Fri Feb 19th, 2021 at 09:42:27 AM EST
According to information revealed by German public media broadcasters NDR and WDR and daily newspaper Süddeutsche Zeitung, last summer the EU Commission received a strictly confidential bid from pharmaceutical manufacturers Pfizer and BioNTech offering their vaccine for a price of 54.08 ($65.4) per dose, for a purchase of 500 million doses.
In total, BioNTech-Pfizer wanted 27 billion to supply enough jabs to inoculate almost half of the EU's population.
But at 54.08 a dose, the BioNTech vaccine would have cost more than 20 times as much as doses of AstraZeneca, which was developed jointly with Oxford University.
At the time, BioNTech-Pfizer said the price already included "the highest percentage discount" offered to any industrialized country in the world.
"I think the price is dubious," said Wolf Dieter Ludwig, chairman of the Drug Commission of the German Medical Association.
"I see in it a profit motive that is in no way justified in the current pandemic situation."
Oxford/AstraZeneca UK-EU vaccine contracts and more Tory falsehoods definition: hoarding
Covid-19 vaccines: a $40bn revenue windfall for pharmaceuticals
The race to find a cure for Covid-19 saw an estimated $25bn spent on pharmaceutical R&D in 2020 alone, with half coming from the US's "Operation Warp Speed".
After a record pace of development, the global vaccination campaign against Covid-19 is well underway, but some countries are moving faster than others. Israel, the UK and the US are clearly leading in terms of doses administered per 100 people, with 48, 11 et 7, respectively, far ahead of Italy (2.5), Germany (2.3) or France (1.8). But as the spread of new Covid-19 variants continues, we expect global vaccination campaigns to ramp up as soon as next month now that both the US and the EU have approved the Pfizer/BioNtech, Lonza/Moderna and Oxford/AstraZeneca vaccines.
Patented drugmakers, i.e. biotech companies and Big Pharma, are set to be the winners of the game at the expense of generic manufacturers that are unable to cash in on the vaccine windfall.
'Generic vaccines' would require too high a financial cost in additional clinical trials and manufacturing expenditures that cheaper prices could not make up for. That's why generic drugmakers are expected to post only +2% revenue growth in FY 2021, compared to +8% for Big Pharma and +21% for biotech drugmakers. In terms of profitability, the operating margin of generic drugmakers is expected to remain below 10% on a global average in 2021, versus nearly 30% for Big Pharma and a lavish 45% for biotechnological companies. However, the latter two segments will still need to watch out for pressure to lower drug prices and (much) less profitable drug wholesalers also wanting their share of the pie.
In the long-run, the success of previously unknown biotechnological drugmakers, notably Moderna and BioNtech, could be a game-changer for pharmaceuticals as a whole.
Barring any unexpected side effects in the long run, the Covid-19 vaccines created using mRNA technology could be the disruption needed in other therapeutic fields, including oncology, a five times bigger market than vaccines. In the future we might see (currently small) biotechnological companies swallowing the world's largest drugmakers eventually, instead of the other way around. Unlike Big Pharma however, biotech companies often lack knowledge in running drug manufacturing plants. Moreover, there is a huge difference in size: the world's 13 largest drugmakers - i.e. Big Pharma - account for about $500bn of total revenues compared to near $100bn for the 15 largest biotech companies. Partnerships between the two are hence the usual way biotech startups break into the pharmaceutical market, as seen in the collaboration between Pfizer and BioNtech.
G7 Countries and Gavi Covax rollout: Me First!
China signs up to WHO supported global COVID-19 vaccine program | BioPharma Oct. 9, 2020 |
US will not send vaccines to developing countries until supply improves | FT |