[e-drug] The G8, Profits, the Poor and a pneumococcal vaccine

["Donald W Light" <dlight@Princeton.EDU>]

E-DRUG: The G8, Profits, the Poor and a pneumococcal vaccine
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Dear E-druggers,

You have probably seen, or will soon, the press release from The Lancet about an intersection of pharmaceuticals, business, and reducing global poverty. The article in the July 28 issue claims that three-quarters of the $1.5 billion in donations to the G8 to buy Synflorix, a new pneumococcal vaccine for the poor, will go to extra profits, because the G8 is committed to paying about four times the nonprofit, average price. 

As a result, only one-quarter as many poor children will be immunized as the donations could make possible. The R&D costs of Synflorix are fully paid, based on large expected sales in affluent countries. 

The article recommends that G8 leaders use the Advance Maximum Benefit Commitment (AMBC) approach so that several hundred million more poor can receive the vaccine than using the AMC contract. 

Will the G8 leaders alienate a humanitarian movement of donations that has taken years to build up by commercializing it for profits? Or will they show that donations are well used to do the greatest good for the greatest number of people? Have G8 leaders been misled by an elite of AMC advocates? 

What you probably don’t know is that GSK (the vaccine’s manufacturer) apparently told the Dutch Ministry of Foreign Affairs it is willing to share its technology with qualified, third-world manufacturers. The Ministry reported the news to Parliament last month in response to a question concerning a policy recommendation I developed at NIAS this year. 

Sharing technology would enable open, global bidding that would maximize the number of doses that could be bought and help lift the burden of disease in nations having an average income of less than $1,000. Attached are the original (see Ques 13) and a translation, followed by some comments. 

Best,

Donald 

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	EMBARGO: 0001H (UK time) Friday 27 June, 2007

IS G8 PUTTING PROFITS BEFORE THE WORLD’S POOREST CHILDREN?

Only a quarter of the $1.5 billion donated by G8 leaders to eradicate disease among poor children will be spent on the costs of vaccines, while three-quarters will go to profits. G8 should instead negotiate the lowest, sustainable, non-profit price in order to maximize the number of lives saved and children who can benefit. These are the conclusions of a Comment published in this week’s edition of The Lancet. 

Professor Donald Light, Netherlands Institute for Advanced Study and the University of Medicine and Dentistry of New Jersey, USA, says that the kind of contract which the G8 is using was designed to match the revenues and profits which multinational pharmaceutical firms earn from medicines sold in affluent markets. But in this case, the G8 plans to purchase a pneumococcal vaccine that is already discovered and developed for affluent markets so it is really a large, extra contract that should be non-profit to help lift the burden of disease in poor countries. He says: “This alternative strategy could be called the Advance Maximum Benefit Commitment (AMBC).” 
 
The current G8 contract is set to pay $5.00 - $7.50 a dose, about four times what Prof Light estimates to be the average cost, including capital and overheads costs for enlarging production facilities. Thus 300 million or fewer children can benefit from the donations, while if the G8 used the AMBC strategy, 1.2 billion or more children could benefit. Prof Light questions whether poor countries and donors will stand by and watch G8 paying four times the average sustainable cost of these vaccines.

Still better would be for G8 leaders to negotiate for licenses and technology transfer so that third-world based companies could compete for long term contracts. The donated money would then provide a double benefit: boost the economies of low income countries as well as lift the burden of disease. He concludes: “The low cost structure in developing countries might get the price down to $1 a dose, so that 300 million more children could be saved.”

Professor Donald Light, Netherlands Institute for Advanced Study and the University of Medicine and Dentistry of New Jersey, USA contact by e-mail only E) dlight@princeton.edu 
 
Tony Kirby
Press Officer
The Lancet
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London
NW1 7BY
Tel: +44 (0) 20 7424 4949
E-mail: pressoffice@lancet.com