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How do we quantify 'hysteria' in vaccine pricing? Thoughts from #ISPORAMST

12 November 2014 Mark Hollis

I'm at the ISPOR Europe 2014 (#isporamst2014) meeting, and an issue that keeps cropping up is vaccine pricing. This is also something that I have been asked about time and time again by journalists covering Ebola. In the safe confines of the RAI conference centre in Amsterdam, far away from the Ebola outbreak in West Africa, most of the discussion on vaccine pricing is focused on vaccines treating infectious diseases which quietly and without much media attention affect the lives of people living in some of the poorest regions of the world.

Writing in Jane's Intelligence Review my colleague Murtala Touray noted in an article co-authored by myself, that Guinea, Liberia, and Sierra Leone are facing up to the economic consequences of the fear generated by Ebola. However, we still have some questions to try and answer: how do we quantify this fear? and should we quantify this?

When deciding on the price of a new product, and seeking to obtain reimbursement of a product, pharmaceutical companies will attempt to measure things such as the budget impact and the incremental cost effectiveness of products. These measures seek to examine the epidemiology of outbreaks and the costs of the vaccine and compare these to the benefit to the country as a whole. In the case of vaccines which are needed to tackle immediate public health emergencies the demand for a vaccine and the wider economic consequences of an outbreak can translate into a massive market opportunity.

In the case of Ebola, high demand for vaccines will not translate into high prices for one key reason. Pharmaceutical companies conscious of the fact they tread a fine line between serving patients and revenue generation will not be keen to be seen as profiting from poor and desperate patients in perhaps the poorest region of the world. It is because of this factor, and the fact that many infectious diseases could drastically impact GDP in today's world, that companies should not and cannot quantify prices based on hysteria.

Beyond immediate needs and looking towards future vaccinating programs across sub-Saharan Africa the pricing of the medicine becomes challenging. But it doesn't necessarily have to be so. Much of the talk on vaccine pricing that has been discussed at ISPOR sees western economic models being applied internationally but these models may not address the realities of economic situations on the ground, especially in low middle and low income countries, and especially in the case of Ebola. There is perhaps a perceived assumption that companies will price vaccines at cost in the poorest regions but by the challenging nature of these markets there could be high logistical costs.

Leaving ISPOR I cannot help but feel that we have not adequately addressed the creation of pricing to reflect the most challenging and evolving conditions and instead still focus on the adaption of current models. I believe this to be especially so for Ebola. Although an Ebola vaccine may be some way off we must start to address the issue of how we can price vaccines in this area to maximise market access.

Posted 12 November 2014

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