09:04 GMT18 April 2021
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    Recent comments by a senior figure at pharmaceutical giant Pfizer have highlighted how the company is looking to turn COVID-19 into a longer-lasting pillar of its business model, including dramatically increasing prices for what could become annual booster shots, as well as the possible effects of a third dose.

    With mass vaccination underway, an end to the pandemic period of COVID-19 is within the bounds of imagination. However, once the uncontained global spread of the disease is over, what comes next? For New York-based pharmaceutical giant Pfizer, that’s when the big bucks start coming in.

    At the Barclays Global Healthcare Conference last week, Pfizer Chief Financial Officer (CFO) Frank D’Amelio laid out for investors the company’s plan to dramatically increase the price of its vaccine against SARS-CoV-2, the virus that causes COVID-19, by nearly 900%, once governments stop being the primary buyers of their vaccine, which they have jointly produced with German firm BioNTech.

    “Based on everything we've seen to date, we believe it's becoming increasingly likely that an annual revaccination is going to take place,” D’Amelio said on Thursday, adding that it would most likely be a single-dose booster.

    He said that so far, pricing for the shot has been dictated primarily by the “needs of governments” to secure enough doses to vaccinate their entire populations at no cost to the receiver.

    “As we move from a pandemic state, from a pandemic situation to an endemic situation, normal market forces, normal market conditions will start to kick in. And factors like efficacy, booster ability, clinical utility will basically become very important, and we view that as, quite frankly, a significant opportunity for our vaccine from a demand perspective, from a pricing perspective, given the clinical profile of our vaccine,” D’Amelio said, adding that “we think as this shifts from pandemic to endemic, we think there's an opportunity here for us.”

    When the disease becomes endemic, that means it’s here to stay and will continue to break out periodically in parts of the population. This is much the case for a disease like influenza, for which an annual vaccine booster is often recommended.

    Last month, D’Amelio told Wall Street analysts that Pfizer gets $19.50 per dose at present, but noted “that’s not a normal price, like we typically get for a vaccine - $150, $175 per dose ... Let's go beyond a pandemic pricing environment, the environment we're currently in: Obviously, we're going to get more on price.” That’s an almost-ninefold increase in price. 

    Pfizer pulled in $15 billion in revenue last just on COVID-related products last year, D’Amelio further noted. He urged that “our objective is always to be very prudent with our shareholders' capital but always to maximize shareholder return.” Indeed, on Thursday Pfizer’s share value has increased by 3.6% since Thursday, which Fox Business credited to D’Amelio’s comments.

    © REUTERS / Tom Brenner
    U.S. President Joe Biden removes his face mask to speak while being introduced by Pfizer CEO Albert Bourla during a tours of a Pfizer manufacturing plant producing the coronavirus disease (COVID-19) vaccine in Kalamazoo, Michigan, U.S., February 19, 2021

    CEO Albert Bourla has claimed the company refused to take federal money because he “wanted to keep Pfizer out of politics,” spending $1.5 billion on vaccine research, but the Trump administration also sent Pfizer $1.95 billion in July 2020 via Operation Warp Speed - one of the largest such contracts under the program - for the first 100 million doses of the vaccine, which were not delivered until December. In December and again in February, the US each time bought 100 million doses for the same price.

    In November, the Department of Health and Human Services revealed that it’s deal with Pfizer did not include government rights to intellectual property developed in the manufacturing of the vaccine.

    In other words, public money helped Pfizer deliver a vaccine for public use, which the company will now seek to transform into a new cash cow for the handful of wealthy private investors who own most of Pfizer’s stock.


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