US plans shift to private market sales of COVID-19 vaccines, drugs

Dive Brief:

• The U.S. government plans to stop buying COVID-19 vaccines, treatments and tests as early as this fall and shift the distribution to private market sales as the coronavirus pandemic endures into its third full year.
• Most commercial sales will not begin until 2023, when officials expect to have worked out regulatory and market issues like making sure uninsured people have access to the vaccines, White House Covid-19 response coordinator Dr. Ashish Jha said on Monday. “My hope is that in 2023, you’re going to see the commercialization of almost all of these products. Some of it is actually going to begin this fall, in the days and weeks ahead.”
• The transition will initially start with treatments like Eli Lilly’s antibody drug, which the company said could be made commercially available in the U.S. by this week before government-bought supplies run out. The Biden Administration has already agreed to purchase updated COVID-19 vaccines that could be available by “early to mid-September,” Jha said.

Dive Insight:

The U.S. government has covered much of the cost of the response to COVID-19, spending billions of dollars on vaccines, therapeutics and diagnostic tests. Its goal was to develop shots within a year under ‘Operation Warp Speed’ and provide free access to them and other treatments to mitigate the impact of the pandemic, which has led to the deaths more than 1 million people in the U.S.

Nearly 70% of Americans are now fully vaccinated against COVID-19, with most of them receiving the messenger RNA shots from Moderna and Pfizer. The government also spent billions of dollars on supply deals with several others, among them Johnson & Johnson and Novavax, which developed the other two shots now available in the U.S. 

But the pandemic is shifting. Infections and deaths have fallen well below their peak levels, and developers have turned their attention to updated shots expected to be used in a fall booster campaign. Jha characterized COVID-19 as a now endemic disease, arguing that the government should get out of the business of buying medicines directly over the long run.

That means a transition to private market sales of vaccines and drugs is coming. The first is Lilly’s antibody treatment bebtelovimab. CEO Dave Ricks said Lilly would begin commercializing the drug this month as part of the move away from large federal government purchases.

The costs of COVID-19 vaccines and treatments could rise once they’re being sold privately because of the additional distribution expenses and loss of discounts from government bulk pricing, Pfizer CEO Albert Bourla said in late June, during the company’s second quarter earnings presentation.

“If we move to a normal market, the prices would reflect — both in vaccines and in antivirals — the prices of similar value, similar technology products that are out there,” he said.

Manufacturing single doses of vaccines and broadening distribution to include doctors’ offices makes the task more complex as well, Bourla said.

A private market for COVID-19 vaccines will be more fragmented, Moderna Chief Commercial Officer Arpa Garay said during the company’s latest earnings call. Moderna’s sales force has already been preparing for the transition by engaging with commercial payers, distributors and key pharmacies, he said. 

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