Market Overview

COVID-19 Vaccines To Generate over $10B Annual Revenue, Analyst Say

COVID-19 Vaccines To Generate over $10B Annual Revenue, Analyst Say

A successful COVID-19 vaccine could be a bumper revenue opportunity for the pharmaceutical companies, with the market estimated to generate at least $10 billion in revenue a year, according to analysts.

The Thesis: Morgan Stanley and Credit Suisse analysts estimate that people will need the vaccine every year, like a flu shot, at a projected cost of $20 per dose, the Financial Times reports.

Morgan Stanley analyst Matthew Harrison said that COVID-19 is not going to go away and will require people to get vaccinated annually. The market size could be worth $10 billion in developed countries alone, even with the conservative assumption that only those who take a flu shot go for the COVID-19 vaccine.

Credit Suisse analyst Evan Seigerman estimates that the market could be even larger and worth $10 billion in the U.S. alone.

The Contenders: Even AstraZeneca plc (NASDAQ: AZN) and Johnson & Johnson (NYSE: JNJ) could make money off the vaccine once their promise of supplying the vaccine at a cost basis till the end of the pandemic is over, FT noted.

Moderna Inc (NASDAQ: MRNA) president Stephen Hoge had said that vulnerable people would continue to get booster shots for a while, and though the opportunity is smaller than flu, it is not a trivial one.

Moderna is expected to submit COVID-19 vaccine trial data to the U.S. regulator in November. The company is developing a vaccine for Respiratory Syncytial Virus and flu, and either could be combined with a COVID-19 shot.

FT notes that the pharma companies have received billions in government funding in the past eight months, and it could profit from public money.

In July, Ex-FDA Commissioner had said that the COVID-19 vaccine should be priced similar to a flu shot, which will afford the company a sufficient margin and some profit that could be invested back in the manufacturing process for future vaccines.

In October, a report claimed that AstraZeneca could start profiting off the vaccine from July 2021, while another report said that Pfizer Inc's (NYSE: PFE) mRNA vaccine could garner $3.5 billion in 2021 sales.


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