When Competitors Collaborate, Who Wins? We All Do

Questrom’s Rena Conti on the historic COVID-19 vaccine deal between Merck and Johnson & Johnson

President Joe Biden on Tuesday announced a rare and historic collaboration between two Big Pharma behemoths and rivals, Merck and Johnson & Johnson, in which the former will help manufacture the latter’s recently approved single-shot COVID-19 vaccine.

These collaborations don’t happen often, and when they do, it’s usually in pursuit of something big: in 2004, Sony and Samsung teamed up to research designs for flat-screen LED televisions. In 2011, Toyota and Ford started jointly designing a hybrid vehicle. Amazon (home of the Kindle) and Apple (iPad creator) partnered in 2007 to let Amazon place e-books on an iPad Kindle app.

Under the vaccine agreement, which could double the available amount of the J&J vaccine, Merck will use one of its facilities to make the vaccine and a second to package it. Seeking to speed up national inoculation against the virus, Biden invoked the Defense Production Act, bumping Merck to head of the line for obtaining machinery it will need to produce J&J’s vaccine, the third one approved and the only one requiring a single dose.

“This is an unprecedented situation and an unprecedented collaboration,” says Rena Conti, a Questrom School of Business associate professor of markets, public policy, and law and a Dean’s Research Scholar. She discussed the deal and its implications with BU Today.

Read the Q&A with Rena Conti at BU Today.

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