Friday January 14, 2022
Contribution of 0.5 percent to GDP
Biontech’s success helps the economy boom
Leading economists are convinced that German economic growth in 2021 would have been significantly lower without the vaccine manufacturer Biontech. There is talk of a “biotech effect”. The success of the Corona vaccine from Mainz lifted GDP growth from 2.2 to 2.7 percent.
The upswing in the German economy would have been one size smaller in 2021 without the business success of Biontech with its Covid-19 vaccine. The now world-famous Mainz-based company may have contributed about 0.5 percent to the gross domestic product (GDP), estimate both the Institute for Macroeconomics and Business Cycle Research (IMK), which is close to the trade unions, and the Kiel Institute for the World Economy (IfW). “There is a clear Biontech effect,” said the Scientific Director of the IMK, Sebastian Dullien.
According to an initial estimate by the Federal Statistical Office, Europe’s largest economy grew by 2.7 percent in 2021. Without Biontech’s success, according to the institutes’ estimates, it would only have been 2.2 percent. “I can’t remember that a single German company has ever contributed so much to growth,” said Dullien.
IfW economics chief Nils Jannsen agrees. The license income from the vaccine developer Biontech, which was due at the end of the year, was included in the calculation of the gross domestic product for the first time. “Gross domestic product is likely to have been boosted by around half a percent in 2021 by Biontech,” he said. “It’s a special case.” The effect is reflected in higher service exports.
The statistical office confirmed that Biontech has boosted the economy noticeably. “The influence is noticeable, that’s clear,” said Michael Kuhn from the Federal Statistical Office. However, the authority did not want to comment more precisely. “We will not provide any information about individual companies,” said Kuhn, even if the topic interests many.
Biontech purchases very little from abroad
According to Biontech, it generated sales of between 16 and 17 billion euros last year with its corona vaccine – the company’s first product to be available on the market since it was founded in 2008. That’s a huge leap: in 2020, sales were less than half a billion. “This is a massive increase that affects the entire German economic growth,” said Dullien.
In addition, Biontech obtains comparatively few preliminary products from abroad that would have to be deducted from the production value for the GDP calculation. “So that’s almost purely domestic value creation,” said Dullien. “That has a direct positive effect on economic growth.”
Biontech has the vaccine based on the new mRNA technology produced in Marburg, for example, and also collects billions in fees from its US partner Pfizer. The impressive success of the company shows that there is an excellent research landscape in Germany, says Dullien.