Bharat Biotech says current price of Covaxin not sustainable

The prices for Covid-19 vaccines internationally have varied between Rs 730 to Rs 2,700 per dose.

Vaccine maker Bharat Biotech on Tuesday said it was not feasible to price its Covid-19 vaccine, Covaxin at `150 per dose. The company said a higher price in the private markets was required to offset part of the costs as current prices were not sustainable in the long term.

The supply price of Covaxin to the government of India was at Rs 150 per dose and most of the doses were supplied to the state and central governments. Less than 10% of the total production has gone to private hospitals. The price for the private sector players was fixed at Rs 1,200 per dose. The company has to date supplied 40 million doses. Going forward, 75% of the total output will be supplied to state and central governments, while 25% will go to private hospitals.

Bharat Biotech said it had so far invested `500 crore at risk from its resources for product development, clinical trials and setting up of manufacturing facilities for Covaxin. Support from The Indian Council of Medical Research (ICMR) was providing of the SARS CoV2 virus, animal studies, virus characterization, test kits and partial funding for clinical trial sites. In return for this support, Bharat Biotech would be paying royalties to ICMR and the National Institute of Virology based on product sales. Royalties are also payable to Virovax towards the licensure of molecules.

The company is also investing in new facilities and repurposing existing ones across several states in India for enhancing the production of Covaxin. The urgent need to set up a significant number of manufacturing facilities had led to the diversion of existing facilities towards Covaxin, resulting in reduced production of other vaccines causing a loss in revenues.

Defending the significantly higher pricing for private sector players compared to what was sold to the government, the company said it was purely due to low procurement volumes, high distribution costs and retail margins. The company said a higher price was also due to the complex technology of making the whole-virion inactivated vero cell vaccines with critical ingredient based on live viruses, which require highly sophisticated, multiple level containment and purification methods.

The absence of a dual pricing system would lead to Indian vaccine and pharmaceutical companies being reduced to mere contract manufacturers with intellectual property licensed from other nations, the company said.
The company has quoted examples of such pricing policies in the case of the human papillomavirus vaccine which is priced for GAVI supplies at Rs 320 and at Rs 3,500 in the private market. The rotavirus vaccines are supplied to the government at Rs 60 per dose but costs Rs 1,700 in the private market. The prices for Covid-19 vaccines internationally have varied between Rs 730 to Rs 2,700 per dose.