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Annual lecture
- 1. OHE CONNECTS Annual Lecture: How should the world pay for a COVID-19 vaccine? #OHEAnnualLectur June 25, 2020
- 3. Graham Cookson OHE Chief Executive Introduction to the OHE Annual Lecture 2020 #OHEAnnualLectur
- 4. Adrian Towse Director Emeritus & Senior Research Fellow OHE Today’s lecture #OHEAnnualLectur
- 5. How should the world pay for a COVID-19 vaccine? #OHEAnnualLectur “
- 6. #OHEAnnualLecture Acknowledgements • Co-author of the paper Isobel Firth of the OHE • Kalipso Chalkidou, Rachel Silverman and Ganesh Ramakrishnan from the Center for Global Development, and Hannah Kettler from PATH • My OHE colleagues • All errors of fact and analysis, and the value judgements (especially those you disagree with) are my responsibility alone
- 7. My Agenda Our objective and context An analytical framework The challenges of COVID-19 Exploring AMC proposals Putting it all together Lessons for the future
- 8. The COVID-19 vaccine wish list one or more vaccines that work (at least for the most vulnerable) vaccines developed and manufactured as quickly as possible the ability to manufacture and deliver these vaccines at scale for populations across the world Affordable and cost-effective, i.e. a good use of scarce resources, in very different health care settings around the world What is our objective? #OHEAnnualLectur
- 9. What is the global context? COVID-19 is causing a health and economic disaster Source: John Hopkins Source: World Bank An effective COVID-19 vaccine can provide massive health and economic benefit for the world #OHEAnnualLectur
- 10. Operation WARP Speed ACT Accelerator EU proposal UK government bilateral deals AcceleratingH T COVAX Facility CEPI leading push funding Gates Foundation BBAMC What is the vaccine context? The cornucopia of schemes to get a vaccine ource Fox Business 2. Source: nobelprize.org 3. Source: Fox Business 1 2 3 #OHEAnnualLectur
- 11. My Agenda Our objective and context An analytical framework The challenges of COVID-19 Exploring AMC proposals Putting it all together Lessons for the future
- 12. We can distinguish between ‘push’ and ‘pull’ funding Product launched R&D begins Push funding reduces scientific risk Pull funding reduces commercial risk Development process $$ • In HICs, buying power in the market ‘pulls’ investment through development, manufacture and distribution • In LICs buying power of donors ‘pulls’ investment through • For some diseases, where the HIC market is small, we see ‘push’ and ‘pull’ funding • There has been a debate as to the appropriate balance of push and pull funding These funding types can be used to overcome different kinds of risk #OHEAnnualLectur
- 13. ‘Push’ and ‘pull’ have been used in practice Push & pull funding was used to develop an Ebola vaccine and maintain a vaccine stockpile A mixture of push and pull funding was used to develop an Ebola vaccine #OHEAnnualLecturSource: WHO Afro An advanced purchase commitment between Gavi and Merck in 2016 enabled the development of a stockpile of 500,000 doses of the vaccine which was deployed during the 2019 Ebola outbreak in the Democratic Republic of Congo.
- 14. #OHEAnnualLectur The pneumococcal AMC was a pilot of a new concept Quantity/time Vaccine price per treatment Tail price AMC Diagram adapted from MVI Advanced Market Commitment for Malaria Vaccines It was used by Gavi to test the concept of an advanced market commitment The pneumococcal vaccine was already developed for HICs, the AMC was designed to deliver the vaccine to LICs. $1.5 billion was raised by 6 donor countries towards vaccines produced by 2 suppliers A 3rd supplier has now entered More than 150 million children have been immunised, saving an estimated 700,000 lives
- 15. What does the vaccine context look like with this analytical framework? We can group the COVID-19 schemes into ‘push’ and ‘pull’ COVAX Operation Warp Speed ACT Accelerator BBAMC CEPI EU joint procurement Gates UK Government PUSH PULL Accelerating HT MIX #OHEAnnualLectur
- 16. My Agenda Our objective and context An analytical framework The challenges of COVID-19 Exploring AMC proposals Putting it all together Lessons for the future
- 17. #OHEAnnualLectur It is not easy to develop a vaccine. Full stop. We don’t have a vaccine for HIV We only recently got malaria vaccine but with limited efficacy We have a very limited vaccine for TB We don’t have brilliant vaccines for the top 3 infectious disease killers
- 18. #OHEAnnualLectur • Coronaviruses do not generally induce long-term immunity. • The vaccine needs to generate immunity in older people which is difficult. • There may be safety concerns around vaccine-induced enhancement with coronaviruses. It is not easy to develop a vaccine. Full stop. Developing a COVID-19 vaccine may be especially complicated
- 19. #OHEAnnualLectur It is not easy to develop a vaccine. Full stop. It’s hard to get portfolio diversification a bunch of mediocre vaccines, each with a mere 10 per cent chance of working, but they were likely to fail for entirely different reasons…If we put 20 into trials, there is a near 90 per cent chance of at least one success. “
- 20. #OHEAnnualLectur It is not easy to develop a vaccine. Full stop. It’s hard to get portfolio diversification Contrast this with a set of excellent vaccine candidates, each with a 40 per cent chance of working, but all likely to fail for the same reason. Here, we would be stuck with a 60 per cent chance of failure no matter how many we tried “
- 21. #OHEAnnualLectur It is not easy to develop a vaccine. Full stop. It’s hard to get portfolio diversification If we look at the Covid-19 front- runners, individually rational choices may have concentrated risk in terms of the vaccine platforms that are being used and the specific pieces of viral machinery targeted. ... An overt move towards diversity is necessary, even if individual projects look less attractive “
- 22. There are currently 13 candidates in clinical development Candidates are being developed by teams in academia, biotech & large pharmaceutical companies Pre-clinical Phase I Phase 2 Phase 3 mRNA-1273 Moderna & NIAID BNT162 BioNTech & Pfizer INO-4800 Inovio Pharmaceuticals AZD1222 University of Oxford & AstraZeneca Ad5-nCoV CanSino Biologics Unnamed Wuhan Institute of Biological Products and SinoPharm Unnamed Beijing Institute of Biological Products and SinoPharm PiCoVacc Sinovac Unnamed Institute of Medical Biology and Chinese Academy of Medical Sciences NVX-CoV2373 Novavax 129 candidates Unnamed Gamaleya Research Institute saRNA vaccine Imperial College London Unname d CureVac Source: WHO. Correct as of June 22nd 2020 #OHEAnnualLectur
- 23. #OHEAnnualLectur Estimates suggest we need 1.5 billion doses in the short term and a further 14 billion doses in the medium term (up to 2026). Global demand for a COVID-19 vaccine is unprecedented
- 24. High variability High fixed and ongoing costs Low fungibility Long lead- times #OHEAnnualLectur vaccines are often manufactured through variable biological processes a facility can cost between $50M and $500M. Quality checking and raw materials are expensive vaccine manufacturing technology is traditionally bespoke to one vaccine product a lot can take between 6 months and 3 years to manufacture depending on the complexity of the vaccine. Vaccine manufacturing presents a significant challenge Manufacturing is even more complex for COVID-19
- 25. My Agenda Our objective and context An analytical framework The challenges of covid-19 Exploring AMC proposals Putting it all together Lessons for the future
- 26. #OHEAnnualLectur The Covid-19 Vaccine Global Access Facility (COVAX) Attribute COVAX Incentivise private capital to invest in development No, push needed Incentivise private capital to invest in manufacturing capacity No, push needed Contingent Advance Purchase contracts Yes Advance Market Commitment No (Phase 1 is not a market commitment, planned phase 2 includes unspecified market commitment) Incentivise follow-on vaccines Only if AMC component put in place Countries to participate LICs, LMICs but HICs, MLICs welcome Quality hurdle WHO TPP Cost-based Pricing Yes, flat price (allows for other options after first 12 months) Value-based pricing No Differential pricing Reference to tiered pricing Account taken of push funding Yes, in price Donor support for LICs / LMICs Yes Prioritising allocations of vaccines Secretariat COVAX is a procurement mechanism mainly for low-income countries Tail price COVAX Facility price per vaccine Quantity/time Bilateral Contract Bilateral Contract Bilateral Contract Bilateral Contract Bilateral Contract Bilateral Contract Bilateral Contract Bilateral Contract
- 27. #OHEAnnualLectur Benefit-Based Advanced Market Commitment (BBAMC) Price/ volume Price/ volume Price/ volume Quantity Quantity Quantity BBAMC Tail price BBAMC Tail price BBAMC Tail price High- income Middle- income low- income Market commitment Attribute BBAMC Incentivise private capital to invest in development Yes but compatible with Push Incentivise private capital to invest in manufacturing capacity Yes, but separate push needed also Contingent Advance Purchase contracts No Advance Market Commitment Yes Incentivise follow-on vaccines Yes, a major objective is to have more than one vaccine Countries to participate HICs, MICs, LICs (via Gavi) to give overall market commitment Quality hurdle WHO TPP, with a minimum and maximum for setting value-based prices Cost-based Pricing No, except for the LIC/ LMIC tail-price Value-based pricing Yes, using HTA to assess value Differential pricing Yes, prices reflect local HTA and affordability results Account taken of push funding Yes, in price, or reduced volume commitment Donor support for LICs / LMICs Yes Prioritising allocations of vaccines Pre-agreed, implemented by the Secretariat BBAMC can address some of the limitations of COVAX
- 28. Context The buying mechanism Who is buying? Exploring the proposals What does industry think? Putting it all together Lessons for the future
- 29. #OHEAnnualLectur Normal business paradigm COVID-19 paradigm A tale of two paradigms During normal business governments set value-based prices and industry invests at risk • The market pulls products through • Investment will lead to a return if the product improves health enough • Price will reflect value rather than cost High income countries Low & Middle income countries • Vaccines delivered through tiered or differential pricing • Donor led pull needed for LICs • Push and pull for vaccines with no HIC market
- 30. Normal business paradigm COVID-19 paradigm A tale of two paradigms During covid-19 governments invest in all sectors and industry is expected to deliver products not-for-profit High income countries Low & Middle income countries • Governments investing in • all stages of vaccine development / manufacture • Companies offering to supply at cost • Donors identifying importance of finding resources to supply LICs • MICs falling through the gaps • Current lack of global coordination and commitment • the market pulls products through • Investment will lead to a return if the product improves health • Price will reflect value rather than cost High income countries Low & Middle income countries • Vaccines delivered at cost through tiered or differential pricing • There is no credible mechanism to develop vaccines where there is no HIC market #OHEAnnualLectur
- 31. COVID-19 paradigm A tale of two paradigms What is missing from the COVID-19 paradigm? Governments invest directly and industry is expected to deliver products not-for-profit • Greater global co-operation and a move away from vaccine nationalism • To get more private capital mobilised In relation to the COVAX Facility • To move from cost to value • To use HTA to ensure benefits exceed costs • To move from bilateral contingent contracts to creation of a market We need: #OHEAnnualLectur
- 32. Reward Timing ˃2 Years ˂2 Years Cost Value BBAMC for second wave of vaccines push + COVAX • Reward vaccine value • Ensure benefit exceeds costs • Move from bilateral contingent contracts to a market ? How can the BBAMC can be implemented for COVID-19? COVAX can be adapted or BBAMC run in parallel to pull candidates through Parallel BBAMC COVAX incorporating BBAMC reforms #OHEAnnualLectur
- 33. Context The buying mechanism Who is buying? Exploring the proposals What does industry think? Putting it all together Lessons for the future
- 34. What can we learn for the next pandemic? #OHEAnnualLectur We need to avoid the same mistakes being made in the COVID-19 vaccine effort We need to develop market mechanisms for pandemic preparedness Distributive issues can only be overcome by planning in advance Financing arrangements can be pre-agreed and triggered
- 35. What is the global context? COVID-19 is causing a health and economic disaster Source: John Hopkins Source: World Bank Let us wish success to those in academia and in industry involved in researching, developing, or planning the manufacture of a COVID-19 vaccine #OHEAnnualLectur
Notas do Editor
- - High Process Variability vaccines are often manufactured through biological processes using raw materials also produced through biological processes High Cost manufacturing has high fixed costs (a facility can cost between $50M and $500M) and high ongoing costs (QA and raw materials are expensive) Low Fungibility vaccine manufacturing technology is traditionally bespoke to one vaccine product. A flu vaccine facility can’t switch to produce HPV. Long lead-times a lot can take between 6 months and 3 years to manufacture depending on the complexity of the vaccine.