A group of economists, public health experts, and lawyers has proposed a way to convince drug companies to develop lifesaving vaccines for poor countries, where market demand is weak and profits low. Their plan would obligate governments and other donors to purchase the vaccines for distribution, but only if companies agree to test and produce them.
It is no secret that most of the world's drug development is not for diseases that affect the world's poor masses. A Washington policy research organization called the Center for Global Development says 90 percent of all drug research is for conditions that affect just 10 percent of the world's people - the wealthiest 10 percent.
At the Biotechnology Industry Organization, a trade group, vice president Scott Whitaker says drug companies began fleeing the vaccine business in the 1980s in part because governments and international organizations set prices for existing vaccines too low. Another reason was low global demand, meaning in the ability to pay, not in the sense of need.
Mr. Whitaker says the entire global market for vaccines today is less than two percent of the amount spent on all pharmaceuticals, and the developing country vaccine market is a minuscule portion of the global one. "Given the limited pool of talent and investor capital, biotech companies cannot devote their resources to disease for which there is very little or no market," he said.
But the Center for Global Development says it has a solution to this problem. What if governments and other donors sign a contract with drug companies guaranteeing to purchase vaccines for given diseases if the firms actually invent and make them?"Could it actually stimulate additional private investment in more research and development and potentially a faster movement to newer vaccines?," asked public healthy expert Ruth Levine of the center. Her answer is "yes," based on this fundamental assumption. "More money for research and development would lead to faster progress."
Ms. Levine's group argues that drug companies would be encouraged to invent vaccines for diseases such as AIDS, TB, and malaria if groups of donors promise to buy a certain number of doses at near-market prices. It also believes such a commitment could speed delivery of recently developed vaccines.
"Part of the deal would be [that] after the maximum number treatments had been purchased at the relatively high price, the suppliers would agree to provide the product at an affordable price. That would be after the cost of the research and development had been captured," she said.
The plan has been developed with funding from the Gates Foundation of Seattle. The foundation's director for global health, physician Richard Klausner, says the proposal follows the example of the Global Alliance on Vaccines and Immunization, a grouping of governments, drug companies, and private institutions that buys existing vaccines for global distribution. Dr. Klausner says the Alliance's efforts have expanded hepatitis B vaccine suppliers from one to about 10 companies and the price has dropped 20 percent. He says the Center for Global Development idea could provide the same incentive for new vaccines. "This specific report presents a convincing argument that we may now have one more specific tactic, a new tool, for pulling vaccine development," he said.
The reaction from the drug industry has been positive. Scott Whitaker of the Biotechnology Industry Organization calls the plan exciting and a new model for providing investment for many of its companies who need help. The chief of policy at the Merck drug company's vaccine division, Mark Feinberg, also welcomes it. "This type of initiative would definitely help us plan appropriate manufacturing capacity to serve global needs. Should we ultimately have an HIV vaccine, an advance purchase guarantee would help implement that worldwide, as well," he said.
The Center for Global Development estimates that an average commitment of $3 billion is required to create a market for each new vaccine.