According to a report from the U.S. Defense Department, pharmaceutical and health companies, including COVID-19 vaccine and test makers, received more than $36 billion in contracts from the Pentagon in fiscal year 2021. This surge in spending was a direct response to the mandated coronavirus vaccines for U.S. military personnel and the need for antibody treatments.
Leading the list of top recipients among defense contractors were Pfizer Inc., Moderna Inc., and Regeneron Pharmaceuticals Inc. Pfizer, based in New York, ranked sixth and received $13.3 billion in contracts, while Moderna, headquartered in Cambridge, Massachusetts, ranked tenth with $6.9 billion in contracts. Both companies manufacture COVID-19 vaccines that have been mandated for the military.
In terms of overall defense contracts, Pfizer and Moderna found themselves in the top 10 alongside established defense and aerospace giants like Lockheed Martin, Boeing, Raytheon Technologies, General Dynamics, and Northrop Grumman, indicating the significant role played by pharmaceutical firms in military spending.
Other pharmaceutical and health companies also profited from the military's pandemic-related spending. AstraZeneca Pharmaceuticals, which developed COVID-19 vaccines and antibody treatments, received $287.1 million in contracts. Johnson & Johnson, known for its one-dose COVID-19 vaccine, received $62.4 million. Regeneron, based in New York, secured $5.6 billion for its monoclonal antibody treatments, while Indianapolis-based Eli Lilly & Co., another developer of monoclonal antibodies, received $1.9 billion.
Pharmaceutical provider and distributor McKesson Corp. was awarded $3 billion in contracts, and Cardinal Health, which supplies medical products such as syringes and needles, received $517.9 million. Merck & Co., based in New Jersey, earned $1.2 billion in contracts for its oral anti-viral treatment for COVID-19.
COVID-19 test makers also benefited from Defense Department contracts, including Abbott Laboratories with $1.7 billion and Eli Lilly & Co. with $1.9 billion.
The Pentagon and U.S. military have administered approximately 8.9 million COVID-19 vaccine doses to military personnel and civilian personnel, following President Joe Biden's vaccine mandates in 2021. However, there is a current push in Congress to end military COVID vaccine mandates in the upcoming Pentagon spending package.
The report also highlights significant healthcare expenditures by the Pentagon, including $7.1 billion awarded to Humana Inc., which operates the Tricare East health systems for military personnel, and $3.2 billion granted to Centene Corp., the parent company of HealthNet, which oversees the Tricare West military health system in western states.
William LaPlante, Under Secretary of Defense for Acquisition & Sustainment, emphasized the importance of understanding contract spending to strengthen the defense industrial base and ensure resilient and secure supply chains for critical capabilities.