Vax competition pushes down prices for poor

The GAVI Alliance--a Geneva-based public-private partnership aimed at improving health in the world's poorest countries--touted the news this week that millions of more children would be able to receive vaccines next year thanks to increased competition among drugmakers that produce five-in-one shots, known as the pentavalent vaccine. The multi-tasking injection protects kids from diphtheria, pertussis, tetanus, hepatitis B, and a bacteria called Hib.

When GAVI was founded in 2001, just one company produced the vaccine. Now four drugmakers (two in India) manufacture it. GAVI's goal--what the alliance calls the "GAVI effect"--was to create greater demand for the vaccine, causing more drugmakers to produce it. That has led to competition between manufacturers, driving prices down. In 2004 the cost for a single dose was $3.65; that's expected to drop to $2.83 by 2012. "This is the GAVI effect at work: encouraging and pooling growing demand from countries, attracting new manufacturers and increasing competition to drive down prices," said GAVI CEO Julian Lob-Levyt.

"The price drop has come later than we had hoped and it needs to fall further. But this is a clear indication that our market-shaping efforts work," Lob-Levyt added.

- see the GAVI Alliance release
- read this report for more