Pharma giant Merck is facing accusations of price gouging after it charged the U.S. more than $700 per patient for a taxpayer-funded coronavirus treatment that, according to research, costs just $17.74 to produce.
The New Jersey-based pharmaceutical giant Merck is facing accusations of price gouging after it charged the U.S. over $700 per patient for a taxpayer-funded coronavirus treatment that, according to research, costs just $17.74 to produce.
Last week, Merck announced plans to request emergency federal authorization for molnupiravir after a late-stage clinical trial showed that a five-day course of the antiviral drug cut the risk of COVID-19 hospitalization or death in half in patients with mild-to-moderate cases.
The same day Merck unveiled the results of the trial and White House officials hailed the drug as another possible tool against COVID-19, the New York Times reported that “the federal government has placed advance orders for 1.7 million courses of treatment, at a price of about $700 per patient” — far more than the estimated cost of manufacturing the drug.
According to an analysis by Melissa Barber of Harvard T. H. Chan School of Public Health and Dzintars Gotham of King’s College Hospital in London, “the cost of production for molnupiravir capsules is U.S. $1.74 per unit, or U.S. $17.74 per five-day regimen.”
“Adding an allowance for 10% profit margin and taxes in India, we arrive at an estimated sustainable generic price of U.S. $1.96 per capsule or U.S. $19.99 per five-day regimen,” the researchers concluded.
Dean Baker, a senior economist at the Center for Economic and Policy Research, noted that the $712 price-per-course price the U.S. government is set to pay for molnupiravir amounts to a roughly 4,000% markup.
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