Get the best daily market and macroeconomic commentary anywhere for less than $7 per month.
Already have an account? log in
‘The Most Severe Risk’: Goldman On Vaccine-Resistant Virus Mutations
What could go wrong?
That's the question Goldman asked in a sweeping new note that found Joseph Briggs and David Choi attempting to quantify the hit to the bank's upbeat outlook for the US and global economies in 2021 from various downside risks.
As market participants learned in 2020, the list of things that could go awry is everywhere and always longer than you think, precisely because we can't know what we don't know. That most annoying of all tautologies was on display around this time one
Remember, the key to getting the new vaccines was Chinese scientists mapping the genomes of the covid virus quickly. We may be reliant on the same guys (gals) doing the same on the mutants.
The mRNA technology that has proven itself so impressively in the PFE/BNTX and MRNA vaccines can be very rapidly adjusted to target a new variant that is different enough to require it. As long as the new variant remains a coronavirus – which it by definition will – the revised vaccine can be designed, built and ready to test in several weeks.
The primary obstacle will be regulatory, rather than scientific. If the FDA requires the full process of pre-clinical, phase 1, phase 2, and a n=30K phase 3, then it will take several months to have a new vaccine ready for mass production. If the FDA treats this like the seasonal influenza vaccine, which is routinely revised each year to target the expected combinations of influenza virus, then the new vaccine can be ready for mass production in weeks.
The next obstacle will be logistical. If we build a massive nationwide vaccination program, complete and dismantle it, then have to stand it up again, that will be more months and months lost. If we build and sustain a continual vaccination process with every American receiving a booster every 6 months, then the new vaccine can be combined with the old and fed into the supply chain. This will require an expensive ongoing program, but as we’ve seen, penny wise is pound foolish here.
Anyway, if vaccine variants are indeed our “most severe risk”, that makes me bullish indeed.