Why is AstraZeneca selling its Covid vaccine at cost without profit?

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AstraZeneca Sells Covid-19 Vaccine At Cost Without Profit

AstraZeneca is selling its Covid-19 vaccine, Vaxzevria, at cost without generating a profit. This pricing strategy applies to the vaccine developed in collaboration with the University of Oxford. The company has shipped approximately 319 million doses globally in the first half of the year, contributing to US$1.2 billion in sales during that period.
Vaccine Development and Distribution

Vaxzevria has been a significant contributor to global vaccination efforts, with AstraZeneca and its partners releasing one billion doses to over 170 countries. The vaccine was developed alongside the University of Oxford, highlighting a collaborative approach to addressing the pandemic. These efforts have been crucial in various vaccination drives, including the one in Britain, which facilitated the country's economic reopening.
Financial Performance Beyond the Vaccine

While the Covid-19 vaccine is sold at cost, AstraZeneca has reported strong overall financial performance. In the first half of the year, net profit increased by 40 per cent to US$2.1 billion, and total revenues rose by nearly a quarter to US$15.5 billion. Excluding the vaccine, total revenues saw a 14 per cent increase, reaching approximately US$14.4 billion, demonstrating robust growth across different disease areas and regions.
Strategic Growth and Future Outlook

The company's strategic growth is further bolstered by its acquisition of US biotech firm Alexion, which is expected to enhance its pipeline in rare diseases and immunology. This acquisition has led AstraZeneca to raise its full-year 2021 guidance, with revenues, excluding vaccine sales, now projected to grow by a low-twenties percentage. This forward-looking strategy indicates a focus on expanding its portfolio beyond the immediate pandemic response.

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Why is AstraZeneca selling its Covid vaccine at cost without profit?

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