New Delhi: Producer of COVAXIN, Bharat Biotech on Tuesday justified higher pricing of its coronavirus vaccine in the private market, saying the supply price of the shot for the Government of India is clearly not sustainable in the long run.
“The supply price of COVAXIN to Govt of India at Rs 150 a dose, is a non-competitive price and clearly not sustainable in the long run,” the company stated in a statement.
Delineating factors like low procurement volumes, high distribution costs and retail margins among few others contribute to higher pricing of COVAXIN, Bharat Biotech quoted.
As the government provides the vaccines free of cost, the ROI of the vaccine producer declines as procurement of vaccines by private hospitals is optional and not mandatory.
Therefore, Bharat Biotech communicated the above message to the Central and the State Government. It illustrated the factors cited before freezing the vaccine sale prices and its reliance on raw materials, product failures, at-risk product development outlay, product overages, the entire capital expenditure for setting up sufficient manufacturing facilities, sales and distribution expenses, procurement volumes and commitments besides other regular business expenditures. It also presented the complexity involved in whole-virion inactivated Vero cell vaccines, which require highly sophisticated multiple level containment and purification methods.
So far, Bharat Biotech has invested over Rs 500 crores at risk from its own resources for product development, clinical trials and setting up manufacturing facilities for COVAXIN.