Covaxin's makers could earn Rs 7,300 cr by vaccinating children

With a booster dose, the market of 12-18-year-olds represents a revenue pool as much as Rs 11,500 cr

Much before PM Narendra Modi called for vaccinating teenagers on ‘mission mode’,  thousands of young adults in the age group of 15-18 years, many in school uniforms flashing their student identity cards, were lining up at vaccination centres to get the first shot of the Covid vaccine. With Modi’s push likely to push reluctant parents of many of these young adults to get them inoculated, the jab’s makers seem to have tapped into a lucrative market for their product.

Bharat Biotech, the inventors and manufacturers of Covaxin, which is being administered to these young adults, could earn revenues of almost Rs 4,300 crore by the time both doses are injected. If the government decides to allow a booster dose of Covaxin in the near future, the revenues from jabbing these young adults could touch Rs 6,400 crore for the Hyderabad-based Bharat Biotech. With vaccination extended to those above 12, this figure could be over Rs 7,300 crore without accounting for boosters. 

According to government projections, there were an estimated 99 million people in the age group of 15-18 years in 2021 in the country. The government reportedly buys a two-dose regimen of Covaxin from Bharat Biotech for Rs 450. The company gets Rs 428 after accounting for tax. A two-dose regimen of Covishield, the vaccine manufactured by Pune-based Serum Institute of India is bought by the government for Rs 410. At the moment only Covaxin is being administered to this age group. The announcement to jab children with Covaxin was made by PM Narendra Modi on the birth anniversary of late PM Atal Bihari Vajpayee on December 25, 2021.

Rs 4,500 crore may just be the beginning of the unravelling of an as yet untapped market for vaccinating kids in the country.  A couple of days after Modi’s announcement, the Drugs Controller General of India (DCGI) had approved administering Covaxin to children above the age of 12 years. Given vaccine supply constraints, the 15-18 year population was initially given precedence. The government is expected to give its nod for jabbing children in the age group of 12-14 by July 2022 once the present inoculation drive gains considerable momentum. That decision would throw open another billion dollar market.

Official projections show that there are 71 million children in the age group of 12 to 14 years in the country in 2021. That’s a market worth Rs 3,200 crore for Bharat Biotech. With a booster dose, the revenues from vaccinating 12-14-year-olds would be almost Rs 4,800 crore. So, if the Modi government goes ahead with vaccinating all those in the age group of 12-18 years with the usual two-dose regimen of Covaxin, the makers of this ‘Made in India’ vaccine could earn revenues of Rs 7,300 crore. With a booster dose, the market of 12-18-year-olds represents a revenue pool of Rs 11,500 crore.    

The juggernaut may not just stop there. In October 2021, the subject expert committee of DCGI had recommended the use of Covaxin to all children above the age of two years. If this proposal were to get the green signal by the end of the year, another captive market of 231 million children in the age group of two to 11 years would open up. Double dosing them at government authorised rates would mean that close to Rs 9,900 crore would be at stake.

Covaxin was developed as a public-private partnership with monetary support from the central government. It is made with an inactivated virus that grown in a vero cell. The vaccine completed phase 3 clinical trials in India in July 2021 with 26,000 volunteers part of the experiment. It started experiments on children soon after that. In over 525 children enrolled as volunteers, nobody reported any serious adverse side effect after being given the vaccine.  

The government’s policy stance could further help Bharat Biotech in cementing its position in this multi-billion dollar market for Covid vaccines for children. India’s drug regulator DCGI has approved another ‘made in India’ vaccine, developed by Gujarat-based Zydus Cadila for use in children above the age of 12 years. Touted as the world’s first DNA vaccine, Zydus Cadila’s jab hasn’t yet been given the clearance by the National Technical Advisory Group on Immunisation. Till date, only Covaxin has been recommended for use in non-adults in India by the group. Recently the Indian Council of Medical Research (ICMR) “strongly recommended” the use of the vaccine as a booster shot for even adults.  

This could well help Bharat Biotech catch up, atleast partially, with Serum Institute of India’s dominance in the Indian Covid vaccine market. More than 85 per cent of all vaccines administered in India were Covishield, manufactured by Adar Poonawala’s company. Significantly, these earnings are many times than what Bharat Biotech earns as revenues every year. Latest regulatory filings show that it earned revenues of Rs 1,080 crore in 2019-20, which was just a fifth of what Serum Institute earned in revenues. Bharat Biotech's spokesperson did not reply to questions till the time of publication. However in a separate e-mailed statement by the company, it’s managing director Dr Krishna Ella said: “Our goals of developing a global vaccine have been achieved. Covaxin is now indicated for adults, children, 2 dose primary and booster doses. This enables the use of Covaxin as an universal vaccine.”

The decision by India to jab children with Covaxin could also prompt other nations using the vaccine to follow suit. This could provide a further impetus to Bharat Biotech’s export revenues which have remained miniscule compared to its domestic revenues in the past. The company has sold vaccines in nations like Afghanistan, Myanmar, Iran, Paraguay, Cambodia and Mauritius among others.