COVID Recovery Shows the Need for Better Immigration and Regulatory Policies

America needs talented foreign-born individuals and government policies that help innovation thrive

By Thomas Grennes

The unexpected arrival of the COVID pandemic has been an enormous negative shock to the world’s health and its economy. Death and destruction have been extremely costly, but the cost would have been much higher without the development of COVID vaccines in record time. Nine months after COVID was recognized as a destructive virus, BioNTech introduced its new vaccine. Major contributors to vaccine development, as well as other forms of COVID relief, were foreign-born scholars and managers. Details about some of these important foreign contributors appear in the informative book “A Shot to Save the World” by Gregory Zuckerman. The successful efforts of foreign-born individuals to mitigate the pandemic are just one instance of the many benefits, economic and otherwise, these individuals bring to America. Therefore, the U.S. government should create policies that encourage the immigration of talented people from all over the world.

Foreign Individuals and COVID Mitigation

Economists have emphasized the importance of economic and political institutions to growth, and favorable U.S. institutions have attracted many scholars to migrate to the U.S., where their research has been invaluable in developing the COVID vaccines. Katalin Kariko began her early research on mRNA in Hungary before migrating to the University of Pennsylvania. The research of Derrick Rossi at Harvard was influential in the development of the Moderna vaccine, and the Canadian-born Rossi’s parents were immigrants from Malta to Canada. Juan Andres, who was in charge of production at Moderna, was born in Madrid, Spain.

BioNTech was led by scholar-managers Ugur Sahin and Ozlem Tureci, husband-and-wife scientists whose families migrated from Turkey to Germany. Pfizer (with partner BioNTech) and Moderna produced the first and most effective COVID vaccines. Their chief executive officers were Albert Bourla (for Pfizer), a native of Greece, and Stephane Bancel (for Moderna), a native of France.

Foreign sources were also important for financing the pharmaceutical startups. German brothers Thomas and Andreas Struengmann were major sources of funds for BioNTech, and Noubar Afeyan, a native of Lebanon, was important for Moderna. The entry of startups adds to competition in an industry that is often described as dominated by Big Pharma.

The substantial adverse health and economic effects of COVID were mitigated by the development of new technology that allowed working and communicating from a distance. The invention of Zoom by Chinese-born entrepreneur Eric Yuan made long-distance cooperation feasible. Huang had the tenacity to continue seeking a work visa in the U.S. after being rejected eight times for earlier visa applications.

U.S. Pharmaceutical Policy

Free entry into an industry is an important source of competition, and BioNTech and Moderna were startups with little experience in developing new vaccines and taking them to the market. BioNTech had developed its successful vaccine before it sought a partnership with the larger and more established firm Pfizer. The ability of these new enterprises to respond quickly and effectively to the devastating COVID shock saved many lives and avoided greater economic damage.

Having a flexible pharmaceutical industry capable of responding to diverse shocks is important since new variants of COVID are a constant possibility. The intense competition from the “bottom-up” process produced quality vaccines from Pfizer/BioNTech and Moderna that were the most effective in the world. The Russian and Chinese vaccines that came from a “top-down” process were less effective, and they were never approved for use in the U.S.

Obtaining government permission to introduce a new pharmaceutical product is a notoriously slow process, but in this case a government effort called Operation Warp Speed helped it along. This effort was led by Moncef Slaoui, a native of Morocco, who once led Glaxo-Smith-Kline’s vaccine division. The specialist in the economics of health at the Council of Economic Advisers during Operation Warp Speed was Tomas Philipson, a native of Sweden.

To protect against both old health problems (cancer, Alzheimer’s) and new ones (new strains of COVID), it is important that the United States create an environment that is conducive to pharmaceutical innovation. The time to prepare for the next crisis is now. New ideas must be rewarded with strong protection for intellectual property rights. The head of the World Health Organization and the Biden administration have sought to suspend intellectual property rights for producers, but so far the industry has successfully resisted those efforts. Punitive price regulation, supported by President Biden and others, must be rejected to encourage research.

Zealous antitrust policy must not be used to punish productive cooperation agreements between big and small pharmaceutical companies, such as the agreement between Pfizer and BioNTech. This form of cooperation between small, new startups and large, established firms is a major source of innovation, and Pfizer has already announced new agreements.

Attracting High-Skilled Immigrants

Talented scholars and managers are in great demand globally, and several countries, including Australia, Canada and China, have programs explicitly designed to attract them. What can the U.S. do to continue to attract a pool of talented immigrants? Policies toward pharmaceuticals that protect intellectual property rights, allow productive agreements by pharmaceutical companies and avoid populist price controls contribute to making the U.S. an attractive destination for high-skilled immigrants.

In addition, immigration policies must allow and encourage talented individuals to legally immigrate to the U.S. and have productive careers living in the U.S. with their families. For example, many talented STEM workers are Asians, who have faced various forms of discrimination in the U.S. that must be addressed. Increasingly common diversity, inclusion and equity programs have resulted in more discrimination against Asians because they are numerically overrepresented at some prestigious colleges and other schools. A well-known case currently before the Supreme Court involves a claim that Asians have been victims of discrimination in admission to Harvard University. Legacy admission policies that favor children of alumni also discriminate against immigrants, as well as African Americans. There are also credible claims of discrimination against Asians in employment and promotion decisions in occupations where the share of Asian employees exceeds the share of Asians in the total population.

There is also room for improvement in providing equal protection of the laws for Asians, as well as other immigrants. Massachusetts Institute of Technology professor Gang Chen was arrested in January 2021 and accused of spying for China; all charges against him were finally dropped after one year. This was not an isolated incident: More than two dozen cases have been prosecuted against academics for improper connections with China. There have also been many reports of physical attacks on Chinese and other Asians in America.

The total value of benefits Americans receive from talented immigrants depends on favorable policies toward the products and services they produce, as well as providing equal protection of the laws for immigrant residents and their families. Professor Chen has stated that some of the best scientists in the world have wanted to work in the U.S., but this desire should not be taken for granted. The U.S. government must create immigration and regulatory policies that will attract talented workers from around the world and enable them to thrive in America.