The U.S. might face fewer vaccine shortages if government agencies were willing to pay more for the vital drugs, according to a recent study. The reasoning is that if drug manufacturers were better reimbursed for their products, they would invest more in the technology and processes needed to address the quality issues that lead to shortages.
Researchers at Duke University found that a 10% increase in the price of a vaccine was associated with a nearly 1% decrease in the probability of its shortage.
Among the 22 vaccines that the researchers followed between 2004 and 2013, there were no shortages of vaccines that had a mean price per dose of more than $75, which was also the mean price among the studied vaccines over those years. Additionally, no shortages were reported among vaccines that were priced over $50 and produced by more than one manufacturer.
The study's authors said they believe the federal government, the country's largest purchaser of vaccines, should consider its influence to avert shortages when evaluating its pricing bids. It is able to negotiate large discounts with manufacturers because it makes bulk purchases and promotes widespread vaccination.
Vaccine discounts are good for the government's bottom line, but they leaves manufacturers with little incentive to invest in quality, said David Ridley, lead author of the study and faculty director of the health sector management program at Duke University's Fuqua School of Business.
Shortages of vaccines and other sterile injectable drugs are largely the result of manufacturing and quality issues. Ridley suggested that higher reimbursement would make vaccine revenue a more valued part of manufacturers' business, and would encourage them to invest in new technologies and more factories that could produce vaccines more quickly and safely.
However, there's no guarantee that manufacturers would use those additional funds to invest in quality, said Erin Fox, director of drug information at University of Utah Health Care. She agreed that drug manufacturers need to place a bigger focus on quality, but questioned the degree to which pricing plays a role.
“Because we have so little transparency on what becomes of that money, if we just start paying more for vaccines, how do we know the companies will invest in their factories?” Fox said. “I think because so much medication and vaccine production is proprietary and secret, we don't have a lot of good windows in there.”
Fox also took issue with the study's use of shortage data, which was sourced from the University of Utah Drug Information Service, which she leads. Many of the lower-priced vaccines listed as currently being in short supply had actually been discontinued, she said.
Ridley acknowledged there's no guarantee that vaccine makers would invest higher profits in higher-quality manufacturing. But the government should consider its pricing policies to send a message to vaccine manufacturers about the importance of the vaccine market.
“As a payer, you want to use funding wisely and you want to pay less, because you'd like to do more with the money,” Ridley said. “But paying less means it's going to be a less important part of that manufacturer's business. When you're paying more, you're getting the energy and attention of the company.”
