Facing flak for selling its anti-Covid jab, Covaxin, at a price cap of Rs 1,410, which is most expensive when compared to others in the private sector, Hyderabad-based Bharat Biotech on Tuesday justified its move saying that it aims to offset the ‘non-competitive’ price of Rs 150 being provided to the Government as it was not sustainable in the long run.
The vaccine maker is currently supplying Covaxin at Rs 150 per dose to the Centre, Rs 400 to the state government and Rs 1,410 to private hospitals. In a statement issued here, the company also pointed out that it has not sought indemnity from the Centre for any adverse events from Covaxin and that it is supplying other vaccines to the government at cheaper prices compared to private market prices.
The company said Covaxin is more expensive for the private sector purely due to fundamental business reasons ranging from low procurement volumes, high distribution costs and retail margins among few others as explained above.
As directed by the Centre, less than 10 per cent of the total production of Covaxin to date has been supplied to private hospitals, while most of the remaining quantity was supplied to State and Central Governments, the company said in the statement.
“In such a scenario the weighted average price of Covaxin for all supplies realized by Bharat Biotech is less than Rs 250/dose. Going forward, approximately 75 per cent of the capacity will be supplied to State and Central Governments with only 25 per cent going to private hospitals,” Bharat Biotech said.
The firm has so far invested over Rs 500 crore at risk from its own resources for product development, clinical trials and setting up of manufacturing facilities for Covaxin, it said.
The pricing of vaccines and other pharmaceutical products heavily relies on a series of factors such as the cost of goods and raw materials, product failures, at risk product development outlays and product overages, besides other regular business expenditures, the city-based company said.