Covaxin, India’s home-grown Covid-19 vaccine from Bharat Biotech, will cost Rs 1,200 per dose for private hospitals, twice the corresponding price tag on Covishield, the AstraZeneca vaccine produced in the country by the Serum Institute of India.
The price has been announced in the middle of an uproar over the Centre’s hands-off policy that has passed the vaccine buck to the states and citizens. On Saturday, Arvind Subramanian, the chief economic adviser to the Union government during Narendra Modi’s first innings, made it clear that “the Centre, NOT the states, should bear full fiscal ‘costs’ of vaccines”.
“Why? Virus does not respect state borders. Centre has better access to resources than states. Fiscal ‘costs’ are trivial compared to lives saved and economic activity preserved…,” Subramanian tweeted.
The Hyderabad-based Bharat Biotech announced on Saturday that Covaxin would cost Rs 600 per dose for state governments and Rs 1,200 per dose for private hospitals, but will continue to cost Rs 150 per dose for the central government. Two doses are required for protection.
Bharat Biotech said the four-fold difference between the price tags for the Centre and the state governments owes to the Centre’s buying of large volumes and advance purchase orders, including a commitment to pay Rs 1,500 crore. The states are expected to procure smaller orders and are known to delay payments, a company representative said.
The Pune-based Serum Institute had earlier this week announced that Covishield would cost Rs 150 per dose for the Centre, Rs 400 for the states and Rs 600 for private hospitals.
These prices would apply under the Centre’s revised vaccination policy starting May 1 under which state governments and private hospitals may offer Covid-19 vaccines to people aged 18 or above while the Centre would continue to support vaccinations for all those above 45 years.
Large differences between the costs per dose offered to governments and the price tags for private hospitals and the open market are common practice across the vaccine sector.
Bharat Biotech said Covaxin is an inactivated (killed) virus that involves an expensive manufacturing process because of relatively low yields. “All costs towards product development, manufacturing facilities, and clinical trials were deployed primarily using internal funding and resources of Bharat Biotech,” Krishna Ella, the company’s chairman, said.
The Serum Institute had used a mix of about $270 million of its internal resources, a grant of $300 million from the Bill and Melinda Gates Foundation, and advance at-risk production orders from some foreign governments to raise over $800 million for Covishield production facilities.
Under the Centre’s new Covid-19 vaccination policy from May 1, the Centre will procure only 50 per cent of the doses. The manufacturers can sell the other half to either state governments or private hospitals. It is unclear how many doses of either vaccine would be available in private hospitals.
Company representatives have said the Serum Institute has a current production capacity of 70 million Covishield doses a month while Bharat Biotech produces about 20 million doses a month. Both have announced plans to ramp up production in the coming months.
India has invited foreign vaccine makers such as Pfizer and Moderna to introduce their Covid-19 vaccines into the country’s private market, but health experts tracking global vaccine orders say the companies’ existing orders make it unlikely that India would get those vaccines within the next few weeks.
Under the Centre’s current vaccination campaign, nearly 22.5 million people have already received the two doses required to protect them from the infection. But this is a small fraction of the nearly 900 million people aged above 18.
