Covaxin to Govt at Rs 150 per dose not sustainable in long run: Bharat Biotech

The whole-virion Inactivated Vero Cell vaccines (COVAXIN derives from this technology platform) are highly complex to manufacture since the critical ingredient is based on live viruses which require highly sophisticated, multiple level containment and purification methods. Such high standards of purification automatically lead to significant process losses and low yields save the outcome of a highly purified and safe vaccine. This is evident from the excellent safety contours of COVAXIN with an impressive supply of more than 40 million doses to date. It is emblematic that Bharat Biotech has not sought Indemnity from the Govt of India for any adverse events from COVAXIN.

Complex manufacturing process:

Further, describing about the complex manufacturing process of COVAXIN, Bharat Biotech noted that the sheer complexity of the COVAXIN manufacturing process is manifested by the fact that it requires about 10,000 sq meters of area to manufacture around 200 million doses of the vaccine annually. In comparison, the same quantity of live virus vaccines can be manufactured from mere 1,500 sq meters. Due to the highly contagious nature of the live SARS-CoV-2 virus, more stringent Biosafety Level-3 (BSL-3) containment facilities are required for the manufacturing of COVAXIN.

Every batch of manufactured product is subjected to more than 200 quality control tests, prior to its release. It is exactly this complexity that has kept away other companies from developing vaccines, especially whole virion inactivated vaccines. The SARS CoV2 virus provided by ICMR-NIV is also equally available to other manufacturers who wish to develop and manufacture such a vaccine. Companies would need access to cell lines, BSL3 manufacturing & quality control facilities, and several well trained technical teams, to manufacture COVAXIN.

Why is COVAXIN more expensive for the private sector:

In continuation, Bharat Biotech highlighted why COVAXIN is more expensive in the private sector. It continued to say that another key point of discussion has been about pricing the company's vaccines for private sector players which is significantly higher than that given to governments and large procurement agencies. This is purely due to fundamental business reasons, ranging from low procurement volumes, high distribution costs and retail margins among few others as explained above.

Bharat Biotech went on to mention that as directed by the Govt of India, less than 10% of the company's 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. 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, ~75% of the capacity will be supplied to State and Central Governments with only 25% going to private hospitals.

The supply price of COVAXIN to the government of India at Rs 150 / dose, is a non-competitive price and is clearly not sustainable in the long run, Bharat Biotech added. Hence a higher price in private markets is required to offset part of the costs.

Furthermore, providing live examples of such pricing policies, Bharat Biotech stated that Human Papilloma virus vaccine is priced for GAVI supplies at ~ $ 4.5 / dose (~ Rs 320), but is also available in the private market at ~ Rs 3500 / dose. Rotavirus vaccines are supplied to the Govt of India at ~Rs 60/ dose, but are also available in the private market at ~ Rs 1700 / dose. The prices for COVID-19 vaccines internationally have varied between ~ $10 to ~ $37 / dose, (~ Rs 730 - ~ Rs 2700/ dose).