Vaccine Companies: An Indian Perspective

 

Vaccines are the miracle drugs that have substantially helped the mankind to prevent life -threatening diseases. Small pox, a vaccine preventable disease, was wiped off effectively by vaccines way back in 1978. Baring few countries like Pakistan, Afghanistan and Nigeria the World has now become Polio free. These two classical examples provide the impetus to further scientific research on vaccines and to make new advancements for their large scale production. Vaccines are averting 2.5 million deaths of children from vaccine preventable diseases. Proper immunization schedule together with sanitation and clean drinking water are curtailing nearly 10 million deaths of children annually.

Vaccines can be prophylactic or therapeutic. Prophylactic (preventive) vaccines ameliorate or prevent the disease. These are administered universally to children to prevent the incidence of various diseases like Polio, Measles etc. These vaccines are part of the Expanded Program on Immunization (EPI) and have lion’s share in global vaccine business.  While Therapeutic vaccines include cancer vaccines, given during the course of treatment. These are targeted to attack the growth of tumors but don’t cater to long term prevention of cancer. Prophylactic vaccines are available at low cost and are in great demand. In recent years demand for therapeutic vaccines has increased substantially. These are usually very expensive and have the promise of generating better revenues from both local and export markets.

Approximately 2.5 billion children need vaccines every year. Developed countries administer vaccines to children against 12 diseases whereas in India under the government immunization schedule vaccines are given for less than 5 diseases. It is believed that as countries become more economically empowered, substantial investments are made towards health sector and consequentially the vaccine usage would increase. Global vaccine market valued at $34 billion in 2012 (pediatric vaccines valued at $23 billion) is expected to increase to $56 billion by 2016. Vaccine business of Indian companies during the year 2012 stood at $600 million which is less than 2% of the Global Market. Four vaccine giants GSK, Sanofi-Aventis, Wyeth and Merck control nearly 71% of vaccine global market.

Indian vaccine companies are major suppliers of vaccines to UNICEF. World Health Organization (WHO) provides the service of prequalification (PQ) of vaccines to UNICEF and other UN agencies. PQ procedure of WHO ensures the purchase of vaccines of global standards of quality, safety and efficacy thereby promoting international standards in vaccine production. It is a kind of quality certification standard with an assurance that the vaccines are safe, effective and suitable for use in poor countries. These purchases are made from different agencies for maximum optimisation of health resources and outcomes.  Nearly two-thirds of world children are immunised with these PQ vaccines. Usually these are of high-quality and affordable. These are used for national immunisation programmes in developing world. India is one of the largest suppliers of the PQ vaccines. About 31 preventive vaccines are listed in the prequalified list of vaccines manufactured by 27 companies from 20 countries. India produces 20 vaccines in different combinations under 60 different brand names. There are still 11 vaccines which are not produced in India. Indian companies, Bharat Biotech, Chiron Behring Vaccines, Biological E, Zydus Cadilla, Pancea, Haffkine Biopharmaceutical and Serum Institute of India supply to UNICEF. There is still a great scope for improvement and for more players to enter the fray.

Recently Shan-5, a pentavalent vaccine developed and manufactured by Shanta Biotech has acquired prequalification status. It is effective against Diphtheria, tetanus, Pertussis, HiB and Hepatitis B. As more Indian vaccines acquire this status, the potential of India emerging as a global hub for various biologics will improve. Vaccines constitute the largest component of the Indian biopharma segment and immense opportunities lie in creating an ecosystem in India that will take India to the next level as a hub for global biologics. China dominates the low cost PQ vaccines. It has already proved its mettle by becoming the first ever country to obtain a PQ status for a new vaccine against Japanese Encephalitis (JE). It has huge vaccine manufacturing facilities capable of producing high-quality and low cost vaccines for developing countries and emerged as second major player in vaccine market after the US.

Vaccine development and large scale production is a very arduous process. It involves lot of researching, testing and manufacturing. Development and testing of a vaccine usually takes around 15 years and costs around 200-800 million USD in developed countries whereas it is 100 USD in developing countries. Developing countries like India have attained greater economies of scale in production of traditional EPI vaccines using time tested technology. Consequently these countries have started exporting EPI vaccines to UNICEF and other agencies but not to other industrialized nations at inexpensive prices. Unfortunately, developing countries like India have failed to embark on newer vaccine production as they lack needed expertise. Developing Countries Vaccines Manufacturing Network (DCVMN)  constituted by 34 members from 14 countries contribute to 86% of vaccine doses amounting to 10-12% of global vaccine market in terms of value. Market for developing world is through UN agencies, UNICEF, GAVI and PAHO (Pan American Health Organization). Egypt, Mexico, Algeria, Turkey obtain vaccines from private markets directly. UN agencies procure nearly 40% of World vaccine supplies.

Vaccine companies in industrialized countries, develop newer vaccines. They invest many years in developing newer technologies, spend several millions of dollars and follow stricter patent regimes. Since the technology has been discovered and owned by a single or few manufacturers’ vaccines supply is meager, leading to higher pricing of vaccines.  International Federation of Pharmaceutical Manufacturers Association (IFPMA) is constituted by such 25 international companies. They generate 80-85% of revenues of global vaccine market and contribute to 12-15% of global vaccine requirement. They supply vaccines to developing world through tiered pricing.

Rejuvenated by the success of the Pulse Polio Immunisation Program India is now on a mission mode to eradicate measles and rota virus. Government procurement of vaccines has subsequently increased. As Government has decided to phase out the oral polio drops in the next two years and replace it with injectable polio vaccines, there will be greater demand for more vaccine doses too.  Other important growth drivers propelling resurgence of the vaccine industry are -swift increase in the population growth, large populations which are to be immunised, increasing focus of governments on national immunisation schemes, fast growing private markets for vaccines, innovative international initiatives to reach out to the unimmunised populations. Hence there is huge demand for vaccines globally. Institutes like GAVI (Global Alliance for Vaccines and Immunisation), WHO, PAHO have pledging to vaccinate every single child across the world. India has a great potential to produce and export vaccines. Indian vaccines companies have recorded 25 % growth during the year 2012. With proper government support and transfer of technology from Western World Indian companies are touted to attain more than 50% growth.

 A new set of vaccines have been developed for meningococcal meningitis, diarrheal disease, rota virus, avian influenza caused by H1N1, pneumococcal disease and cervical cancer caused by human papiloma virus (HPV). Indigenous vaccine companies must acquire the expertise and master the technology of bulk production of these new vaccines to expand its leverage in the ever growing, intensely competitive global vaccine market.

 

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