Pfizer ($PFE) and GlaxoSmithKline ($GSK) are facing a new round of pressure over their pneumonia vaccine prices this week from a familiar agency. Médecins Sans Frontières, a global charity and frequent pharma critic, has initiated a worldwide petition calling for the companies to reduce the prices of the vaccines to $5 per child--for all three doses--in emerging markets and for humanitarian organizations.
|A MSF bus ad outside of Pfizer's headquarters in New York--Courtesy of MSF|
To kick off the campaign, the group dumped $17 million in fake cash--the amount it said Pfizer makes in one day from sales of its pneumonia vaccine--in front of the pharma's New York headquarters, addressed to CEO Ian Read. Each year, pneumonia kills nearly one million children, making it the leading cause of global childhood death, according to MSF.
MSF's moves come after years of "fruitless" negotiations with the pharmas, it said in a statement, over the price of the vaccines that have to date amounted to $28 billion in sales. As the saga has unfolded to this point, Pfizer has cut its per-dose cost by 20 cents, a move MSF called "inadequate," and GSK offered a pricing explanation with no discount, saying the prices are as low as they can go to be sustainable. A MSF report in January said that with the addition of new vaccines in the world's poorest countries, it is now 68 times more expensive to vaccinate a child than in 2001.
In response to the petition, a GSK spokeswoman wrote to FierceVaccines that the company has "been making a major contribution to broadening access to vaccines for decades," and that it provides a "substantial discount" to Western prices in developing countries.
"Many of our available vaccines are advanced and complex and require significant upfront capital investment to make and supply," the GSK representative wrote. "Our pneumococcal vaccine is one of the most complex we've ever manufactured, essentially combining 10 vaccines in one. We will provide 720 million doses of pneumococcal vaccine for Gavi-eligible countries over the next 10 years at a deeply discounted price. At this level, we are able to just cover our costs. To discount it further would threaten our ability to supply it to these countries in the long-term."
MSF isn't alone in calling for change: In May, the World Health Assembly, with 193 national governments present, passed a unanimous resolution calling for more affordable vaccines and more pricing transparency. In some countries, prices for the vaccines aren't disclosed.
Pfizer's Prevnar 13 raked in $4.3 billion in 2014 sales and has continued its expansion this year, helping drive the company's vaccines growth 44% in the first two quarters and 43% in Q3, all over the same periods last year. GSK's Synflorix brought in 2014 sales of £398 million.
As much ire as Pfizer and GSK draw over their pneumonia vaccine prices, however, the issue isn't limited to the vaccines sphere or to the two companies. Recent price increases from Valeant Pharmaceuticals ($VRX) and Turing Pharmaceuticals, among others, have placed the larger drug industry's pricing methods under scrutiny from lawmakers, attorneys general, industry groups and the public. The issue has taken a prominent role in the U.S. presidential election, as well, with candidates from both parties laying out plans to combat climbing healthcare costs.
Pfizer could not be reached for comment.
- here's the release
- and GSK's response