AstraZeneca has decided to make money from the pandemic after all

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AstraZeneca is now looking for “modest profitability” on its covid-19 vaccines, shifting away from its commitment to provide vaccines at cost as long as the pandemic lasted.

On the back of third-quarter results, which showed that covid-19 vaccine sales had earned $1 billion, Pascal Soriot, AstraZeneca’s CEO, told journalists the company has started signing “commercial orders.” The vaccine, he added, “will never be high-priced. Because we want the vaccine to remain affordable to everybody around the world.”

Soriot didn’t reveal the nature of these deals, or the modesty of the profitability that AstraZeneca is now seeking. AstraZeneca did not respond to a brief questionnaire from Quartz.

AstraZeneca’s vaccine was developed by researchers at Oxford University. One of the chief scientists behind the vaccine, Sarah Gilbert, pushed AstraZeneca to pledge that the shots would be sold on a not-for-profit basis so long as covid-19 was classified as a pandemic, and in perpetuity for low-income nations. Soriot confirmed this to the Financial Times as recently as May, saying: “This is a vaccine that, yes, we could possibly make money out of. But this is in the future. We’ve said that as long as the pandemic is raging, we’ll continue doing it at no profit.”

Does AstraZeneca think the pandemic is over?

Separately, Soriot has said that AstraZeneca would determine the end of the pandemic based on a number of factors, including the World Health Organization’s (WHO’s) evaluation of the covid-19 situation. The WHO’s March 2020 classification of covid-19 as a pandemic is still in force. AstraZeneca also retained the right to declare an end to the pandemic unilaterally any time after July 2021, according to a leaked agreement with a Brazilian manufacturer.

AstraZeneca’s shareholders must have been wondering with increasing impatience when Soriot would call it—particularly in light of the steep profits registered by Pfizer and Moderna, two other companies that developed covid-19 vaccines but that made no promises about profit. Pfizer expects sales from its vaccine to touch $36 billion in 2021; in the third quarter alone, Pfizer made $13 billion off its vaccine to AstraZeneca’s $1 billion. Moderna expects to earn $15-$18 billion from covid-19 vaccine sales in 2021.

Until it manufactured and sold the covid-19 shot, AstraZeneca did not have any major lines in vaccines. Now, however, the company is spinning off a whole new division for vaccines and immune therapies, as demand for covid-19 vaccines—boosters as well as shots for potential variants—appears to stretch into the foreseeable future.

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