Total global spending on Covid-19 vaccines is projected to reach $157 billion by 2025, driven by mass vaccination programs underway and “booster shots” expected every two years, according to a report by U.S. health data company IQVIA Holdings Inc released on Thursday.

IQVIA, which provides data and analytics for the healthcare industry, said it expects the first wave of Covid-19 vaccinations to reach about 70% of the world's population by the end of 2022. Booster shots are likely to follow initial vaccinations every two years, the report said, based on current data on the duration of effect of the vaccines.

The United States is preparing for the possibility that a booster shot will be needed between nine to 12 months after people receive their first full inoculations against Covid-19, a White House official said earlier this month. Pfizer Inc  has also said boosters may be needed within 12 months. 

Vaccine spending is expected to be highest this year at $54 billion with massive vaccination campaigns underway around the world. It is expected to decrease after that eventually to $11 billion in 2025, as increased competition and vaccine volumes drive down prices, said Murray Aitken, a senior vice president at IQVIA.

The forecast for such meteoric growth in sales for a new class of drugs or vaccines is unmatched, but reminiscent of the $130 billion spent on the new hepatitis C cures between 2014 to 2020 due to pent up demand, Aitken said in an interview.

The spending forecast for Covid-19 vaccines represents 2% of the roughly $7 trillion forecast for all prescription medicines during that time period, IQVIA said.

Excluding the cost of Covid-19 vaccines, overall medicine spending is forecast to be $68 billion lower over the six years from 2020 to 2025 than it would have been without the pandemic, according to the report.

The pandemic caused major disruptions to doctor visits, procedures and medicine use, leading to some stockpiling in the early days for some medications and then a return to a more normal trend, the report said.

“While Covid-19 vaccines will cost $157 billion over the next five years,” Aitken said, “that is a very small price to pay relative to the human cost of the pandemic.”