Spinning the Spin - Pharma slashes vaccine prices for poorer nations

Economics 101 –When sales drop – cut the cost (profit) to increase sales volume –to increase profits. Who are they kidding? This is ‘Walmart’ theory.
By: Leslie Carol Botha, Vice President, SaneVax Inc.
June 7, 2011 - PRLog -- Traditional media blasted the news on Monday morning that Pharma ‘good guys’ softened their hearts…and let go of their purse strings to slash costs ‘on potentially life-saving vaccines for people in developing countries in an effort to sustain supplies via the GAVI international vaccine alliance.’ 1.  

According to the London Reuters article:

The price cuts, offered by both generic and branded drugmakers including GlaxoSmithKline (GSK.L), Merck (MRK.N), Johnson & Johnson's (JNJ.N) Crucell and Sanofi-Aventis' (SASY.PA) Sanofi Pasteur, should help the alliance narrow a $3.7 billion funding gap for its commitments up until 2015.

GSK said on Monday it would provide its Rotarix rotavirus vaccine to GAVI at a 67 percent discount to the current public price -- bringing it to $2.50 per dose, or $5 to fully immunise a child. Merck said it will offer its Rotateq rotavirus shot at $5.00 a dose initially. "The RotaTeq price will decrease to $3.50 once the purchase volume increases to 30 million doses," it said.

Julie Gerberding, president of Merck Vaccines, said long-term purchase commitments help to speed up availability of vaccines. 1.  

SANE Vax translation on Gerberding’s statement: Cash flow is tight since vaccine sales are down and volume is needed to maintain cash flow.

Meanwhile Bill Gates jumped on the ‘bleeding heart’ bandwagon attempting to raise an additional $3.7 billion to boost immunization uptake among children in the world's poorest countries. According to the HuffPost Tech article also dated June 6 – Group wants billions to boost vaccines for poorest: 2.

A global vaccine group backed by Microsoft tycoon Bill Gates has asked donors for $3.7 billion to boost immunization among children in the world's poorest countries.

The Global Alliance for Vaccines and Immunization says it needs the money to fund the rollout of new drugs for 243 million children through 2015.

On the other side of the world, Pharmabiz (India’s most comprehensive Pharma portal) reported declining pharmaceutical sales. According to an article posted on June 6, 2011 Leading 15 global pharma majors suffer setback in 2010, net falls by over 20% 2. (NOTE: the very same day as the US media trumpeted Pharma companies as compassionate humanitarians.)

The top 15 global pharmaceutical companies suffered a major setback in their working during the year ended December 2010. The operations of these companies affected mainly on account of stiff competition from generics, expiry of their patented products, restrictive healthcare policies and failure in creating breakthrough drugs, as per a Pharmabiz study.

The article went on to state ‘the net profit of 15 global companies declined sharply by 20.1 per cent to $85,955 million in 2010 from $107,595 million in the previous year with major setback for Merck, Bristol-Myers and GlaxoSmithKline (GSK)’ noting that the net profit of the three companies declined between 68 and 93%.

The Pharmabiz article backs up the ‘Walmart’ theory of economics by stating:

‘…the cost of production of 15 companies increased by 16.6 per cent to $172 billion during 2010 and their selling, marketing & administration cost moved up 12.3 per cent to $175 billion from $156 billion in the previous year. R&D expenditure went up by 15.5 per cent to $89 billion from $77 billion. However, the provision for taxation declined by 11.3 per cent to $23 billion from $26 billion.’

UNICEF also upset Pharma’s apple cart when the organization disclosed and posted actual prices paid to individual drug companies for 16 vaccines purchased over the last 10 years.  According to a May 28, 2011 Huffington Post article Vaccine Prices Disclosed by UNICEF for First Time: 3.

It's a move that a few Western pharmaceutical companies don't support. Novartis AG and Merck & Co., which only sells one of its many children's vaccines to UNICEF, both declined to have their prices published.

UNICEF said it will continue to disclose pricing of future vaccine deals, with the hope that the transparency will push drugmakers to cut prices and thus allow the organization to vaccinate more children and save more lives.

While under-developed nations may be the beneficiaries of cost-effective or free vaccine programs – they are also the countries with the least reliable tracking systems and the least education about potential vaccine adverse reactions and deaths.

It is shameful that Pharma and government-funded vaccine programs are preying on innocent people in the dubious name of ‘safe vaccine practices’ while they continue to reap billions in sales.  In a world of ‘informed consent,’ this is not acceptable.

However, the noose is tightening around the vaccine industry gravy train as medical consumers around the world become aware of the scientific evidence indicating this runaway train may be responsible for destroying the health and well being of millions of people.

According to Norma Erickson, President of SANE Vax Inc. http://sanevax.org ‘The Pharmabiz article proves that our global efforts, multiplied by the tireless work of thousands vaccine safety advocates and the volumes of research being brought to light by our valued scientific and medical colleagues are making exactly the impact we intended to make. Perhaps after a few more pharmaceutical companies suffer a 93.3% drop in profits – Pharma and world governments will decide SANE (Safe, Affordable, Necessary and Effective) vaccines are the only viable option.’


1.   Reuters AlertNet - Drugmakers cut vaccine prices for poorer nations - http://www.trust.org/alertnet/news/drugmakers-cut-vaccine...
2.   The HuffPost Tech - Group wants billions to boost vaccines for poorest
3.   Pharmabiz  - Leading 15 global pharma majors suffer setback in 2010, net falls by over 20%
4.   The Huffington Post - Vaccine Prices Disclosed by UNICEF for First Time

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SaneVax believes only Safe, Affordable, Necessary & Effective vaccines and vaccination practices should be offered to the public. Our primary goal is to provide scientific information/resources for those concerned about vaccine safety, efficacy and need.
Source:Leslie Carol Botha, Vice President, SaneVax Inc.
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Tags:Pharmaceutical Companies, Vaccine Prices
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