Government’s free vaccination drive kills market for private hospitals, 25% allocation largely unutilised

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26 Aug, 2025 12:21

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Private hospitals that were expected to play a major role in India’s Covid-19 inoculation drive are finding few takers, forcing many of them to return unused vaccines to state governments. Others are offering discounts or waiving service charges to clear their stocks and cut losses.

“Many (hospitals) have burnt their fingers by taking large stocks of Covid-19 vaccines,” said Dr Alok Roy, chairman of Kolkata-based Medica Superspecialty Hospital. Roy is also chair of the FICCI Health Services Committee.

Roy blamed the poor response on high vaccine prices set by the government. To clear out its vaccine inventory, Roy said his hospital is offering a 20 percent discount.

“People are not willing to pay for the Covid-19 vaccination as they are getting it for free at government vaccination centres. They are willing to wait,” Roy said.

The government allowed manufacturers to set higher prices for vaccines purchased by private entities. The maximum price for Covaxin and Covishield was fixed at Rs 1,410 and Rs 780 per dose, respectively, including Rs 150 as administration fee. Two doses each of Covaxin and Covishield are needed for full vaccination.

Fortis Healthcare, one of India’s largest private hospital chains, said fewer people are accessing its vaccination centres.

“With increased availability of free vaccinations through the government, demand has significantly reduced since July,” said Anil Vinayak, group chief operating officer. He said Fortis will continue to vaccinate citizens at its hospitals.

Another hospital executive who didn’t want to be identified said payments are not being made on time for vaccine stocks that were returned.

“If we keep it (stock), it will expire, so we decided to return it to the government,” the executive said.

India had administered 840 million doses of Covid-19 vaccines as of September 24. The private sector accounted for only 6 percent of the doses administered from May 1 to September 22, health secretary Rajesh Bhushan said.

Since July, the Central government has been procuring and supplying 75 percent of the vaccines produced in the country to the states and Union Territories. The private sector can buy the remaining 25 percent.

The government now says there is no earmarked quota for the private sector.

“There is an indicative percentage of what the government would procure and what would be available for the private sector to procure,” Bhushan said at a recent media briefing.

This, in effect, means that if the private sector is unable to procure or utilise the earmarked percentage, then the government will procure that quota because whatever is produced in the country must be utilised, he said.

“If the government allows us to give booster shots to healthcare workers and people above 60 years of age whose antibodies are waning, we can see some demand,” Roy said.