Pfizer's Covid-19 vaccine may cost less than $10 a dose in India

Govt likely to give partial indemnity to company

US pharmaceutical major Pfizer may price its mRNA-based Covid-19 vaccine, co-developed by BioNTech, below $10 (about Rs 730) a dose in India, sources close to the development indicated. This could be the lowest price of the vaccine globally, and almost half the price in developed markets like the US, UK, and EU.

“It is a single-digit price per dose,” a source said. “This is a not-for-profit price for the government’s immunisation programme.”

Pfizer is now in discussions with the Indian government for supplying the vaccine. “Pfizer has offered to make the required doses of our Covid-19 vaccine available at a not-for-profit price for India, as for all low and lower-middle income countries, once we have the necessary regulatory clearance. Currently, as our discussions with the government of India are ongoing and confidential, we cannot provide further details,” a Pfizer spokesperson said.

The Pfizer-BioNTech vaccine is sold in the US for $19.5 (Rs 1,423) a dose, while in the UK it costs around $21 (Rs 1,532). Its price in the EU was around $18.9 a dose earlier, but price negotiations are on for a higher price of $23.2 (Rs 1,693) a dose. The Indian price, thus, could be the lowest.

The price of Sputnik V, the Russian Covid-19 vaccine, in India is Rs 995 a dose (inclusive of taxes) in the private market, while Bharat Biotech’s Covaxin and Oxford-AstraZeneca’s Covishield, made by Serum Institute of India, are priced at Rs 1,200 and Rs 600 a dose, respectively, when sold to private hospitals. The Centre procures Covishield and Covaxin at Rs 150 a dose at the moment.

Meanwhile, discussions on indemnity are underway between the vaccine maker and the Indian government. The US has provided legal protection to manufacturers like Pfizer and Moderna, except in the cases of “wilful misconduct” by companies. So far, Pfizer has got indemnity (protection against legal suits in the event of any adverse events following vaccination) in the countries where it has launched its Covid-19 vaccine.

“Pfizer seeks indemnity and liability protections in all of our agreements, including the COVAX facility. We seek the same kind of indemnity and liability protections in all of the countries that have asked to purchase our vaccine, consistent with the local applicable laws to create the appropriate risk protection for all involved,” a company spokesperson clarified.

Sources close to the discussions told Business Standard that the government was likely to give a partial indemnity to the company.

“Partial indemnity would imply that the company would disclose the known side-effects or contra-indications of its Covid-19 vaccine. However, against any side-effect that is not yet known to the company and it cannot warn against, they would not be liable to be tried in court of law,” the source cited above said.

Typically, indemnification is a standard clause in vaccine supply arrangements entered by governments around the world, said Sidharrth Shankar, partner, J Sagar Associates, a law firm.

“Grant of indemnity has an impact on the purchase price of the vaccine offered by the manufacturer. Most countries have kept the terms of the agreements entered with vaccine manufacturers confidential. However, a typical indemnity agreement will have clauses such as representations and warranties, for instance, regarding the government’s ability to fulfil the indemnity obligations, ratification of the agreement by the legislature of the receiving country, intellectual property, confidentiality, and protection from liability in case of delayed delivery of vaccines,” Shankar said.

None of the domestic vaccine manufacturers has been granted an indemnity by the Indian government till now. “If the government agrees to give an indemnity to select manufacturers, it will open flood gates for other manufacturers to seek similar terms,” Shankar said.

Moreover, indemnity clauses usually mention the governing law under which one can be tried -– that is the jurisdiction of the court of law. In the case of US vaccine makers, they are likely to insist to be tried in US courts if the need arises, said industry insiders.