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The world is suffering. But just over the horizon is a new access equation that could speed innovative vaccines to where they're needed most.
The first time Margaret McGlynn heard about the brother she never met, it was the 1960s, and she was with her mother at an immunization clinic in Buffalo, NY, waiting to be injected with a brand new measles vaccine.
As the line moved slowly forward, four-year-old Margie grew frightened watching the needle sink into the arm of child after child. That's when her mother took her aside and told Margie the story of this other child, who died a decade earlier of the same disease this vaccine would protect her from.
Margaret McGlynn, President, Merck Vaccines & Infectious Diseases
The 18-month-old had been suffering from measles when he spiked a high fever. McGlynn's mother called the doctor. Wrap the baby in cold towels, the doctor told her. Helplessly, McGlynn's mom pressed the towels around the baby, only to see him get worse. Eventually, she rushed the baby to the hospital, where she learned that he had contracted pneumonia as a complication of measles. He didn't survive the day.
"After hearing how my brother died, I didn't ask any more questions as to why I needed to get this shot," remembers McGlynn.
Merck's Dr. Mark Feinberg (center) administers RotaTeq to an infant in Nicaragua. The rotavirus vaccine marked the first time a vaccine reached a poor nation in the same year it was licensed in a rich one.
In the course of her lifetime, McGlynn has seen the elimination of many diseases—measles among them. She's even done her part in exterminating them. McGlynn was senior director of marketing for Merck's MMR (measles, mumps, and rubella) vaccine. Now, she heads Merck's recently reorganized vaccine group, which fights childhood and early mortality through products such as the cervical cancer vaccine, Gardasil (human papillomavirus quadrivalent, types 6, 11, 16 , and 18) and RotaTeq (rotavirus vaccine, live, oral, pentavalent) which prevents rotavirus, a potentially fatal diarrheal disease.
Vaccination rates have long been dismally low outside of rich countries. Vaccines that have already been developed and cost pennies per dose could prevent some 20 percent of the seven million child deaths each year, according to the World Health Organization (WHO), but fail to because they don't reach the people in need.
Rotavirus disproportionately affects the developing world, where citizens have the least access to vaccines.
But in the last few years, in some places, things have started to change: Deaths from measles worldwide fell 74 percent between 2000 and 2007. The rate of polio, which afflicted 350,000 people per year as recently as 1988, has dropped 99 percent (the disease is expected to be eradicated within five years). And countries that have introduced mumps vaccination have seen cases drop from between 100 to 1,000 per 100,000 population to less than one per 100,000.
All this comes at a time when pharmaceutical companies are entering back into vaccine research, after largely abandoning the field for two decades. Small-molecule pills for chronic diseases offered higher margins and less legal liability. But now, new science has caused many of the world's biggest pharma players—like Merck, GlaxoSmithKline, Sanofi-Aventis, Wyeth, Roche, and Novartis—to come back to the field. It appears that vaccines will again be a major driver in the industry.
The emerging country dilemna
That people in the US and other Western markets can access these promising vaccines there is little doubt. But the real opportunity to prevent human suffering is in the developing world. For that to happen, pharma needs not just next-generation vaccines, but a whole new approach to R&D and access for the poor. In coming years, vaccine makers will be called upon to help define the new rules of global access, and what new progress in science and technology will mean to the 90 percent of the world that can't afford it.
A confluence of political will, funding, and innovation have made these goals more possible than ever. For example:
» In 2000, 192 United Nations member states and more than 20 international organizations agreed to eight Millennium Development Goals—including the goal of reducing mortality of children under five by two-thirds before 2015. That has rallied the global health community behind vaccines, since they are the most cost-effective way to prevent death among young children. President Obama expressed support for the Goals during his campaign, and with strong familial roots in Kenya, it is hard to doubt that he is in alignment with them.
With a multitude of donor commitments, market-based incentives, and new science, vaccines for some of the worlds leading killers of children will reach millions in need.
» The field of vaccines has been transformed in recent years by the GAVI Alliance (formerly known as the Global Alliance for Vaccines and Immunizations), which has worked with stakeholders from NGOs—including the Bill and Melinda Gates Foundation—pharma companies, and governments to increase the use of underutilized vaccines and introduce new ones. "The GAVI Alliance is providing the direct financial support that, once countries recognize the problem and the availability of the solution, gives them the means to move forward," says John Wecker, who directs the immunization activities for the nonprofit group PATH (formerly known as the Program for Appropriate Technology in Health).
» Part of GAVI's approach is to educate developing nations on the burden of disease, and to ensure they pay copays on vaccines. This process has bred a new recognition in government officials that health equals wealth, and that investment in preventive medicine makes economic sense, even for a relatively poor country.
A vaccine diverged
» The battles pharma has fought with the developing world over AIDS drugs and intellectual property have been damaging to the industry—and have taught it a lesson. "The attention that's paid to access will continue to increase, and so being global 'actors' rather than 'tourists' is going to be increasingly important for how companies do business," says Kate Taylor, vice president of global vaccine policy at GlaxoSmithKline Biologicals.
The economic crisis threatens to slow or reverse this progress. But for the moment, even these poor economics have not dampened the promising developments that can stop millions from dying. There's an "if" to that promise, of course, and it's a big one: Companies and other stakeholders need to learn how to reverse a long term trend and ensure that medicine goes to those who need it most and can least afford it. That means solving not just technical problems but finding a way to align moral and ethical principles with the demands of good business.
In 1974, the World Health Organization established its Expanded Program on Immunization (EPI) to guide and support vaccinations for some of the world's biggest killers, including tuberculosis, polio, measles, and diphtheria-tetanus-pertussis. But chronic underfunding of vaccine programs meant that immunization rates remained low among the world's poor. At the end of the 1990s, fewer than half the children in sub-Saharan Africa were immunized, and three million lives were being lost each year to preventable infectious diseases.
As time passed, WHO expanded the EPI list with vaccines for yellow fever, hepatitis B, and Haemophilus influenzae type b (Hib). But the high cost of these new vaccines kept them out of reach. In the early '80s, when a hep B vaccine became available, according to the World Bank, a three-dose course cost more than $150—far too much for the poorest countries.
But there's more to vaccine access than price. There's also the lag between when a vaccine is licensed in the developed world and when it becomes available in developing nations—traditionally 10 to 15 years. "When we really got going in the early '80s, we were just piggybacking off developed countries," says Stephen Jarrett, deputy director of UNICEF's supply division. "Companies were selling vaccines at high prices, but they recovered all their costs, so we managed to get low prices for developing countries."
But it now appears that the vaccine lag need not be a permanent feature of global healthcare. In the past few years, a pharma company working with public health authorities was for the first time able to bring a new vaccine to a developing market in less than a year, if only for a single country.
The vaccine in question is Merck's RotaTeq, approved in February 2006 for the prevention of rotavirus—which is responsible for the deaths of an estimated 600,000 children a year. A GAVI-funded group called the Rotavirus Vaccine Program investigated the disease in the world's 72 poorest countries, where many health authorities were still unaware of the link between fatal diarrhea and rotavirus.
Nicaragua, a member of the bottom 72 and one of the poorest nations in the Western Hemisphere, suffered an outbreak of rotavirus in 2005, the year before RotaTeq received FDA approval. More than 50,000 cases were reported and 52 children died. Nicaragua couldn't pay for RotaTeq, but did strike an innovative deal with Merck. In exchange for a three-year supply of donated vaccines, it agreed to undertake a demonstration project that would add to the body of evidence on how this new vaccine would work in a resource-constrained setting.
"We wanted to change the history of the slow rollout of a new vaccine," says Mark Feinberg, MD, vice president of medical affairs and policy at Merck, who has long chartered access issues for the company. "But there were questions over whether a poor country like Nicaragua could effectively introduce it."
But with government backing—and high public awareness of the toll rotavirus was taking—Nicaragua rolled out the immunization campaign. In just a few months, the country achieved the world's highest rotavirus immunization rate, exceeding even the United States.
The official results of the demonstration project are due later this year, as well as the results of African and Asian clinical trials of RotaTeq and Rotarix (rotavirus vaccine, live), GSK's rotavirus vaccine, conducted by PATH. Those results are expected to form the basis for recommending, funding, and rolling out rotavirus vaccines in the 72 GAVI-eligible countries. By 2025, this vaccine should save 2.4 million lives, according to PATH.
The speed of introduction is a testament to just how much the landscape has changed.
Nina Schwalbe, GAVI's head of technical policy, says—aside from more reliable funding—it comes down to new partners that help mobilize the vaccine infrastructure. "There's PATH, which tests vaccines in developing countries, and WHO that approves them and signals to countries that they are beneficial. There's GAVI—the 'Sam's Club' of vaccines—and UNICEF, which is the major procurement agency for vaccines." That doesn't even take into account the other nonprofits that educate, advocate, and build the investment case for vaccines in developing countries.
This web of interconnected health agencies, health systems, funders, and companies is now mobilizing behind a vaccine for pneumococcal disease, which kills almost a million children each year, 90 percent in developing nations. The Pneumococcal Accelerated Development and Introduction Plan (PneumoADIP), a project based at Johns Hopkins University and funded by GAVI, is working to bring Wyeth's Prevnar, a seven-valent pneumococcal conjugate vaccine, to several countries over the next few years. (Meanwhile, Wyeth is developing a next-generation dose of Prevnar that offers more protection.) To facilitate this rollout, Wyeth plans to donate 3.1 million doses of Prevnar in 2009, to be used in Rwanda and Gambia, the first two African countries to introduce the vaccine.
The GAVI Alliance is still deciding which vaccines to fund—and like everyone else, seeing how the financial crisis pans out. But with several new therapies on or close to market, their short list of diseases to tackle over the next few years include cervical cancer, typhoid, Japanese encephalitis, and rubella.
Less than 10 percent of investment in health research goes to diseases that affect 90 percent of the world, according to the Commission on Health Research for Development. Still, companies are more engaged in global health than ever before—and not just because of the sales they hope to eventually make in poor nations. "All of the large pharmaceutical companies recognize that the world is changing, and there is also an ethical obligation to enable access to life-saving drugs and vaccines," says Merck's Feinberg. "Companies will have a difficult time if they approach the world solely from a commercial perspective."
Most recently, the first pharma-funded institute was established dedicated solely to the development of vaccines for neglected disease. The Novartis Vaccines Institute for Global Health (NVGH), in Siena, Italy, is a companion to the company's nonprofit Singapore site, focused on drug treatments for tropical diseases. NVGH is Novartis' answer for developing vaccines that target developing world needs, but it does so in a context where it can work with and trade intellectual property with the company's commercial arm. NVGH's first project aims to develop a broad-range enteric vaccine to protect children against several Salmonella infections, including typhoid fever, which kills 200,000 children each year outside the West.
"New medicines can only be made efficiently by commercial organizations," says Paul Herrling, head of corporate research at Novartis. "We have some responsibility to think about access to medicine, and simply allocate the portion of our research capacity and science technology to these diseases. We think it's a way companies can distinguish themselves from one another."
Still, most companies don't go it alone. In fact, the majority opt to participate in product development partnerships, or PDPs, which have exploded in number in recent years as a result of the massive influx of Gates Foundation funding. In 2005, there were 32 PDPs with pharma companies. By 2008, the number had jumped to 67, according to a study undertaken by the International Federation of Pharmaceutical Manufacturers.
There are many reasons why it makes sense to work within the PDP framework. "The success rate is much higher if pharma works in collaboration with a product development partner," says Alan Fairlamb, a professor and researcher at the University of Dundee's school of life sciences, a hub for research on sleeping sickness and other diseases. "They are constantly checking to make sure that the additional challenges that a product faces in the developed world are being addressed."
The evidence to the contrary, says WHO's EPI medical officer Rudi Eggers, MD, is products like Prevnar. "The pneumo vaccine comes in a pre-filled syringe, which is very complicated in the public sector because it adds to your cold chain storage," he says. "Disposal of pre-filled syringes is also complicated. In terms of developing future vaccines, the interaction between the advisors, ourselves, and the manufacturers has to be much closer to develop appropriate formulations that actually would work better in developing-country public-sector markets."
PDPs have been successful in creating a neglected disease pipeline where there was none. In particular, the malaria vaccine RTS,S—a recombinant circumsporozoite protein fused to a hepatitis-B surface antigen which uses an adjuvant to enhance the immune response—illustrates the power of PDPs to mount research where the risk would be too large for any one entity to bear. GlaxoSmithKline first undertook development of a malaria vaccine more than 25 years ago, but progress picked up when Gates committed funding to the PATH Malaria Vaccine Initiative, and GSK teamed up with the group. The vaccine is expected to move into Phase III, where it will be tested in 16,000 patients in Africa—the largest clinical trial ever conducted for a vaccine on that continent.
"We've reached a high in malaria vaccine development, but this high is a real high," says GSK's Joe Cohen, an inventor of RTS,S. "It will very hopefully take us all the way to registration and implementation of the very first malaria vaccine. That's a big step forward, a big breakthrough."
As the vaccine progresses through the pipeline, it has generated more excitement, but the majority of neglected disease projects—39 of the 67—are still in early-stage research. "There may be a lot of science and discovery projects," says IFPMA president and Schering-Plough CEO Fred Hassan. "But frankly, the funnel becomes pretty narrow on the other end."
The cost of early-stage research is just a fraction of full-scale clinical development. "To move these drugs in the pipeline, it will cost $1 billion a year," says Herrling. "That's what it cost to build the pipeline over the last five to eight years." Indeed, the IFPMA study estimates that the funding shortfall from now until 2017 is between $6 billion and $10 billion. With no indication that current donors could meet the need, many fear such research efforts will simply stall.
With the expected funding shortfall of the pipeline, efforts to develop a market-based solution to the R&D problem have been energized. "The challenge over the next few years is financial innovation as much as product innovation," says Peter Hotez, MD, president of the Sabin Vaccine Institute, a nonprofit developing vaccines for hookworm and other diseases. Here are some new ideas to spur neglected R&D.
Priority review voucher At press time, the PDUFA date for Novartis' gold standard antimalarial Coartem (artemether–lumefantrine) had come and gone without any decision, but all eyes are on the drug as it waits to hear from FDA on its eligibility for a PRV.
Novartis submitted the drug for FDA approval before Congress enacted the PRV scheme, which entitles organizations that license new products for neglected diseases to a speedier regulatory review on another product. These days, with PDUFA dates regularly being missed, PRVs have the potential to create a new kind of legal tender in the market because they are transferrable and immediately valuable.
"This can make a big difference to a company with a blockbuster in its portfolio, jumping the queue to get FDA review," says Peg Willingham, senior director of external affairs from Aeras Global TB Vaccine Foundation. "Even as a nonprofit, we could trade the waiver or sell the waiver and then plow that money back into our work."
Critics say that PRVs have the potential to distort the philanthropic motive and "pseudo-commercialize" the neglected disease research field, which may impact the willingness of organizations to collaborate. As an initial test run, Coartem is a bad example because it could reward Novartis with a voucher, though countries in Africa and Asia get no new technology since Coartem has already been widely available in the public sector for some time. Critics say that sends the wrong signal to companies to scour their current portfolios for relevant indications rather than engage in new research.
But among the wider industry, the idea is resonating. "It's stimulating many companies, including ours, to think about how we might be able to take advantage of that," says Margaret McGlynn. "The real value will play out over time, when you see if this actually leads to quicker approvals."
Milestone grants The new Funding model for R+D in Neglected Diseases (FRIND) recently proposed by Novartis' Paul Herrling goes further to mitigate the risk of developing drugs and vaccines for neglected diseases. Under the model, funds from donors and governments are pooled and used to award milestone-specific grants to organizations carrying out R&D projects where there is no commercial return. If a therapy is successfully developed and approved, the inventors then can license their intellectual property to FRIND for the specific neglected-disease indication—while retaining IP rights for all other indications they might develop. This could be useful, for instance, when investigating a compound for Dengue fever, which might show activity in the closely related disease hep C, a commercial blockbuster indication.
Advance market commitments are agreements through which governments or other bodies promise to purchase a specified amount of a product if it is successfully developed. The goal is to stimulate research by guaranteeing a market to the manufacturer—provided that the product meets a particular profile.
The first AMC, signed in 2007 by Canada, Italy, Norway, Russia, the United Kingdom, and the Gates Foundation, committed $1.5 billion to finance a pneumococcal vaccine for the world's poorest countries. (Prevnar, on the market since 2000, does not protect against certain serotypes common in poor countries.) Vaccines that fit the profile are moving quickly to market. In early January 2009, GlaxoSmithKline's candidate pneumococcal vaccine, Synflorix (pneumococcal Haemophilus influenzae Protein D conjugate vaccine), which protects against three additional pneumococcal strains, was recommended for approval. A 13-valent vaccine, developed by Wyeth, is due on the market later in 2009. Based on this progress, experts believe that a suitable vaccine in sufficient quantities can be rolled out as early as 2010, and can save 7 million lives by 2030.
The pneumococcal AMC also addresses price. At a specified point, after development costs have presumably been recouped, the agreement calls for manufacturers to drop down to a sustainable "tail price," or to license technology to other manufacturers. "The AMC offers a reasonable return for the significant investment we are going to make, and at the same time is at a price point that is affordable for the countries poorest in the world," says Jim Connolly, head of Wyeth's vaccines.
This sort of planned price structure is a good deal for the industry, says Orin Levine, an associate professor for Johns Hopkins Bloomberg School of Public Health, and executive director of PneumoADIP. "It's money in advance, diminished uncertainty around the product characteristics, and offers a price that should allow [both manufacturer and purchaser] to offset legitimate risks and costs and let countries feel comfortable about the sustainability of the vaccines."
The issue of demand is important. GAVI requires each government in its programs to pay a copay to help finance vaccine development. And while prices are mostly subsidized, they still take up a substantial portion of a developing nation's budget. "Demand generation is the critical factor," says GSK's Kate Taylor. "AMCs will be successful if countries know there's robust financing available, and therefore have the confidence to introduce [vaccines] in a timely manner."
But for pharma to feel comfortable agreeing to a low, long term price, they need good forecasts, and good forecasts are not generally available. "A lot of governments will wait to see exactly what's happening, who signs up and what the deal might be," says Jarrett of UNICEF. "Prevnar is one thing. But if you're talking about a 10- or 13-valent, end-price still may be quite expensive from a point of view of a poorer country. The industry has always said that it's very difficult for them to sign up to an end-price."
A second AMC is already in development, but companies express caution. "These are all important initiatives," says Fred Hassan. "But given that it takes 10 years to develop a drug, it's not easy to implement these ideas because people and policies change over a number of years."
Sales of pharmaceuticals in Brazil, Russia, India, China, Indonesia, Mexico, and Turkey are expected to account for 20 percent of the global market by 2020. And even before they hit that level, the relatively rapid growth of pharma sales in these countries (combined with the stagnation of the US and European markets) is pushing companies to explore new frontiers.
For example, GSK recently contracted with UCB Pharma to acquire the right to market UCB products in 50-plus emerging countries. The agreement offers GSK access beyond the middle-income markets and into less-developed nations in Latin America, Asia, Africa, and the Middle East—places where pharma needs to pursue a new model based on high volumes and low margins. How high and how low? According to a paper authored by David Bloom, an economist who chairs Harvard's department of global health and population, Wyeth distributed 100 times more Prevnar in the developing world through UNICEF and the Pan American Health Organization (WHO's regional office) than in the US, for about half the revenue. And those figures aren't necessarily a bad thing. "Vaccines are a core growth driver of the industry, if you can deal with the economies of scale," says Cameron Durrant, worldwide vice president, virology global strategic marketing for Johnson & Johnson.
Efficiency of manufacturing will dictate much of the flexibility in pricing, and the AMC gives companies more confidence to invest in appropriate scale-up. "Over the last five to seven years, we've invested $1 billion to $2 billion dollars to increase our manufacturing capacity to meet the demand for today and look to the future as we expand," says Jim Connolly. "We also hope that our cost of goods will come down as our volume increases and our facilities become more efficient."
Companies that want to compete in developing markets must also adopt pricing strategies that capture subtle differences between markets. "Most companies have a price for the first world, a price to third one, and that's it," says Thomas Nagle, a partner at the Monitor Group who specializes in pricing. "But companies can open up markets around the world if they can get countries to pay indexed to per capita [income]."
GSK, the largest supplier of vaccines to UNICEF, says it uses a hybrid volume-driven model that includes tiered pricing matched to a country's ability to pay and the value of the vaccines. Even before buying UCB's portfolio of drug rights, it had begun to use tiered pricing in low- and middle-income countries to ensure the greatest availability of its products, while still recovering R&D costs from those who are able to pay. GSK's vaccine pipeline may be an indication of how confident the company is about where the market is going.
As in developed markets, companies will have to learn how to deal with generics companies, both as competitors and as partners. In the past few years, for example, GAVI has obtained an increasing share of its drugs from suppliers coming from Brazil, Cuba, China, and India, says Nina Schwalbe. Today, half of its vaccines come from multinational companies and half from companies in developing countries.
"Essentially, what we're talking about is creating a healthy marketplace," says PATH's John Wecker, who helped establish industry-sponsored HIV access programs in Africa earlier in his career. "Making sure that there are multiple manufacturers participating in the market is, from my perspective, one of the best ways to really address the long term issue of pricing."
Other companies are watching. Merck, for example, offers no-profit pricing on RotaTeq and Gardasil in the developing world, but is exploring other options. "If you're able to compete at very low prices, you can have some profit over time and incentives to continue to build capacity," McGlynn says. "It's a potential transition, we have to see how this evolves."
Developing nations increasingly recognize that health and wealth are linked. Thus, even during a recession they will regard a vaccination program as an investment. "Insofar as a healthy population grows its economy faster, then anything that improves population health will tend to have these follow-on economic benefits," says Harvard's David Bloom. "And vaccination tends to improve population health quite dramatically."
But the growing availability of vaccines is forcing nations to make hard choices. In many countries, a simple step like vaccinating for rotavirus, pneumococcal disease, and HPV could quadruple the national vaccination budget, says Bloom.
"The trouble is, even though they know vaccines are a good value, [policymakers] have to come up with the money to buy them," says Cynthia Whitney, MD, pneumonia expert at CDC.
"It makes me very concerned about HPV," says Dr. Peter Hortez. "That's going to be a great challenge. These new-generation vaccines coming out are as expensive as the rest of all the vaccines combined. I do think companies are making a good-faith effort, but the market has not yet been defined."
"We have an innovation pile up where some countries are looking at introducing five or even seven more vaccines in just a few years," says Kate Taylor. "What we haven't figured out is how to accelerate such a rapid expansion. We can't make false choices. It's not OK for a kid to die of rotavirus versus pneumococcal versus meningitis."
Ted Bianco, director of technology transfer for the Wellcome Trust, says some nations might revert to putting their dollars into time-tested vaccine solutions, like measles. It's a situation McGlynn and others will have to address, at the same time catching nations up with vaccines from the past and piloting them into the future.
McGlynn, on the availability of an HIV vaccine: "While we are committed, we can't be unrealistic and assume we that we're going to solve this problem in the next couple of years—and I've heard experts say we should assume we won't have an HIV vaccine in the next 10 years. Now, certainly, I'm motivated that I we can prove those experts wrong, but I don't want to create false hope. We need other strategies."
Did you know? the considerable noise spread by antivaccine groups in the United States about the link between vaccines and autism, less than one percent of children received no vaccinations at all, according to the CDC, and 80 percent of all children received all recommended vaccines.