Pfizer (PFE.N), which dominated COVID vaccine sales, now finds itself looking up at GSK (GSK.L), whose rival new respiratory syncytial virus (RSV) vaccine has surged to an early lead since the shots launched this summer.
GSK accounts for close to two-thirds of RSV shots given in the United States since early September, according to IQVIA data seen by Reuters.
The British drugmaker's early advantage may be tied to its positioning as the lone RSV shot offered by CVS Health (CVS.N), the biggest pharmacy chain in the U.S. and a dominant player in the retail vaccine market, analysts and industry experts say.
Price may also be playing a role, according to independent pharmacists. GSK's lists at a slight discount.
Pfizer and GSK will provide more clarity on demand for the shots when they report third-quarter financial results on Oct. 31 and Nov. 1. While early analyst sales estimates are in the low hundred millions range for 2023, both companies have said their shots could become multibillion-dollar sellers.
"What CVS does will have broader market implications than what its potential competitors do, just as a function of its size, and we believe that extends into vaccines," said Ben Link, vice president of pharmacy at healthcare research firm 46brooklyn.
Link said CVS is the nation's largest retail buyer of pharmaceuticals and "they get a better price by consolidating their purchases."
Both shots won U.S. approval for use in adults age 60 and over in May. Pfizer's was also recently approved for pregnant women to protect their babies.
Both companies hope vaccine sales will help offset lost revenue as older medicines like Pfizer's breast cancer treatment Ibrance and GSK’s HIV drug Dovato begin facing generic competition later this decade.
Pfizer is also contending with weaker-then-expected demand for its COVID-19 vaccine and its antiviral treatment Paxlovid, which led it to slash 2023 sales estimates and announce a cost cutting program.
"800 POUND GORILLAS"
CVS, which has more than 9,000 U.S. locations, declined to comment on why it was only carrying GSK's vaccine. The company said it hopes to offer Pfizer's Abrysvo as a maternal RSV vaccine once it has updated internal pharmacy systems and training "sometime next month."
"CVS and Walgreens are sort of the 800-pound gorillas in the retail channel," said Morningstar analyst Damien Conover. Should CVS continue to solely or predominantly favor the GSK vaccine, it could have a significant impact in future years, he said.
Walgreens (WBA.O), the next largest U.S. pharmacy chain with around 8,700 locations, carries Pfizer's Abrysvo and GSK's Arexvy. Walmart (WMT.N) and Rite Aid also carry and administer both.
It was not immediately clear how many RSV shots were being administered in pharmacies versus doctors' offices. About 60% of adult flu shots were given at pharmacies in the U.S. in the 2022-33 flu season, according to government data.
GSK declined to discuss its RSV vaccine contracts, but said customer relationships gives it a competitive advantage.
"We’ve spent decades building trust with our customers," GSK spokesperson Alison Hunt said in an emailed statement. "This gives us confidence in our ability to execute new launches."
A Pfizer spokesperson directed questions about what CVS is carrying to that company, but added: "We are actively working to contract with all large pharmacy chains and have ample supply of Abrysvo." It has released 3.2 million doses of the vaccine.
At $280 per shot, the list price for GSK's Arexvy is $15 lower than Pfizer's list for Abrysvo. That price does not represent any volume-based discounts larger chains may receive.
Two independent pharmacists said they are being charged a lower price by wholesalers for the GSK vaccine, which comes in boxes of 10.
"The wholesaler I order from, you can order one dose of the Pfizer brand or you have to order 10 of the GSK one," said Michelle Vargas, who owns two pharmacies in South Carolina.
"If I knew that tomorrow I was going to have five people come in, I'd order the box of 10. But we're talking thousands of dollars here."
