The $1.6 billion business of flu (CNBC)
This number has been shared by a lot of medical freedom activists as a way to show how much the pharmaceutical industry is earning from manufacturing the flu vaccine.
But let’s unpack this number a bit. This is based on 2015 numbers, but math is math and these numbers haven’t changed that much.
$1.6B (in revenue) / 147.8M vaccines distributed = $10.83 (revenue per unit to the manufacturer).
Now here’s when my day job comes in handy, given my knowledge of pharmaceutical COGS (cost of goods sold). These aren’t precise, but they’re a decent estimate:
- components (vial + stopper) - $1
- the flu strains for the vaccine - $3
- excipients for the vaccine - $0.50
- manufacturing costs - $3
- labeling - $0.25
- distribution - $1
The cost of producing a flu vaccine is at least $8.75, giving the manufacturer a gross profit of $2.08 per unit. Add in SG&A and other business costs, and you’re probably at a net profit of $1 per unit, or a 10% margin.
Vaccines are not a m…
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