Thread by @sritara

Thread on BBIL’s justification of higher Covaxin’s prices and the media’s gullible coverage of BBIL’s claims about costs, pricing and output.
1. Most stories in the business media are solely based on the BBIL’s press release of June 15, 2021, without any contestation.

2. To innocent journos who know little about manufacturing and costs, BBIL explains vaccine making has many steps and risks associated with production and marketing of a pharma product. It doesn’t tell us that these risks were known to it BEFORE it undertook to develop Covaxin.

3. It refers to the “complex” manufacturing process associated with the inactivated virus vaccine platform. Again, it does not bother to tell us that nobody forced the company to adopt this platform. It was a choice BBIL made, with its eyes open.

4. Significantly, for a vaccine developed in partnership with the GoI, especially because the basic foundational work was done in publicly funded labs, BBIL is extremely coy about how much support it has received. So, its claims on costs are unsubstantiated.

5. It pretends to ask why Covaxin is costlier but has little by way of explanation. It makes vague references to costs associated with royalties it has to pay but is silent about the significant costs associated with clinical trials, which we know were largely borne by the public

6. Talking in general about costs without any specifics does not in any way justify its claims that Covaxin costs almost twice as much as Covishield because of these costs. It digresses into irrelevant details about its plant having to be spread over a larger area…

7. but misses the sig point that nobody forced it to adopt this platform.

8. In effect, BBIL is adopting double standards. In pricing, it seeks a free hand, but while selling it seeks the market’s forgiveness by taking into account the special “complexities” of the platform it has chosen of its own free will. The word for this is hypocrisy.

9. Most importantly, we know BBIL has struggled to increase output. Its vaccines account for just 12 % of vaccinations so far (since January 2021). In the first half of June (after the May slump) Covaxin vaccinations have been at an avg of about 0.52 million doses/day.

10. This means a monthly rate of 15.6 m doses, a far cry from the 55 m doses/month that was projected for July by the Govt in the SC hearings. In fact, it remains to be seen whether even this surge in 15 days of June remains sustainable over a longer time frame,

11. A fundamental question that ought to be raised by any reporter familiar with industrial production and capacities ought to be this: how far is the constrained capacity responsible for the higher cost of Covaxin? This is because cost per unit is a function of scale economies.

12. If scaling up is proving go be a problem, then these are of BBIL’s own making in terms of underestimating the challenges and instead providing the media with a gung-ho narrative. The only redeeming feature is that the NaMO Govt has been a willing partner in this misadventure.

13. BBIL’s claim that the Covaxin price of Rs. 150/dose, at which it supplies the GoI, is “unsustainable” is unverifiable for the simple reason that we do not know the costs. It cannot seek the logic of the market, but yet somehow seek insulation from competition.

14. Here is an example of innocent, gullible coverage that can only be described as press release journalism. No attempt to check the facts, counter claims or even compare it to previous claims made by BBIL
theprint.in/health/complex…

15. Here is another example of naive journalism that actually justifies dual pricing of vaccines without an iota of evidence or reason
thehindubusinessline.com/news/national/…

16. Here is one from the stables of the biggest of them all - which essentially regurgitates the press release
economictimes.indiatimes.com/industry/healt…

17. This too, from a old and venerable publication, is a story that seems to be afraid to go beyond the press release
business-standard.com/article/curren…

18. This, from a prominent business mag, acts the loyal stenographer of the company (END) businesstoday.in/coronavirus/bh…

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