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Australian taxpayers are today pledging about $60 million over the next three years to help pay for vaccines for children in poor countries. This sounds like a positive development. More money equals more vaccines - or does it?
Medecins Sans Frontieres knows well the importance of immunisation, and its teams of doctors and nurses vaccinate about 10 million children in the developing world each year.
But cash donated by governments means cash donated by taxpayers, and therefore it is right to ask unpleasant questions.
There has been acclaim for today's Global Alliance for Vaccines and Immunisation conference after the announcement by GlaxoSmithKline that it is to sell its $12 a dose rotavirus vaccine for less than $5 a dose to low-income countries through GAVI. But is this the best price that GAVI can get with its cash handed over by (frequently unwilling) taxpayers? Government leaders have to assess their strategies to make sure their taxpayers are not being fleeced. A new reality is emerging: manufacturers in India can match the quality standards of Big Pharma and sell their vaccines at a fraction of the price.
Médecins Sans Frontières buys HIV medicines from Indian manufacturers at significantly lower prices than Big Pharma companies offer. Recent price disclosures by GSK and the Johnson & Johnson subsidiary, Crucell, show these companies have been selling some vaccines at premiums of up to 180 per cent.
GSK and Pfizer are selling pneumococcal vaccines to GAVI through a scheme called the Advance Market Commitment.
Under this scheme, both companies are selling 30 million doses annually to GAVI for $3 each. To secure this discounted price, GAVI is subsidising each company to the tune of an additional $210m.
Andrew Witty, GSK's chief executive, calls this an "innovative financing mechanism"; we would describe it as corporate welfare that is scandalously expensive to donors and taxpayers.
Subsidies to entice Big Pharma to sell to GAVI don't make sense when the vaccine can be produced more cheaply by other companies. Emerging country suppliers such as India's Serum Institute have said they could sell similar pneumococcal vaccine products for $1.90 a dose.
The executive director of Serum Institute, Suresh Jadhav, said recently if his company had not faced patent restrictions, the vaccine could have been available by next year; now it is not expected until 2015.
Australians owe it to people in developing countries to make sure new vaccines are affordable and capable of being used there. New versions of pneumococcal and rotavirus vaccines being sold to GAVI were designed for use in rich countries. The rotavirus vaccine, for example, which protects against diarrhoeal diseases, takes up large amounts of precious refrigerator space, and can be given only to children under nine months old.
Reaching children in remote locations is challenging. Furthermore, the vaccine is protective against 90 per cent of rotavirus strains in Europe and North America, but only 70 per cent of strains in Africa. Vaccines produced by emerging suppliers are likely to have far better efficacy in resource-poor settings than those produced by Big Pharma.
Today's conference is to discuss a shortfall in GAVI's funding. The fact is, GAVI needs to start thinking about more affordable vaccines rather than acting as the PR vehicle for GlaxoSmithKline. Australia and other donors need to support GAVI, but they need to make their support conditional on GAVI using its buying power to foster competition and push for adapted products.
Nicholas Coatsworth is president, Medecins Sans Frontieres Australia