With demand drastically falling for its COVID-19 shots, Pfizer plans to jack up the price as its product hits the commercial market.
"The EUA way environment has been new for all of us, but we will now be moving into our sweet spot of the traditional commercial marketplace," said Pfizer's global president for hospital business, Angela Lukin, on an analyst and investor call last week. "With decades of experience, launching and commercializing medicines and vaccines, we are confident that we will see the continued success of the vaccine once this transition occurs."
The new price point of $110-$130 in the United States is a four-fold increase compared to its current $30, which is already a more than 50 percent increase from the $19.50 the government paid for the vaccines in its initial contract with the pharmaceutical company. Wells Fargo analyst Mohit Bansal estimates the new cost will bring in roughly $2.5-$3 billion in annual revenue, reports Reuters.
According to BioPharma Reporter, Lukin noted the estimated price represents the value Pfizer believes its product brings to patients and society at large. It also reflects the manufacturing costs, which will include the use of single-dose vials now.
But the massive cost increase goes well beyond what analysts predicted.
"This is much higher than our assumption of $50 per shot, and even assuming $80 per shot net price in high-income countries, we see $2 per share upside to our estimates" from the new prices, Bansal wrote in a research note.
Global vaccine access group the People’s Vaccine Alliance, which has pushed for Pfizer to allow cheaper copies of the vaccine to be made, called the proposed price hike "daylight robbery."
The price range announced by Pfizer represented a more than 10,000% markup over what experts have estimated it costs the vaccine makers to produce the shots, it said.
Pfizer's price targets for its COVID vaccine are well above the cost of annual influenza shots. Under the U.S. Medicare program, the government pays around $20 to $30 for standard flu shots and around $70 for high-dose shots. (Reuters)
Depending on when Pfizer's contracts with the government expire, the transition to the commercial market could take place early next year.
Critics from all sides blasted the massive price hike.
Pfizer’s C19-V is already one of the most lucrative products in history, yet it plans to quadruple its price.
— Aaron Siri (@AaronSiriSG) October 21, 2022
This is not about health. It is about profits. And it will now earn billions more to influence media, hire lobbyists and crush our freedoms.https://t.co/wTTlPBDYGh
After receiving billions in federal contracts, Pfizer wants to charge up to $130 for a COVID vaccine shot that costs as little as $1.18 to manufacture – 10,000% above cost. Enough is enough. The COVID vaccine should cost $0. Pfizer's greed is killing people throughout the world.
— Bernie Sanders (@SenSanders) October 21, 2022