3 September 2020 - Conventional drug costing models are unlikely to apply when it comes to putting a price tag on a vaccine against COVID-19 for Canadians, according to health economist Christopher McCabe.

"When you have an infection that is endemic in the population, what you need is for the vaccine to achieve herd immunity, and that means you need to get between 60 and 80 percent of the current population vaccinated," McCabe said. "If you can't afford to buy it at the level that would achieve herd immunity and the public is paying to get to herd immunity, then the value is a lot less."

McCabe noted that the standard estimate to research and develop a new drug is US$1.3 billion, based on work developed by Tufts University. That number takes into account the sunk costs of the nearly 90 percent of prospective drugs that never make it to market.

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