The Coalition for Epidemic Preparedness Innovations (CEPI) and Gavi, the Vaccine Alliance -- two arms of the World Health Organization (WHO) set up to develop vaccines against emerging infectious diseases -- haven't garnered a lot of attention in the U.S. during the coronavirus pandemic. In March, as the U.S. was shutting down, CEPI put out a call for $2 billion in the hopes of creating eight vaccine candidates, shepherding three through clinical trials and approval. In May, CEPI invited organizations to submit proposals for funding their vaccine candidates. By the end of August, there were nine candidates in the program, and another nine under evaluation. The goal of the program is to bring equitable access to successful vaccines in order to end the global pandemic. There are currently 172 countries signed on -- 80 "self-funding" countries and 92 low and middle-income countries.

Among the vaccines currently in the program are candidates from public companies Inovio (INO -1.11%), Moderna (MRNA -0.72%), CureVac (CVAC 2.17%), AstraZeneca (AZN 0.38%), and Novavax (NVAX -2.68%). The program could have real implications for investors. Terms of the agreements may determine which vaccines ultimately get distributed, where they are available, and how much the developing company charges. 

A woman getting a vaccine shot while wearing a face mask

Image source: Getty Images.

A noble cause

In early August, the Bill & Melinda Gates Foundation, along with Gavi, agreed to provide upfront capital to AstraZeneca and Novavax. In exchange, the drug makers committed to provide 100 million doses -- at $3 per dose -- for low and middle-income countries, once a vaccine is approved. This deal is in addition to an agreement AstraZeneca made in June to provide 300 million doses to the most vulnerable populations across the globe.

Gavi was launched in Davos in 2000, and has received funding from Norway, Germany, Japan, the Bill & Melinda Gates Foundation, Australia, Belgium, Canada, the European Union, and Wellcome, a research-charity based in the U.K. All of these organizations were created long before COVID-19 to ensure that vaccines are equitably available across the world.

Shots on goal

For its part, the U.S. has told the WHO it will not participate in the vaccine development program. The decision was driven by grievances with the WHO over its relationship with China. The go-it-alone approach could have left the U.S. without access to a bevy of promising vaccine candidates. At the end of March, Operation Warp Speed (OWS) -- the government's public-private partnership to fund vaccine development, manufacturing, and distribution -- funded its first candidate. The program has now delivered almost $10 billion to vaccine partners. These partners have advanced through clinical trials at record pace and now find themselves in critical Phase 3 studies, one step away from delivering a vaccine. Although candidates from Johnson & Johnson (JNJ -1.38%) and AstraZeneca were temporarily on hold in the U.S., they have recently resumed to join Moderna and Pfizer (PFE -2.67%) with partner BioNTech (BNTX -1.24%), carrying the country's vaccine hopes on their shoulders.

Earlier this summer, Pfizer and BioNTech pledged 120 million doses to Japan and an undisclosed number to Canada, upon approval of a successful vaccine. The supply should be ample; Pfizer believes it will produce 100 million doses by the end of 2020 and 1.3 billion doses by the end of 2021. In July, Pfizer also agreed to provide the U.S. with 100 million doses. Moderna, which has projected 20 million doses by the end of 2020 and at least 500 million through 2021, has a deal in place to supply 100 million doses to the U.S.

Scenario planning

This mixture of funding deals, doses, and dates is enough to make anyone's head spin. What is clear is that there are many vaccine candidates being developed by companies all over the world, and where you live will have a lot to do with what vaccine is available to you. With China recently joining CEPI's vaccine initiative, the insurance policy the program offers to nations will be available to almost every developed country except the U.S. and Russia.

Like the U.S., Russia has decided to go it alone, developing its own vaccine and cutting deals with other countries. The country has two drug makers, Bektop and the Russian Ministry of Health, with vaccines approved even before starting Phase 3 trials. While the Russian vaccines are being studied in several countries, they have distribution agreements with  Brazil, Mexico, and India.

Investing in an unprecedented effort

Investors buying shares in any COVID-19 vaccine stocks should understand which vaccines will be made available where and for how much, before chasing the latest news on clinical trials. In the U.S., the best chance at making money from a vaccine may be by betting on the Pfizer-BioNTech collaboration. Like Johnson & Johnson, it is unencumbered by any agreement for global distribution through CEPI, but its candidate is in Phase 3 with multiple endpoints for potentially stopping the trial early if it proves especially effective.

Hopefully, as the new year arrives, there will be clarity around which vaccines are approved, and the worries will go from development to distribution. Ultimately, an approved vaccine candidate will eventually be distributed around the world, but the lack of cooperation and country-specific funding agreements make it dangerous territory for investors thinking a vaccine will bring a financial windfall and a return to normal. Currently, it is anyone's guess which companies will clear regulatory hurdles and be able to broadly distribute a vaccine. U.S. citizens should be cheering for as many as possible, but keeping their fingers crossed for Pfizer and Johnson & Johnson. If those candidates don't come through, getting enough doses of an approved vaccine in the U.S. could be complicated due to our refusal to join the global initiative.