The world faces a shortage of vaccines. Shortages this year in the US have interrupted the immunization schedule for common childhood diseases, such as measles and whooping cough, and have delayed the immunization of older adults against influenza and pneumococcus. With fewer children being properly immunized, “herd” immunity to these currently preventable diseases has been lowered. Falling immunization rates can lead to outbreaks of disease, such as the outbreak of measles in Germany this past March and the 36 confirmed cases reported in the UK by mid-February 2002. Ongoing vaccine shortages throughout the world may be a reality for the foreseeable future.

The current shortage is due to the dearth of companies producing vaccines. Only four major companies—Merck, Wyeth Lederle, Aventis Pasteur and Glaxo SmithKline—still produce vaccines to the 11 common disease-causing agents as recommended by the US Advisory Committee on Immunization Practices, compared to over 15 companies in the 1980s. Reliance on single manufacturers has inherent risks. In 1999, the US Public Health Service called for the removal of thimerosal preservatives—which act as an antimicrobial agent—from vaccines. As a result, Wyeth Lederle discontinued its tetanus and diphtheria (Td) toxoid production and Aventis Pasteur became the sole supplier of Td vaccines in the US, although it had to switch formulations. US Food and Drug Administration (FDA) approval for the new Td vaccine only came in March 2001. Other pharmaceutical companies have been driven from vaccine manufacturing by product liabilities, the costs required to adhere to stricter FDA regulations and overall profitability. Given that one to three doses can often provide lifelong protection, vaccine manufacturing is not nearly as lucrative as providing agents for the treatment of chronic diseases.

The individual and societal health benefits of immunization cannot be overstated. In every instance, the availability of vaccines correlates with dramatic decreases in morbidity, mortality and treatment costs. Indeed, the very success of immunization programs throughout the world has dimmed the public's memory of the pathologies associated with the diseases themselves, leading many to focus on the possible risks associated with vaccines. Previous drops in immunization rates in the US and elsewhere have been attributed to religious beliefs or fears of adverse reactions. A now discounted 1998 report linked autism to the MMR (measles, mumps and rubella) vaccine, provoking many parents in the UK to abstain from vaccinating their children. However, a 2001 World Health Organization (WHO) bulletin provided a pertinent reminder of how minimal the comparative risks of the vaccine are. The health risks stemming from contracting measles include a 1 in 20 risk of pneumonia, 1 in 2000 risk of encephalitis and a 1 in 3000 risk of death, whereas the risks associated with the MMR vaccine are only 1 in 1,000,000 for encephalitis or severe allergic reaction. Disease outbreaks of measles, pertussis and diptheria have occurred in Japan, Russia, Ireland and elsewhere when immunization rates have fallen. High vaccination rates also protect those who may be immunocompromised or otherwise fail to seroconvert upon vaccination, by lessening the likelihood that they will come in contact with the disease-causing agent. Immunization is clearly one of the cheapest ways to control preventable diseases.

Despite these advantages, governments and the private sector find it difficult to keep up with the costs of immunization. Each year the US federal government purchases over half of the US vaccine supply to support immunization programs for disadvantaged children, spending over US $1 billion to do so. Upon licensure, the US Centers for Disease Control negotiates vaccine purchase agreements with manufacturers, usually at steeply discounted prices. However, the newer vaccines are costly to develop and produce. The conjugate pneumococcal vaccine, which can protect against multiple serotypes, costs over US $50 per dose, which is clearly prohibitive to developing nations. However, manufacturers state that without firm commitments for future vaccine purchases, the incentive to invest in increased capacity is considerably lessened. The few remaining vaccine manufacturers also face little competitive pressure to reduce production costs.

The global vaccine supply needs to be ensured. One proposal voiced in a 2000 report by the US Institute of Medicine called for government-owned national vaccine facilities. Private contractors selected by a competitive bidding process would conduct the research, development, production and distribution of vaccines. However, this setup may guarantee neither lower prices nor adequate vaccine supplies. Indeed, the start-up costs and additional layer of oversight may lead to higher vaccine prices and still suffer single-supplier problems. Another solution, proposed by the Global Alliance for Vaccines and Immunization—a consortium assembled by private donors (such as the Gates and Rockefeller Foundations), WHO and the World Bank—envisions a commodities market approach. Like buying wheat futures, prices for a preset volume of vaccine would be locked-in for delivery at a specific date. This latter approach seems most promising, as it creates a guaranteed market that may well entice suppliers to re-enter the arena, by providing the production volume guarantees they demand and the necessary incentives for cost-containment demanded by the purchasers.