US pharma firms Merck, Pfizer rebuff China’s push for price cuts on COVID-19 drugs

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Top US makers of COVID-19 drugs appear to be pushing back on China’s efforts to get them to cut their prices, underscoring the challenges the country faces in giving its vast population easy access to antivirals.

Merck & Co’s molnupiravir, also known as Lagevrio, will sell in China for 1,500 yuan ($221) per bottle, local media outlet Jiemian reported on Tuesday, citing sources it didn’t identify. While that’s lower than the cost in many western countries, the price signals the US drug firm didn’t agree to a request by the Chinese authorities to cut the price further, it said.

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The company didn’t respond to Bloomberg News’ emailed request for comment on the Chinese media report.

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The apparent rebuff coincides with a similar deadlock over Pfizer Inc.’s antiviral Paxlovid. Talks between the drugmaker and the Chinese agency that oversees the $423 billion state medical insurance program to cut the treatment cost failed over the weekend.

The pricing deadlock reflects China’s quandary as it’s plunged into the biggest virus outbreak in the world after dismantling curbs last month. As its vast population clamors for treatments, China’s homegrown COVID-19 therapies face questions around efficacy and safety while access to foreign, best-in-class ones are largely on Western pharmaceutical companies’ terms.

The lack of treatment supply has also intensified public anger that the Chinese government did not adequately prepare for its abrupt shift in virus control.

State medical insurance provides sole coverage for an overwhelming majority of the country’s 1.4 billion people, and the program reimburses the use of approved COVID-19 medicines including Paxlovid and Lagevrio until the end of March. While China has managed to persuade global drugmakers to lower prices to be included in the insurance list in the past, the lack of agreement on COVID-19 pill costs throws into question whether the drugs will continued to be covered.

With fierce demand for COVID-19 therapies across China, the companies appear to believe that sales will still be strong even if they’re booted off the state coverage list. Pfizer’s Chief Executive Officer Albert Bourla said earlier this week that if insurance coverage lapses, the company is willing to continue to sell Paxlovid in the private market. China’s demand for a lower price than what middle-income countries pay was unacceptable to the company, he said.

“They are the second-biggest economy in the world and I don’t think that they should pay less than El Salvador, which is a poor country,” he said.

Public anger has been growing over the difficulty of access to COVID-19 drugs in China. A shortage of antivirals has already prompted some people in China to turn to the black market, often paying much higher prices for potentially low-quality medicines.

Pfizer’s Bourla said the company’s Chinese partner will start domestic Paxlovid production soon. The drug has so far been imported from overseas by state-owned China Meheco Co. while Chinese generic drug giant Zhejiang Huahai Pharmaceutical Co. has a deal with Pfizer to make Paxlovid ingredients locally.

Read more: COVID-19 surge in China not expected to ‘significantly impact’ Europe: WHO

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