Webinar Transcript: Professor Justin Stebbing On COVID Omicron

Disclaimer: We’re not giving any financial advice here and there won’t be any non-public information as well. Everything is based on public sources and personal opinions.

This is an edited transcript of our webinar with Professor Justin Stebbing, which took place on 1 December 2021.

Bilal Hafeez (00:00):

Welcome everyone to this webinar by Macro Hive. We’re very pleased to have Professor Justin Stebbing to give us his take on this latest virus variant. Just for your background, Professor Justin Stebbing, he’s a professor at the Faculty of Medicine at Imperial College. He’s written extensively. He’s published numerous articles in academic journals on a range of different topics. And he has actually published some work on using AI to find drugs, to treat COVID 19 and perhaps most important of all, he’s been a very close follower of the ups and down of the COVID pandemic since it began first at the beginning of 2020. And he’s also recently published a book, which we’ll also talk about where he documents the spread of the virus over the course of 2020. I think for me, Justin’s one of the best sources for synthesising and channeling kind of our understanding of the pandemic at each stage of its journey so far.

And before we go into the particular topic, I just wanted to just give some background to the other people on this call. So there’s myself, I’m the CEO and head of research at my Macro Hive. We also have Dominique Dwor-Frecaut, who’s our senior researcher at Macro Hive, who focuses on US economics and strategy. And she’s been following the spread of COVID from a kind of case, death, count, and understanding the implications of COVID. If we have time, we’ll get her take on the implications of it all, as well.

Recently we published pieces on Omicron, answering whether it’s ‘Micro or Macro?’ and which countries are least protected against the new COVID variant. We also talked about our favourite equity sector plays after Omicron. We look at crypto, releasing our regular Ethereum and Bitcoin update as well as a new Crypto Index Tracker, and we also do summaries of academic papers – this week taking a look at using newspapers to monitor growth in real time. And you can just sign up by going to macrohive.com. You can sign up to become a member to receive all of this. You’ll also get access to a slack room where you’ll be able to interact with the research team and other members too.

But the main reason we’re on this call today is really to learn more about Omicron, the variant. So the way we’re going to structure this is I’m going to just pose a series of questions to Justin, and if anyone in the audience has questions, there’s a Q&A tab at the bottom of your Zoom window. If you just post your questions in there, then as I receive them, I’ll then be able to pose those questions to Justin. So we’ll try to make this as open as possible. I’ll start it all off, but feel free to fire questions away in the Q&A section. And then we’ll have some concluding comments towards the end, and hopefully we’ll get some time to talk about Justin’s book as well, which I also wanted to flag too.

So Justin, welcome to this webinar. It’s great to have you on. Obviously there’s a lot of uncertainty at the moment. We don’t know a lot about the fall out from Omicron, but from your understanding, perhaps we can start with all of this talk about mutations. There so many mutations of this variant, which is different from before. Can you just tell us a bit more about that and based on that, what can that tell us about its transmissibility and its virulence? Can we learn much from the mutations itself?

Professor Justin Stebbing (04:00):

So it’s very, very evolutionary different from the other SARS-CoV-2 viruses. Just to give you an idea, if you look at Alpha, Beta, Gamma, Delta, and you take Delta, Delta had three mutations in the spike. This has 32 of which approximately half are deep in the spike at really important sites for antibody binding, including two of them at cleavage sites that the virus needs to get into cells. I and others have really been left with egg on their face. I’ve been talking to structural modellers, such as Steve Burley at Rutgers University, members of the team of AlphaFold. And we thought you could only have a very small number, maybe up to say 10 at the most, mutations in the spike protein, and after that, it might collapse. So here now we see 32 mutations, got that completely wrong, which just goes to show that what you think in theory and what nature can create and what practise can create are totally different things. And there’s so many mutations that when I was talking to the team at Imperial who had sequenced it, the main sequencer, who’s first author on the paper or the sequence describing it, said he thought they’d got the metadata mixed up with another bat, and that something wrong had happened. That’s clearly not the case and on that basis, and if we’re going to be at all guided by science, I can see the alarm now.

If you take the E484K vaccine resistant previous mutation, that was one mutation that knocked at least 20 percentage points off vaccine efficacy. Now this doesn’t have E484K. It has E484A, but it has numerous other mutations. So to suggest, as the BeyondTech CEO or the University of Oxford have, that vaccine efficacy won’t be that reduced, I think is an error. But again, we’re going to need laboratory studies to confirm this, and then clinical studies to confirm this, provided that the virus continues to spread and cause problems, because it’s possible that because of the number of mutations, it’s so unstable that it actually, in a different environment… So getting off a plane in warm South Africa, going to Holland or London in a different colder environment, the virus itself isn’t stable and that in a couple of weeks’ time, this completely peters out and is gone. And that’s part of the reason why some of the vaccine companies didn’t make variant specific vaccines because they did so with Beta, and then by the time they finished that, Beta was gone. You have to remember that Gamma… Remember Gamma? P.1 that infected millions of people in Brazil, but restrictions managed to get rid of that and now you could counter that by saying, “Well, it was out competed by Delta,” and that is an argument. And there’s arguments for everything.

But at the beginning of the week, we thought based on its growth trajectory, there would be at least 10,000 cases per day in South Africa, if not more, and that’s not the case. South Africa population, similar to the UK and Germany where there’s 40 to 65,000 cases a day, there’s only 2,500 cases per day, or there abouts in South Africa. It is going up, but it’s not going up with an RO of six or seven that some people said. We’re not talking about rice in a chess board and more atoms than in the Universe, by the end of it. But we are seeing a slightly different picture. We’re seeing in adults shorter duration infections, not so respiratory night sweats, which we’ve never heard of before, sore throats, blocked noses.

But of course the most worrying thing we’re seeing is we’re seeing sick toddlers, babies under the age of two, brought to hospital with fever and lethargy and tachycardia, and that’s fast heart rate. And of course, if you bring a baby to hospital, that baby who’s sick, that baby will be admitted because it’s not like an adult that you can say, “Well, if you get sicker, come back,” because the baby’s not really going to tell you. And when they become sicker, they just sleep more, which is a bit scary. And no one’s going to take the risk with a baby of sending it home in case something tragic happens. And so you do have a potentially nasty constellation of things that’s occurring. And I’ve also outlined, you also have a potentially very good scenario. So on the basis of such a broad fan of outcomes, the uncertainty is very, very troubling to say the least, as uncertainty always is troubling. And you can see why people have reacted in the way they have. And I actually think that the political and the transport and the travel responses to this have been absolutely proportionate and correct, and sensible. It’s very difficult in these situations because you have some people saying, “Lockdown, lockdown, lockdown.”

I can tell you right now that I just went to Pret a Manger in central London to buy my tuna baguette for lunch, I know this gourmet meal. And there were two people really protesting inside about mask wearing. I mean, these are people obviously with a lot of time on their hands and things, but really ferociously, shouting and protesting. And you’ve got people at both ends of the spectrum. And I actually think that governments have actually steered a fairly prudent and sensible path here. So I think I’ve gone into a bit more detail than you were expecting.

I’m happy to expand on any one of those points.

Bilal Hafeez (10:00):

So, Justin, this point about the transmission and the number of cases that you had said, you would’ve expected close to 10,000 cases a day and we’ve seen those charts of a very sort of sharp move up in Omicron. And so, it’s so early, but like how should we understand the number of cases picking up around the world? At what point do you start to think, “Okay, this is very bad,” from the case counts?

Professor Justin Stebbing (10:43):

I don’t think we’re there yet. We have thus far in the EU 44 cases in 11 different countries, there’s a lot more in South Africa. And we’re not hearing about… If you can imagine with the virus, I think there’s three things to consider, and imagine an elastic band in your hands with three corners. On the one corner you have the infectiousness and transmissibility, on the next corner, you have the vaccine evasiveness, and on the next corner you have the ability of the virus to cause bad symptoms, ITU admissions, hospitalisation, deaths.

It would be very unusual and not like the nature of a biological entity, like a virus for all three things to go up together. Not impossible, but very, very unusual. And I don’t really understand whether viruses are living or dead. I don’t really fully understand their aims other than to replicate, but it’s almost as if we’re seeing evolution fast forwarded here. And this is the virus’s way of adapting to live with us because the one thing I had the highest conviction on is its vaccine evasiveness. I have less conviction on its transmissibility and how transmissible it is, because it seems so different to Delta that it’s maybe possible to me that there’s very little cross immunity and someone could be infected with both. So infection with Delta doesn’t protect against this, but if that’s true, then it should cause fewer symptoms.

Now because of the age structure of Southern Africa, we’re not able to see, obviously, if it’s going to result in severe hospitalisations and deaths, because it’s a tonne of young people basically, but you could argue on the other hand, young people with mild symptoms is still very worrying, but then you could argue, well, this likely evolved in a immunocompromised, HIV positive host. It didn’t kill them or cause them significant harm over a long period, we think, therefore it’s probably not going to be that dangerous. So there’s many ways of thinking about this.

It does though seem sufficiently different from the other SARS-CoV-2 viruses to really raise a lot of issues, generally. I think that the antivirals, the tablets, which are designed to prevent hospitalisation are very timely. When it comes to Pfizer’s pill, there is a mutation in the protease of Omicron, and Pfizer’s pill binds to the protease, but the mutation isn’t in the binding site where packs of it binds, it’s quite far away. And when it comes to Merck’s pill-

Bilal Hafeez (13:37):

And just, sorry, just on that Pfizer one, by saying that you mean that it’s potentially less effective against Omicron because it’s away from the binding, or?

Professor Justin Stebbing (13:45):

No, so the drug binds in the binding site, which isn’t affected by the mutation.

Bilal Hafeez (13:51):

Oh, sorry. Okay, that way around. Okay, so then it should in theory retain its effectiveness.

Professor Justin Stebbing (13:56):

It should do. But if you imagine a 3D shape, and a lock and a key, even though the key is going into the lock, if you change maybe some aspect of the door, you could still affect the key going in, even though it’s not quite… So we know that distant changes in protein structure can still affect an area a bit far away. We call that an allosteric effect. But for the most part, sure, I don’t really want to get into that. And then yesterday, the FDA narrowly, 13 to 10 with the vote, an FDA advisory committee… The FDA doesn’t always listen to its advisory committees, but usually does, voted to approve Merck’s pill, to my surprise, because the data looked pretty mixed in comparison to Merck’s initial press release, and no studies in pregnant or lactating people or in issues like that, issues about the mechanism of Merck’s drug, which is to introduce errors in replication, which can create a theoretic cancer risk.

But to me, the main thing is we’re also now, as well as the vaccines and vaccine platforms will be able to change is rapidly now within weeks, we’re going to have antiviral pills. Now the bigger an issue Omicron is, the lower the regulatory hurdle. So there’ll be this natural slack in the system. In the same way, when cases go up, we naturally stay in a bit more. If this is worse, then the FDA and other regulatory authorities will be more sort of lax. It’s a natural reaction to get things happening very quickly, if you see what I mean.

Bilal Hafeez (15:46):

And just to be clear, in terms of how the antiviral pills work compared to the vaccines, how would you describe that in layman’s terms?

Professor Justin Stebbing (15:55):

Well, I always think prevention’s better than treatment. And an issue with an antiviral pill is, you develop symptoms, you do a COVID test, you’re positive. You then have to somehow telemedicine, whatever, get a prescription, get it from pharmacy. It’s not a great… there’s a lot of tablets involved, 30 with Pfizer, 40 with Merck, whatever, whatever. They’re expensive. A vaccine’s 20 bucks, these pills in the West are going to be $500 or $700. It’s not straightforward. I always think prevention is better than a treatment. And of course, if you get infected, they suspect you of long COVID, and so forth, but it’s possible that these vaccines don’t offer any protection whatsoever. And I think the Israeli data saying that Pfizer protects is really poor quality, that’s all over Twitter. I think I was very surprised to see that tweeted because they’re basically saying the four cases in Israel didn’t have the Pfizer vaccine, therefore the Pfizer vaccine protects. I think they would’ve studied it a bit more, but to me to make those sorts of assertions to a very sensitive kind of world is the wrong time and place. We just don’t have the information.

Bilal Hafeez (17:12):

And, and in terms of, Omicron’s come at a time when we’re learning that the vaccine efficacy falls over time. If you’ve had a vaccine, second dose, first dose, whatever, six months ago, it starts to wane over time. And then at the same time you have a certain natural immunity. People who’ve been infected and that provides some kind of immunity of sorts. I mean, how do you think about those two forms of immunity in relation to the Omicron?

Professor Justin Stebbing (17:41):

We don’t know whether infection with Delta protects you from Omicron. We don’t know whether recent vaccination and having booster vaccination protects you from Omicron.

Bilal Hafeez (17:52):

Okay.

Professor Justin Stebbing (17:52):

We don’t know whether it protects you from being infected by it, transmitted, whether it protects you from ill health, hospitalisation or death. So what we’ve learned from the vaccine so far is the vaccine might not be very good at protecting you from infection. A good example of that might be AstraZeneca, but it’s still very good at protecting you from hospitalisation and death. So they’re good at protecting you in different ways. The most worrying finding is its ability to affect children under the age of two. And that will cause absolute pandemonium and panic in the West because mothers will stay at home. They won’t want fathers to go out, labour inflation and just strain on paediatric beds, and there aren’t many paediatric beds. I’ve asked questions about South Africa and there was a question in the chat room on South African data. And I would tell you that the South African Infectious Diseases Network is far more developed well than most countries in the West, because of their HIV experience. Okay, cancer care might not be as good and other care might not be as good and long term residential facilities and whatever, but I can assure you that they know how to deal with infections better than we do because of their HIV experience, particularly in children, where we have almost no experience in that sort of thing, compared to them.

Bilal Hafeez (19:34):

And your point about on the children’s side, I mean, that obviously sounds very worrying. Outside of South Africa, what evidence do we have of that outside of South Africa?

Professor Justin Stebbing (19:44):

Absolutely none because we have 44 cases in the EU who are either asymptomatic or mildly affected, but what we don’t have is a breakdown of their ages and so forth. But to have 10% of all admissions in Gauteng being toddlers under two is a really shocking thing to read. I don’t know what percent, for example, of those are HIV positive, just for example, just one question. I don’t know how sick they are. I do know there has been a death in a presentation from the South African Ministry of Health two days ago.

Bilal Hafeez (20:20):

And with Delta and with Beta, how did it affect toddlers or under twos?

Professor Justin Stebbing (20:26):

Less so. The incidents of MIS-C or this Kawasaki disease or this multisystem inflammatory syndrome that affects kids, affected one in a 100,000 children. The reason to vaccinate children is not to protect the children. It’s to stop symptomatic transmission to their grandparents. So to have actually something that can come along and infect children… The point about the children and the school closures and so forth is to me, this is the one thing that could lead to lockdowns everywhere. If children start becoming sick and dying, that’s lockdown material, whereas Biden was very relaxed, a couple of days ago saying, “There won’t be any more lockdowns.” Dominique will know more about this than me, but I was amazed he said that in the absence of further data, but he’s running short in the polls. And to be honest, there probably won’t be another lockdown if this resembles previous COVID ways. But if it starts infecting and damaging children, placing a strain on paediatric beds, to me, that’s it. That’s game over for movement in the West. I don’t know if Dominique will agree with that and she knows more about that than me, but…

Bilal Hafeez (21:37):

Dominique, do you wanted to chip in there in terms of Biden’s response?

Dominique Dwor-Frecaut (21:49):

Sure. We have an election in the US in less than 11 months. The Democrats have a razor thin majority, both in the House and in the Senate, and the response to COVID is going to be a big driver of the election. The American public is desperate for normality. There has been big differences in how the pandemic was handled in the blue and red states, and there is pressure on the blue state to be much less heavy-handed with lockdowns. So, I suspect this is what’s driving the response. Though, I mean, if I may ask, there is so much uncertainty around, can we really fault Biden? And specifically in the US genomic surveillance is so limited. In April, there was an article in Nature saying that basically the US sequences less than 1% of COVID cases that in terms of, sequencing it’s 43rd country in the world or was the 43rd country in the world. So how confident are we that we have a good handle on the spread of Omicron?

Professor Justin Stebbing (23:25):

I don’t think we have a good handle on it at all, but I would say two things. It’s not just the article in Nature, Dominique. We all know that in the UK we’re sequencing up to 50% of samples, and in America it’s like one to 2%. Denmark’s somewhere in between. The difference is you don’t need to sequence this one because of the mutation profile it’s very easy to detect via PCR. So you don’t need formal sequencing, but to me, and I’d rather look on the positives, this is a real time example of global genomic surveillance for the first time ever working. I think in 10 years’ time, sequencing and genomics will be a part of our everyday lives, whether it’s buying fresh food or screening for diseases in people. I think it will be a part of our everyday existence. And what we’re seeing with Omicron is actually a futuristic example that genomics and real time genomics, however you want to call it, sequencing or PCR, and you don’t need to sequence for this, is actually working. And that’s really, really sort of interesting news for humanity and shows that genetics is just going to be really, really important to all of us going forwards.

Bilal Hafeez (24:43):

No, that’s great, Justin, and I mean, I wanted to talk about timelines, but before we go into there, just a couple of kind of the typical questions that come up. Number one, seasonality of COVID in general? Obviously in Europe we’re seeing kind of a wave that was occurring anyway. I mean, what’s your view on seasonality? And then the other one is on non-pharmaceutical interventions, like mask wearing, things like that, what your take is on those two issues.

Professor Justin Stebbing (25:06):

So early on in the pandemic, there was a slew of papers on the effect of weather or climate on the virus. And that’s generally divided into two, which is temperature and humidity. And I read them all and I got more and more and more confused. And one thing said one thing, and one thing said another, but these viruses tend to like slightly colder weather, which is why Africa isn’t known for its great flu outbreaks. And then I realised that the effect of the weather has nothing to do with the effect on the virus. It’s an effect on our behaviour, very cold weather forcing us indoors and very hot and warm weather make us go outdoors or very hot weather making us go indoors with air conditioning, which can be really bad, unidirectional airflow. And I’ll go back to, though, the first comment I made that because the number of mutations in the spike protein, the change in weather from South Africa to Europe might make this really, really unstable. And so in two weeks time, this may have completely disappeared. Simple as that.

Bilal Hafeez (26:16):

And mask wearing, the effectiveness of mask wearing?

Professor Justin Stebbing (26:18):

When it comes to non-pharmaceutical interventions, to me, the best one and the most underestimated one is ventilation. Really impressive. But I think mask wearing is important and social distancing and hand washing less so. That’s what I think. I mean, mask wearing has been proved in enough studies to be effective. Whether they’re circumstantial studies, i.e. Areas that introduce masks wearing have fewer infections or actual physical studies showing that people infected are less likely to pass it on, if they’re wearing a mask. I think there’s genuinely enough evidence to suggest that mask wearing prevents it. And that’s why the government in the UK, 4:00 a.m. on Monday morning made it a legal requirement. But I can tell you walking around London, I’m not seeing anyone wearing masks… very few people wearing masks. I’m seeing people working in the shops, wearing masks but I’m not seeing people that are going into the shops wearing masks. And I think it’s just fatigue. I don’t think people are vehemently anti masks. I just think people are just tired of it all.

Bilal Hafeez (27:33):

Yeah. Now in terms of timelines, is the next two, three weeks, the period where we learn more about Omicron?

Professor Justin Stebbing (27:42):

I would actually say the next week.

Bilal Hafeez (27:44):

Okay.

Professor Justin Stebbing (27:46):

What we really want is you’ve got 10,000 people infected, these are vaccinated, these are unvaccinated, these are their ages, these ended up in hospital, these ended up in ITU, these ended up worse, these ended up better. Who are those groups? Now, if we don’t get that, then that paradoxically means it’s sort of gone away.

Bilal Hafeez (28:08):

Okay.

Professor Justin Stebbing (28:09):

And if we do get it, we’ll know exactly what to do, who’s vulnerable? Who’s at risk? And whether the vaccines work, because I strongly suspect that Stéphane Bancel, the CEO of Moderna is correct, when he’s totally worried about this. I don’t see how people can’t look at the spike mutation sequence and not be exceedingly worried because it’s so different. Now, just to keep in mind the existing vaccines we’ve had, all use the original China sequence published on January the 10th. Now straight after that sequence was published, the virus mutated to include something called a D614G mutation in the spike. And then we have the Alpha, Beta, Gamma, Delta mutations, and they didn’t make variant specific boosters or variant specific vaccines because they did, and then the variants went away or the existing vaccines covered it. But I don’t think, my view, is that the existing vaccines can cover this.

Vaccines, just to be clear, are designed to induce antibodies, but so are antibody treatments and you can’t have it both ways. You can’t say antibody treatments aren’t going to work, but vaccines are going to work, because they both are antibodies, the end product is an antibody against the virus or against a spike protein. So you can’t have it both ways, and some people are choosing to have it both ways.

Dominique Dwor-Frecaut (29:36):

Justin, we’ve just discussed how different countries have different quality of monitoring of the pandemic. In the US, obviously, our decentralised health policy is just multiplying the difficulty of managing the pandemic. So, which country do you expect to come up first with the most reliable estimate of what this Omicron really means for us?

Professor Justin Stebbing (30:06):

To me, it has to be Israel, which is because of their data collection, their organisation, the fact that they’ve all had one vaccine, the fact that a lot of people are on longitudinal studies with assessments and they don’t have the data privacy issues in America that prevent a lot of contact tracing and so forth. So I think we’ll get a good idea there.

Bilal Hafeez (30:25):

Okay, so Israel’s the one to watch the next week or so, next week even is kind of a crucial week to see whether… Hopefully it dies out, but if it doesn’t then we’ll have the breadth of data to understand it better?

Professor Justin Stebbing (30:38):

I think so. If we don’t have the breadth of data in a week, to me it’s a problem that’s gone away. I think that’s not unrealistic. The fly in the ointment and it’s a very big fly is this kid’s thing, because that has the possibility… Let’s say vaccines do protect. We still can’t vaccinate toddlers aged zero to two. And you remember babies lose their antibodies at six months to 12 months. They don’t have any natural antibody protection because the antibodies from breast milk wear off by then, and then their immune systems start to form. So it’s a very risky time generally. And of course, when an adult becomes sick, they just say, “I’m feeling more breathless.” A baby doesn’t. You just don’t know. It’s veterinary medicine. You can’t really talk to your patients.

Bilal Hafeez (31:29):

And in terms of vaccine development and boost of development and everything. So let’s say, in a week or two, we learn that, okay, the existing vaccines aren’t that effective, like what’s the timeline to create a new vaccine, distribute it?

Professor Justin Stebbing (31:46):

I think it’s much quicker than everyone’s thinking. I think that all that will be needed, if it’s a problem, is we’ll have, they’re making it now, a trial of healthy volunteers will take two weeks and then scaling it up and distributing it. And don’t forget, these companies have produced huge manufacturing capacity, over capacity, in fact. It will take, just can occur then and there, really, really quick, if it’s a problem. If it’s not a problem, the regulators will say, “Well, do trials and do normal studies,” and so forth. So I think either way the vaccines will come along and sort it out, and we’ll have the antivirals, the Pfizer one in particular.

Bilal Hafeez (32:31):

Yeah. Okay, I just wanted to sort of put a shout out to the audience. I mean start firing questions away. You can start posting in the Q&A. I have a few more questions left, but do start posting your questions everybody. Now, Justin, just one question, you mentioned long COVID earlier, you kind of hear about this in the news media a lot and my personal social circle, I kind of know one person maybe with long COVID, but from the newspapers, it seems like it’s a bigger issue. What are your thoughts around long COVID?

Professor Justin Stebbing (33:02):

Yeah. I mean, I’ve actually spent quite a lot of time looking at it. One of the problems is there’s no easy way to define and measure it and follow it up, and there’s no great drug treatment for it. I think it does exist. I think it’s much rarer, true long COVID is much rarer than people think. But I think the psychological interplay between not being able to go out, be isolated, financial stress, employment stress is very, very intertwined with it, and it’s very difficult to dissect out the physical and some of the mental consequences of the virus, as opposed to the consequences of the virus affecting the world around us. I think it’s a very difficult area. There are long COVID clinics in hospitals and if you compare with people that have had a very bad viral pneumonia and have been on intensive care for a long time, we’re not seeing things that are necessarily that different to those people. It’s just many more people affected.

Bilal Hafeez (34:03):

Yeah. Understood. Yeah. We’re getting a few questions now. One is on the toddler side, would breastfeeding past six months help protect babies?

Professor Justin Stebbing (34:13):

No, I don’t think so because you only get the antibodies from breast milk straight away. In the initial terms and then they last for six months. It’s the initial breast milk after a birth that gives the protection. It’s not the breastfeeding that occurs later, but the antibodies transferred initially wear off after six months.

Bilal Hafeez (34:39):

Okay. There’s a question on, is the high incidence of AIDS amongst children in South Africa skewing the numbers?

Professor Justin Stebbing (34:46):

It’s not that high. It’s about 2.5%. So that’s why I mentioned earlier, you would want to see how many are HIV positive. It might do, but I doubt it based on the 2.5%. Good question.

Bilal Hafeez (34:58):

And on the vaccine effectiveness, someone’s saying, “We’re getting different messages.” So you interpret Moderna’s caution as, is it around protection against infection or is it around hospitalisation death?

Professor Justin Stebbing (35:11):

I think all they can look at to start with is protection against infection. Because it’s possible that Omicron could be a blessing in disguise. If there’s no cross immunity from previous infection with Delta or whatever, or Beta, or vaccination too, and this doesn’t cause real sickness, then it could be a blessing in disguise. But we just don’t know yet. And I think Moderna’s caution is just based around simply saying, “Well, the spike protein, which is the vaccine target, is so different that we need to be cautious.”

Bilal Hafeez (35:50):

When I listen to the interview with Moderna, it sounded really well balanced and reasonable. I mean basically saying, “It’s something very different. We just don’t know yet. So, let’s just see.” Okay. There’s another question around antigens. What are your thoughts about the specificity of T-cell responses generated by the vaccine and are they nonspecific enough to be protected against Omicron?

Professor Justin Stebbing (36:17):

I think that’s a great question. I mean, when I think of T-cell responses, I’m thinking more, the Adenoviral vector vaccine such as AstraZeneca and J&J, although Moderna and Pfizer, the mRNA vaccines do induce CD4 responses. To me, we just don’t know about cross immunity when it comes to T-cells and B cells. And if there is a CD4 T-cell response that should induce B-cell antibody production, we just don’t know. I wish I could answer that in greater depth. I think it’s a great question. We just don’t know.

Bilal Hafeez (36:57):

Okay. And then there’s another question on booster programmes. So if individuals get booster now, and then the booster has to change, would you still have the time lag where you need like three, six months before you get the next booster or are they kind of, or orthogonal from each other?

Professor Justin Stebbing (37:13):

I think they’re orthogonal from each other. If Omicron becomes a real problem, people will be willing to have boosters containing the Omicron sequence, I believe in February and March when they’ll be available. And don’t forget you have the flu and the issue is mild COVID plus mild flu may call a very serious disease. But we just don’t know yet.

Bilal Hafeez (37:41):

So, listeners feel free to fire more questions, and another question, Justin. There’s some countries in Asia, like China that seem to be following like kind of a zero COVID strategy. So they’re kind of very restrictive on the borders.

Professor Justin Stebbing (37:57):

Well they can do can’t they, because they don’t need any of us to come there for whatever reason. China’s a net exporter of many things. Why do you think this is called Omicron and not Xi, which was the next letter in the alphabet and that’s not a joke. That’s absolutely serious.

Dominique Dwor-Frecaut (38:20):

So one thing is the science, which is going to get settled quite soon. I think the other aspect in terms of devising a policy response is the willingness of the public to be put through inconvenience or let’s call a mild inconvenience such as mask. And given this that we seem to have exhausted quite or used quite a bit of the public’s patience. What do you see as at this stage, as the measures that is both the most effective from a science perspective, but also the most likely to be followed by the public?

Professor Justin Stebbing (39:07):

I think the best measure is boosters and vaccination, but I just don’t know, and don’t think they’ll protect adequately from Omicron but I’m not sure how much of a problem Omicron is going to end up being. I mean, for example, today, we heard that an Omicron sequence was detected in Nigeria in October. Yesterday, we heard that it was detected earlier in November, November 19th, in Holland. We’re not seeing the numbers of Omicron going up and up and up. And if you actually look at the slope, if you go to next strain and put in South Africa, we’re still seeing Delta massively predominating, although it is taking over in Gauteng, it’s not taking over in the whole of South Africa. And the actual slope of the Omicron rise is not as great as Delta was. So I think boosters is the best thing. And hopefully Omicron won’t come along and start displacing Delta or co-infecting with Delta in the West. If it does, we’ve got real problems.

Bilal Hafeez (40:24):

And there’s a few more questions from the audience. One was in terms of upcoming news flow. What’s more important, the analysis of the cohorts of cases, hospitalisations, so on, or is it sort of tests around vaccine antibody?

Professor Justin Stebbing (40:41):

We’re going to hear a load of negative news flow. Of that, I have zero doubt that regular antibodies, therapeutic antibodies and vaccine induced antibodies don’t adequately neutralise this. I have no doubt. Yeah, you may see one or two studies saying it does, but the majority will say it doesn’t, I have zero doubt about that. But those studies aren’t as relevant as the real life ones. And the real life ones will give us answers. And if Omicron is as bad as some people say it’s going to be, then we’ll have those answers really soon. If we don’t get the answers soon, then Omicron’s not really a problem. You’re sort of going to know both ways.

Bilal Hafeez (41:20):

Yep. Yep. Understood, yeah. So the real world examples are most important and the absence or not will tell us a lot.

Professor Justin Stebbing (41:27):

One thing the COVID pandemic’s taught us is that real world evidence is really, really important.

Bilal Hafeez (41:32):

Yeah. We had another question asking, we’re obviously in these big Delta waves in Europe right now. Europe had high vaccination levels, so why is that? Why are we seeing such high number of cases in Europe despite vaccinations being relatively high?

Professor Justin Stebbing (41:47):

Just because antibody protection wanes off after six months, simple as that. And Europe started vaccinating relatively late and they haven’t done the boosters yet. So we’re in that window period. Simple as that. And also, it is people are scared of France, because of the anti-vaxxers there, but then France mandated vaccinations. Whereas the big problems are like in Germany and Austria where there’s still a lot of very unvaccinated people. Now I’ll be careful what I say, but I’ve had discussions with anti-vaxxers and there is nothing, there is no rationale, no reasoning that can… And in America as well, there’s a lot of people in the States that believe the world is flat, right? There’s no argument, rationale or reasoning with these people, in my opinion. There’s no science, there’s no… I’ll just leave it at that. And that is a problem for the world. I mean, look, Greece now is going to fine unvaccinated people every month. Different countries will do different things. In America, state lottery is to, and awards and guns and fishing trips, to bring people to have a vaccination work for at least 10 minutes.

Bilal Hafeez (43:17):

Yeah. Okay there was a question on natural immunity, which was around, what was the chance of reinfection? Has it stayed low between variants or not?

Professor Justin Stebbing (43:30):

No. It’s high. But it just happens after about six months. The issue I have with natural immunity is that natural infection can really mess up your immune system and mess up your immune response. And it can stun your immune system, which is why we prefer, people like me prefer vaccination, to give the advantages of the immune response without the disadvantages of organ specific damage and general immune damage and other aspects of the immune system.

Bilal Hafeez (44:05):

It’s not free lunch, so to speak. One person’s asking, your comment about the risk to young children, I mean, is there a chance now that authorities just won’t share that information to the public, that they’ll try to sort of keep that under rounds.

Professor Justin Stebbing (44:22):

I can’t imagine that. I think that would be very surprising. Another thing we’ve learned about COVID is data sharing has become really important. And I have to say that I’m an editor of one of Nature’s journals, and we’ve had a lot of issues with Chinese data in the past, but one thing I’m really encouraged by is we’re seeing a lot of negative Chinese studies published for the first time. So to me, it’s been really encouraging that we’re seeing negative data, negative studies coming out of China and it shows that things are not always as they are perceived or they used to be.

Bilal Hafeez (45:06):

Yeah, we have a question about India. Essentially, the country’s got relatively low vaccination, there’s no booster programme there. Obviously, it got heavily affected by Delta. Is that a country to watch as well?

Professor Justin Stebbing (45:23):

I’m surprised India hasn’t been mentioned. Earlier on in the Omicron, about a few days ago, India was one of the first countries to close its border, I think, to about 20 countries, not just countries in Southern Africa. And so the government there is very worried. If you look at which countries India closed its borders to, in terms of flights, very early in the Omicron kind of worry. The whole India thing is a worry. People thought India reached herd immunity in 2020, how wrong they were. They thought that about Manaus, in Brazil as well, with very high infection rates. And we know. We don’t need reminding that this virus can come in waves either the same type or easier still different types. So if Omicron does turn out to be a problem, I think there’ll be very little cross immunity protecting us. That’s just my personal view.

Bilal Hafeez (46:17):

Which then means the idea of herd immunity doesn’t really make sense then.

Professor Justin Stebbing (46:22):

I think Israel taught us that herd immunity doesn’t exist. They reached like 90% vaccination and then saw a wave in unvaccinated children. Right? They taught us that herd immunity for this virus for whatever reason doesn’t really exist. And I subscribe to that belief.

Bilal Hafeez (46:40):

And we’ve got a few questions about what is the end game here? At what point does this become like seasonal flu?

Professor Justin Stebbing (46:47):

I think it’s possible that Omicron, if it doesn’t cause major sickness, becomes like a seasonal flu virus. Simple as that. I mean, I think of COVID as being about… The way I think of it is as a very primitive doctor, because I’m a real simpleton, is I think about it as being twice as bad as the flu.

Bilal Hafeez (47:11):

Someone’s asking a question, is long COVID related to post-sepsis syndrome?

Professor Justin Stebbing (47:20):

Similar. It’s very similar. All delirium people experience in ITU, when you look at people with post-sepsis syndrome and their symptoms over time, and long COVID, it’s very, very similar. It’s just that there’s very few people in the world with post-sepsis syndrome.

Bilal Hafeez (47:34):

Well, what is post-sepsis syndrome?

Professor Justin Stebbing (47:36):

It’s where someone has a really bad pneumonia, is really, really sick and they’re in hospital for a couple of weeks and then they go out. And a month later, they’re not quite like they were. They’re fatigued, they’re depressed, they’re forgetful. Similar things, very, very similar. It’s just that now we have a lot of people who’ve had this new infection to compare it with a very small number of people who’ve been in hospital and recover with that pneumonia.

Bilal Hafeez (47:57):

And last question, someone’s asking the Covaxin vaccine from India. The compilation of Covax, includes an inactivated coronavirus. What’s your views on that versus other vaccines?

Professor Justin Stebbing (48:10):

I think this makes the possibility that inactivated viral vaccines, which includes the China ones, and Covax may be beneficial because all the other vaccines such as AstraZeneca, J&J, Pfizer, Moderna, rely on an immune response to the spike, whereas within an inactivated virus, you’re going to have an immune response to other proteins as well. It’s going to be much more polyclonal.

Bilal Hafeez (48:39):

So let’s kind of round off all the questions there. We’re coming close to the hour now I did want to talk about your book as well, Justin.

Professor Justin Stebbing (48:46):

Oh that’s super sweet.

Bilal Hafeez (48:48):

So let me just share the screen. I just wanted to show people how to get hold of it. So, it’s on Amazon, Witness to Covid: 2020: The Diary of a Global Pandemic by Justin Stebbing. It’s got some great… it’s got David Sinclair, Sir Michael Parkinson, giving you shout outs then in the bylines, which is great. We’re actually going to give a whole bunch of these books out to our super fans, our sort of members. So a bunch of people will be receiving the books quite soon. But Justin, I mean, I’m kind of halfway through the book, and for me, this is almost like the definitive reference guide to 2020, where in diary form, you go through like, “In January, this is what I was seeing. And this is what studies were being said. And then February, March,” you go month by month. And it’s an amazing, real time account of 2020.

Professor Justin Stebbing (49:34):

And very embarrassing too. So if you get it, I write in early February 2020, “It’s getting warmer in Wuhan. I think the worst of it’s over and this will be gone in a week.”

Bilal Hafeez (49:44):

Yeah. And was this an actual diary you wrote in real time?

Professor Justin Stebbing (49:48):

Yeah, so it’s real time. So if it wasn’t real time, I would’ve taken that out because there’s enough embarrassing information in there that I think, “Oh my gosh, did I really think that at the time?” And of course when you look back like at a share price or a football match, you can always say, “Oh, that was obvious. And that happened because of that.” It’s a lot harder, as we’re now realising with what’s going to happen with Omicron, to say what’s going to happen in the future. Now in two weeks time, I can easily say to you, “Well, that was obvious, why it just did that.” And that’s what happened. It’s very difficult right now to say what’s going to happen over the next two weeks.

Bilal Hafeez (50:25):

Absolutely. Yeah, and as kind of a researcher in markets, what I always like to do is like to go back to real time accounts to see what was driving the price action. So your book for me is an important book.

Professor Justin Stebbing (50:38):

But it also describes how with the artificial intelligence and benevolent AI, we looked for a drug that was both an antiviral and an anticytokine. We came up with this and in nine months we took it through all the clinical trials, from computer, all the laboratory work, showing how it worked in the lab with super resolution microscopy, showing it prevented the viruses getting into cells, through to an FDA approval last November. And it’s just a pill you take once a day. Now, it stops people going to ITU. Steroids are very useful for people on intensive care, this is for hospitalised patients to stop them getting there. And it’s the story of sort of global collaboration occurring at breakneck speed.

Bilal Hafeez (51:21):

Yeah, that’s excellent. So I’ve urged people to get the book. I’ll send people the link as well to the book. And Dominique, do you want to just add a few words to your views on how the Fed and how party makers are going to respond to this or have responded so far?

Dominique Dwor-Frecaut (51:38):

Sure. So the bar for policy response is going to be higher this time arounds. And it was last year for a couple of reasons. First of all, I think a big driver of the policy response in the US was the electoral calendar. So, the pandemic happened to take place in an election year. Then the party that won the white house got a razor thin majority in Congress, so clearly was off to the races to try to limit the damage that typically a midterm election does to the party in the White House. So that explains the scale of the fiscal stimulus, but this strategy backfired because it created a demand shock. The stimulus checks were so high that people’s income increased well above what it was before the pandemic. And to me, that’s a big driver of the inflation we’ve had. And this inflation has dragged down the popularity of the administration, and actually reduced the chances that the Democrats would be able to keep Congress next year. So I don’t think the administration is about to make the same mistakes. In addition to the feasibility of getting another big package through Congress, given the lack of support of the centrist Democrats. So in order to see the fiscal consolidation that’s going on, and that is really unprecedented in size, we would need to see a really bad pandemic, perhaps the panic around toddlers that Justin was talking about. So that’s fiscal policy. Monetary policy, we’ve just had a chair of the Fed telling us that he didn’t think anymore that inflation was transitory and that the Fed would pick up the pace or announce faster taper next… Actually, in a couple of weeks. So that tells us the Fed is much more focused on inflation. And the problem is that no matter what the Fed does, inflation is not going to come down much because of the Fed, because it reflects, A, this past fiscal policy shock I mentioned, and B, supply shocks over which monetary policy obviously has no control. Yeah. So the risk is that the Fed is going to tighten supply shock and that it’s going to add downside to the economy.

Bilal Hafeez (54:39):

That was great. Great, Dominique, thanks for that. I mean, so just a big thanks, Justin. I mean, obviously it sounds like there’s a high level of uncertainty right now. Hopefully in a week’s time, we’ll learn a lot more. Israel’s probably one of the countries to watch just because of the depth and breadth of the data. So next week could be quite pivotal for everything. I mean, from my side, like as Dominique’s been saying, I think it’s too early to make big calls on, in terms of economies and markets and such. And yeah, Justin, we’ll stay in touch and if needed, we’ll try to communicate your views or maybe have another webinar if it’s required.

Professor Justin Stebbing (55:17):

Sure, love to. Thanks so much. Thanks for having me.

Bilal Hafeez (55:20):

So just big thanks again, Justin.

Professor Justin Stebbing (55:22):

Thanks for having me.

Bilal Hafeez (55:22):

And thanks everyone for dialling in.

Professor Justin Stebbing (55:23):

Okay, thanks. Okay, bye.

Bilal Hafeez (55:24):

Great, thanks.

Dominique Dwor-Frecaut (55:24):

Thank you.

Bilal Hafeez is the CEO and Editor of Macro Hive. He spent over twenty years doing research at big banks – JPMorgan, Deutsche Bank, and Nomura, where he had various “Global Head” roles and did FX, rates and cross-markets research.

(The commentary contained in the above article does not constitute an offer or a solicitation, or a recommendation to implement or liquidate an investment or to carry out any other transaction. It should not be used as a basis for any investment decision or other decision. Any investment decision should be based on appropriate professional advice specific to your needs.)