Paxlovid is startlingly expensive.
As with many drugs in the United States, its pricing deserves renewed scrutiny. Among a handful of approved anti-retrovirals, the drug is the go-to prescription medicine to treat mild-to-moderate COVID-19 in adults. It can reduce the likelihood of ending up in the hospital for people at elevated risk. For older people with chronic health conditions, taking Paxlovid early in the course of illness can reduce the rate of hospitalization about 51%.
The current price raises questions about its cost-effectiveness
Last month, a friend who was recovering from COVID-19 texted me the bill for his recent Paxlovid prescription. Like me, he was solidly middle-age. Unlike me, he had a health issue that might put him at a slightly elevated risk for hospitalization. His total cost for the 5-day course of treatment was an exciting zero, zilch! But that’s not why he texted me. 
Looking closer at the bill, his health insurance plan reported paying the pharmacy a striking $1700. To any one person, it might make sense to pay for an anti-retroviral drug to avoid a COVID-related hospitalization that costs an average of $13,072 (in 2022). But when we take a population approach, and especially when the risk of hospitalization for COVID-19 is lower than it has ever been, the math gets much fuzzier.
The non-profit Institute for Clinical and Economic Review (ICER) suggested in 2022 that Paxlovid would meet standard cost-effectiveness benchmarks when priced at $563-$906. That amount aligns with the $530 Pfizer charged the federal government during the “emergency” phase of the pandemic. But as the risk of hospitalization declines–whether due to vaccination, experience with COVID-19, or continuing evolution of the virus–ICER hinted at further reductions in the benchmark.
When the drug received full FDA approval in mid-2023, Pfizer announced that the list price of a single-course of the drug would nearly triple to $1390. But even that price now seems a little low. The average retail price (at the time of this publication) is closer to $1450 according to GoodRx, an online consumer price comparison portal. Last month, the average price at the same site was nearly $1600.
The cost to the insurance system should raise eyebrows for consumers
Like my friend, most patients will pay very little at the point of purchase for the drug. Most people with public or private health insurance currently pay little or nothing for the prescription, though that will likely change in 2025. The uninsured may also get Paxlovid for free through a government-provided patient-assistance program until the end of 2024. Beyond that, who knows?
But health insurance plans do not simply eat the cost of a high-priced drug. They effectively pass it on to consumers in the form of higher premiums. And publicly-funded programs like Medicare and Medicaid–which cover older and poorer people who most at risk for COVID-19 complications–simply consume a larger portion of public budget. Also, Paxlovid does not appear to be on the list of drugs that will benefit from the new price negotiation ability of Medicare.
The argument here is not that we should stop using Paxlovid. One of the most recent analyses of the cost-effectiveness of Paxlovid continued to suggest economic benefits (even if those benefits are overstated as they relied on the low, outdated Paxlovid price). Rather, we need to question and challenge the high price, and consider being more targeted about who receives Paxlovid. I’m not the first to point this out. Each health insurance plan has the ability to consider this, but very little pressure from consumers to do so.
The high cost points us, once again, back to vaccination and basic hygiene
Look, Americans are no stranger to high health care prices. Most people reading this will probably not feel any outrage. Most of us don’t have a sense of the actual cost of our health care. And most of us are resigned about our ability to do anything about it.
A colleague who works in health insurance, simply shrugged when I shared the Paxlovid price and said, “Hey, somebody has to buy all those Ferraris, right?” But if we continue to accept exceptionally high prices for Paxlovid (and other drugs and many forms of health care), the costs of care will continue eat up more of our personal and public budgets, and eventually price many out.
Yet there are simple, public health alternatives. The Centers for Disease Control and Prevention (CDC) points to anti-retrovirals as just a last step in preventing serious illness. And it directs us to ongoing vaccination and basic hygiene (think handwashing) as very effective strategies to reducing COVID-19 infection and its risks. 2024 COVID-19 boosters, for example, currently cost about $90, are covered by health insurance, and reduce the chance of COVID-19 infection by about 50%.
Sure, I love the idea of a Ferrari. If public health leads to me seeing fewer on the streets, I’m OK with it. Especially if it keeps more people healthy and helps maintain the affordability of health insurance.
Gregory Stevens