By James Paton, Washington, July 11, 2020
- Agreement could cover as many as 600 million coronavirus shots
- U.S. government to pay when it gets initial 100 million doses
The United States of America has agreed to pay $1.95 billion for 100 million doses of Covin-19 vaccine made by Pfizer Inc. and BioNTech SE, the government’s latest step to lock up supplies to fight the pandemic.
The U.S. will pay the companies when it receives the doses, following regulatory authorization or approval, according to a statement on Wednesday. The government also can acquire up to an additional 500 million doses.
Pfizer shares rose more than 5% in pre-market trading. BioNTech climbed about 5% after the announcement.
Nations around the world have begun ordering vaccines that are still being tested as part of their efforts to try to blunt the impact of the pandemic that’s roiled economies and killed more than 600,000 people since the beginning of the year. The U.S. has already ordered experimental shots including one co-developed by the University of Oxford and AstraZeneca Plc.
Assuming the deal for the Pfizer-BioNTech vaccine is for the first 100 million doses, that suggests a price of $20 per dose, according to Sam Fazeli, a Bloomberg Intelligence analyst.
“If this vaccine prevents disease after one use, we calculate a windfall of more than $15 billion revenue for Pfizer,” he said in a note. “We believe this sets the top price for a vaccine, with lower prices elsewhere. Need for repeated use would be the game changer.”
Earlier this week, Tazeen Ahmad, an analyst with BofA, estimated that BioNTech’s vaccine program is worth about $11.7 billion. That’s based on an estimated $36 net price per dose in the U.S., $30 per dose in the European Union and $12 per dose in the rest of the world.
Pricing a Covid vaccine is far different than other products because of the potential demand and value, Pfizer Chief Executive Officer Albert Bourla said in June at a conference.
“If we try to calculate the value of the vaccine for the pricing like any other vaccine,” through common market principles, Bourla said, “it would be unethical.”
The U.S. deals have stoked concerns that other countries, especially poorer regions of the world, will be left behind. Other rich countries, such as the U.K. and those in Europe, have also secured deals.
The U.S. in May pledged as much as $1.2 billion to AstraZeneca to help make Oxford’s Covid vaccine, and the government has backed projects underway at Johnson & Johnson, Moderna Inc. and other companies.
The Pfizer vaccine would be available to the American people for free, according to the government. The U.S moves are part of a larger initiative to secure coronavirus vaccines for the U.S., officially dubbed Operation Warp Speed.
“Expanding Operation Warp Speed’s diverse portfolio by adding a vaccine from Pfizer and BioNTech increases the odds that we will have a safe, effective vaccine as soon as the end of this year,” Health and Human Services Secretary Alex Azar said in the statement.
This report is part of Kenya Confidential FREE information to inform our readers on progress made in search of vaccines to curb Coronavirus Global Threat.
We welcome DONATIONS to keep us afloat.
Your generosity could save lives.