What Caused the Flu Vaccine Shortage?
October 19, 2004
Health care | Medicine | News | Science

I did a little research into why we now only have two (no, make that one!) suppliers of flu vaccine for the entire US, and why that supply is available only through the government. If the authors quoted below are correct, perhaps current policy needs to be revised.

I've heard various politicians and administrators lately (most recently Tommy Thompson) telling us how the flu vaccine shortage is not a public health problem, and people questioning how dangerous the flu can be. I have to disagree with them - for anyone who has asthma or respiratory diseases, or simply doesn't have a lot of defense against the flu, ithe possibility of getting a bad case of the flu can be a pretty scary prospect.

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Posted by ellen at October 19, 2004 01:53 PM

Almost a year ago, Robert Goldberg wrote about the federally-run, price-controlled bulk purchase of flu vaccine which covers all of us - whether we want it or not. According to Goldberg, director of thedirector of the Manhattan Institute's Center for Medical Progress.,

    "The current mismatch of immediate demand and available supply can be blamed on the federal Vaccines For Children Program...which buys up nearly 70 percent of all childhood vaccines at government-set prices, then distributes them to states according to a federally set formula... Vaccine prices have remained stagnant since 1994, while new regulations and lawsuits have driven up the cost of producing old vaccines and developing new ones.
        Thanks to these policies, there are now only four developers of childhood vaccines -- down from 20. As a result, there have been periodic shortages of the 11 shots for vaccine-preventable childhood diseases for several years in a row...

December 17, 2003, in WorldNet Daily, Steve Marr wrote:

No Flu shot for You

"As folks scramble for the last bit of flu vaccine available, allegations abound on who is to blame. We need look no further then our federal government.

When Hillary Clinton was First Lady, she used her influence in health care to have government agencies buy most of the flu vaccine, rather then private parties. The action was taken to force the price of the shots as low as possible, by making government the big buyer. However, as a result, most companies could not make money producing the vaccine, leaving just two manufacturers in business. Also, last year manufacturers lost millions when doses went unsold....

...The combination of very low pricing and wide open legal liability has forced most manufacturers out of the marketplace, resulting in today's shortages. Economic history teaches that whenever the government establishes price controls, regardless of the controlling method, the result is a shortage...."

And from a review of a report put out by the Institute of Medicine, entitled "Hillary's Vaccine Shortage"

"...The national immunization system has achieved high levels of immunization, particularly for children, but faces new challenges, including: continued disparities in immunizations across geographic and socioeconomic populations; recent, unprecedented vaccine shortages; a diminishing number of vaccine suppliers; erosion and fragmentation of insurance coverage for immunization; and concerns about the level of private investment in both current vaccine production and future vaccine development.  
Financing Vaccines in the 21st Century: Assuring Access and Availability (Aug. '03) addresses these challenges by proposing new strategies for assuring access to vaccines and sustaining the supply of current and future vaccines. 

The report proposes a federal mandate, subsidy and voucher program for vaccines.  The mandate would require all insurance plans to include vaccine benefits.  The federal government would subsidize health plans and providers for the purchase costs and administration fees created by the vaccine mandate.  Uninsured individuals would receive a voucher that could be used to receive immunization from any provider....

The report recommends changes to the Advisory Committee on Immunization Practices (ACIP), the entity that currently recommends vaccines...."

Note, November 28, 2004: I recently found this article on the new Free Trade Agreement between Australia and the USA, which discusses how restrictive patent laws make it more difficult for vaccine makers to create new vaccines, particularly one that will protect us against a devastating bird-flu:

Patently Yours
by Sam Varghese
November 26, 2004

    "...The first line of defence is a vaccine. But the patent thicket that surrounds biotechnology has made it all but impossible for any single company to develop an effective vaccine using genetic engineering techniques. Only two companies in the world are attempting to develop such a vaccine - Aventis Pasteur, and Chiron. Both are attempting to do so in the US, and the patents problems are so intense that both companies are doing so under the protection of the US government - under National Institutes of Health contracts. To our knowledge, no other companies anywhere in the world are attempting to produce an avian flu vaccine - despite the obvious commercial rewards for succeeding - precisely because the biotechnology patents impede such activity, and no government other than the US has so far been prepared to offer protection for the companies concerned. This is an opportunity for innovation from which Australian companies are shut out because of the patent thicket surrounding this vaccine..."

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