Deadly Imbalance: Deadly Imbalance: Social vs Medical Social vs Medical Value of Preventative Value of Preventative Vaccines Vaccines Donald P. Francis, MD, DSc Donald P. Francis, MD, DSc Global Solutions for Infectious Global Solutions for Infectious Diseases Diseases Brisbane, CA, USA Brisbane, CA, USA
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Deadly Imbalance: Social vs Medical Value of Preventative Vaccines
Deadly Imbalance: Social vs Medical Value of Preventative Vaccines. Donald P. Francis, MD, DSc Global Solutions for Infectious Diseases Brisbane, CA, USA. Public Health Goal. Decrease or eliminate disease. Public Health Goal. Decrease or eliminate disease ….. in the shortest time possible. - PowerPoint PPT Presentation
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Deadly Imbalance: Deadly Imbalance: Social vs Medical Social vs Medical
Value of Preventative Value of Preventative VaccinesVaccines
Donald P. Francis, MD, DScDonald P. Francis, MD, DSc
Global Solutions for Infectious DiseasesGlobal Solutions for Infectious Diseases
Brisbane, CA, USABrisbane, CA, USA
Public Health GoalPublic Health Goal
Decrease or eliminate diseaseDecrease or eliminate disease
Public Health GoalPublic Health Goal
Decrease or eliminate diseaseDecrease or eliminate disease
……....in the shortest time in the shortest time possiblepossible
OutlineOutline1.1. Delayed disease control - Delayed disease control -
examplesexamples
2.2. Why? Lack of social valueWhy? Lack of social value
3.3. Roles of industry and public Roles of industry and public healthhealth
4.4. Costs of vaccine Costs of vaccine developmentdevelopment
5.5. Costs of delayed vaccine Costs of delayed vaccine useuse
6.6. Positive changes: “push” Positive changes: “push” and “pull”and “pull”
Academic Academic ResearchResearch versus Pharmaceutical versus Pharmaceutical
DevelopmentDevelopment““The public sector institutions involved in vaccine The public sector institutions involved in vaccine R&D are primarily focused on basic science R&D are primarily focused on basic science knowledge diffusion, rather than single-mindedly knowledge diffusion, rather than single-mindedly solving applied development problems to ensure solving applied development problems to ensure large scale, consistent production. The incentives large scale, consistent production. The incentives in the public sector reinforce this knowledge focus in the public sector reinforce this knowledge focus and are generally inconsistent with efficient and are generally inconsistent with efficient production of commodities.“production of commodities.“
McKinsey & Company. Preliminary Report. How can McKinsey & Company. Preliminary Report. How can public-private partnerships accelerate the availability of public-private partnerships accelerate the availability of vaccines for the developing world? July 2001. World vaccines for the developing world? July 2001. World BankBank
Output Output Measurements of Measurements of
Each PlayerEach Player
PlayerPlayer Output Output MeasurementMeasurement
Public InstitutesPublic Institutes Knowledge/ManuscriptsKnowledge/Manuscripts
Private CompaniesPrivate Companies Products and Products and ProfitsProfits
Social Value Drives Social Value Drives Vaccine Development Vaccine Development
and Applicationand Application
Scientific DiscoveryScientific Discovery
Vaccine DevelopmentVaccine DevelopmentSocial ValueSocial Value
Vaccine ApplicationVaccine Application
Low Value Given to Low Value Given to
Vaccines:Vaccines:
• By vaccine industry - who makes By vaccine industry - who makes vaccinesvaccines• By public health (society) - who By public health (society) - who uses vaccinesuses vaccines
Public Health’s Role in Public Health’s Role in Discouraging Vaccine Discouraging Vaccine
DevelopmentDevelopment
• Recognize value, but unwilling to pay Recognize value, but unwilling to pay for vaccinesfor vaccines• Little or no urgency to deliver new Little or no urgency to deliver new vaccinesvaccines
The global vaccine market
Developing countriesIndustrialized countries
Population
Disease Burden
Vaccine market
18%82%
93%
85%
T=$6 Billion/y
15%
7%
Vaccine R&D
T= $500 Million/y90% 10%
Pricing in Low vs. High Pricing in Low vs. High Income CountriesIncome Countries
Primary Disease compared to
vaccineMeasles
Diptheria, Pertussis, Tetanus
TB HepatitisBHaemo
philious BPolio
Low Income Countries
Measlesmomoin
combo with DTp
Middle Income Countries
MMRwholecell in combo
BCGin combo
with DTPwin combo
with DTPwOPV
High Income Countries
14c
$15.50
7c
$10.65
10c
$8.25
7c 32-90c
$9.00
$3.10
$21.38
Cape Town, RSA April 11, 2002
““Low or uncertain demand for new vaccines in Low or uncertain demand for new vaccines in developing countries, together with the low developing countries, together with the low prices negotiated over the years for the prices negotiated over the years for the traditional six vaccines (DPT, polio, measles traditional six vaccines (DPT, polio, measles and BCG) for use in developing countries, and BCG) for use in developing countries, have deterred vaccine manufacturers from have deterred vaccine manufacturers from developing vaccines for use almost exclusively developing vaccines for use almost exclusively in what are perceived to be “low profit” in what are perceived to be “low profit” countries.” countries.”
(WHO, State of the World’s Vaccines and (WHO, State of the World’s Vaccines and Immunization, 2002)Immunization, 2002)
Vaccine development is Vaccine development is expensive.expensive.
Vaccine Development CostsVaccine Development CostsLicensed Product: Flumist Licensed Product: Flumist
ExampleExample
InvestmentInvestment
1996 – 20021996 – 2002 Research & DevResearch & Dev$145mm$145mm
2003 – 20042003 – 2004 Manufacture and LicenseManufacture and License$200mm$200mm
Source: H. Greenberg (2004)Source: H. Greenberg (2004)
Investment Investment Required to Required to Develop One Develop One
VaccineVaccine
Money: Money: $200 to $200 to $500mm$500mm
Time:Time: 12 to 15 years12 to 15 years
Why Vaccines Fail to Why Vaccines Fail to CompeteCompeteVaccine/Therapeutic Market ComparisonVaccine/Therapeutic Market Comparison
Source: Piers Whitehead: Vaccine market data 2000, pharma sales 2001
Costly ResultCostly Result
Lack of social valueLack of social value
Lack of political (government) Lack of political (government) leadershipleadership
CostlyCostly
Costs of Vaccine Costs of Vaccine DelayDelay
• Continued disease occurrenceContinued disease occurrence
Costs of Vaccine Costs of Vaccine DelayDelay
• Continued disease occurrenceContinued disease occurrence• Increased infected pool – more Increased infected pool – more difficult to difficult to controlcontrol
Costs of Vaccine Costs of Vaccine DelayDelay
• Continued disease occurrenceContinued disease occurrence• Increased infected pool – more Increased infected pool – more difficult to controldifficult to control
• Small market further reduces Small market further reduces incentives for incentives for industry to make industry to make vaccines –> more delayvaccines –> more delay
Adjusting market forces.Adjusting market forces.
Altering the Altering the Market FailureMarket Failure
• State and National State and National GovernmentsGovernments• International OrganizationsInternational Organizations
Summary: Adverse Summary: Adverse FactorsFactors
Vaccine development, like other pharmaceutical Vaccine development, like other pharmaceutical development, is costly ranging from $200 to $500 development, is costly ranging from $200 to $500 million per vaccine;million per vaccine;
Vaccine development is slow taking 12 to 15 years;Vaccine development is slow taking 12 to 15 years;The skills necessary to develop vaccines rest The skills necessary to develop vaccines rest
primarily within the private sector;primarily within the private sector;For the same cost and effort, pharmaceutical For the same cost and effort, pharmaceutical
companies can develop therapeutic drugs that companies can develop therapeutic drugs that are far more profitable;are far more profitable;
Public health leaders are cheap and unwilling to pay Public health leaders are cheap and unwilling to pay reasonable prices for valuable vaccines;reasonable prices for valuable vaccines;
The lack of social value given to vaccines makes them The lack of social value given to vaccines makes them unattractive products for the pharmaceutical unattractive products for the pharmaceutical industry to develop;industry to develop;
Vaccines, once developed, are often applied very Vaccines, once developed, are often applied very slowly;slowly;
Public-private vaccine development Public-private vaccine development partnerships, having pharmaceutical partnerships, having pharmaceutical development expertise, are being development expertise, are being established;established;
Funding is being provided, most notably by Funding is being provided, most notably by the Bill and Melinda Gates Foundation;the Bill and Melinda Gates Foundation;
Foundation support is driving public health Foundation support is driving public health authorities to deliver existing vaccines;authorities to deliver existing vaccines;