With the approval for a coronavirus vaccine inching nearer, questions are mounting over how it will be priced and how much money drugmakers will make.
In a recent hearing of the U.S. House Energy and Commerce Oversight and Investigations Subcommittee, several of the major pharma companies in the hunt for a vaccine expressed differing views over how much it should cost. Officials from Pfizer, AstraZeneca, and Johnson and Johnson reportedly said that they will initially produce vaccines on a non-profit basis. Moderna and Merck, however, indicated that their vaccines will be priced above the cost of production.
Typically, flu shots are priced between $16-25 per dose, but analysts from Jefferies have speculated that a coronavirus vax could be priced between $50-100 per course. Although vaccines don’t typically generate large profits for pharma companies, Jefferies has estimated that if several doses of a coronavirus vaccine are needed, companies such as Moderna could pull in over $5 billion in revenue.
However, Pfizer may have already settled the matter. This week, Pfizer and BioNTech signed a $2 billion agreement with the U.S. government to supply 100 million doses of its lead vaccine candidate, pending FDA approval. As part of the deal, the companies agreed to sell their vaccine for $19.50 a dose, which analysts say could set a price ceiling for the fast-developing market. Pfizer expects that patients will need two doses of their vaccine making the cost to inoculate a patient near $40.
Although the other companies with leading vaccine candidates have yet to say exactly how they’ll price their shots, analysts believe that it’s unlikely they’ll now set the cost above $20 per dose, unless their vaccine has been proven to be more effective.
Most of the companies with lead candidates are also receiving hefty investments from the U.S. government to support their development efforts, which will increase scrutiny of pricing.