16 hours ago

Axios Vitals

Good morning.

Join me and Axios' Sam Baker today at 12:30pm ET for a Vitals "Check-Up" event on social determinants of health. Guests include Rep. Cheri Bustos (D-Ill.) and director of the FXB Center for Health and Human Rights at Harvard University Mary T. Bassett, M.D.

Today's word count is 997, or a 4-minute read.

1 big thing: Billion-dollar booster discussion

Illustration: Aïda Amer/Axios

Pfizer said yesterday that it expects to sell nearly $34 billion worth of coronavirus vaccines this year — and there could be billions more behind that if people who have gotten the shot ultimately need boosters.

Why it matters: It's unclear whether, when and for whom a coronavirus vaccine booster will be necessary. Pfizer has a lot of money riding on those answers, and executives are already making the case that many Americans will need a third dose, Axios' Bob Herman reports.

What they're saying: Pfizer released new data, not yet peer-reviewed, that suggests the vaccine's efficacy diminishes over time — from 96% in the first two months after receiving the second dose, to 84% after four months.

  • Reduced efficacy could mean more transmission of the virus.
  • "We are very, very confident a third dose, a booster, will take up the immune response to levels that will be enough to protect against the Delta variant," Pfizer CEO Albert Bourla told CNBC yesterday.

Yes, but: The same data show the vaccine was still 97% effective in preventing severe disease, across a full six months of monitoring.

By the numbers: Pfizer increased its sales estimates yesterday for the doses it has already committed to sell. The company expects those sales to total $33.5 billion this year, almost a 30% jump from its previous estimates — without accounting for sales of any potential boosters.

What's next: "The numbers are going to be much higher," Bernstein analyst Ronny Gal wrote to investors, estimating Pfizer's sales could be as high as $43 billion this year.

  • "We expect total sales growth will slow over the next 12 months as COVID-19 vaccine demand shifts toward emerging markets where pricing is lower," analysts at Morningstar wrote about Pfizer. However, "potential upside exists if larger demand for boosters emerges."
2. Testing our way around the Delta surge

Illustration: Aïda Amer/Axios

The recent surge of COVID-19 cases is strengthening the case for more frequent testing, Axios' Bryan Walsh reports.

Why it matters: The more contagious Delta variant threatens the fuller reopening of offices and schools in the fall. But regular testing — especially with cheap and almost instantaneous tests — could help catch cases before they have a chance to spread.

Driving the news: President Biden on Thursday reportedly plans to announce that all civilian federal employees will need to be vaccinated, or submit to regular COVID-19 testing, as well as other social distancing requirements.

  • It's the latest sign that regular testing could emerge as a potential fallback for workplaces trying to reopen without full vaccination coverage.

By the numbers: From a peak of more than 2.3 million COVID-19 tests a day in early January 2021, daily testing fell to fewer than 900,000 a day by mid-July.

What they're saying: "The most important aspect of these tests is the rapid result," Michael Mina, an epidemiologist at the Harvard T.H. Chan School of Public Health, told the New York Times last month.

  • "Waiting two to three days for laboratory test results isn’t ideal when you need results quickly to make decisions about going to school, work or a social gathering," he said.

Go deeper.

3. Infrastructure deal's winners and losers

Providers can breathe a sigh of relief: Congress isn't planning on repurposing unspent money from the pandemic provider relief fund, at least not yet.

Driving the news: The White House finally reached an infrastructure deal with a bipartisan group of senators yesterday, paid for in part with health care policies.

  • Providers have been warning that they wouldn't be happy if the remaining provider bailout money was used to pay for bridges and roads.
  • Hospitals in particular would have been an unwelcome opponent for advocates of the infrastructure package, which will already have a tough time getting across the finish line.

Between the lines: Hospitals may have been the most powerful industry group awaiting the list of infrastructure pay-fors, but pharmacy benefit managers may be the bigger winners.

  • The proposal delays the Trump administration's rebate rule, which would force prescription drug discounts to occur at the pharmacy counter — a massive disruption to PBMs' business model.
  • Democrats will likely try to fully repeal the regulation in a partisan package down the road.

What we're watching: The infrastructure proposal also includes savings from reducing what Medicare spends on unused drugs that are left over from single-use vials.

  • This may sound like a niche policy, but drugmakers stand to lose money from it, and thus probably won't like it.
4. Earnings lightning round

UnitedHealth Group, HCA Healthcare and Pfizer have been the most notable health care companies to post Q2 earnings so far, but this week has been chock-full of others, Bob writes.

🏥 Hospitals: The second quarter for Universal Health Services was so profitable that it returned $189 million in federal coronavirus bailout funds. But executives cautioned higher COVID cases may lead to labor shortages.

🦿Medical devices: People returning to hospitals means more sales for the companies that make hip implants, heart valves and other medical devices. Revenue and profits surged in a big way for Stryker and Boston Scientific.

🤕 Insurers: The increased use of all health care, and rising COVID cases, has led insurers to pay out more medical claims, which Humana said yesterday is leading to "uncertainty" and very conservative profit estimates for the back half of the year. Similar vibes from Centene and Molina.

💊 Pharma: Doctors are prescribing large volumes of cancer, heart and anti-inflammatory drugs, which led to sizable sales for Bristol-Myers Squibb and Novartis.

🖥 Tech: The pandemic created an opening for telehealth to explode, but a slowdown really may be here. Teledoc's membership and virtual visits missed Wall Street's estimates, crushing the company's stock.

📈 Deals: Inovalon, a data analytics company used by almost every major health care company, nearly quintupled its profit in the second quarter. A private equity firm is now circling Inovalon, Bloomberg reports.