https://www.ft.com/content/d415a01e-d065-44a9-bad4-f9235aa04c1a
Pfizer
and Moderna raise EU Covid vaccine prices
Calls for booster shots and spread of more infectious variants
underpin demand for products
Donato Paolo Mancini in Athens, Hannah
Kuchler in London and Mehreen
Khan in Brussels
AUGUST 1 2021
Pfizer raised the price of its Covid-19 vaccine by more than a quarter and
Moderna by more than a tenth in the latest EU supply contracts as Europe
battled supply disruptions and concerns about side effects from rival products.
The groups are set to generate tens of billions of dollars in revenue this
year as they sign new deals with countries anxious to secure supplies for
potential booster shots in the face of the spread of the highly infectious
Delta coronavirus variant. The terms of the deals, struck this year for a total
of up to 2.1bn shots until 2023, were renegotiated after phase 3 trial data
showed their messenger ribonucleic acid vaccines had higher efficacy rates than
cheaper shots developed by Oxford/AstraZeneca and Johnson & Johnson.
The new price for a Pfizer shot was €19.50 against €15.50 previously,
according to portions of the contracts seen by the Financial Times.
The price of a Moderna jab was $25.50 a dose, the contracts show, up from
what people familiar with the matter said was about €19 ($22.60) in the first
procurement deal but lower than a previously agreed $28.50 because the order
had grown, according to one official close to the negotiations.
The official said the companies had capitalised on their market power and
deployed the “usual pharma rhetoric . . . Vaccines work so they increased the
‘value’.”
Pfizer last week raised its guidance for annual vaccine revenue by nearly a
third to $33.5bn, after sales of the shot helped almost double sales in the
second quarter. Chief executive Albert Bourla said prices for higher-income
countries were “comparable”, with middle-income countries charged about half
and lower-income countries paying cost. Pfizer, which shares profits with its
German partner BioNTech, expects to raise prices after the pandemic is over.
The revenue gap between messenger RNA vaccines, whose genetic instructions
prompt cells to make viral proteins that prime the immune system, and more
traditional rivals that contain either viral proteins or an inactivated virus,
is set to widen further next year according to forecasts compiled for the FT by
Airfinity.
The life sciences consultancy predicts sales of Pfizer’s shot will hit $56bn
with Moderna’s reaching $30bn, as they dominate the high-income markets. Sales
of the AstraZeneca jab, which is priced at cost and is the largest vaccine
supplied to low-income countries, are forecast to rise to $15bn next year. The
EU contracts were struck at a complex moment in the bloc’s vaccine rollout, as
it faced supply problems from AstraZeneca and J&J as health authorities
probed a suspected link between their shots and rare blood clots. Recommended
Covid-19 vaccines Covid-19 vaccine tracker: the global race to vaccinate
Brussels was also battling criticism from member states led by Austria that
accused the European Commission of “unfair” vaccine distribution, arguing that
the EU system had left some countries short on supply.
Officials said the commission and EU governments had agreed to pay a higher
price to secure proved supplies from European manufacturing plants. The new
Pfizer price is the same as that agreed earlier in the year on an advance of
10m doses, officials said. One official said staff working for Moderna were
especially “preposterous and arrogant” in their dealings with the commission,
highlighting a lack of previous experience in government affairs.
The revenue gap between messenger RNA vaccines and more traditional rivals
is set to widen further next year © Jens Schlueter/Getty Moderna, whose Covid
vaccine is its first commercially approved product, did not respond to a
request for comment on the details of its EU pricing but pointed to previous
disclosures that smaller-volume agreements would be executed at higher prices.
It reiterated that it aimed to provide effective and affordable vaccines to
“all populations”.
The FT reported last year that Moderna had initially asked buyers including
the EU for a price of at least high double-digit dollars per course. The
commission said Brussels has reserved the right for an additional 1.8bn doses
of Pfizer’s vaccine “to be ready if booster shots are necessary and should we
need additional vaccines in the context of variants”.
Pfizer declined to comment on pricing, citing confidentiality.
