Talks to negotiate a lower price for Pfizer Inc’s COVID-19 antiviral pill Paxlovid in China did not pan out, the Chinese National Healthcare Security Administration on Sunday said, creating a quandary for the Chinese government amid a rampant outbreak in the world’s most populous nation.
Pfizer and the government agency that oversees the state medical insurance program failed to agree on a further cut on the price of Paxlovid, which initially sold for 2,300 yuan (US$340) and was recently lowered to about 1,900 yuan for a course of treatment, Chinese news reports said.
The pill is covered by state medical insurance under a provisional measure, which would continue until the end of March, the agency said in a statement.
Photo: REUTERS
The government remains in talks with Pfizer for a licensing deal to allow domestic companies to manufacture generic versions of Paxlovid, Reuters reported on Saturday.
Although five Chinese companies make inexpensive, generic versions of Paxlovid for low-income countries under an agreement with the UN-backed Medicines Patent Pool, they cannot sell the output in China.
Pfizer’s unwillingness to further reduce Paxlovid’s price underscores the challenge Beijing faces in getting US and European drugmakers to help ease its strain in dealing with a COVID-19 wave that has overwhelmed hospitals and caused medicine shortages.
Pfizer would continue to collaborate with the government and other stakeholders to secure an adequate supply of Paxlovid in China, even though negotiations for state insurance coverage did not work out, the New York-based drugmaker said in a statement yesterday.
Given China’s under-developed private medical insurance market and the reliance of its 1.4 billion people on the state-run program, Beijing has been dangling inclusion on government’s reimbursement list to push drugmakers to offer deep cost cuts.
Every year it negotiates to set prices for newly approved and life-saving medicines that are part of the 2.87 trillion yuan state program, which covers more than 95 percent of the population.
Companies ranging from AstraZeneca PLC and GSK PLC to Gilead Sciences Inc and Pfizer have participated, as the expanded sales volume stemming from the insurance coverage can more than offset the reduced revenue from price cuts.
The approach means some drugs in China cost a faction of their price in developed countries.
While China has relied exclusively on domestically produced vaccines for most of the COVID-19 pandemic, Beijing has demonstrated a greater appetite for antiviral therapies developed abroad following the country’s abrupt termination of its “zero COVID-19” approach last month.
After Paxlovid was approved early last year, state-owned China Meheco Co (中國醫藥) struck a deal to import and distribute more of it to meet surging demand.
Pfizer has also reached deals with two Chinese manufacturers to produce the drug’s ingredients locally. China’s drug regulator approved Merck & Co’s antiviral Lagevrio late last month.
The state-run health insurance program extended coverage to the home-grown COVID-19 antiviral azvudine and traditional Chinese herbal medicine granules, but neither demonstrated the same ability to prevent severe disease and death in clinical trials as Paxlovid.
Supply of the Pfizer drug in China has fallen significantly short of the demand for it, a situation exacerbated by the comparatively low rates of vaccination among elderly people, who are at greater risk of severe disease or death.
Many people have turned to the black market, buying the drug from other countries or bringing in generic versions made in India.
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