Assessing How Increases in COVID-19 Vaccine Prices May Impact Pharmacies

Pharmacy Times interviewed Susan Lang, MA, MBA, the CEO of XIL Health and former senior executive with Express Grips, on the losses that pharmacies have experienced due to the COVID-19 pandemic.

Alana Hippensteele: With an annual revaccination likely necessary for the foreseeable future due to COVID-19 variants, Pfizer has projected that vaccine prices will continue to increase. If this does occur, what might this mean for pharmacies that have already been hard hit by the pandemic?

Susan Lang: So, a couple things. One is Pfizer did come out when they did their Barclays announcement and said that they believe there will be a booster because of the variants, and this will be an annual event.

So, we already have that—that is a normal service that all pharmacies provide now, which is they do vaccinations. What is different about the pandemic is most pharmacies did vaccinations for adults, they've now reduced that down to children, so down to age 7, maybe age 5—not infants and not toddlers, but children.

So, they're now doing pediatric vaccinations, and that could mean everything from mumps, rubella, measles, whatever. So, that's normal. So, I think they can handle that; that's not the issue. The issue is what happens to the drug when it becomes part of the private supply chain.

So, Pfizer's already announcing they've made an enormous amount of money. They had a 25% net margin on this, which is an unbelievable margin on the COVID-19 vaccine. So, now when it moves to the private supply chain, does the cost of the drug dramatically increase above what any of the payers are willing to pay you to administer the drug? That's what this always comes down to—is there any margin left at all, or do they get squeezed to the point where every time they put a shot in an arm, they lose money.

This is going to become a really basic issue. So, we really have to see what happens in the private supply chain. We have to see what those prices come out to for the vials, and then we'll have to determine if there is an economic reason for them to continue to give the vaccine.

One would assume and hope that there's enough margin that it covers their cost, but that's not guaranteed yet until we see what the numbers are. So, that's what we're waiting to see you.