Moderna CEO Stephane Bancel defends fivefold price hike of Covid vaccine during Senate grilling

Sen. Bernie Sanders grills Moderna CEO over Covid vaccine prices during hearing

Moderna CEO Stephane Bancel on Wednesday defended the company’s plans to hike the price of its Covid shots fivefold, deflecting pressure at a Senate hearing to abandon the hike while taking barbs over his compensation.

Moderna plans to increase the list price of its vaccine 400% to $130 when the shots are sold on the private market as early as this fall. The company has been charging the U.S. government about $26 per dose.

Vermont’s independent Sen. Bernie Sanders, chairman of the Senate health committee, pressed Bancel during the hearing to agree not to increase the vaccine’s list price by that much.

“Quadrupling the price is huge,” Sanders told Bancel. “I would hope very much you would reconsider that decision. It’s going to cost taxpayers of this country billions of dollars. Is that something you can do?”

Chairman Bernie Sanders, I-Vt., questions Stephane Bancel, CEO of Moderna, during the Senate Health, Education, Labor and Pensions Committee hearing titled Taxpayers Paid Billions For It: So Why Would Moderna Consider Quadrupling the Price of the COVID Vaccine? in Hart Building on Wednesday, March 22, 2023.

Tom Williams | Cq-roll Call, Inc. | Getty Images

Bancel declined to make such a commitment. He told the committee that the Covid vaccine market is changing substantially as the U.S. government stops buying and distributing the shots for the entire country.

Join CNBC’s Healthy Returns on March 29th, where we’ll convene a virtual gathering of CEOs, scientists, investors and innovators in the health care space to reflect on the progress made today to reinvent the future of medicine. Plus, we’ll have an exclusive rundown of the best investment opportunities in biopharma, health-tech and managed care. Learn more and register today: http://bit.ly/3DUNbRo

Moderna expects demand for the vaccine to fall by 90%, leaving the company will be on the hook for any wasted doses, Bancel said. During the pandemic, the federal government picked up those costs.

“To protect people, we need to make more than we think is going to be needed. We are going to have to pay for it,” Bancel said.

Moderna developed the vaccine partnership with the National Institute of Health. The U.S. government spent $12 billion on research, development and procurement of the shots.

The Covid vaccine remains Moderna’s only product on the market at the moment. The company has made $21 billion in profits since the shot first rolled out in the U.S. in December 2020.

Sanders accused Bancel of “profiteering” and “excessive CEO compensation” during his opening remarks. The senator later told Bancel the public doesn’t understand why Moderna is quadrupling the price of the vaccine when the company and its executives have made so much money.

Bancel cashed out more than $390 million in stock options in 2022, according to financial disclosures. He had a 7.3% stake in Moderna as of March 8 valued at $4.3 billion based on the stock’s Tuesday closing price of $152.10 a share.

Moderna’s board of directors approved a golden parachute for Bancel that soared to $926 million at the end of 2021 as the company’s stock price surged. The value of that package had decreased substantially by the end of 2022 to about $472 million as Moderna’s shares fell in value, according to financial disclosures.

Sen. Mitt Romney, R-Utah, came to Moderna’s defense. Romney said Bancel has become a billionaire because the stock he owns is now valuable due to the success of the company’s technology. Romney said people who invest large sums of money in risky, unproven drugs and treatments need a substantial return.

“I don’t know how much money is the right amount of money,” Romney said. “But the idea that somehow corporate greed has just been invented in America is absurd. It’s been there since the beginning of free enterprise — individuals investing, hoping that if it succed they’ll do very well financially.”

Bancel said the U.S. vaccination program has provided $5 trillion in economic value and prevented 18 million hospitalizations and 3 million deaths.

CNBC Health & Science

Read CNBC’s latest global health coverage:

For all the latest Health News Click Here 

 For the latest news and updates, follow us on Google News

Read original article here

Denial of responsibility! TheDailyCheck is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected] The content will be deleted within 24 hours.