Gabriel Crouse
On February 15, Discovery Group CEO Adrian Gore wrote a letter to clients explaining “why we don’t just procure vaccines” for them. The first constraint was that “pharmaceutical companies manufacturing the vaccines will currently sell only to national governments, and not to any other entities”.
Yet developments on the ground in Brazil, Indonesia, Bangladesh, Mexico, and India — along with the circumstances surrounding the Russian Gamaleya Research Institute of Epidemiology and Microbiology vaccine, and the private confirmation of at least one major Western manufacturer — lift that constraint sufficiently for Discovery to seize its opportunity.
Since Gore said that if manufacturers were prepared to sell, “we will rapidly engage” without delay “to become directly involved in procurement and distribution”, these developments will be welcome. However, another unspoken constraint arose when the health department declared a “central procurement” vaccine strategy on February 28. This meant the SA government would enforce monopsony power to import vaccines exclusively.
However, in an affidavit sworn in early March, health department director-general Dr Sabelo Buthelezi said the February 28 briefing merely touted an idea that “does not contain any legal prohibition on private parties procuring Covid-19 vaccines”. The department’s affidavit further offers an open invitation to all relevant companies, implicitly including Discovery, to secure deals first so the government can apply “careful and close scrutiny” to test proposed trades against the national objective of saving lives.
The department is worried that, for example, healthy children of the richest parents will get vaccines that are more badly needed by poor, old and frail people. Lobby group DearSA pointed out in a responding affidavit that a company can follow scientifically based prioritisation protocols on distribution.
Moreover, DearSA observed: “Every person that is privately vaccinated is one less person that requires assistance from the government. This is particularly important for the poorest and most vulnerable who should not be forced to wait longer than necessary to get vaccinated while those who can afford to be privately vaccinated delay the process in one government-run queue.”
The government’s rate of procurement — 160,000 Johnson & Johnson vaccines in over two weeks — will only get the country to its required threshold in a decade. Ramaphosa has promised 2.8-million J&J vaccines by the end of June, too late to halt a third wave, which could kill an additional 44,000 people if a slow vaccine drive is tolerated right now, according to Discovery.
To summarise the state of play, international manufacturers are available; the government has invited companies to seek procurement; Discovery has the money and skill to buy millions of additional vaccines; time is short; and thousands of lives hang in the balance. Should Discovery go ahead and “just procure vaccines” right now?
In the interests of its clients and national health, the answer is undoubtedly yes. But what about political consequences? If Gore has even the vaguest appreciation of the political scene, he will know some members of the governing alliance known as the radical economic transformation (RET) faction, are so resentful of the free market that any life-saving vaccine privately imported beyond the government’s limited capacity will be considered an insult.
The very existence of Discovery’s membership, a rainbow smoothy of dynamic, middle-class South Africans who eschew moral hazard, work hard, gym smart and drive safe, is an affront to elite kleptocrats, kulak-hating traditionalists and political nepotists alike.
In turn, Gore would be extremely naïve to overlook the possibility that RET ideologues will later attempt punitive regulation if Discovery now gives life-saving “offence” by relieving the government’s vaccination burden. He must, therefore, at least consider bowing to a tardy “central procurement” regime to appease RET officials. But would an appeasement tactic make strategic sense?
Not if you consider the biggest mid-term threat to Discovery’s members in SA (the business is thriving internationally), which is accelerated, procrustean National Health Insurance (NHI). As Gore put it: “We just don’t have enough money as a country to fund one system that covers everything.” And that was in 2019, when the country was significantly richer.
The positive argument for saving private health from proposals such as NHI “central procurement” was put simply by Gore in 2019: “[T]he role of the private sector and medical schemes is fundamental as a safety valve.”
Covid-19 vaccination is the case in point today. Either you think of Discovery’s need to privately procure vaccines as a “safety valve” that would relieve pressure on the government, or you think of it as rich people skipping “one government-run queue”.
If Gore sits back now, according to the second line of mythical zero-sum illogic, these actions will speak louder than any lip service Discovery could pay later. In short, appeasing a few irate RET ideologues right now will all but guarantee NHI in the aftermath, and there is no greater regulatory threat than that.
Gore’s only option is to fight for life today, for his clients, for real social solidarity and human dignity by unleashing the safety valve SA needs most. Pull this off and Gore will save lives by Easter while defending the private health sector this country will need for years, having proven, once again, the fitness of buying power.
• Crouse is a writer and analyst at the Institute of Race Relations.
