur before October 22nd, then the FDA is unlikely to have enough serious data to consider.

Stock-market investors will also be focused on the October FDA meeting. The alluring narrative of a COVID cure has drawn-in investor money like a moth to a flame. The five largest (US traded) COVID pure-plays (we ignore diversified blue-chips involved in such as J&J, Astra, Sanofi, Glaxo and Pfizer who for whom their exposure is relatively unimportant) currently have an aggregate market value of $53bn (see Fig. 2). None of these companies has ever previously successfully commercialised either a vaccine or drug and they currently have only $500m of revenues between them (just 1% of the equity value). Although scepticism is clearly increasing (the group is now down 40% from their summer peak) we believe that the valuation of these stocks is in aggregate still detached from reality, and a reflection of a speculative bubble. If their vaccine candidates are approved then clearly there is scope for significant revenue appreciation not currently captured by 2020 revenue estimates but at average valuation multiples of 100x sales (compared to a typical diversified Pharma stock sales multiple of just 5x) this is already more than anticipated. Consider that the current global revenue market for flu vaccines is just $4bn and the COVID vaccine landscape promises to be significantly more competitive with greater uncertainty over duration of demand.



Profits from SARS-2/COVID vaccines are either going to be illusory if no vaccines are ever approved or a diminishing zero-sum situation whereby collective success from intense competition sees diminished volumes and reduced pricing power. It is likely that populations are already well advanced on achieving herd immunity with or without a vaccine19 so unless the virus mutates into something more deadly, demand will fall away dramatically. Although it is possible that one company might get lucky and receive regulatory approval before others, the short-term excitement in this stock is likely to be offset by disappointment in others20. If they are all successful there will be no pricing power. Between them these five pure-pay vaccine companies have raised $4bn of equity this year but management insiders have sold over $300m of stock: it is always worth remembering that the world of biotech is full of multi-millionaire management spivs whose companies have never made a profit nor ever brought a single drug to market.

No vaccine will immediately eliminate COVID. The general perception of vaccine success is therefore at odds with the realistic aims of the vaccine developers. It is worth bearing in mind that there is still no vaccine for the common cold and that although flu vaccines mitigate flu symptoms by around 50% (only when they are well matched with the particular seasonal strain)21 they do not work well in those with already impaired immune systems. As such, despite a vaccine , every year the WHO estimates that there are 290k-650k deaths from seasonal flu22(compared with 900k23 thought to have died this year from COVID). It would be unwise to have any higher expectations for a COVID vaccine. The likelihood is that eventually most vaccines will demonstrate some efficacy in healthy adults but none will be able to prevent transmission or help the specific population, with already impaired immune systems, at risk from COVID.

It would therefore appear a highly dubious choice for policy makers to avoid near-term risk of infection through the continuation of a suppression policy in the deluded hope that a vaccine solution will remove all public health risk and allow normal behaviour to recommence. Whilst the fanfare of publicity has focused on the race to develop a SARS-2/COVID vaccine, better treatment of hospitalised patients largely through cheap therapeutic drugs24 and smarter management of nosocomial infection risk has already drastically reduced the mortality risk from COVID to the extent that we are possibly already at the point where people might die with but not from COVID. Consider after 40 years of research and fanfare there is still no vaccine for HIV: the solution to those infected with HIV to continue a normal life was better therapeutic drugs. Instead of thinking in terms of binary positive outcomes like Smallpox or Polio it would be more realistic to think of a COVID vaccine as a mitigation tool as with flu or alternatively perhaps we will discover as with HIV that a vaccine solution was never the most likely or effective solution.

Barry Norris
Argonaut Capital
September 2020



3 ADE is caused by the vaccine antibodies reacting with pre-existing natural antibodies causing a severe adverse reaction










Chinese data still to be released

14 As the CEO of world leading testing company Roche Diagnostics recently commented: “What appears to happen is that people do lose antibodies over time. And that of course poses the question, will vaccines actually work if you lose antibodies” Thomas Schinecker, CEO, Roche Diagnostics. Roche Q2 Conf Call, 23 July 2020






20 Those who believe that SARS-2 originated in a Wuhan Lab might also think that the Chinese vaccine producers might have a competitive advantage