Feds' contract with Pfizer for Paxlovid has some surprises

NPR has obtained the government's $5.3 billion contract for the first 10 million courses of Paxlovid, an antiviral pill for COVID-19. Here's what's in it.

Transcript

TAMARA KEITH, HOST:

Doctors are counting on Pfizer's antiviral pill Paxlovid to help keep COVID patients out of the hospital. And despite the government spending billions of dollars for 20 million courses of the drug, Paxlovid is hard to come by. Why?

Well, NPR's pharmaceuticals correspondent Sydney Lupkin has obtained a copy of the federal government's Paxlovid contract, and she is here to talk about what's in it. Hello, Sydney.

SYDNEY LUPKIN, BYLINE: Hello.

KEITH: What does the contract tell us about when to expect more Paxlovid to become available?

LUPKIN: It tells us deliveries were always expected to start slowly and that production would inch up and then really get going by summer. For instance, in December, the government was expecting only enough Paxlovid to treat 50,000 people. In March, the contract said there would be enough for another 400,000. And then in August, Pfizer is expected to deliver enough Paxlovid for another 3 million people.

Now, I have to say that since this contract was signed, Pfizer and the government have moved up the delivery targets and doubled the order to 20 million treatment courses. So Pfizer declined to comment on the contract or the schedule. And I haven't seen the new schedule, but it would compress the timeline I just talked about. That said, even though this may not be the complete picture, it's a lot more than we knew about the vaccine delivery timelines a year ago.

KEITH: Right, and - though we also just said it's still hard for sick people to get their hands on the drug right now.

LUPKIN: That's right. As I'm sure some listeners have experienced, the supply is still really tight. The government has distributed about a quarter million courses so far. But Paxlovid production should pick up speed pretty soon.

KEITH: Yeah. And this contract does give you unique insight here. What else is in it? Do we know, for instance, if the government got a good deal?

LUPKIN: So it comes out to $530 for a five-day course of Paxlovid. That's obviously a lot more expensive than the $20 per dose of the Pfizer-BioNTech vaccine. But the United States did get a better deal in some ways. Here's Robin Feldman, a professor at the University of California Hastings College of the Law.

ROBIN FELDMAN: I think this contract reflects a change in the national mood across time. So with vaccines and some treatments on the shelves, the nation is less panicked.

LUPKIN: And that means the government had a stronger negotiating position and appears to have won some concessions. There's a clause saying Pfizer will buy back unexpired Paxlovid if, for some reason, the FDA revokes authorization. And there's also something called a most favored nation clause. That means that if one of a handful of wealthy countries, such as Japan or Germany, gets a lower price on Paxlovid, the United States can push Pfizer for the same price.

KEITH: Have you seen that in any other contracts like this one?

LUPKIN: So it's unusual in a drug contract. A clause like that was also in the Sanofi COVID vaccine contract, but you don't see it too often. James Love is the director of Knowledge Ecology International, a nonprofit public interest group.

JAMES LOVE: The U.S. gets the option to purchase the product at the lowest price. We've been asking for that about 12 times a year to be put into NIH contracts, for example.

LUPKIN: And they haven't been too successful. The argument has always been, the industry will just never go for it. So Love was shocked the government got this clause into the Paxlovid deal. However, the Paxlovid most favored nation clause is limited, so it's only a few countries. So if, for instance, Belgium gets a better price, it doesn't count.

KEITH: So how does that compare to Pfizer's vaccine contract?

LUPKIN: So it's almost the polar opposite of the pricing clause of the original Pfizer vaccine contract. That contract says the vaccine price, $20 per dose, can't be used as a reference price for future purchases. It gave Pfizer more room to raise the price in the future.

But, of course, there's a trade-off. The United States is also paying more money for Paxlovid than the vaccine despite getting a much smaller supply.

KEITH: That was NPR pharmaceuticals correspondent Sydney Lupkin. Thank you, Sydney.

LUPKIN: You bet. Transcript provided by NPR, Copyright NPR.