The overall climate of the world has been changing with each passing day, especially in the past few decades. Regular updates of climate change such as the glacier melting, have been doing rounds for quite some time now.
It is no secret that the temperatures are soaring to newer heights and the outcome is likely to give rise to the spread of several vector-borne diseases, resulting in an increased demand for vaccinations. That means the pharmaceutical companies will need to respond to the aggravated demand for vaccines.
Let’s unravel more on how leading pharma companies are actually going to make a profit from climate change.
What do some notable health organizations say?
The World Health Organization (WHO) reported that the changes in the climate will have an “overwhelmingly negative” outcome on human health across the globe. As such, it has been already observed that the future effects of climate change are taking over almost all individuals in the world. The increasing temperatures will increase the risk of diseases and subsequently the need for more vaccinations and medicines resulting in more opportunities for the pharma companies to make and sell medicines.
For instance, as novel epidemics like the recent Coronavirus outbreak, pharma bigwigs are getting proactive in catering to the rising needs, in order to solve subsequent health crises.
Another similar report presented by Morgan Stanley states that the pharma industry is all set to reap sweeter fruits as the planet gets warmer in the coming future. In other words, epidemics and contagious outbreaks will get more prevalent, translating into significant gains for the medicine market.
How does climate change affect the spreading of diseases?
According to the CDP (formerly Carbon Disclosure Project), warmer temperatures will help lengthening the transmission period and geographical range of vector-borne diseases. In other words, tropical health complications will have more reasons and locations to survive.
The report further identifies mosquitoes Aedes Aegypti and Aedes Albopictus as carriers of fatal diseases such as yellow fever, Zika, dengue, and chikungunya. Due to their potentially larger impact than the others, the two organisms are being heavily researched upon.
Researchers predict that by 2050, around 385 to 725 million more people than today are expected to be diagnosed with infectious diseases such as Zika and chikungunya. By the time we reach 2080, the numbers would have increased more than one million.
What does this mean for the pharma industry?
The CDP further states that almost 70% of biotech, healthcare, and pharma companies already have climate change as their core of business strategies. That itself suggests that pharma businesses are expecting to rework their business plans at par with increasing temperatures and make a profit from climate change.
Let’s understand in a deeper sense of how an infectious outbreak can cause pharma companies to grow.
The selling of medications such as relevant vaccines is a crucial aspect afforded to pharma companies as a result of climate change. So much so that the researchers estimated $50 – 125 billion of incremental vaccines will be required to cater for an additional population that has been exposed to epidemic diseases.
On the other hand, the numbers could rise up to an approximate $200 billion with branded pricing of more complicated vaccines that are opted by developed countries.
The current pharma industry, which today stands at a market value of $500 billion, is set to gain new and prosperous ventures through a significantly higher sale of vaccines and other medications.
Which pharma companies are likely to gain?
The Morgan Stanley report identifies seven pharma bigwigs: GlaxoSmithKline, Sanofi, Moderna, Takeda Pharmaceutical, Merck, Janssen Pharmaceutical, and Pfizer to be more likely to profit from climate change.
Of these, Sanofi and GlaxoSmithKline are the two companies that are expected to benefit from climate change to a greater extent. As per the CDP report, both these companies have enough stocks of specialized drugs to combat tropical diseases. The development of drugs for malaria, dengue, and Zika is in process.
What can be inferred?
As we’ve known all this while, the rising temperatures are the only reason for the spread of tropical diseases – affecting millions of people worldwide. As a result, pharma companies will need to prepare themselves for supplies in larger markets. While climate change may be a big opportunity for the world’s biggest pharmaceuticals, the industry itself will also need to become less damaging in terms of their carbon footprint, as well have more accommodative pricing for its products as higher number of people in the world who may be exposed to the risk of diseases may need affordable healthcare. Climate change is probably the biggest challenge the world will continue to face, and the industry will need to do everything possible to reduce its overwhelmingly negative outcomes through the best possible efforts.