GSK and Merck accept cut-price vaccines deal

 GlaxoSmithKline (GSK) and Merck have agreed a deal to make their rotavirus vaccines available in the developing world for five years at a third of their standard price.

International vaccines group GAVI will make 132 million doses of GSK’s Rotarix and Merck’s Rotateq available to poorer countries at $5 per course.

The vaccines will help to combat the main cause of diarrhoea, a major killer of young children worldwide.

GAVI (the Global Alliance for Vaccines and Immunization) plans to distribute the vaccines in more than 40 economically deprived countries by 2016.

The new deal with GSK and Merck will enable GAVI to drop the price of its two-dose rotavirus vaccine courses from $15 to $5.

The WHO recommended in 2009 that all countries should target rotavirus – which kills half a million children every year – with national immunisation programmes.

A spokesman for GSK, which will supply 95% of the doses contracted by GAVI, said: “Rotavirus vaccine has demonstrated real-world, life-saving impact on reducing deaths. We have a chance here to collaborate in programs designed to protect millions of children.”

Based in Geneva, GAVI is a public-private partnership whose backers include the WHO, the World Bank, UNICEF, the Bill & Melinda Gates Foundation and a number of governments.

“Our market-shaping goal is to maintain supply security and strive to achieve the lowest price for currently available products,” commented Dr Seth Berkley, CEO of GAVI. “We have already taken an encouraging step forward towards this goal. GAVI Alliance members will continuously pursue these efforts to broaden competition and ensure the provision of quality vaccines at sustainable prices.”

GAVI’s procurement strategy offsets the cost to suppliers of heavy discounts by prepaying a portion of the fee and extending the deal period.