Understanding & Estimating Costs of Vaccine Development,Production and Pricing

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DESCRIPTION (provided by applicant): Childhood vaccines have been identified as one of the top 10 greatest achievements in public health in the 20th century, and new vaccines recommended already in the 21st century promise additional reductions in morbidity and mortality for children and adults. However, the rapidly expanding immunization schedule and increasingly expensive vaccines threaten the fiscal stability of public vaccine financing at federal and state levels. In the fragile public-private partnership at the core of United States vaccination efforts, public officials negotiate with private vaccine manufacturers to set federal contract prices. Public officials prefer lower prices in order to provide as many recommended vaccines as possible to vulnerable children, whereas manufacturers prefer higher prices that yield sufficient return on investment and capital for future vaccine development. To minimize risk for both parties, there is a need for better symmetry of information about manufacturers' investments in vaccine development and commercialization [including responses to the Food and drug Administration (FDA) regulatory efforts], and about program officials' price expectations for newly recommended vaccines relative to previously recommended vaccines. The investigators propose a two-year research project with the following specific aims: (1) To develop and evaluate a conceptual model of observable factors that contribute to the costs of vaccine development, commercialization, and pricing, using expert primary sources; (2) To translate the conceptual model into a working model of development/commercialization costs and pricing for vaccines, using an array of confidential primary industry sources and publicly available secondary sources; (3) To operationalize the working model of vaccine costs and pricing as a user-friendly tool with observable inputs that can be used in the future by federal immunization program staff and manufacturers. This vaccine cost/price tool will be of great value in the ongoing partnership between public health and vaccine manufacturing interests. RELEVANCE OF RESEARCH TO PUBLIC HEALTH: The public-private partnership between public immunization programs and vaccine manufacturers is strained by increasing prices of vaccines. The government wants to understand better how the costs of developing and producing new vaccines inform prices. Manufacturers want the government to understand their level of investment in vaccine development. This research will yield a tool to help improve mutual understanding of these issues.