Open Source Collaboration versus Winning the Race for Receiving a COVID-19 Vaccine Patent

The world needs a COVID-19 Vaccine.   Is there now a patent race to deliver a high quality vaccine?  Will the “winner takes all” winner gain a multi-trillion dollar patent?  There are over 7 billion people on the planet. If the average value of life around the world is $2 million dollars and if the vaccine reduces the probability of death by 1 percentage point, then each risk neutral person would be willing to pay $20,000 for this vaccine.  The global market would be 7 billion * $20,000 = $140 trillion dollars.  That’s a big market!

Now by backwards induction, each drug company knows that if it wins the patent race that public pressure would lead it to sell the vaccine at marginal cost.  In simple English, the winning firm will collect closer to $0 rather than $20,000 from each sale of the vaccine.  So, doesn’t the core model of backwards induction predict that drug companies should tell their scientists to work through an open source collaborative agreement across research groups and then let all of the scientists who collectively solve this social challenge share the glory of greatly improving our collective quality of life?

A counter-factual;  if private research labs insist on not working together — how much longer will the world wait for the vaccine? If the labs work together how much sooner will the world have the vaccine or will a free rider problem exist and slow down the race for the cure?

Are social incentives (Nobel Prizes, hugs from President Obama) sufficient to drive innovation at this key time or must we dangle a Trillion dollars for the winner?