Tim Wilsdon and Ryan Lawlor, Life Sciences Practice, CRA, examine how price-based models for vaccines are affecting coverage across the globe.
Vaccine
The focus on the role of vaccines in addressing global health challenges has intensified in recent months in light of the spread of coronavirus. Vaccines have been shown to play a central role in the prevention and spread of many serious infectious diseases. In Europe, an estimated nine in 10 children receive basic vaccinations.1 Europe has also seen significant economic benefit due to vaccination programs. The EU receives 71% of global vaccine R&D investment, produces 80% of the world’s vaccine doses, and is home to 45% of all vaccine manufacturers.2 But despite the many advantages immunisation programmes have been shown to offer, vaccination rates in Europe have been declining in recent years, resulting in a significant increase in the incidence of many infectious diseases.
A recent analysis led by the Life Sciences Practice at the global consulting firm CRA finds that procurement (or purchasing) methods, specifically price-based models, could play a part in the decline in vaccine coverage rates (VCRs) in the EU. The CRA team interviewed a range of stakeholders in the life sciences sector including payers, government officials, academics, and public health specialists and reviewed available literature to gain better insights into the vaccine procurement methods used in different European markets. The team focused on the approaches to procurement for measles, influenza, and hexavalent vaccines in Germany, Italy, Spain, and Romania.
The pitfalls of price-based models
There are multiple methods used in vaccine procurement, including pure price-based models and others that use a more holistic approach based on a vaccine’s perceived value to clinicians, patients, and healthcare systems. Price-based models are associated with lower prices (which could lead to higher levels of access). In one example, after government officials in Germany introduced price-based procurement for influenza vaccines in 2011, the average price fell by 30% in year one and 56% in year two.3,4 Conversely, hexavalent and measles, mumps, and rubella (MMR) vaccines were not purchased with price-based models and their prices remained constant over this time period.
While price-based models can result in near term cost reductions, our analysis shows that purchasing decisions based solely on price often do not correlate with increased VCRs. In Spain, an effort to reduce influenza vaccine prices in all regions was associated with a decline in VCRs, with no evidence to suggest that the lower prices have helped the VCR to recover since then.5 Similarly, in the Puglia region of Italy where price is the only criteria considered when purchasing vaccines in bulk, the VCR has dropped in tandem with vaccine prices.6
A country-by-country review also indicated that price-based models can lead to longer term challenges including limits on vaccine supply, poor patient outcomes, and lower R&D spending. Following the implementation of price-based purchasing in Spain, the region has experienced issues in attracting bids from vaccine suppliers for diphtheria, MMR, tetanus, pertussis, pneumococcus, typhoid fever, rabies, and yellow fever vaccines, due to the lower commercial attractiveness for eligible companies.7 In response, the government increased the MMR vaccine price in 2014 as an incentive to suppliers to continue supplying the Spanish market.8
Findings from the analysis also show that complex and lengthy production processes for vaccines could exacerbate supply issues, especially for regions that choose a single manufacturer to supply specific vaccines. In 2012, several federal states in Germany hired a sole supplier to produce influenza vaccines. The supplier could not deliver the required one million doses due to impurities - and no other influenza suppliers had produced or stocked excess doses.9 As seen in this example, the combination of production timeframes and inaccurate planning of local supply needs might mean that a population misses the immunisation window, putting them at risk of disease.
Too much focus on price can also result in limited availability of value-added services including education and awareness programs for patients, clinicians, and other healthcare professionals. This can be especially important when there are limited public funds allocated to educate the public, particularly given the risk of anti-vaccination campaigns in recent years. In addition, lower prices and resultant smaller profits could lead to market consolidation, risking long-term availability and market sustainability. The impact on market competition and manufacturers’ willingness to invest in R&D could stagnate innovation, leading to areas of unmet need.
Sustainable approaches to vaccine procurement
While price-based vaccine procurement can bring short term financial savings, they may be limiting the effectiveness of vaccination programs in the long term. In contrast, value-based models can help alleviate vaccine shortages and improve VCRs and patient outcomes. Plans that involve multiple suppliers, appropriate contract length, and more achievable delivery timelines that take into account the complex and lengthy production requirements can also play a significant role in improving outcomes.
Based on these findings and the challenges associated with price-based procurement models, some countries have already started shifting strategies. In Romania, a shortage of MMR vaccines has led the government to look outside the country to find additional suppliers. Italy, Spain, and even the U.S. have changed their vaccine purchasing frameworks to facilitate long term competition by allowing multiple suppliers in their markets.10 Other countries have moved to procurement models that place more weight on the concept of value-added services to increase or maintain VCRs. In Spain and Italy, a major contributor to low VCRs is the lack of awareness and understanding of vaccination value from a public health standpoint. Some Italian regions report that education and awareness campaigns are difficult to sustain due to tight budgets. To encourage companies to provide educational resources for clinicians and patients, these regions are considering requiring value-added services to be included in any purchasing agreements.
Conclusion
Vaccine procurement strategies are a key factor in the success of vaccination programmes. Decisions related to procurement can affect both the sustainability of vaccination programmes and their ability to meet public health goals. The results of this analysis indicate that there is a need in many countries to consider more valued based purchasing methods and to include value-added services in the vaccine procurement process. The addition of training services for healthcare professionals, public awareness campaigns, better patient monitoring, and vaccines registries are also important factors to consider. It will be important for manufacturers and purchasers to collaborate closely to address the challenges with current procurement mechanisms in an effort to find mutually agreeable solutions that achieve the desired result: sustainable vaccine procurement programmes that optimise outcomes.