US, WASHINGTON (ORDO NEWS) — In mid-January, the 45-year-old head of the $ 10 billion Russian Direct Investment Fund (RDIF) received a call from a close friend in China. It was businessman Wang Jian.
The chairman and co-founder of BGI Group, one of the world’s leaders in human genome sequencing, was based in Wuhan trying to use genetic information from SARS-CoV-2 virus samples to develop the first diagnostic tests for infection… which will soon be called Covid-19. Jiang warned Dmitriev that the situation in Wuhan was serious and could escalate into a global crisis. “To be honest, after this conversation I became one of the biggest paranoiacs about Covid-19 in the highest Russian circles,” Dmitriev says.
As a person with great connections in Russian politics, Dmitriev has considerable weight. The Harvard-educated former investment banker is married to a friend of President Vladimir Putin’s daughter, and was appointed head of RDIF in 2011 with the aim of reducing the dependence of the Russian economy on oil.
After speaking with Jiang, Dmitriev focused the fund’s investment strategy on tests, treatments, and especially Covid-19 vaccines. After analyzing more than 20 potential vaccines from Russia and from abroad, he decided to support the strategy of virologists from the Moscow Gamaleya Research Institute.
In the 1950s, scientists at this research institute began to study the interaction of bacteria and viruses with the human body as part of a program to repel possible attacks using biological weapons. The program was closed after the end of the Cold War, but the institute continues to use the knowledge about viruses accumulated during the Soviet era to develop vaccines. In particular, scientists at the Gamaleya Institute have created a vaccine platform using human adenoviruses (common viruses that most of us have) as vectors to deliver genes for the new SARS-CoV-2 virus into the body. They stimulate the body to make antibodies against viral proteins.
Other pharmaceutical companies such as Johnson & Johnson and CanSino are also developing Covid-19 vaccines using human adenoviruses. But scientists at the Gamaleya Institute are using two adenoviruses instead of one (rAd26 and rAd5), arguing that this provides a stronger immune response.
For the past 39 years, the institute has been using this platform in the development of various vaccines. The latest are the vaccines for Ebola and the Middle East respiratory syndrome MERS. To convert an existing MERS vaccine into a Covid-19 vaccine, it was necessary to replace the gene encoding the spike protein of the Middle East respiratory syndrome with the gene for SARS-Co-V-2. “We cannot say that from the very beginning we came up with some mind-blowing vaccine,” says Dmitriev. “The scientists at the Gamaleya Institute already had a product from MERS that had been tested and validated and had been working on for six years. And this human adenovirus platform has been studied for decades and has been shown to be safe in 250 trials.”
The vaccine was named “Sputnik V” after the Soviet space program. Clinical trials of the Covid-19 vaccine began in the spring. Last month, the Gamaleya Institute, like Pfizer / BioNTech, Moderna and AstraZeneca, announced the successful results of an ongoing third phase of testing. In a press release on November 24 (eight days after the Moderna press release), an interim analysis of 18,794 participants showed an efficiency of 91.4%. According to RDIF, there are now 1.2 billion confirmed orders for Sputnik V from 50 countries around the world.
However, Sputnik V has also caused serious controversy and doubt. In August, Russian regulators licensed the vaccine, allowing it to be produced in limited quantities. But they did this before the publication of the safety data of the first and second stages. This data appeared only on September 4, and Putin made a statement on August 11, announcing Sputnik V as the world’s first approved vaccine against Covid-19 and saying that it is available to the country’s population. By November, 100,000 Russians from high-risk groups who could become seriously ill with Covid-19 had been vaccinated with this vaccine. There were no official reports of any serious side effects in these volunteers, but it was a shameless act. No regulator approved the Covid-19 vaccine before the publication of Phase 3 data on its effectiveness.
Dmitriev insists that Russia was able to approve Sputnik V so quickly because it was confident in the safety of the adenovirus platform. However, many scientists considered this decision irresponsible. Pharmaceutical and biotechnology researcher Ayfer Ali, who works at the University of Warwick’s business school, said Russia “is essentially conducting a massive experiment on its own population.” Others believe that this is a manifestation of nationalism.
“By coming in first and claiming to be faster than everyone else, Russia is actually making a political statement through science and development,” said Mathieu Boulègue, who studies Russian domestic and foreign policy at Chatham House. “She says,” We won this race, we won the USA, we won the world’s best minds.”
Buleg points out how aggressively RDIF advertised Sputnik V. So far, it is the only Covid-19 vaccine to have its own website and Twitter account. There you can read criticisms of the media that report “fake news” and see the constantly emerging comparisons of the Russian vaccine and competitor vaccines in terms of efficiency and price.
Dmitriev has been criticized this year for repeatedly calling AstraZeneca’s “monkey vaccine”, which uses a similar platform, but with chimpanzee adenovirus. But he is not ashamed of his pretentiousness and accuses other pharmaceutical companies of attacking Sputnik V. “The Russian vaccine is often attacked,” he says. – Russia is a new player in the pharmaceutical industry, and we have a good product. However, we have to overcome negative perceptions of Russia, frankly fueled by the spirit of rivalry among other pharmaceutical players.”
But according to some scientists, Russian PR raises concerns, forcing them to think whether the vaccine is really as effective as the press releases claim. “I am concerned about the sheer lack of transparency in the data,” says Sheena Cruickshank, an immunologist at the University of Manchester. – As far as I know, they did not disclose intermediate data on the third stage, limiting themselves to what we saw in the newspapers. It is difficult to say how effective it is without looking at the large amount of data, especially for those patients who took placebo and got Covid, compared to vaccinated groups.”
Others believe Sputnik V’s hasty approval has distracted attention from what is the real science of vaccines. “The hasty approval did not help her image,” says microbiologist Brendan Wren of the London School of Hygiene and Tropical Medicine. – But I don’t understand many negative comments about Sputnik V. This vaccine is very similar to the AstraZeneca vaccine in that it uses adenovirus as the carrier of the spike protein. Therefore, it is not surprising that it turned out to be effective.”
However, Western skepticism does not matter when it comes to assessing the commercial success of Sputnik. RDIF announced its readiness to partner with other pharmaceutical companies, such as AstraZeneca. In these collaborative schemes, patients will receive different vaccines with the first and second vaccinations. However, the Russian vaccine program has never seen the West as the main market.
As the price of Sputnik V (£ 15 for two doses) shows, the vaccine is cheaper than Pfizer and Modern, but more expensive than the AstraZeneca vaccine, which costs £ 3 a dose and is not made for profit. And the scheme of its use shows that this vaccine is intended mainly for low-income countries. Vaccines from Pfizer and Moderna companies must be stored at very low temperatures, while Sputnik V is produced in dry form and stored at a stable temperature of +2 to +8 degrees Celsius. This makes them easier to transport in the developing world. The third stage of clinical trials of Sputnik V is currently taking place in Belarus, Brazil, Venezuela and other countries, and a queue of orders has already appeared.
According to the Statista website, Brazil has ordered 50 million doses of Sputnik V, Uzbekistan 35 million and Mexico 32 million. Other countries, such as Turkey, are still thinking whether they should use the Russian vaccine or not.
Bouleg believes this is no accident. “Russia has learned over the years that there are no small victories when it comes to earning political points,” he says. “In this case, they send a signal to these countries that Russia has come to their aid, because it will supply a cheap and effective vaccine. This makes sense, as a low-income country will certainly want to buy a cheap product, but in large quantities. Therefore, Moscow will supply them with all this vaccine with big Russian flags on it, as if to say: “We are your friends.”
This is fully consistent with Russian foreign policy of the past 10 years. Around the time Dmitriev was appointed head of RDIF, Russia began the process of diversifying its economic activities, moving away from the traditional and reliable areas of export supplies, which include weapons and oil. Such a change in strategy was proposed by the Russian state-owned tech corporation Rostec, headed by former KGB officer Sergei Chemezov, who worked with Putin in East Germany in the 1980s. Following the imposition of Western sanctions in 2014 for the annexation of Crimea, Rostec began to focus more on developing vital products such as medical devices and pharmaceuticals. This provided two tasks: reduce Russia’s dependence on imports and create a new production niche for the Russian army, which is the country’s largest employer for the civilian population. “This is the Chinese logic that the military production chain can make tanks and ping-pong tables in equal measure,” says Buleg. “Russia looked at this model and said that it is by no means stupid.”
The export of cheap but effective pharmaceutical products is also a new way for Russia to penetrate those regions of the world where local pharmaceuticals are weak, but there is a rapidly developing consumer market. First of all, these are the countries of Latin America and Africa.
Over the past five years, the Russian business elite has been paying more and more attention to trade deals with Africa. In October 2019, 43 African leaders were invited to come to Sochi for the first ever Russia-Africa Summit. This was long before Covid-19, and then Russia planned to double the volume of its foreign trade with African states in three to four years, bringing it to $ 40 billion.
Now the vaccine race and Sputnik V have given Russia an excellent opportunity to form and develop new ties with Africa. As the United States and the European Union buy hundreds of millions of doses of vaccine, and the World Health Organization’s Covax initiative is able to provide only 20 percent of the African population, the continent has a serious shortage of means to combat Covid-19. Dmitriev says that Russia is simply trying to defeat the global health crisis and help the global economy return to normal, but is by no means building a future in trade. However, Russian commentators believe that this is one of the strategic goals of RDIF and the Kremlin.
“Russia has a great opportunity to present itself to these countries as a great scientific power,” says Alexander Gabuev, a researcher at the Carnegie Moscow Center. “If the Russian vaccine is effective, it will open the way for new commercial deals and contracts.”
But Russia will not be able to do everything its own way. China has similar plans targeting low-income countries in Asia, Africa and Latin America, and wants to supply its own vaccine there with government support. Thus, Russia has found itself in a somewhat uncomfortable position, since 1.2 billion doses of Sputnik V vaccine will be produced at Chinese enterprises, which it has pledged to supply. Because of this, Moscow also turned to India for its powerful and well-established vaccine base.
In October, RDIF signed agreements with Indian pharmaceutical companies Dr Reddy’s and Hetero to produce and distribute 200 million doses of Sputnik V. This reflects the growing political ties between the two countries amid rising tensions with China. “For Russia, this is a difficult situation because it needs China’s assistance in manufacturing, but there is more competition than cooperation, as China intends to sell Covid-19 vaccines to the same countries,” Buleg says. “But it also cannot completely switch to India, because China is a valuable partner for it, to whom it supplies energy resources. This is a very delicate political situation for the Kremlin.”
But the need for a vaccine in the developing world is so great that Buleg predicts that China and Russia will eventually be able to deliver many millions of doses of vaccines to low-income countries around the world.
“There will be a lot of politics here. In this case, there is no such thing as free business competition, because top government officials are engaged in this, he says. – Since Russia is closely cooperating with the Central African Republic, it is likely that it will send Sputnik V there first, and Chinese supplies to this country will be limited. They will probably share the production in a country like Indonesia, where there is market share for both countries. And China will do better in other African countries, which it generously showered with contracts and money.”
Such vaccine diplomacy will for many years and will very significantly shape the balance of power between Russia, China and Africa. As Russia and China seize footholds in Africa, Bouleg points out, they can gradually build up their influence to export more goods there and secure better deals. “With this relationship, they can extort whatever they want,” he says.
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