GAVI working to reduce vaccine prices
In response to the DT article “GAVI funds big pharma while Indian drug firm could produce for less”, it is necessary to clarify the aim of the Advance Market Commitment (AMC), as well as GAVI’s aim to ensure that children in poor countries have the same access to life-saving vaccines as their counterparts in rich countries do.
Every year millions of children in developing countries die from vaccine-preventable diseases because their governments are unable to afford the appropriate vaccines or because vaccines are not even available in those regions. GAVI firmly believes that these children should not have to wait the usual 10-15 years until cheaper vaccines are available in needed quantities. Children need them now.
The first AMC was launched to accelerate the availability of effective and affordable vaccines against pneumococcal disease, the biggest cause of pneumonia, which kills more children around the world than any other disease. Thanks to the AMC, these life-saving vaccines are now being provided by GAVI to children in developing countries at hugely reduced prices, 80% less than the lowest prices available anywhere in the world.
If plans are fully implemented, GAVI will be able to prevent the deaths of approximately 650,000 children by 2015.
The AMC was designed to be a “pull mechanism” to stimulate supply from multiple manufacturers and guarantee the long-term availability of vaccine supply. It rewards successful investment from any pharmaceutical company that develops the appropriate vaccines in the right quantities. The reward allows companies to recover some investment costs, including investment in capacity to supply the GAVI market.
The AMC was intended to reach beyond pharmaceutical multinationals. Products from developing country manufacturers that meet quality standards set out by WHO and approved by an independent review committee are also eligible. By awarding supply through sequential tenders, the AMC was designed to encourage multiple manufacturers to enter the market. For example, the Serum Institute of India and Panacea Biotech have already registered to participate.
Reducing vaccine prices is a global effort that the AMC is part of. “Push funding” is also important and GAVI collaborates with partners like the Bill & Melinda Gates Foundation, which has provided push funding to emerging market manufacturers to develop next generation pneumococcal vaccines.
The AMC’s substantially reduced prices are a good start. However, they are still high for low-income countries. GAVI believes that the pharmaceutical industry should ensure that vaccines are made even more affordable.
Further lowering vaccine prices is a key element of GAVI’s five-year strategy to shape the vaccine market. This strategy also aims at increasing supply security and facilitating the introduction of new vaccines.
Just last month, GlaxoSmithKline committed to major price reductions on their rotavirus vaccines for low income countries. Serum and Merck also offered price reductions on pentavalent and human papillomavirus (HPV) vaccines, respectively.
While the AMC and other market-based approaches may have their critics, they won’t be among the children benefiting from the vaccine in low-income countries. Thanks to the AMC, parents will no longer have to watch helplessly as their children waste away from the effects of pneumococcal disease. Waiting years for vaccine prices to naturally drop and sufficient supply to increase is not an option. Thousands of young lives would otherwise be lost.
Managing Director Performance & Policy for GAVI Alliance