National governments across the globe face the challenge of securing enough doses of a safe, effective coronavirus vaccine when one or more become available. Many wealthier nations are taking a competitive approach to this negotiation challenge, jostling with each other to tie up deals with pharmaceutical companies for the most promising vaccine candidates. A coordinated global plan promising greater fairness and efficiency has emerged—but it may be too little, too late. The situation highlights barriers to win-win negotiation when scarce resources are at stake—and suggests how you can do better in business negotiation through different negotiation strategies.
A Win-Lose Negotiation Mindset
Early in the Covid-19 crisis, drug manufacturers worldwide dove into developing vaccines that could provide immunity to the virus without harmful side effects. Governments of higher-income nations quickly began negotiating with drugmakers to ensure their citizens would be first in line to be vaccinated. The race was on, with wealthier nations trying to negotiate to win, elbowing out poorer nations.
“Vaccine nationalism” quickly ate up most of the world’s near-term vaccine manufacturing capacity, experts tell the Wall Street Journal. By September 1, the United States, the European Union, Japan, and the United Kingdom had unilaterally agreed to purchase a total of at least 3.7 billion doses of at least eight vaccines for their own use from Western vaccine developers. Knowing that only a few vaccine candidates would likely prove safe and effective, nations bought many more doses than they would need. China and India also invested in vaccines for their huge populations. Vaccine hoarding had begun.
Discover how to handle complicated, high-level business negotiations in this free report, Win-Win or Hardball? Learn Top Strategies from Sports Contract Negotiations, from Harvard Law School.
Toward Win-Win Negotiation
The World Health Organization (WHO), the public-health arm of the United Nations, came up with a plan aimed at ensuring that Covid-19 vaccine doses reach the world’s most vulnerable populations. On August 24, the WHO announced that 172 nations, comprising about 70% of the world’s population, had made preliminary commitments to participate in the Covid-19 Vaccines Global Access (COVAX) Facility, a global initiative to secure two billion doses of safe, effective vaccines for high-risk populations worldwide.
Harnessing the buying power of many economies, COVAX is investing in nine promising vaccine candidates being developed by manufacturers in countries ranging from China to the United States to Northern Ireland. Eighty higher-income economies are expected to financially support the participation of 92 lower- and middle-income economies in the program. While COVAX aims to reduce vaccine hoarding by wealthy nations, participating governments can continue to pursue bilateral deals with drug companies.
“For higher-income countries, [COVAX] represents a win-win,” says Dr. Seth Berkley, the CEO of COVAX partner Gavi, the Vaccine Alliance. “Not only will you be guaranteed access to the world’s largest portfolio of vaccines, you will also be negotiating as part of a global consortium, bringing down prices and ensuring truly global access.”
“Whatever we have, it won’t be enough to vaccinate everyone,” WHO assistant director general Mariângela Simão told the Journal. “It is in everybody’s interest to collaborate globally because we need this pandemic controlled in all countries.”
Passing on Win-Win Negotiation
A week after the COVAX Facility was announced, the Trump administration said it would not be joining the global effort. The decision was in keeping with Trump’s “America first” attitude toward trade, climate change, and other multinational agreements and with his decision to withdraw the United States from the WHO.
Politics aside, passing on access to a promising pool of vaccine candidates is a high-risk gamble that fails to show strategic leadership. If none of the vaccine candidates that the United States has invested in prove viable, the nation will be left unprotected. Even if it does secure an effective vaccine, it is unlikely to offer complete protection to the U.S. population, leaving residents vulnerable, disease experts tell the Washington Post.
Opting out of the COVAX Facility is akin to passing on an insurance policy, Kendall Hoyt, a professor at Dartmouth’s Geisel School of Medicine, told the Post. “By joining the facility at the same time that you do bilateral deals, you’re actually betting on a larger number of vaccine candidates,” Simão said at a press briefing.
To find out how you can move beyond competitive negotiating strategies to implement a win-win negotiation strategy in your organization, subscribe to Negotiation Briefings and read the rest of this story. The Program on Negotiation’s monthly newsletter will help you resolve conflicts, build agreements, and get deals done.
What advice do you have for working toward win-win negotiation?