I group the costs of making the neglected diseases (those without treatments) less neglected into: the costs to develop and manufacture a new treatment and the costs of buying (at a price which is the cost plus a profit to make the production sustainable and the producer economically viable) and distributing it. The latter seems to me to require increasing the resolve and resource allocation by governments around the world to providing health care as one of their basic responsibilities. The former, since it involves human biology and a regulatory process, is time- and capital-intensive, but, to me as a biologist and technologist, seems a more tractable problem. Since I know something about drug and vaccine development, I‘ve tried to contribute ideas to reducing this cost (my posts of March 11, April 4, and November 4 this year) and posited a general scheme for “cheap” drug discovery and development, but other than pointing to several products and services that may contribute to lowering the cost, I’ve not had a real life example to learn from. But that’s changed.
Last week the Meningitis Vaccine Project (MVP), a partnership of the World Health Organization (WHO) and PATH, announced the launch (deployment) of a new meningococcal vaccine called MenAfriVac™ in the West African nation of Burkina Faso as the start of a campaign to eliminate epidemic meningitis in 25 countries of sub-Saharan Africa (PATH press release; also NYTimes article). Meningitis is a life-threatening infection of the lining of central nervous system (the meninges) that can be caused by a number of a bacteria or viruses and that occurs, for reasons unknown, in 7-14-year epidemic cycles in Africa, most recently in 2009 when 88,000 people were afflicted and more than 5000 died (WHO fact sheet). The causative agent is Neisseria meningitides, specifically subgroups A, B, C, W135, and X. While the potential elimination of the epidemics is great news, the interesting sub headline is that, when the MVP started the project in 2001, it aimed to keep development costs as low as possible and find a manufacturer who could price it at less than $.50 per dose- and they did. I looked through their literature for techniques that may be generally applicable to reducing development and manufacturing costs (MVP website).
Although I was not able to find a specific number, PATH indicated the vaccine development cost was about $50 million or, according to them, one-tenth the “typical” cost for vaccine development (PATH press release). The relevant points I found were:
- MenAfriVac™ is a monovalent vaccine, meaning it stimulates an immune response only to the A subgroup bugs unlike the existing vaccines which are tri- or tetravalent but also means it works well in infants and confers a longer-lasting immunity than the existing vaccines [keep the product as simple as needed and focus on performance];
- Its basic design (a polysaccharide antigen conjugated to tetanus toxoid as an immune stimulant) is similar to existing vaccines [build on pre-existing and proven technology]; and
- Clinical trials were done in India, the Gambia, Ghana, Mali, and Senegal [use relatively low-cost settings for trials].
A setting target purchase price of under $.50 per dose is praiseworthy but seemed arbitrary. MVP apparently conferred with the public health officials of the endemic countries (their public sector customers), picked $.50, and, according to Luke Timmerman of Xcomony, confirmed that this price was close to a feasible manufacturing cost with industry experts (Xconomy article). Then MVP had “discussions” with unnamed major vaccine companies, but none was interested in the project and the price ceiling, and somehow selected and licensed the Serum Institute of India (SII) as the manufacturer in 2002 (it’s not clear if the MVP tried a competitive bidding process) (MVP About). While not giving the exact price, PATH states SII’s price for the purchasers, presumably the Global Alliance for Vaccines and Immunization (GAVI, see below), is under $.50 per dose (PATH press release), but it is not clear if SII’s costs are actually this low and if there is any profit.
Some of the points relevant to keeping the manufacturing cost down I found were:
- SII has strong experience in producing low-cost, public-sector vaccines (it sells UNICEF most of the vaccines in its immunization programs) [manufacturing experience is helpful];
- MVP was able to license a vaccine conjugation technology from the USFDA at no cost (a royalty-free license) and therefore did not have to pass that cost to SII (MVP product development) [get no/low cost licenses from government and academia];
- the USFDA transferred its technology to SII at no cost [negotiate tech transfer with a license];
- SII used the least costly methods (“… Serum [Institute] made a conscious decision to be as frugal as possible to meet the vaccine price requirements,” MVP product development) [again experience counts]; and
- Regulatory approval was through the Indian government and the WHO vaccine manufacturer prequalification process (MVP About) and not through the FDA [skip the costly FDA route, if possible].
The MVP director, Dr. F. Marc LaForce, also emphasized good project management and business planning in a presentation in 2007 (LaForce 2007), specifically:
- Understanding of the motivations of the participating groups, lots of communication, and not relying on “benevolence” [use friendly but forceful persuasion, I guess];
- Business arrangements that make economic sense;
- A business plan that is well-negotiated, sound, and includes milestones;
- CROs for obtaining critical practices and knowledge; and
- Guidance of the partnership with clear, economically viable goals.
MenAfriVac™ is now in its launch phase, and the cost of its full deployment in the afflicted countries is estimated at $570 million (PATH press release) which means that the cost of vaccine (300 million doses at $.50 per dose or $150 million) is about 25% of the overall cost. $95 million (17%) has been raised to date through GAVI, Michael and Susan Dell Foundation, Médecins sans Frontières, and UNICEF, so there is more needed to meet the distribution cost.
So bravo to Gates, PATH, MVP, and SII for cost-effective vaccine development, but does this mean “watch out big pharma” as Luke Timmerman titled his article (Xconomy article)? I think so, especially if SII has the rights to use the technology they licensed and developed (as they should) and if they can use it to make multivalent meningitis vaccine and get it approved world-wide. The 2009 market for preventative meningitis vaccines is $1.8 billion and is estimated to grow to $4.5 billion by 2017 (Globe Data report). The typical price for the current vaccines, e.g., Menactra® by Sanofi and Menveo® by Novartis, is about $80 (group) to $103 (individual) (CDC vaccine price list), so, even if SII’s tetravalent vaccine costs twenty times the cost of MenAfriVac™ (or $10 per dose), its pricing will crush the competition and make them a boat-load of money (to use in other ND vaccine projects).