6 September 2021 — Following US diagnostics corporation Cepheid’s communication with Médecins Sans Frontières/Doctors Without Borders (MSF) that it will reduce the price of the GeneXpert COVID-19 test from US$19.80 to $14.90 for low- and middle-income countries, MSF demanded that Cepheid release the cost of production for its COVID-19 test to justify the $14.90 price, which is still too high for many countries in which MSF operates.
MSF’s analysis of Cepheid’s similar TB and HIV tests that run on the same GeneXpert machine shows that it costs the corporation less than $5 to produce one GeneXpert test cartridge. This means that, at $14.90, Cepheid is selling the COVID-19 test for three times more than what it costs the corporation to manufacture the test.
While many low- and middle-income countries remain unable to access these tests because of the high price, Cepheid’s sales volumes for the COVID-19 test are ramping up to unprecedented levels, largely through sales to high-income countries, with the corporation expecting to sell 45 million COVID-19 tests in 2021. Considering that Cepheid’s annual revenue has doubled during the pandemic, reaching over $2 billion, largely from the sale of COVID-19 tests; and that the corporation's parent company, Danaher, paid no US federal income tax in 2020 despite receiving significant public funding to develop the GeneXpert tests, largely from the US government, it is unacceptable that Cepheid is seeking a more than 200% profit on a COVID-19 test which, as MSF’s analysis shows, could still be profitable for Cepheid if sold for $5.
MSF urges Cepheid to immediately reduce the price of the COVID-19 test to no more than $5 to ensure access to this essential test for all countries. If not, Cepheid must justify the $14.90 price of the COVID-19 test by providing transparency on the cost of production.
Stijn Deborggraeve, Diagnostics Advisor, MSF Access Campaign:
“If Cepheid continues to charge low- and middle-income countries a price that puts the test out of reach for many people, then the corporation should, at the very least, provide justification by opening its books and making the cost of production of its COVID-19 test available to countries for public scrutiny.
Considering MSF and Treatment Action Group’s (TAG) recent findings that Cepheid received more than $250 million in public funding to develop the GeneXpert system, and that Cepheid’s parent company Danaher paid zero US federal income tax in 2020, we cannot accept that Cepheid still chooses to sell the GeneXpert COVID-19 test for more than 200% profit to low- and middle-income countries.
In this pandemic, where testing as many people as possible is critical, Cepheid’s pricing costs lives. There have been multiple alarms from countries that the unaffordable price of Cepheid’s test is hindering their COVID-19 response. Cepheid must immediately drop the price of the COVID-19 test to $5 or disclose the cost of production in full transparency.”
To learn more about the US government’s role, please see this TAG/MSF briefing document, “Realizing Returns on U.S. Government Investments in GeneXpert Diagnostic Technologies”.