Lower priced vaccines will help organization

Pharmaceutical companies have agreed to large cuts in the price of vaccines bought by the GAVI Alliance, an international partnership aimed at boosting immunisation of chidren living in poor countries. The vaccines covered by the deal will protect against rotavirus and human papillomavirus, and also includes a pentavalent vaccine protecting against diphtheria, tetanus, pertussis, hepatitis B, and haemophilus influenzae type b.

The lower priced agreements gave GAVI hope just before their June 13 fundraiser meeting in London, where the Alliance had hoped to persuade donors to make up a US$3.7 billion shortfall in its planned $ 6.8 billion expansion of vaccination programmes over the period 2011 to 2015.

News releases from this conference shows that GAVI donors actually exceeded their request. Donors committed US$ 4.3 billion at the first pledging conference held by the GAVI Alliance. This exceeds an initial target of $3.7 billion, enabling GAVI to reach more children faster than planned and to accelerate the introduction of new vaccines. A portion of the pledges are conditional upon GAVI raising additional funds from other donors in the future. Those pledges bring GAVI’s total available resources for the period 2011 to 2015 to $ 7.6 billion.

The Alliance wants, in particular, to roll out new pneumococcal and rotavirus vaccines, to combat the two largest killers of children in poorer countries: pneumonia and diarrhoea.

In regards to the reduction in prices, GlaxoSmithKline announced that they will offer GAVI its rotavirus vaccine at $2.50 per dose ($5 per child, as vaccination requires a double dose). That is 67% lower than the current lowest price for the vaccine. Merck will also discount its vaccine against rotavirus, which causes diarrhoea and kills more than 500,000 children each year. GAVI plans to vaccinate 50 million children against rotavirus by 2015, and price cut brings the cost of the vaccine down to a level where it becomes affordable to use on a large scale.

If GAVI is able to buy the vaccine at this price this year, it would save $140 million through 2015. GAVI hopes prices of the rotavirus vaccine will fall further as emerging country makers, including Bharat Biotech, the Serum Institute and Shantha Biotechnics, a subsidiary of Sanofi Pasteur, bring onstream their own rotavirus vaccines around 2015. Bharat Biotech has told the Alliance that it could bring the cost below $3 per child.

Merck also announced that it will offer its vaccine against human papillomavirus – which kills some 200,000 women annually in poor countries – to GAVI at $ 5 per dose, a 67% reduction. India-based firms Serum Institute and Panacea Biotec also agreed to further reduce the price of their their pentavalent vaccines, which are already relatively cheap at around $2 a dose.

The new pricing cuts are “excellent news,” says Daniel Berman, deputy director of the Access to Essential Medicines Campaign at Médecins Sans Frontières. But there are problems: Merck’s rotavirus vaccine would be impractical to use, he claims, as it requires three doses and demands an unbroken cold chain, whereas refrigeration is often lacking in poorer countries. The GSK rotavirus is a much more suitable product, he says, but it has the limitation that it must be given to children within 32 weeks of birth. Such timely coverage is difficult to achieve in the developing world. Ultimately, vaccines made in emerging countries which are often designed for poorer countries are a better bet, he says.

Getting cost reductions and promoting greater competition is now a pillar of the alliance’s strategy, although it needs to do more, says Jeffrey Rowland, its chief spokesman. While calling the new price cuts “extraordinary” and “highly welcome”, he adds that “we want to continue driving prices down. Today is just the first step.”

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