Academic science and the business of vaccines

The Revised Authoritative Guide To Vaccine Legal Exemptions

Vaccines Have Serious Side Effects

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R. E. Johnston

Carolina Vaccine Institute, School of Medicine, University of North Carolina,

Many elements of the global medical research and development enterprise are involved in the discovery, development, manufacture, distribution and regulation of vaccines. These include academic scientists, government funding and regulatory agencies, commercial vaccine manufacturers in the western world and essentially generic vaccine manufacturers in the developing world. The central tenets of the system as it exists today are 1) that public health need will drive fundamental research supported by government at academic institutions, and 2) that the resulting discoveries will be translated into useful products, because public health need can be converted into an economic return for the vaccine industry and its shareholders. In those instances where public health need exists in parallel with potential economic return, the system works surprisingly well.

For diseases primarily affecting resource poor areas of the world, such as AIDS, malaria, tuberculosis and dengue, the causative agents have been known for decades, yet no affordable, effective vaccines exist. One reason for this stunning lack of success is that substantial technical challenges are presented by these diseases. However, it is my opinion that the major cause for this failure is the absence of a parallel between public health need and potential economic return for diseases of developing countries, where the need is high but the projected economic return is invariably low.

All the participants in global vaccine discovery, development and manufacture are limited in ways that impede their ability to effectively address these vaccine needs. Commercial vaccine companies have a fiduciary responsibility to their shareholders to provide maximal returns on investment. Many of the largest vaccine companies are actually relatively small divisions of much larger conglomerates. These vaccine divisions compete for resources within the larger entity on the basis of internal rates of return calculated for each division. Given that vaccine manufacture is inherently less lucrative than some other endeavors in the medical arena, such as cancer drugs, the vaccine divisions must focus almost exclusively on products that will give a high monetary return. Thus, even at the earliest stage of vaccine development, choice of vaccine target is dictated by market size in dollars rather than by public health need. This selection criterion almost always excludes vaccines for diseases primarily affecting countries with poor economies.

Universities are repositories of knowledge and new ideas, and are populated by persons generally inclined to contribute to the public good. Exciting discoveries in fundamental pathogenesis, immunology and genetics flow daily from our universities and government laboratories, and have led to several very promising new vaccine technologies. However, universities are not organized, chartered or otherwise suited to translate these technology concepts into actual products. The scope of their efforts rarely extends beyond the laboratory door.

To move their basic discoveries to application as products, most universities have now constituted technology transfer offices to patent their new vaccine technologies and prototype vaccines. However, these offices generally are chronically underfunded and lack the resources to sustain the patenting process without a commercial partner. This most often necessitates that a university technology be licensed at a very early stage of development and that the license be exclusive and worldwide. Because of these constraints, research universities inadvertently contribute to the market bias of the industry. When an academic institution licenses its discoveries to a commercial company for further development, it accepts the company's market-based decision-making criteria by default. Few if any options to this licensing process are open to universities.

There is an active and growing group of vaccine manufacturers in the developing world, and they produce most of the world's polio, measles and hepatitis B vaccines, for example. However, these low cost manufacturers operate like generic drug companies, depending for their product pipeline on commercial vaccine products coming off patent. Thus, there is significant delay in their ability to produce new vaccines. Because the pipeline was selected originally by the commercial manufacturers, vaccines for diseases predominantly of the developing world are not present in the product pipeline, even through this delayed process. Resource constraints limit these companies in terms of generating their own suite of in-house products.

Therefore, the useful fruits of academic science, overwhelmingly funded from government and philanthropic sources, are most often provided only to wealthy countries with little or no direct benefit to those nations most in need. The question then, for those of us in the vaccine research community is, "How do we insure that the benefits of our research are available to all those who might have need of them?"

We propose a new type of not-for-profit research and development entity, Global Vaccines, Inc. (GVI). GVI will be highly focused on vaccine technologies and their application to vaccines against diseases of the developing world. GVI will

1) Apply state-of-the-art vaccine technologies and innovative business strategies to the design and development of affordable vaccines for resource poor nations,

2) Provide an alternative strategy for university based technology licensing that will protect promising new vaccine technologies for use in poorer countries, 3) Develop these technologies in the context of prototype vaccines addressing global public health needs, and 4) Link academic vaccine research centers to independent vaccine manufacturing capabilities already established in the developing world, facilitating the application of promising vaccine technologies as prototype vaccines.

Global Vaccines will utilize the business expertise, discipline and energy of an entrepreneurial business to circumvent many of the current limitations of the western vaccine industry, vaccine manufacturers in the developing world, and academia. The new company will have the flexibility to devise innovative solutions to vaccine problems of the developing world, not only in the laboratory, but also in licensing vaccine technologies and financing development and production of these vaccines. The primary objective of GVI will not be to maximize profit but rather to maximize the likelihood that a given vaccine concept will reach successful application in the field.

Global Vaccines will develop platform vaccine technologies that can be applied to a broad spectrum of disease targets and will identify such potentially viable new vaccine technologies at the earliest possible stage, in some instances at the level of basic discovery. As with a commercial company, GVI will seek exclusive, worldwide rights in return for payment of an initial licensing fee and assumption of patent expenses. In contrast to most commercial concerns however, GVI and the university will remain partners in the development of the technology through proof-of-concept in appropriate animal models and perhaps through phase I trials in humans. Such partnerships will be led by GVI, will involve the original inventors and will be supported by jointly obtained research grant funds. By advancing a technology to proof-of-concept, the value of the technology will be far greater than at the time of the original license, thus enabling a sublicense to a commercial company with technology rights geographically limited to commercial markets. GVI will utilize the gains from this sublicense to subsidize continued development of needed vaccines, partnering with low cost manufacturers in the developing world. Note that a commercial sublicense and establishment of a partnership with

Grant Supported Joint Research

License Fee, Royalties, etc.

Grant Supported Joint Research

University Vaccine Technology

License Fee, Royalties, etc.

Vaccine Product

University Vaccine Technology

Low Cost > Manufacturing r

Global Vaccines

Low Cost > Manufacturing

Global Vaccines

Non-Commercial Vaccine Markets; Orphan Vaccines

Fig. 1. GVI technology licensing and partnering strategy

Non-Commercial Vaccine Markets; Orphan Vaccines

Fig. 1. GVI technology licensing and partnering strategy a commercial vaccine manufacturer could occur at any point in the technology development timeline if circumstances were favorable.

As the licensing university will share in the proceeds of the commercial sublicense, the GVI strategy can potentially provide a much larger and more timely return for the university than could have been realized in a typical early license agreement with a for-profit concern. Therefore, GVI can compete very effectively with commercial companies in obtaining licenses for exceptional vaccine technologies.

The GVI strategy has the potential to benefit everyone. Vaccines will be provided to the populations most in need. Inventors and their universities will receive a fair return for their inventions. Developing country vaccine manufacturers will have a pipeline of high technology products for the populations that they serve. And, commercial vaccine companies will have the opportunity to license more mature and therefore less risky vaccine technologies for their use in profitable markets.

Global Vaccines has taken the first steps to position itself to implement this strategy. The company is constituted as a North Carolina corporation, and it has obtained tax exempt status from North Carolina and the Federal Government. Negotiations have begun for licensing the company's first vaccine technologies, and a major fund raising effort is being planned.

It is our hope that Global Vaccines will complement the many other ongoing efforts to alleviate health disparities between rich and poor populations, and that this new entity will ultimately contribute to a solution for these currently intractable diseases.

Author's address: R. E. Johnston, Carolina Vaccine Institute, School of Medicine, University of North Carolina, Chapel Hill, U.S.A.; e-mail: [email protected]

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