Should the Covid-19 vaccine being developed by Pfizer Inc. (NYSE:PFE) prove successful, it could give the company a $15 billion shot in the arm.
That's the potential sales estimated by Bloomberg Intelligence analyst Sam Fazeli for a one-dose regimen of the vaccine, according to a FiercePharma article. Of course, that's contingent on Pfizer being able to deliver 100 million doses of an effective inoculation.
Pfizer's deal also includes an option for another 500 million doses, RBC Capital Markets analyst Randall Stanicky pointed out, so "investors are increasingly seeing real opportunity here."
Meanwhile, Johnson & Johnson (NYSE:JNJ), a late entrant to the vaccine race, has started its first human trials. The company is testing both one and two shots, but thinks, based on animal tests, that one might be enough. AstraZeneca's (NYSE:AZN) goal was also one shot, but got better results when a booster was added, according to BioPharma Dive. Pfizer said it's going after a two-dose regimen
Only a month ago, Pfizer CEO Albert Bourla said it would be unethical for the company to price the vaccine based on typical market demand, though he called the business opportunity "huge" under "open-market principles."
At the time, Bourla said the company never started its research seeking a return on its investment, but was looking for a "return on effort." He seems to have altered his opinion since then, after the company started phase 3 trials of a vaccine with its partner BioNTech SE (NASDAQ:BNTX) and secured a nearly $2 billion supply agreement with the U.S. government.
Bourla said this week that he disagrees with those who think Covid-19 vaccine developers shouldn't profit from their products. "You need to be very fanatic and radical to say something like that right now," he told Barron's. He pointed out that the private sector is spending heavily on a solution, with Pfizer slated to sink more than $1 billion into its vaccine development and manufacturing this year.
Both Johnson & Johnson and AstraZeneca have said they won't pursue profits on their vaccines during the pandemic. Moderna Inc. (MRNA) seems to be following in Pfizer's footsteps. FiercePharma reported that Moderna could price its vaccines between $50 and $60 per course--consisting of two shots--according to unconfirmed reports.
Representative Jan Schakowsky, a Democrat from Illinois, told Barron's that if the report is true, "it will represent yet another example of why we must require reasonable pricing of Covid-19 vaccines and treatments that have been developed by taxpayers." Because Moderna has taken $955 million from the U.S. government, the company will likely be under more pressure to temper its pricing. Meanwhile, Pfizer has yet to take a dime in federal funds.
Michael Neidorff, the CEO of large health insurer Centene Corp. (NYSE:CNC), sided with those urging restraint, suggesting companies keep their Covid-19 vaccine prices low. "My whole mentality is, when things are tough, that's not the time to try to capitalize on it, he told Forbes.
Disclosure: The author holds positions in Pfizer and Johnson & Johnson.
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This article first appeared on GuruFocus.