Israel Seeks a COVID Sugar Daddy to Save Its Struggling Vaccine Venture

Yossi Melman head
Yossi Melman
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A man recives a dose of the Israeli COVID-19 vaccination as part of clinical trials, last year.
A volunteer recives a dose of vaccination during the first phase of the clinical trial of the Israeli developed COVID-19 vaccine, last year. Credit: Oren Ben Khakun
Yossi Melman head
Yossi Melman

About a year and a half has passed since then-Prime Minister Benjamin Netanyahu announced that Israel would develop its own program for developing a vaccine for COVID-19, in the hope of being among the first countries in the world to do so. But the Israel Institute for Biological Research in Nes Tziona is yet to deliver a vaccine and progress continues to be bogged down despite the 175 million shekels ($53.6 million) that has already been spent.

To date, at least 10 companies have developed a vaccine against the coronavirus, with varying levels of efficacy: Pfizer, Moderna, Astrazeneca, Johnson & Johnson, four Chinese companies and two Russian companies. An Indian vaccine is also in the works.

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The biological institute, the defense establishment and the Prime Minister’s Office have recently claimed that a breakthrough is imminent, but this is not the first time such an announcement has been made. Negotiations are underway, meanwhile, to sell the pharmacological knowledge to a foreign company and grant it ownership rights providing it would underwrite clinical trials. If this move succeeds, it is estimated that it will take another 18 or so months (that is, three years in total) to get a domestically produced vaccine on the market. However, this vaccine – dubbed BriLife (“health” in Hebrew + life) – will no longer be blue and white but painted in international hues.

Vials of the Israeli developed COVID-19 vaccine, at the Israel Institute for Biological Research in Nes Tziona, last year.Credit: The Israel Institute for Biological Research and the Ministry of Defense

Secret negotiations are currently underway between the institute and its partner, Tel Hashomer Ltd. of Sheba Medical Center, and a medium-sized pharmaceutical company in a Western country. Discussion is centering around the sale of a patent for the scientific knowledge and granting Israel priority in terms of supplying the vaccine. Due to the small size of the Israeli market and the lack of manufacturing facilities, exclusivity has been ruled out. To clarify: Pfizer invested $3 billion in their successful vaccine.

If an agreement is reached – and as mentioned, this is doubtful – the foreign company is expected to finance Phase 3, the most complex and expensive phase, of the vaccine’s clinical trials. The cost of this phase, which will be conducted abroad and is expected to involve some 40,000 participants, is $300 million to $500 million. If it succeeds, the foreign firm will start producing the vaccine abroad and will pay Israel royalties. In any case, no vaccine manufacturing plant will be established in Israel – and thus another of Netanyahu’s promises will ring hollow.

For the time being, the parties involved refuse to disclose which foreign entity has been approached and in which country/countries the Phase 3 trials would be conducted. As in other matters, here too the safest Israeli prescription is preferred: Secrets are kept for reasons of state security, even if they are minor or nonexistant. The aura of secrecy is being promoted by the Ministry of Defense, the Prime Minister’s Office, the National Security Council, the Nes Tziona institute – and indirectly and surprisingly also the Ministry of Health, under Minister Nitzan Horowitz.

The Israel Institute for Biological Research in Nes Tziona, central Israel.Credit: Dan Keinan

Rafi Meron, head of the technology division at the NSC, is conducting the talks on behalf of his organization, as per the instructions of the former director, Meir Ben-Shabbat. Prof. Shmuel Shapira, director of the biological institute – who persuaded and encouraged Netanyahu to commit to the project – retired in May. His departure was particularly surprising and perceived as a show of lack of faith in the mission. He was replaced by Dr. Shmuel Yitzhaki, who has worked at the institute for 23 years. It is unclear whether Prime Minister Naftali Bennett and Defense Minister Benny Gantz will approve his permanent appointment or elect someone else.

Phase 2 of the BriLife vaccine trials, involving some 800 volunteers at nine hospitals, is expected to be completed in a few weeks. Thus far its results, and that of Phase 1, have been lackluster, an outcome of  arrogance and inexperience. At first the dosages concocted in Nes Tziona apparently lacked a sufficient amount of COVID-19 antibodies, and progress could only be made after they were increased. Sources at the institute and in the health establishment claim that although there have been no definitive findings yet, the interim results and reactions of the participants are positive and encouraging.

Along with the great uncertainty clouding the future of this project, what is already clear is that Phase 3 will last for many months and must be carried out in countries with a high rate of illness and minimal access to existing COVID-19 vaccines. That is, countries in Latin America, Asia or Africa. The NSC and the Nes Tziona institute and tried to promote that idea in Uganda, India and later Brazil.

Israel's outgoing President, Reuven Rivlin, right, and Prof. Shmuel Shapira, the director of the Israel Institute for Biological Research, during a visit to the institute last year.Credit: Kobi Gidon / GPO

Eduardo Bolsonaro, son of the Brazilian President and chairman of his country’s International Affairs and National Defense Committee, arrived in Israel in March and met at Hadassah University Hospital in Jerusalem with its CEO, Prof. Ze’ev Rothstein; medical director Prof. Yoram Weiss; director of COVID-19 wards Prof. Dror Mevorach and others. The meeting was also attended by Dr. Eran Zahavy, the biological institute’s chief innovation and technology officer.

Bolsonaro, Jr. signed a memorandum of understanding and cooperation with the Prime Minister’s Office – but Hadassah, the NSC or the people in Nes Tziona have yet to hear from him. Maybe the entire episode was a political and media stunt by his COVID-19-denying father and his government?

In May, Israel launched similar negotiations with a desperate Argentina that was suffering from a high incidence of infection and a vaccination rate of only 10 percent. A delegation led by Weiss, Mevorach and Zahavy met in Buenos Aires with other senior officials. Power struggles between the Nes Tziona institute, Hadassah and Israel’s Ministry of Health thwarted the progress and Argentina abandoned the initiative.

An Israeli doctor holds the hand of a coronavirus patient, at Hadassah University Hospital in Jerusalem.Credit: Ohad Zwigenberg

If the Israeli vaccine reaches the clinical trials phase, the foreign company involved must be asked to underwrite all expenses, with the price per participant reaching as much as $50,000 in a Western country and about $10,000 in a developing or poor country. This sum would cover, among other things, salaries for the medical staff (doctors, nurses, technicians, lab workers) who manage and supervise the experiments; payments to the volunteers, clinics and laboratories; and very high insurance and indemnification costs. There is no doubt the risk is high, but the possibility that a foreign entity will finance Phase 3 likely indicates that it believes in the chances of its success.

While the purpose of Netanyahu’s declaration regarding development of a homegrown vaccine is clear – politics and public relations – it is not clear why Prof. Shapira of the biological institute did not put things into proportion and provide a realistic time line at an early stage. In fact, the opposite is true: Shapira was apparently pleased that the government would inject large sums of money into his institute, which was then on the verge of major budget cuts, layoffs and closures. He did not bother to inform the public that Israel lacks the necessary experience and knowledge – and in particular, the financial resources – to develop vaccines, because since the establishment of the state, Israel has only undertaken such efforts twice: against polio and anthrax.

The Nes Tziona facility employs about 300 workers. Half of them are biologists, microbiologists, physicists, chemists, and veterinarians, and the rest are technicians and maintenance workers. Moreover, its raison d’etre is military – not civilian. The institute was established to develop protective means against and to monitor chemical and biological warfare in Israel and, from time to time, according to foreign sources, to develop chemical and biological weapons.

The fact that the institute’s vaccine program is based on the VSV method has also contributed to the skepticism concerning the ability of its scientists to succeed. VSV is a Canadian patent used in one of the vaccines against the Ebola virus. It was administered to tens of thousands of people but was not needed after the epidemic ended. Based on this patent, pharmaceutical giant Merck began developing its own COVID-19 vaccine, but halted the process after realizing how complicated and lengthy it would be, not to mention lacking any guarantee of success.

Moreover, Israel has no advantage to compete in this realm with such pharma giants and world powers, like the United States, China, Russia and the European Union. “The biological institute’s initiation of a vaccine development program was launched without an orderly plan,” says Prof. Mevorach. “There was no clear financial or budgeting plan, and no strategic partner was brought in. It was unclear who was leading the process and precious time was wasted on idle arguments.”

Mevorach notes that his company, Analivex, has raised $90 million in order to develop a drug that will lessen COVID-19 symptoms. “It took me 10 years and [appeals to] 150 groups, 30 percent of which promised to invest,” he says.

Will the Israel Institute for Biological Research eventually find a company willing to invest hundreds of millions of dollars in its vaccine project? Many people in the country’s health care system are skeptical and believe that the idea that it will succeed it is yet another empty promise by the institute and the defense establishment.

For their part, the institute and NSC reject the claims and emphasize that even if there have been birth pangs, Israel has always strived to conquer the frontiers of science, innovation and technology, and therefore the initiative and the investment in the process should be commended – not criticized. Nonetheless, one can expect that should the whole enterprise fail, none of those involved will accept responsibility.

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