Covid-19 Vaccine Prices

By Dr Milton Lum | 25 December 2020

Agreements on vaccine procurement and pricing should be subject to external oversight of the Executive.

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Covid-19 vaccines are expected to be a significant intervention in managing the pandemic.

The Covid-19 vaccines have been tested, produced and licensed for use in about 10 months – a relatively short time in vaccine development.

The production of vaccines, like medicines, is an expensive process. The development of the scientific knowledge and production take time. Expenditures expended may end up with nothing.

Pharmaceutical companies that tried to produce vaccines against SARS and Zika virus got their fingers burnt. Whilst poorer countries need large volumes, the prices have to be affordable to them. On the other hand, the influenza vaccine generates billions annually, particularly as annual boosters are needed with the influenza virus constantly mutating.

Governments, private companies, non-governmental organisations and COVAX, the vaccines pillar of the ACT-Accelerator partnership launched by the World Health Organization (“WHO”), Coalition for Epidemic Preparedness Innovations (“CEPI”) and Gavi, the Vaccine Alliance have funded the development of the Covid-19 vaccines.

Different prices for different vaccines

Pharmaceutical companies are charging different prices for different Covid-19 vaccines.

The WHO states “Vaccine pricing is becoming increasingly complex and multidimensional at a global level and in certain country contexts. Contracts now include elements such as assured volumes, upfront payment, multiyear contracts, bundling of products, discounts and rebates, etc. These conditions make it more difficult to identify the actual price of a vaccine and to disaggregate all price components.”

Many of the rich countries signed agreements with Covid-19 vaccine manufacturers, and some made contributions to research and development and even made pre-payments.

The Belgian budget state secretary’s tweet about the price list of the Covid-19 vaccines that her country intended to purchase from the European Union (“EU”) drew the ire of pharmaceutical companies. The tweet was deleted, but not before screenshots taken have put it in the public domain.

The prices that the EU is paying for the vaccines are:

  • Oxford/AstraZeneca: €1.78 (£1.61)
  • Johnson & Johnson: $8.50 (£6.30)
  • Sanofi/GSK: €7.56
  • Pfizer/BioNTech: €12
  • CureVac: €10
  • Moderna: US$18

Belgium, which has a population of 11.5 million, will purchase more than 33 million vaccines for a total of €279 million (£253 million). The mix of the vaccines are in the tweet below.

The prices for the various Covid-19 vaccines differ between that in the United States (“US”) and European Union (“EU”) as summarised in The Washington Post of 18 December 2020.

Another summary by the British Broadcasting Corporation (“BBC”) is shown in the graph below.

Malaysia’s Vaccine Procurement

The currently available Covid-19 vaccines require two doses to be administered. As such, Malaysia, with a population of 32 million, would require 64 million doses.

The Prime Minister has announced that the Covid-19 vaccine will be given free to all Malaysians. On 27 November 2020, the government announced that it will purchase 12.8 million doses of the Pfizer vaccine to vaccinate 6.4 million people. One million doses of the vaccine will be delivered in the first quarter, 1.7 million in the second, 5.8 million in the third and 4.3 million in the fourth quarter of 2021.

The government has also signed an Optional Purchase agreement with COVAX to provide vaccines for 10% of the population i.e. 6.4 million doses for 3.2 million people. The ceiling price per dose has been set at US$10.55.

On 21 December 2020, the government signed an agreement with AstraZeneca to purchase 6.4 million doses of its vaccine to vaccinate 3.2 million people. The agreements announced to date would be sufficient to vaccinate 12.8 million Malaysians i.e. 40% of the population.

Based on the prices for the EU and the US, the Pfizer vaccine would cost the government between US$188.93 million to US$249.60 million, and the AstraZeneca vaccine between US$14.02 million and US$25.60 million. Based on the ceiling price, the COVAX vaccine would cost a maximum of US$67.52 million. The cost then to vaccinate 40% of the population would be between US$270.47 and US$342.72 million.

On 23 December 2020, the Minister of Science, Technology and Innovation announced that the government is also negotiating to buy 14 million and 3.5 million doses of the Sinovac and CanSino vaccines from China, respectively, and 6.4 million doses of the Sputnik V vaccine from Russia to cover another 11.95 Malaysians. With these additional purchases, up to 26.5 million people i.e. 82.8% of the population.

The published price per dose of the Sinovac vaccine ranges from US$13.60 to US$29.75 and the Sputnik V US$10. Indonesia will be getting the Sinovac vaccine at US$13.60. The price per dose of the Sinovac, CanSino and Sputnik V vaccines for Malaysia were not disclosed. However, reports of phase 3 trials of these vaccines are yet to appear in the scientific literature.

The Minister of Science, Technology and Innovation tweeted that the vaccine expenditure on 22 December 2020 for 26.5 million Malaysians was US$504.4 million.

Transparency And Accountability Needed

The Finance Minister informed Parliament that MYR3 billion (about US$750 million) has been allocated for Covid-19 vaccine procurement (Hansard 20201217). The government has stated that the targeted coverage of the population is 70%.

Covid-19 vaccine procurement has been politicised by politicians and interested parties. Some of the statements have not been based on facts, but were misrepresentations of the complexities of global vaccine pricing.

Concerns have been raised about the effects of the politicisation undermining and eroding public confidence in the efforts to procure safe and effective vaccines for the population.

The government has not disclosed the purchase price of any of the Covid-19 vaccines which it has agreed to purchase or is currently negotiating to do so, and the proposed quantum.

The reason given for not disclosing the purchase price of all the vaccines which the government has signed agreements to purchase and those that it is negotiating is that non-disclosure agreements (“NDA”) have been signed with the manufacturers.

It is difficult to accept such simplistic reasons as large sums of public monies are involved. When NDAs are signed that limits disclosure of information, about any procurement, to a few individuals, it raises suspicions of impropriety, whether real or not.

Agreements on vaccine procurement and pricing should be subject to external oversight of the Executive. This can be done expeditiously by the Parliamentary Select Committee on Health, Science and Innovation as well as its Public Accounts Committee, and not presented as a fait accompli.

The Dalai Lama stated: “A lack of transparency results in distrust and a deep sense of insecurity.”

Public trust is critical to getting to grips with the pandemic. A trust deficit is the last thing any government would want as population support is vital if the SARS-COV-2 virus is to be stopped in its tracks.

Paraphrasing Abraham Lincoln, the use of the acronym NDA may fool some of the people all of the time, and all of the people some of the time, but one cannot fool all of the people all of the time.

The onus is on the government to be transparent and accountable for Covid-19 vaccine procurement and pricing.

“Secrecy is the linchpin of abuse of power, . . . its enabling force. Transparency is the only real antidote.”

Glenn Greenwald

Dr Milton Lum is a past President of the Federation of Private Medical Practitioners Associations, Malaysia and the Malaysian Medical Association. This article is not intended to replace, dictate or define evaluation by a qualified doctor. The views expressed do not represent that of any organization the writer is associated with.

  • This is the personal opinion of the writer or publication and does not necessarily represent the views of CodeBlue.
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