Vaccines were in the news this week after donors pledged a whopping US$4.3 billion over five years to the Global Alliance for Vaccines and Immunizations (GAVI), a public-private partnership providing subsidized vaccines to the world’s poorest countries.
Canada chipped in $65 million, only a little over 1 percent of the total, but more than anyone expected. GAVI was brought back from the brink of insolvency, and 250 million children will get vaccinated.
Welcome as that was, it’s not the big victory I’m referring to. The real win came some days earlier after a sustained lobbying effort by Oxfam and Medecins sans frontières. Unicef, which buys most of the shots for GAVI, finally raised the curtain on the prices it pays for vaccines.
Why is that a big deal? Because price gouging was a major reason why GAVI ran out of money this year and had to cut 16 countries from its beneficiaries.
The data Unicef released showed for example that GAVI/Unicef paid Crucell (a Dutch company owned by the multinational Johnson & Johnson) 40 per cent more than to Indian manufacturer Serum Institute for the very same paediatric vaccine.
Public scrutiny brings down prices. Sure enough, last week, in the wake of Unicef’s move, several vaccine manufacturers voluntarily lowered their prices, albeit in a one-off ad hoc offer.
Donors should be congratulated for encouraging GAVI and Unicef to ensure value for money. And they must keep up the pressure because one more crucial step is needed.
Two representatives of the vaccine manufacturers sit on GAVI’s board, even though every decision the board makes affects the profits of vaccine suppliers. Let’s not forget that GAVI is the largest purchaser of vaccines in the world.
Crucell, the price gouger noted above, earns most of its income from GAVI contracts and is due to take a seat on the GAVI board in July. Such conflict of interest is a clear obstacle to getting value for money. GAVI must get its suppliers off the board.