Billions or trillions: The great coronavirus trade-off

Yahoo Finance’s Alexis Christoforous, Brian Sozzi, and Andy Serwer discuss the cost of developing a COVID-19 vaccine in such a short time, and why that money is worthwhile.

Video Transcript

ALEXIS CHRISTOFOROUS: As the uptick in cases is putting even greater focus on a COVID-19 vaccine and just how soon we might have one, our Editor-in-Chief Andy Serwer is joining us now with an original piece that's on our website. Hey, Andy. Good morning to you. We know that the cost of trying to come up with a vaccine, especially in such a short time, is going to mean billions of dollars. But you say that is money worthwhile.

ANDY SERWER: Absolutely, Alexis. There are 135 or so vaccine projects around the world, mostly in the United States, China, and Russia. And these are incredibly expensive endeavors-- so expensive that even giant private companies like Merck, Johnson & Johnson, or Sanofi in France can't really afford to do these things on their own anymore. And this has been the case with these big vaccine projects for a while.

They need government funding or funding from the Bill and Melinda Gates Foundation, an entity like that, because it is billions of dollars. The United States government has put forth over $2 billion for four big projects. And you say that's a lot of money.

But the tradeoff, as you asked about, Alexis, is billions versus trillions, because the United States has spent or is going to spend some $8 trillion in terms of fighting the economic fallout when it comes to coronavirus, in terms of stimulation packages, and then if you look at lost economic activity in addition to that. So the billions is in lieu of trillions, absolutely.

BRIAN SOZZI: Andy, there was one quote that lingers with me this morning from your story. And it was from Phillip Sharp, a professor of biology at MIT. He said the response so far has been primitive-- jarring.

ANDY SERWER: Yeah, and besides him just being a noted biologist at MIT, he is a Nobel laureate. So I think he knows of what he speaks. He's also involved in some of these efforts actually on the therapeutic side, which is the other side of the house here in terms of treating coronavirus rather than just having a vaccine.

I think that he may be-- well, I shouldn't say he's overstating it, because he knows better than I do. There is a tremendous amount of work going on. And each one of these viruses that attacks the humanity is slightly different. So you do have sort of a base knowledge. But each one is also very, very different.

And I was delving into this and really talking to these biologists and scientists and trying to wrap my brain around how this one is different. This one's different because it really suppresses part of the body's response to an infection in a way that we've never seen before. And so yes, primitive in that we don't fully understand how that works yet. But again, 135 projects around the world-- people are trying to figure that out.

ALEXIS CHRISTOFOROUS: Yeah Andy, I mean, have you talked to experts about what comes next in terms of cost? I mean, you were just saying that we could be spending trillions to fight this in terms of economic loss, stimulus packages. There might be another stimulus package coming down the pike. And Larry Kudlow, President Trump's economic-- one of his economic advisors, is talking about perhaps that it comes in the form of incentives to get people back to work. What are you hearing from experts you're talking to? Is that the best way to move forward, or is a straight up more checks to Americans the way to go?

ANDY SERWER: Yeah, you know-- boy, there is a debate raging, of course, Alexis, here. And you are hearing about people saying I don't want to go back to work because I'm making more money on the dole, as they say, than going back at a minimum wage job, which is unfortunate. I mean, these checks that are sort of across the board are very much a blunt instrument. I think for the most part, people do want to get back to work, so that's probably the exception rather than the rule.

But, of course, there are talk-- there's talks about bonuses to get people to come back to work. There's talk about more money going directly to businesses to actually have them hire people. So this is uncharted territory. We know the government's going to have to spend a lot of money here in terms of the vaccines, in terms of therapeutics, and in terms of stimulus and bailouts. So it's costing a lot of money.

But then again, as you said at the open, what choice really do we have here? I mean, we've got to get the country back to work and also making sure that we're a viable entity and nation going forward.

ALEXIS CHRISTOFOROUS: Yeah, even as President Trump has said, it's not the time to think about rising deficits. Andy Serwer, thanks so much. Have a great week.

ANDY SERWER: Thank you.