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U.S. to end purchase of COVID-19 vaccines as industry pivots to commercial market

Vaccine makers have been working on a transition to a commercial market in the U.S. by next year, as White House COVID-19 Response Team coordinator Dr. Ashish Jha said Tuesday the U.S. government will stop buying treatments, tests and vaccines by this fall.

"My hope is that in 2023, you're going to see the commercialization of almost all of these products. Some of that is actually going to begin this fall, in the days and weeks ahead. You're going to see commercialization of some of these things," Jha said at a U.S. Chamber of Commerce Foundation event.

Tests have already been available commercially at pharmacies, grocery stores and online, and treatments — those that remain effective — are pivoting to commercialization for 2023.

Of the four vaccines available in the U.S., only two have regulatory approval to go commercial: Moderna (MRNA) and Pfizer/BioNTech (PFE/BNTX).

Both companies have U.S. government orders for booster doses this fall, and are only planning to transition out after those doses have been delivered — but have not determined details such as price of doses, coverage by insurers, and details of how to transition logistics away from the government partnership.

Moderna, by comparison, said it is already working on commercialization.

"The commercial organization has already engaged with commercial payers and the channel, both channel distributors as well as key pharmacies, in anticipation of this shift. Internationally, we expect public health authorities to remain key purchasers of vaccines but we are also identifying markets where there may be a private commercial market as well," Arpa Garay, chief commercial officer, said during an earnings call this month.

A Jackson-Hinds Comprehensive Health Center nurse prepares a syringe of a Moderna COVID-19 vaccine at an inoculation station next to Jackson State University in Jackson, Miss., Tuesday, July 19, 2022. (AP Photo/Rogelio V. Solis)
A Jackson-Hinds Comprehensive Health Center nurse prepares a syringe of a Moderna COVID-19 vaccine at an inoculation station next to Jackson State University in Jackson, Miss., Tuesday, July 19, 2022. (AP Photo/Rogelio V. Solis) (ASSOCIATED PRESS)

Novavax (NVAX), which only just got emergency use authorization and is filing for booster approval in adults, and Johnson & Johnson (JNJ), do not have approval.

Novavax said it intends to pursue full approval by then end of 2022 and pricing will "be similar to the premium-priced influenza market in the U.S."

J&J faced waning demand in recent months as the Centers for Disease Control and Prevention (CDC) warned against potential blood clot risks, and advised Moderna and Pfizer doses be used to boost protection against emerging variants. J&J did not respond to a request for comment Wednesday.

Insurers are awaiting guidance from the government, as well as the official end of the public health emergency, which is set to expire October 13 — and has a 60-day notice if the Biden administration intends to lift it. All signs point to another extension, which would leave in place coverage and rules for vaccines, treatments, tests, and even provisions for telehealth and other pandemic-related shifts in policy and operations.

But once the emergency declaration is lifted, it opens the floodgates to a myriad complexities. Who will be paying out of pocket costs and copays, including through Medicare, remains unclear. The Centers for Medicare and Medicaid Services (CMS) did not respond to a request for comment Wednesday.

But with Congress unwilling to budge on ongoing funding, the U.S. is facing a potential cliff in vaccine availability. Currently, the U.S. has ordered booster doses for adults in the fall, but not enough for all.

The government has ordered 105 million Pfizer doses for delivery through the end of 2022, with an option to purchase 195 million more, and 66 million doses from Moderna through the end of 2022. The 171 million doses is about two-thirds of the more than 250 million needed to give each adult an additional booster.

Follow Anjalee on Twitter @AnjKhem

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