The drug manufacturing industry during the pandemic has presented its humanitarian caring face during the Covid 19 pandemic and its PR departments have done well in giving the image that they are not taking any mercenary advantage of the health emergency. Short term tactics however are not the same as a long term marketing strategy.
Executives at Johnson & Johnson, Moderna, and Pfizer—the pharmaceutical corporations that supplied the Covid-19 vaccines —are quietly planning to hike prices on doses "in the near future," once they decide the pandemic is over.
Many epidemiologists expect the coronavirus to continue to mutate, requiring booster shots on a regular basis and the pharmaceutical companies understand the business opportunities about cashing in.
Pfizer is very clear about the enormous moneymaking opportunity they see in the vaccines.
"As this shifts from pandemic to endemic, we think there's an opportunity here for us," Pfizer's Chief Financial Officer Frank D'Amelio said during a recent healthcare conference sponsored by Barclays Bank. The potential need for booster shots, D'Amelio added, provides "a significant opportunity for our vaccine from a demand perspective, from a pricing perspective, given the clinical profile of our vaccine."
Carter Lewis Gould, an analyst with Barclays Bank, noted that Pfizer faced the particular challenges with "optics" but asked when the company could "pursue higher pricing down the road." The current pricing, answered D'Amelio, is "clearly not being driven by what I'll call normal market conditions, normal market forces," but rather the "pandemic state that we've been in and the needs of governments to really secure doses from the various vaccine suppliers." Once the pandemic ends, he continued, there will be "significant opportunity" for Pfizer.
Moderna and Johnson & Johnson have indicated to investors that they plan to return to more 'commercial' pricing as early as later this year."
Moderna President Stephen Hoge said that "post-pandemic, as we get into those what I will call seasonal epidemics that you would expect to happen with a SARS-CoV-2 virus, we would expect more normal pricing based on value."
And at the Raymond James Institutional Investors Conference earlier this month, Johnson & Johnson's Executive Vice President Joseph Wolk told investors that the company would "reevaluate the vaccine for 'pricing that's much more in line with a commercial opportunity' when the pandemic is over."
The Covid-19 vaccines are already poised to be some of the most lucrative drugs of all time and will be expected to bring in billions in profit this year alone. But a one-time bonanza is not enough, a steady constant stream of revenue is what the stock-market seeks.
Through its massive army of lobbyists, Big Pharma has been fighting calls to regulate drug prices as well as the India and South Africa-led proposal to temporarily waive the World Trade Organization's patent protections, which currently enable a handful of private companies to monopolize knowledge and technology related to coronavirus tests, treatments, and vaccines.
Pfizer's Chief Executive Officer Albert Bourla told investors during a call that "the company had little to worry about in terms of political opposition."
"We believe the industry has generated a great deal of goodwill with Congress and public opinion through our Covid-19 treatment and vaccine efforts," said Bourla.
Companies like Pfizer, which has not made the vaccine available to 85% of the world's population, are enjoying immense popularity in the U.S. and Europe because of the fact that they got the vaccines done fast, and they seem to work well. That's an unusually good position for pharma, they're not used to being thought of as benefactors and saviors.
Big Pharma's profit-maximizing behavior is that they are now waiting for the opportune time to raise prices once enough people have been vaccinated.
Last year routine visits to the doctor's office and demand for new prescription medications fell sharply as a result of the pandemic. The pharmaceutical industry made up for lost revenue by raising prices on more than 300 drugs in the U.S. on January 1.
As Bernie Sanders indicated, "It is unconscionable that amid a global health crisis, huge multibillion dollar pharmaceutical companies continue to prioritize profits by protecting their monopolies and driving up prices rather than prioritizing the lives of people everywhere, including in the Global South."