The Partnership Between Pfizer and BioNTech for Developing the COVID-19 mRNA Vaccine

The Partnership Between Pfizer and BioNTech for Developing the COVID-19 mRNA Vaccine

While vaccine development typically takes over ten years, Pfizer and BioNTech developed an mRNA-based COVID-19 vaccine within an unprecedented 11 months, from selecting vaccine candidates in mid-January 2020 to completing Phase 3 clinical trials in November 2020. Notably, despite starting their clinical trials two months later than Moderna, Pfizer-BioNTech received emergency use authorization one week earlier. By the end of 2021, Pfizer-BioNTech's vaccine accounted for about 30% of the global COVID-19 vaccine doses, significantly ahead of competitors like AstraZeneca (24%), Sinovac (19%), and Moderna (10%), showcasing their market dominance and leadership.

Pfizer-BioNTech's Strategy

Pfizer leveraged its existing capabilities to obtain government emergency use approval, preemptively established manufacturing facilities and distribution networks, and entered the market rapidly. Additionally, Pfizer partnered with BioNTech, a startup with advanced mRNA vaccine platform technology, to compensate for its relative lack of expertise in this new technology compared to Moderna.

Early Standard Establishment

Through swift government approval, rapid market entry, and extensive distribution, Pfizer-BioNTech's vaccine began to be recognized as a standard in the market. Reflecting on the early stages of COVID-19 vaccination in South Korea, where Moderna was preferred and Pfizer was a secondary option while vaccines like Janssen and AstraZeneca were less favored, it is clear that Pfizer's strong brand name and extensive distribution enabled it to quickly secure a significant market share. Early standard establishment can make a brand synonymous with a product category but also carries the risk of being overtaken by later entrants with superior technology. In the urgent context of the COVID-19 pandemic, the benefits of early standard establishment outweighed the risks, allowing Pfizer-BioNTech to maintain a market share of about 25-30% into 2022.

Strategic Partnership

While other major competitors faced supply issues and safety concerns, Pfizer-BioNTech demonstrated stable production and supply capabilities. Their success in developing and distributing the vaccine was due to their complementary partnership. BioNTech, a German biotech company, provided the mRNA vaccine technology platform and candidate vaccines, while Pfizer brought extensive experience in clinical trials, global regulatory compliance, and a robust manufacturing and distribution infrastructure. Their collaboration created significant synergy. The two companies had established a working relationship through influenza vaccine development cooperation since 2018, fostering a network of trust and the ability to share confidential information. BioNTech's CEO, Ugur Sahin, upon realizing the potential pandemic from a news article in January 2020, initiated discussions with Pfizer about developing a COVID-19 vaccine. Although the initial talks failed, by March, circumstances had changed, and they agreed to collaborate. Once the vaccine was successfully developed and approved, they agreed to split the vaccine sales profits 50:50 and share development, manufacturing, and marketing costs equally, demonstrating a fair and trusted partnership. Despite the complexities and risks of partnering, including increased project complexity and potential loss of trade secrets, the mutual dependence and prior collaboration experience enabled Pfizer and BioNTech to build a successful partnership.

Market Impact and Future Prospects

Through their partnership, Pfizer and BioNTech generated substantial revenues from the COVID-19 vaccine. The mRNA vaccine platform technology has since become a major vaccine technology. BioNTech, once a small company, is now transitioning into an oncology-focused company. However, the advanced technology market requires constant vigilance to changing conditions. Post-pandemic, BioNTech faced lower-than-expected demand for its COVID-19 vaccine, leading to a write-off of approximately €900 million in 2023. Pfizer also significantly reduced its 2023 revenue forecast due to lower-than-expected demand for its COVID-19 vaccine, Comirnaty, and the COVID-19 oral antiviral Paxlovid. The success of Pfizer and BioNTech's mRNA vaccine was driven by the urgent pandemic context, supportive government approvals, and their rapid partnership. However, the pharmaceutical industry involves high-risk, high-reward investments with uncertain clinical outcomes.

As the world looks forward, it is time for other companies to consider strategies for leveraging similar partnerships to achieve significant advancements in the biotech and pharmaceutical industries.

Sources:

1. "The secret of Pfizer-BioNTech vaccine's rapid and bold decisions," December 30, 2021, https://www.mk.co.kr/news/business/10156416
2. "The secret of Pfizer-BioNTech vaccine's rapid and bold decisions," December 30, 2021, https://www.mk.co.kr/news/business/10156416
3. "COVID-19 vaccine makers face challenges due to declining demand," October 18, 2023, Medipharmstoday, https://www.pharmstoday.com/news/articleView.html?idxno=325968