The issue of affordable access to vaccines in less developed countries was recently raised by Financial Times reporter Andrew Jack. Specifically, Mr. Jacks’ article highlighted the contentious issue of differential pricing between rich, poor and middle-income countries — and how PAHO’s vaccine system is undermining efforts to provide vaccines to the least developed countries in Latin America, Africa and elsewhere around the world. Patients and Patents further discussed this issue in a recent blog (PAHO’s vaccine system hampers African efforts).
The June 23, 2009 Financial Times article by Andrew Jack entitled: “Vaccine system hampers progress in Africa” examines an important and often misunderstood issue relating to access to medicines in the developing world. Mr. Jack is right, that the issue of differential pricing between rich, poor and middle-income countries is contentious and that “tensions will increase”. But going beyond the hyperbole reported from the various stakeholders and examining the reality of the issue one can only conclude that the “vaccine system” does not hamper progress in less developed countries in Africa or elsewhere.
Differential pricing or “tiered pricing” has been successfully used in many industries for many years based upon identifying different “classes” of buyers for which differentiated pricing would be used. For over a decade the World Bank’s Human Development Network has endorsed tiered pricing for vaccines as a means to increase economies of scale in production through greater sales thus reducing costs, prices and distribution inequities around the world. (1) Costs of vaccines are recovered through higher market pricing in rich nations, moderate bulk procurement pricing in middle income countries, and much reduced pricing in the poorest of countries.
Most important to understand is that this is not subsidization of one country by another. Each country pays what it can afford for its citizenry – either through private plans or government plans (and mostly the latter for vaccines) thus removing financial barriers to access.(2) According to the Global Alliance for Vaccines and Immunization (GAVI) this private sector mechanism benefits all humankind equally in that poorer nations can now afford brand new vaccines earlier in their life cycle putting them on par with the richest of countries – one of the few, measurable tactics that has moved the world towards the goal of health for all.(3)
The Pan American Health Organization (PAHO) wants to negotiate a single price for all its member states. Let’s compare two PAHO member states: Canada’s 2007 per capita income was $35,310 (4) thus placing it in the higher price market segment. Haiti’s 2007 per capita income was $560 placing it amongst the poorest countries of the world, a market segment that also includes many sub-Saharan African countries, which are most deserving of lowest possible GAVI prices. PAHO also includes middle income member states such as Argentina that had a 2007 per capita income of $12,990, and Brazil which is often grouped with Russia, India and China into the BRIC group of rising economic powers.
PAHO must accept their share of the responsibility in ensuring health for all in the 21st century. Many Latin American countries are “rich” today compared to most African states and some of their sister “south” American nations. Middle income PAHO states cannot hold much of Africa or their own poorer member countries like Haiti hostage for the self-interests of their more powerful, richer rapidly developing countries.
D. Wayne Taylor, PhD, F.CIM
The Cameron Institute
Hamilton, Ontario, Canada
(1) For a commentary on this see Amie Batson, “Win-Win Interactions between The Public and Private Sectors”, Nature Medicine, 1998;4(5S):487-91.
(2) Jens Plahte, “Tiered pricing of vaccines: a win-win-win situation, not a subsidy”, THE LANCET Infectious Diseases, 2005;5(1);58-63.
(3) GAVI is the organization that advocates for and works with nations that have a gross national income per capita of
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