advanced search

<< Back To Home

VACCINE PRICE CUTS ANNOUNCED BY WESTERN AND INDIAN MANUFACTURERS/ GAVI REACTION

Monday, 6th of June 2011

This Bloomberg News item on price cuts to GAVI and to 'graduating GAVI' countries. In terms of current GAVI expenditure, the cuts in the cost of pentavalent are most important. Will HPV, as well as pneumo and rotavirus vaccines, now become affordable to GAVI eligible and GAVI 'graduating' countries? GlaxoSmithKline Plc (GSK) and Merck & Co. agreed to lower prices for vaccines to protect children against potentially deadly diarrhea, supporting an international effort to help least-developed nations fight diseases. The GAVI Alliance, set up by Microsoft Corp. (MSFT) founder Bill Gates to give the world’s poorest people better access to life- saving immunizations, also received commitments from India-based drugmakers Serum Institute of India Ltd. and Panacea Biotec Ltd. (PNCB) to cut the price of a key pediatric vaccine, it said today. The agreements will help the alliance prevent an extra 4 million deaths by 2015 by rolling out new vaccines to tackle the main killers of children: pneumonia and diarrhea. The Geneva- based group’s donors and partners are meeting in London next week as they seek $3.7 billion to expand immunization programs over the next five years. “Ensuring full funding for GAVI’s goals is essential to meeting our public health commitment to all children,” said Julie L. Gerberding, president of Merck Vaccines, in a statement. “The upcoming GAVI conference, and the commitments highlighted today by so many, are critical steps toward advancing access to vaccines in developing countries.” Merck, based in Whitehouse Station, New Jersey, will offer RotaTeq, its oral vaccine for rotavirus, to the United Nations Children’s Fund, a GAVI Alliance partner, at $5 a dose. The price will drop to $3.50 once the volume bought reaches 30 million doses. Merck will offer its Ardabil cervical cancer vaccine to the GAVI Alliance at $5 a dose for certain developing countries, it said. GlaxoSmithKline Plc, based in London, offered to sell its rotavirus vaccine at $2.50 per dose, or $5 to fully immunize a child, a 67 percent reduction in the current lowest available public price, GAVI said in a separate statement. Bill Gates The GAVI Alliance comprises governments of developing and donor countries, the World Health Organization, Unicef, the World Bank, vaccine makers, research and technical agencies, civil society, the Bill & Melinda Gates Foundation and other private philanthropists. “We’re particularly excited about the offers for rotavirus vaccine because the shock of learning that more than 500,000 children die from a preventable disease that causes severe diarrhea is what drew us to work in global health in the first place,” Bill and Melinda Gates said in a separate statement. “With these offers, GAVI will be able to make even greater use of donor commitments, now and in the future, to significantly increase the number of children it can protect from deadly yet preventable diseases.” Deadly Diarrhea Rotavirus is the leading cause of severe diarrhea -- the world’s biggest killer of children after pneumonia. Bharat Biotech, the Serum Institute and Shantha Biotechnics, a subsidiary of Paris-based Sanofi, are developing rotavirus vaccines for GAVI-eligible countries, the alliance said. Vaccines from these suppliers aren’t expected to be ready for purchase through Unicef for about four more years. Bharat Biotech may offer further price reductions and lower the cost of immunizing a child to $3, according to GAVI. The Serum Institute reduced prices for the pentavalent vaccine, which protects against five fatal diseases, to $1.75 a dose -- the lowest available, GAVI said. Panacea Biotec said it would cut prices for the same shot by as much as 15 percent.

GAVI REACTION TO VACCINE PRICE CUTS

GAVI welcomes lower prices for life-saving vaccines

Manufacturer commitments will help GAVI vaccinate millions of children in least-developed countries

Geneva, 6 June 2011 – In the lead up to its first pledging conference on June 13, the GAVI Alliance announced today it has achieved commitments from two emerging market vaccine manufacturers to lower prices for the life-saving pentavalent vaccine, which protects against five deadly diseases. Developed country manufacturers have also offered price reductions on rotavirus and human papillomavirus, or HPV, vaccines.

“These are promising offers that demonstrate industry commitment to work towards affordable and sustainable prices for life-saving vaccines in developing countries. We congratulate all manufacturers who have responded to our call in the lead up to the pledging conference,” said Helen Evans, GAVI’s interim CEO. “We will continue to drive for sustainable prices, while ensuring procurement of innovative, appropriate, quality vaccines to meet GAVI country needs.”

The India-based firms Serum Institute and Panacea Biotec have committed to price reductions on their pentavalent vaccines funded by GAVI. Serum, which had already lowered its price to US$ 1.75 per dose, the lowest price available today, announced it would continue to provide the most competitive pricing and encouraged other manufacturers to follow its lead. Panacea Biotec committed to lower its prices by up to 15%. The pentavalent vaccine protects against five potential killers: diphtheria, tetanus, pertussis, hepatitis B, and Haemophilus influenzae type b. The price reductions illustrate the key role of emerging market suppliers as new global players, contributing to both innovation and increasing competitiveness in the market place.

In addition to these announcements, GlaxoSmithKline, GSK, has offered to provide the rotavirus vaccine to GAVI at $2.50 per dose, or $5 to fully immunise a child, in response to a current tender administered by UNICEF, a GAVI Alliance partner. The offer is a 67% reduction in the current lowest available public price. Merck has also stated that it will offer its rotavirus vaccine to UNICEF at discounted prices. Both vaccines are WHO prequalified and currently available for use.

New market entrants, including Bharat Biotech, the Serum Institute and Shantha Biotechnics, a subsidiary of Sanofi Pasteur, are developing rotavirus vaccines for GAVI-eligible countries. Vaccines from these firms, however, are not expected to be ready for purchase through UNICEF until approximately 2015. Bharat Biotech said it could then offer further price reductions and lower the cost of immunising a child to $3. Rotavirus is the leading cause of severe diarrhoea – the world’s second biggest killer of children after pneumonia.

UNICEF, which procures the majority of vaccines funded by GAVI, is currently conducting a tender for rotavirus vaccines. It will assess offers from manufacturers in the coming months.   

Evans said that if rotavirus vaccine could be purchased this year at a $2.50 price, the impact on public health could be significant and would allow GAVI to save approximately $500 million through to 2020, or about $140 million through to 2015, as measured against GAVI’s current financial estimates. Price reductions and offers by new entrants could create further savings and ensure a dynamic supply base. “We are strongly encouraged by these new developments,” said Evans.

Also today, Merck announced it will offer GAVI the HPV vaccine at a reduced price of US$ 5 per dose, a 67% reduction in the current public price. The price offer is the first of its kind for developing countries. HPV vaccines are part of GAVI’s vaccine investment strategy and the Alliance hopes to see further price reductions. 88% of cervical cancer deaths occur in developing countries killing 275,000 women each year.

Furthermore, Crucell and Sanofi Pasteur will extend GAVI prices on their pentavalent vaccines to the 16 countries currently expected to graduate from GAVI support. Sanofi Pasteur confirmed that this would also apply to its yellow fever vaccine and the rotavirus vaccine being developed by its subsidiary Shantha. These offers will help ensure that price is less of a challenge to sustaining vaccination programmes once GAVI support ends. The announcements build on similar commitments made to graduating countries by Pfizer and GSK to provide the same access to pneumococcal conjugate vaccines through the Advance Market Commitment.

“This encouraging news shows the potential for strong price reductions today and potential ones in the future, particularly from developing country manufacturers,” said Tore Godal, Special Advisor to the Norwegian Prime Minister on Global Health. “Every year, approximately 1.7 million children die of diseases that can be prevented through vaccination. That’s one child every 20 seconds. Working with manufacturers for low and sustainable prices ensures that donor funding goes further in immunising children where vaccines are needed most.”

“Our market-shaping goal is to achieve the lowest price for currently available products while maintaining supply security,” said Evans. “Looking forward, Alliance members will work to broaden competition and ensure the provision of quality vaccines at sustainable prices. Today’s announcements are a step forward to achieving this goal.