Teapot Tempest

Médecins Sans Frontières (MSF, or Doctors Without Borders) is likely the world’s most well-know and effective humanitarian health care organization. In many large-scale, nature- and human-made disasters, MSF is the first-responder, for example, treating patients in the Ebola outbreak before the WHO had even issued a press release. But in the hoopla surrounding the recent release of its report on vaccines, the MSF’s bashing of Big Pharma may have obscured a more positive message.

The sound bites that accompanied the report, called “The Right Shot: Bringing Down Barriers To Affordable and Adapted Vaccines” (Report), were “Glaxo, Pfizer Blamed for High Vaccine Prices in Poor Countries” (Bloomberg) and “MSF Slams Expensive Vaccines” (Reuters) and may have been a result of the combative phrasing of the Report’s executive summary: “the challenges we face in purchasing vaccines at an affordable price have become acute. In addition, countries that are unable to afford these high prices are increasingly voicing their frustration at the inability to protect their children against life-threatening—but preventable—diseases.” My reading of the Report is that it does a good job in reviewing the complications, and success, of the current global immunization effort and makes several good recommendations. I address some of these points below, but first some background. Not surprisingly, MSF is a not a major provider of vaccination; it notes delivering 6.7 million doses of vaccines and “immunological products” (I’m not sure what is meant) in 2013 while, in comparison, the national programs subsidized by GAVI, the global alliance for vaccination, immunized 145 million children with multiple doses in same year. Also, as noted the Report, MSF has been in five-year negotiations with GlaxoSmithKline and Pfizer, the two pharma companies that developed the most recent childhood vaccine (Pneumococcal Conjugate Vaccine or PCV), to obtain the vaccine at the GAVI price ($3-3.50 per dose), but to no avail. Both companies have been willing to donate the vaccine, and MSF resisted, citing concern about limitations on use, but decided to accept for the near-term (Report, page 12).

MSF’s main points in the Report are as follows.

-Price is a barrier to immunization. Well, yes and no. Not for immunization to the nine childhood diseases as recommended by WHO and covered by GAVI (tuberculosis, measles, rubella, diphtheria, tetanus, pertussis, hepatitis B, Haemophilus influenzae type b, poliomyelitis; under $10 per child per year, Report, page 7). MSF estimates that adding in the three most recently developed vaccines (for pneumococcal diseases, rotavirus and, for adolescent girls, human papillomavirus) may increase the total to $40, a substantial increase, but, as MSF acknowledges, a price that may be reduced by competition from other vaccine makers. MSF also expresses justified concern that some countries, especially those countries now no longer eligible for GAVI subsidy and middle-income countries, will not be able to afford these costs. But the authors also note that “a GAVI-commissioned fiscal space analysis generated a model predicting that GAVI-graduating countries would need to allocate only 0.6% of health budgets to independently support the full cost of vaccines.” (Report, page 8). So it is the cost of the vaccines or a country’s allocation of health funding that is the problem? Also it is not clear to me, and not given in the Report, what proportion of the overall cost of vaccination (e.g., including “human resources, transportation, cold chain, infrastructure, wastage, other immunisation supplies, waste management, etc.” Report, page 106) is the per-dose cost. Further, according the Bloomberg story, Glaxo and Pfizer have already agreed to offer their PVC vaccines to the graduate countries at the GAVI price.

-Vaccine prices are not readily available, i.e., the market is not transparent. This is true (although MSF was able to assemble lots of price data for Annex A of the Report), but this is really a minor factor in the negotiation between a likely purchaser and seller. More important factors to the seller are the volume and period of the purchase. As MSF points out, countries have and are creating procurement pools to better their negotiating position (Report page 23). Also in 2011, WHO started the Vaccine Product, Price and Procurement (V3P) project to gather and disseminate price information (V3P). I also should point out that manufacturers have a difficult time predicting their production costs and therefore need to be cautious in negotiation for a product yet-to-be-made (MSF points out the PCV takes two years to make).

-New vaccines that are better adapted for under-resourced environments are needed. This is true. Longer shelf-life, ease of delivery, and fewer doses are improvements that many companies and research groups are working on with some success. MSF says there have been 30 such improvements but few have been implemented (Report, page 29), and rightly points out that for vaccine makers, “Without clarity on market uptake, developing a business case for adapted vaccines remains challenging.” MSF’s answer is that purchasers, especially the largest like UNICEF, need to use their procurements to drive innovation. I agree and add that the advance purchase contracts could be used to fund late-stage technology development. I should also note that last spring Glaxo announced that it is developing vaccines and other products specific to the health needs of Africans (FierceVaccines story).

-Competition does and will bring down prices. “Efforts to accelerate real competition in the vaccines market will deliver the most sustainable price reductions” (Report, page 4). Amen. That’s how business works.

Of course, Pfizer execs tune in to the media, too, and announced, at the annual GAVI Pledging Conference and six days after the MSF report release, that the company was decreasing the GAVI PCV price by 6% to $3.10 per dose (and extending the price to former GAVI countries) (press release in FierceVaccines). Not good enough, responded MSF, the price should be $1.67 per dose, as reported by FierceVaccines. Why? According to MSF, because Pfizer sold about $4 billion of PCV in 2013 (of which about $500 million were GAVI sales) (relevant?) and the Serum Institute of India, a leading generic vaccine-maker, plans to sell a PCV at $2 per doses (relevant?). Bill Gates, also at the GAVI meeting, added to the tempest, noting in an interview in the Guardian that the PCV price is very cost-effective in comparison to other health costs and that its manufacture is complicated and therefore the price can’t be zero. His ire may have been raised because, as reported by the Guardian, at the meeting “MSF organised a stunt featuring supporters dressed as Merkel, David Cameron, Barack Obama and others spinning “Pharma’s wheel of fortune”, claiming that whichever way the wheel was spun, the drug companies always won.”

The good news is that the GAVI announced at the Pledging Conference that it had received $7.5 billion in new pledges and that with the $2 billion in hand it will be able to meet its immunization program goals for the next five years (GAVI press release). And MSF released a report with lots of solid data and recommendations for improving global immunization. The not-so-good news is that the pledges and the report may have been overshadowed by hyperbole and stunts from MSF’s public relations group.

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