Russia, facing lags, turns to Chinese firms to produce Sputnik shots

Sputnik V. Photo: Reuters

Russia is turning to multiple Chinese firms to manufacture the Sputnik V coronavirus vaccine in an effort to speed up production as demand soars for its shot.

Russia has announced three deals totaling 260 million doses with Chinese vaccine companies in recent weeks.

It's a decision that could mean quicker access to a shot for countries in Latin America, the Middle East, and Africa that have ordered Russia's vaccine, as the US and the European Union focus mainly on domestic vaccination needs.

Earlier criticism about Russia's vaccine have been largely quieted by data published in the British medical journal The Lancet that said large-scale testing showed it to be safe, with an efficacy rate of 91 per cent.

Yet, experts have questioned whether Russia can fulfill its pledge to countries across the world. While pledging hundreds of millions of doses, it has only delivered a fraction.

Kremlin spokesman Dmitry Peskov has said demand for Sputnik V significantly exceeds Russia's domestic production capacity.

To boost production, the Russian Direct Investment Fund, which bankrolled Sputnik V, has signed agreements with multiple drug makers in other countries, such as India, South Korea, Brazil, Serbia, Turkey, Italy and others. There are few indications, however, that manufacturers abroad, except for those in Belarus and Kazakhstan, have made any large amounts of the vaccine so far.

Airfinity, a London-based science analytics company, estimates Russia agreed to supply some 630 million doses of Sputnik V to over 100 countries, with only 11.5 million doses exported so far.

RDIF declined to disclose how many doses are going to other countries. Through April 27, less than 27 million two-dose sets of Sputnik V have been reportedly produced in Russia.

The Russian Direct Investment Fund, which has been in charge of international cooperation for Sputnik V, said in April it would produce 100 million doses in collaboration with Hualan Biological Bacterin Inc., in addition to an earlier deal announced in March for 60 million doses with Shenzhen Yuanxin Gene tech Co.

The two deals are in addition to a deal announced last November with Tibet Rhodiola Pharmaceutical Holding Co, which had paid USD 9 million to manufacture and sell the Sputnik V vaccine in China.

RDIF said in April the terms of the deal were for 100 million doses with a subsidiary company belonging to Tibet Rhodiola.

Russia is very ambitious and unlikely to meet their full targets, said Rasmus Bech Hansen, founder and CEO of Airfinity. Working with China to produce Sputnik V could be a win-win situation for both Russia and China, he added.

In recent years, Chinese vaccine companies have turned from largely making products for use domestically to supplying the global market, with individual firms gaining WHO preapproval for specific vaccines seen as a seal of quality.

With the pandemic, Chinese vaccine companies have exported hundreds of millions of doses abroad.

Chinese vaccine makers have been quick to expand capacity and say they can meet China's domestic need by the end of the year.

This is an acknowledgment of the Chinese vaccine manufacturers who can produce at volume, said Helen Chen, head of pharmaceuticals LEK Consulting, strategy consultancy firm in Shanghai, in an email.

However, none of the three Chinese companies have yet to start manufacturing Sputnik V.

Tibet Rhodiola started constructing a factory in Shanghai at the end of last year and expects production to start in September, the company said at an annual meeting for investors last month.

Tibet Rhodiola's chairman Chen Dalin also said that after the successful technology transfer, they will start with an order of 80 million doses to sell back to Russia.

An employee at the company declined to transfer a phone call request to the company's media department for comment.

The timeline for the newest deals are also unclear. Hualan Bio was among the 10 largest vaccines manufacturers in China in 2019. Phone calls to Hualan Bio went unanswered.

A spokeswoman for Shenzhen Yuanxing declined to say when the company will start production but said their order would not be for sale within China. RDIF had said the production will start this month.

In spite of the delays, Russia's vaccine diplomacy has made gains.

From the outset, Russia, the first country to approve a coronavirus vaccine, aimed to distribute it globally. Within weeks of giving Sputnik V regulatory approval, RDIF started actively marketing it abroad, announcing multiple deals to supply the shot to other countries.

It is so far winning the public relations battle, analysts said in a new report examining Russia and China's vaccine diplomacy from the Economist Intelligence Unit.

Russia has been able to build stronger diplomatic ties and in areas where it hasn't been able to, before, said Imogen Page-Jarrett, an analyst at EIU.

They have this window of opportunity while the US, EU and India are focusing on domestic and the rest of the world is crying out for a vaccine supply.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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