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We hope that our malaria vaccine will be ready to file with regulatory authorities
in 2012 for young African children aged five to 17 months. So far GSK has invested
$300 million in R&D for this vaccine and our partner, PATH Malaria Vaccine Initiative
(MVI), has invested a further $200 million. The dilemma we face is that, unlike
virtually every other vaccine, there is no wealthy market for this vaccine, so tiered
pricing is not appropriate.
In a speech at the Council on Foreign Relations in January 2010, GSK’s CEO Andrew
Witty laid out the principles we will pursue when setting a responsible price for
this vaccine.
First, we must set a price that is sustainable, which covers our costs and allows
for investment in high quality manufacture and continued investment in follow on
R&D.
Secondly, we do not want to price in a way that will discourage others from continuing
to invest in R&D in this area. We believe, therefore, that it would not be helpful
to launch the first vaccine at a not-for-profit price as it could create an expectation
that all following products would have to be similarly priced. This could be a major
disincentive to investment for some organizations.
We will therefore set a price which covers our costs and makes a small return. We
will reinvest this return in R&D for second generation malaria vaccines or for
other vaccines for diseases of the developing world.
Vaccine production is very sensitive to economies of scale, so until we have a better
idea of our own cost structure and of the likely demand for the vaccine we will
not be able to provide guidance on what the actual price will be.
In addition to the price commitment, GSK has pledged to donate at least 12.5 million
doses of vaccine to the PATH Malaria Vaccine Initiative.
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