Tuesday, November 25, 2014

Most Logical Explanation? Ebola Vaccine Was A Relatively Low Priority -- Prior To 2014

I hinted at this, in my shortish piece, this morning -- all three of the leading Ebola vaccine candidates have been known for several years. The lack of economic incentives to bring them to market has been, in large part, the "gating variable". [I'll try not to editorialize, to excess here. Right(!).]

Candidate vaccine strains known for several years. True. And yet, these candidate strains weren't rushed into development -- at least in part because there was scant hope of ever reaping a profit, on the effort. Until this year, that is. Prior to this outbreak, Ebola hadn't been seen as a global problem. Just an African problem, or even a sub-Saharan African problem -- and one for which a vaccine would have to cost pennies, not dollars (per dose), let alone tens of dollars -- in order to be remotely viable for reimbursement, inside the affected African economies.

But now that Ebola has hopped continents, and is appearing in the post-modern economies -- even sporatically -- there is a much better chance that some governmental payer in Western Europe, Japan or North America (and less probably in China or Russia) will agree to pay what it really costs to immunize their population(s). So Merck offered "only" $50 million for the exclusive rights. It will likely lose money on this deal. And it is the right thing to do: delay, and foot drag no longer. To my mind, the story here is less a mystery than the Canandian news outlets might suggest. It is at least in part a story about big pharma -- and big money -- or the lack thereof. A bit:

. . . .What is odd, however, is that the money goes not to the Canadian publicly owned entity that developed the vaccine but to a small U.S. middleman that appears to have done little.

Iowa-based NewLink Genetics has had the exclusive commercial licensing rights over the Canadian vaccine since it bought them from the Public Health Agency of Canada in 2010.

In return for those rights, according to the filings the company made with U.S. regulators, NewLink provided the Canadian government with a “milestone payment” of just $205,000.

That’s considerably less than the $50 million the Iowa company got for passing those rights on to Merck. . . .

Even so, $50 million is not a lot of money, either -- not for big pharma. Most big pharma concerns measure success by the billions, or very high hundreds of millions, per year, in revenue -- per candidate. And that outcome is very unlikely here. A little less unlikely than it was prior to 2014 -- true enough. But still unlikely, overall. Now you know.

1 comment:

Birdman said...

You are quite astute. I have not seen anyone that is willing to admit that NewLink and the Canadian government has done nothing different from all the other companies (and governments) currently peddling ebola vaccines and treatments. It is clear and unfortunate that it is very difficult for a company to survive if they make vaccines and treatments for rare diseases that affect the poorer areas of the world. It is difficult enough to work on government contracts because the profit margins are so small and the risk of failure is often moderate to high. Someone has to pay for the efforts! Even the Gates Foundation, GAVI, etc. did not push to get the ebola vaccine treatments and vaccines through the pipeline prior to the current outbreak, because, prior to this outbreak, ebola outbreaks were sporadic and localized in time and location.