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TABLE 3.1 Sample Array of Hypothetical Vaccine Costs and Benefits

Vaccine

Annualized Present Value of Expected Net Costs ($ million)

Annualized Present Value of Expected Health Benefits

A

−1,000

250

B

−800

200

C

−500

200

D

−400

100

E

−200

150

F

−50

100

G

10

125

H

20

105

I

40

150

J

80

80

The annualized expected net costs are negative for vaccines A through F. Negative net costs mean that an investment in the vaccine is expected to produce net savings. In other words, the health resources saved from reduction in disease more than outweigh the investments required for vaccine development, production, and administration.

If a vaccine is expected to produce both net savings (negative costs) and positive benefits, it qualifies automatically as a socially advantageous investment. Some vaccines with calculated positive costs may have other substantial savings in indirect costs, such as time lost from work or expenditures for certain public health measures (e.g., contact tracing for sexually transmitted diseases). Methods described in this report do not deal specifically with such indirect costs for reasons discussed in Chapter 4.

The net cost figures attempt to take account of the total needed investment, from both public and private sources, to develop and administer a vaccine. Decisions of a single agency like the NIAID should take account of the expected investment by others. Also, the NIAID may not have sufficient resources at this time to invest in each of the vaccines that are expected to be both cost saving and beneficial. This type of analysis can help the NIAID set necessary priorities among vaccines that are gainful in both economic savings and health benefits. The analysis may support the wisdom of additional allocations of public funds to the development of new vaccines, though this is not its primary purpose.



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