The role of the right valuation method in setting the firm's break-even price for mpox (and other) vaccines

Critical voices on unfairly high mpox and other vaccine prices open the debate on the € right price' to be paid to private vaccine suppliers. We apply compound real options analysis as a more appropriate valuation method to derive a correct firm's break-even price. Real option models are better able to capture the development costs, associated risks and the embedded operational flexibility in vaccine development in a superior way compared with more traditional net present value (NPV) methods. The real option price is lower than standard NPV-based methods, thereby providing a basis to improve the bargaining position of payers in negotiating better vaccine price outcomes. Deeper insights into the correct break-even price will create a more balanced playing field between firms and payers. This can also lead to more equitable access to vaccines in developing countries.