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  • Robert MacCulloch

Wellington media management on serious health-care issues reaches new heights

Minister of Health Hipkins has just told The AM Show the vaccine rollout has "gone as fast as it can given the availability of vaccines in NZ ... if we could have got more vaccines into the country faster, then yes of course we could have gone faster. But ultimately supply has been the thing that's constrained that".


Newshub reports that NZ initially ordered four different vaccines, but only in January opted to switch to a Pfizer-only strategy after seeing its success overseas and the safety problems plaguing the AstraZeneca and J&J jabs. "When we ordered the extra doses of that vaccine, Pfizer were very clear to us: 'You can have the extra doses, but you won't be able to get them until the second half of the year,'" said Hipkins.


Thing is, none of what he says makes any economic sense whatsoever. Here's why using a back-of-the-envelope cost-benefit analysis (CBA). The cost of the vaccine is tiny compared to the cost of closing down our nation due to an outbreak. The Pfizer vaccine costs around $US 20. So to vaccinate NZ would cost $US 200 million (for two doses). Whereas the cost of the wage subsidy scheme alone last year was between $10,000 million and $15,000 million.


As a result, the Ministry of Health should have ordered 5 million vaccine courses from Pfizer as early as possible, as well as this same number from each of the other suppliers, even if the government ended up binning some of its choices. The decision to "make Pfizer our primary vaccine provider", as stated by the Ministry, shouldn't have been made in January 2021 on the ex-post medical grounds they describe. Ex-ante, 5 million courses of all available vaccines should have been ordered - the cost being so small relative to potential benefits that even if those benefits didn't materialize in the case of some purchases - it didn't matter.


Instead the Ministry of Health under-ordered last year since they didn't do the simplest, most basic, one-liner of a CBA. Blaming our bottom-of-the-OECD vaccination rate on Pfizer is an outrage. It was a late order. By the way, the British Medical Journal reports, "Israel, which is on course to vaccinate all its citizens before any other nation [in January 2021] acknowledged paying $US 23.50 per dose to Pfizer to obtain early shipments. Even at this high price, vaccinating the entire population of Israel costs the economy only as much as two days of lockdown". Shame our Wellington bureaucrats couldn't do the math.


See:

https://www.newshub.co.nz/home/politics/2021/06/coronavirus-vaccine-rollout-going-as-fast-as-it-can-covid-19-response-minister-chris-hipkins.html