7
A Strategy to Enhance U.S. Participation in the Children's Vaccine Initiative

The Children's Vaccine Initiative (CVI) seeks to harness new scientific technologies to advance the immunization of children throughout the world. The ideal CVI vaccine will require fewer doses and will be given near birth, be heat stable, effective against diseases for which vaccines are currently unavailable, and be affordable. Achieving the challenging vision of the CVI requires international commitment to the development and production of a new generation of vaccines. It is not only the health of those in the developing world that is at stake; the growing problem of immunization in the United States, especially among economically disadvantaged children, is a major concern.

Since the World Summit for Children in New York City in September 1990, many different countries and organizations are currently evaluating what each is most able and willing to contribute toward achieving the vision of the CVI. This committee was asked how best to enhance both U.S. public-and private-sector participation in the global CVI, recognizing that U.S. resources and scientific capabilities are significant and extensive.

The committee spent a great deal of time considering ways to enhance U.S. public-and private-sector participation in the CVI and to ensure that CVI vaccines are developed, manufactured, and made available to national immunization programs in developing countries. The committee evaluated three major strategies for achieving full U.S. participation in the CVI (see Appendix D). After much deliberation, the committee rejected two of these strategies as less than optimal. The first would have provided supplemental



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The Children's Vaccine Initiative: Achieving the Vision 7 A Strategy to Enhance U.S. Participation in the Children's Vaccine Initiative The Children's Vaccine Initiative (CVI) seeks to harness new scientific technologies to advance the immunization of children throughout the world. The ideal CVI vaccine will require fewer doses and will be given near birth, be heat stable, effective against diseases for which vaccines are currently unavailable, and be affordable. Achieving the challenging vision of the CVI requires international commitment to the development and production of a new generation of vaccines. It is not only the health of those in the developing world that is at stake; the growing problem of immunization in the United States, especially among economically disadvantaged children, is a major concern. Since the World Summit for Children in New York City in September 1990, many different countries and organizations are currently evaluating what each is most able and willing to contribute toward achieving the vision of the CVI. This committee was asked how best to enhance both U.S. public-and private-sector participation in the global CVI, recognizing that U.S. resources and scientific capabilities are significant and extensive. The committee spent a great deal of time considering ways to enhance U.S. public-and private-sector participation in the CVI and to ensure that CVI vaccines are developed, manufactured, and made available to national immunization programs in developing countries. The committee evaluated three major strategies for achieving full U.S. participation in the CVI (see Appendix D). After much deliberation, the committee rejected two of these strategies as less than optimal. The first would have provided supplemental

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The Children's Vaccine Initiative: Achieving the Vision funds to existing federal agencies to support CVI-related vaccine research and development and would have made changes in the way that the U.S. government participates in the purchase and delivery of vaccines for developing countries; another would have given the U.S. government a primary role in all stages of vaccine development, including large-scale manufacture and distribution. Although each approach was thought to have some merits, the committee felt that neither would capitalize on the unique skills, expertise, and capabilities in the private sector (both biotechnology firms and commercial vaccine manufacturers). In the committee's view, the success of U.S. participation in the CVI will depend ultimately on effective cooperation and collaboration among government, universities, and most critically, the private sector. The committee's recommended strategy, which is presented below, combines the most desirable characteristics of the two strategies outlined above and includes new elements designed to achieve the vision of the CVI. A NATIONAL VACCINE AUTHORITY In the committee's view, the United States, through both the public and private sectors, has the potential to contribute most significantly to the achievement of the goals of the global CVI through the development and production of CVI vaccines (Chapters 3 and 4). However, it has become clear to the committee that the fragmented system of vaccine research, development, and manufacture in the United States, which produces high-quality vaccines for the domestic market, is not likely to produce the vast majority of CVI vaccines (Chapters 3, 4, and 5) (Institute of Medicine, 1992). This is primarily because most CVI vaccines targeted to developing countries lack the market potential of vaccines intended for industrialized-country markets (Chapters 4 and 5). In this regard, the committee concurs with the findings of the Institute of Medicine report, Emerging Infections (1992) that an integrated process is required to ensure that needed vaccines that lack well-paying markets are developed and manufactured. In addition and over the course of this study, the committee identified a number of specific impediments that hinder the ability of the U.S. public and private sectors to pursue the development of vaccines in general, and of CVI vaccines in particular (Chapter 6). In the committee's view, a major bottleneck in the development of low-profit vaccines, such as those envisioned by the CVI, is the lack of pilot production facilities that are capable of meeting the U.S. Food and Drug Administration's standards of current Good Manufacturing Practices (Chapter 6). At present, pilot manufacture of vaccine products of low commercial value is postponed for

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The Children's Vaccine Initiative: Achieving the Vision months or even years in commercial facilities, while the small number of public-sector facilities remain oversubscribed. In the committee's judgment, the optimal way to maximize U.S. public-and private-sector participation in the global CVI and ensure that needed vaccines are developed and manufactured for developing countries is to empower an entity to organize and manage an integrated process of CVI vaccine development, manufacture, and procurement that capitalizes on the skills and expertise in both sectors. At this time, no federal entity, with the possible exception of the U.S. Department of Defense, has the capability of undertaking the breadth and range of activities required to ensure the integrated development, production, and procurement of CVI vaccines. In the committee's view, the development of new and improved CVI vaccines is unlikely to occur unless there is an entity that has the mandate to manage and oversee the process from beginning to end. Because the private sector alone cannot sustain the costs and risks associated with the development of most CVI vaccines, and because the successful development of vaccines requires an integrated process, the committee recommends that an entity, tentatively called the National Vaccine Authority (NVA), be organized to advance the development, production, and procurement of new and improved vaccines of limited commercial potential but of global public health need. Mission As envisioned by the committee, the overall mission of the NVA would be to foster the development of new and improved vaccines of limited commercial potential but global public health need through the maximal use of U.S. public- and private-sector expertise and resources. It would do this both by reducing the risks and costs to industry associated with vaccine development and by offering a variety of incentives to companies willing to undertake CVI vaccine development. The NVA would achieve its goals through a dynamic partnership with the public and private sectors, in which each contributes what it is best able and most willing to provide. The new entity would take advantage of the traditions of discipline and attention to the bottom line that are common to private industry and the accountability to societal needs embodied in the public sector. To accomplish its mission, the NVA would operate as a product development unit. In conjunction with the global CVI, it would be involved in setting the priorities for and generating the desired characteristics of candidate CVI vaccines. The NVA would issue requests for proposals to

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The Children's Vaccine Initiative: Achieving the Vision encourage private-sector firms to develop targeted CVI products, and it would have an in-house capability to conduct applied research and development and manufacture pilot lots of vaccine. In the committee's judgment, this would overcome one of the major bottlenecks to the development of new and improved vaccine products, as identified and discussed in Chapter 6. The NVA could have a collection of incentives at its disposal to encourage private-sector enterprises (both large commercial companies and development-stage firms) to participate in its vaccine-related activities. These include: guaranteed procurement of vaccine, research and development (R&D) tax credits, investment-tax credits for firms that undertake CVI activities, Small Business Innovation Research program grants for CVI products, Cooperative Research and Development Agreements (CRADAs), access to an NVA pilot production facility, financial assistance with clinical trials, and assistance in assembling intellectual property rights. In its dealings with private-sector partners, the new entity could, as appropriate, retain the right to transfer technology it owns to developing countries. In addition, all such collaborative agreements with private-sector partners could include a clause to ensure that whatever products are developed would be affordable to markets in developing countries. Ensuring that vaccine products are affordable could be accomplished through a variety of mechanisms including: use of technological design (whereby the NVA would propose the use of simple, low-cost technologies in vaccine construction) or a pricing clause. Alternatively, the NVA could purchase vaccine products at one price, and sell them at another (thereby subsidizing the prices paid by the United Nations Children's Fund (UNICEF) and the Pan American Health Organization (PAHO) and providing higher returns to private developers and manufacturers, where appropriate). The NVA would accomplish as much as possible by contracting with the private sector. However, to accelerate the development of CVI vaccines, the NVA would have its own vaccine development program, which would be called on to undertake product-related R&D, as needed. The committee believes that having a public-sector vaccine development and pilot manufacture facility would overcome a major bottleneck in the development of low-profit vaccines, including many of those envisioned by the CVI. The NVA pilot facility would be made available to newly emerging biotechnology

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The Children's Vaccine Initiative: Achieving the Vision companies, multilateral agencies and organizations, and public-and private-sector vaccine manufacturers that agree to develop CVI products. The NVA would support six broad areas of vaccine product development: vaccines used primarily in developing countries (e.g., shigella, cholera, salmonella, malaria, and dengue); improvements in existing vaccines that would not lead to a high market return but that would make them easier to distribute and administer or allow them to achieve immunity earlier in high-risk populations (e.g., heat-stable polio, single-dose controlled-release tetanus toxoid and other childhood vaccines, and a more immunogenic measles vaccine); development of simple, low-cost vaccine manufacturing technologies that could be easily transferred to vaccine manufacturers in developing countries (e.g., heat stability); exploitation of vaccine technologies that are nonproprietary and therefore of little interest to commercial manufacturers who desire market exclusivity; adaptation and introduction of currently available vaccines (e.g., pneumococcal conjugates) and new vaccines, including combination vaccines, to the developing world; and vaccines for which there are small or limited markets or that are otherwise unprofitable. Functions As a product development organization, NVA would be involved in nearly all aspects of vaccine innovation and development, from identifying priorities to arranging procurement (see the box ''Functions of a National Vaccine Authority"). The concept behind the NVA is similar to the U.S. Department of Defense's (DOD) approach to vaccine development for U.S. military personnel.1 Setting Priorities and Product Characterization The first step in vaccine development is to set the priorities and describe the desired characteristics for a target vaccine. Currently in the United States, no agency, public health committee, or other group sets the priorities or generates the desired characteristics for vaccines, particularly those envisioned in the CVI. The NVA would, in conjunction with the EPI, global CVI, representatives of U.S. government agencies, private-sector

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The Children's Vaccine Initiative: Achieving the Vision Functions of a National Vaccine Authority • Define the need • Assess the market • Establish priorities for U.S. CVI vaccine development in conjunction with the global CVI • Characterize desired vaccine products • Assemble intellectual property rights • Advance CVI product development through the private sector • Conduct in-house vaccine-related R&D • Assist companies in the production of pilot lots of vaccine • Support clinical testing and field trials of candidate vaccines • Transfer CVI-related vaccine technology to developing-country manufacturers • Train U.S. and overseas nationals in the principles of vaccine development, pilot manufacture, and quality control • Arrange and contribute to the procurement of NVA vaccines • Evaluate and redefine needs • Represent the United States in international CVI forums, such as the Consultative Group firms, and public health experts, set priorities and describe the desired characteristics of the vaccines to be advanced by the NVA. Given the likelihood of limited resources and the need to accelerate the development of CVI products, NVA would probably focus its initial product development efforts on just a few CVI vaccines. Basic Research The NVA would not conduct basic research but would draw on research and technologies developed in academic institutions and at the National Institutes of Health (NIH). The NVA could also provide resources to these institutions for research related to CVI vaccines and could help bring international vaccine development needs to the attention of the domestic scientific community.

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The Children's Vaccine Initiative: Achieving the Vision Applied Research and Exploratory Development NVA would have a core of scientifically trained staff that would be able to conduct applied vaccine-related R&D to meet the needs of CVI. NVA scientists would be actively involved in testing new approaches to vaccine construction, determining the feasibility of new technologies, and taking candidate vaccine products to the point of proof of principle (the point in R&D when the feasibility of a particular product or process is determined and product development can begin). In addition, NVA would be able to enter into CRADAs with private firms, giving the NVA access to additional staff, funding, and proprietary technologies. The incentive for firms to enter into CRADAs with NVA would be the right to manufacture or market successful vaccines or employ proprietary technologies developed under license for profitable markets. Intellectual Property Rights A key feature of NVA would be its capability to assemble patent and know-how rights. Because the promotion of the goals of CVI is a legitimate governmental purpose, NVA, as a part of the federal government, could retain the rights to patents and other forms of protection for products or processes developed with federal money. This could occur even if that work was conducted on its behalf by private parties. (The NVA could also take advantage of technology embodied in patents that were not the result of federally funded research. If CVI research or the supply of CVI products is "by or for" the U.S. government, nongovernmental patent holders would not be able to stop those activities through a preliminary or permanent injunction. Contractors serving the government's purposes would be protected from patent infringement suits. The only remedy available to this category of patent holder would be reasonable compensation, presumably a reasonable royalty from the U.S. government. As discussed in Chapter 5, since the NVA would be serving a need left unfulfilled by these patent holders, it is unlikely that such actions would proliferate. In any case, the size of the awards should be small.) The NVA would also be able to file patent applications both in the United States and foreign countries for vaccine-related inventions of the government. The NVA would not, however, be able to transfer technology or to require the transfer of technology it does not own, unless such action were allowed under the terms of a contract with the developer or patentee.

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The Children's Vaccine Initiative: Achieving the Vision Product Development The NVA would be a goal-oriented entity, targeting the development of a variety of specific CVI vaccines. Each vaccine would require a customized product development strategy. It is likely that some vaccines will be developed exclusively through a contracting mechanism. Other vaccines may require parallel tracks of development in the private sector and at the NVA. A few may require substantially more involvement by the NVA. In all of its work, the NVA would draw on technology developed through collaborative agreements and advances made through its CRADAs, by NIH, DOD, and other relevant agencies. The NVA would ensure that all applied research is consistent with the needs established at the outset of the priority-setting process and specified by potential end users of the vaccine products. To accelerate the process of vaccine development, all R&D on NVA vaccines would be done under conditions of Good Laboratory Practices so that the results could be used in support of Investigational New Drug Applications and future Product License Applications. Manufacture of pilot lots of vaccine would be performed under Good Laboratory Practices and, whenever possible, current Good Manufacturing Practices on a scale sufficiently large to simulate closely the future manufacturing scale. This is important to avoid technical problems during scaleup, to ensure that the vaccine lots used in the pivotal efficacy studies will be similar to scaled-up vaccine lots, and to facilitate the transfer of vaccine technology to commercial or public sector vaccine manufacturers in the United States or public sector manufacturers in developing countries, or both. In addition, the NVA would be open to training both U.S. and overseas nationals in the principles of product development and manufacture of pilot lots of vaccines, including quality control and quality assurance. Clinical Evaluation The U.S. government, through the U.S. Agency for International Development (AID), the Centers for Disease Control and Prevention (CDC), DOD, and NIH, has considerable expertise in and resources for conducting clinical trials. Indeed, one of the most important ways that the U.S. government can share risk with the private sector is to organize, conduct, and evaluate clinical and field studies of new vaccines, especially in developing countries. As noted in Chapter 6, CVI vaccines pose additional challenges for clinical trials in that CVI vaccines will need to be tested in infants at international field sites. The NVA could enter into agreements with different federal agencies and multilateral organizations to evaluate candidate vaccines. To accomplish this activity, NVA staff could work with

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The Children's Vaccine Initiative: Achieving the Vision private-sector companies to design phase I studies in the United States, although most such firms may want to design and carry out those studies themselves. It is more likely that NVA scientists, in conjunction with staff at other relevant agencies, will play a greater role in later-phase studies and in forming collaborative relationships with ministries of health in developing countries. Regulation The U.S. Food and Drug Administration (FDA) is the U.S. government entity charged with ensuring the safety and efficacy of vaccines. The NVA could enter into interagency agreements with the FDA to conduct R&D, develop new product standards, and assist in technology transfer. The NVA might also work with the FDA to develop quality control and quality assurance methods that could be adapted to conditions that exist in the developing world. Most private-sector collaborators will develop production methodologies in line with accepted quality control standards. The NVA, which would have some expertise in regulatory affairs, could serve as a link with the FDA and between vaccine development companies in the United States, foreign regulatory authorities involved in vaccine licensing, and international agencies such as the World Health Organization (WHO). In addition, the NVA could contribute to or the FDA could waive the user fees that would be borne by companies seeking to license CVI vaccines (see Chapter 6). Manufacture Optimally, vaccines developed by the NVA and its private-sector partners would be licensed to public or commercial manufacturers in the United States. In instances in which there is no U.S. interest in manufacturing a vaccine, the NVA could elect to transfer technology to a foreign public-sector manufacturer, provided that the country upholds patents. Vaccines developed by or with the support of the NVA could be sold to public health departments in the developing world, to international agencies, such as UNICEF, or to commercial distributors in the developed world. Procurement In the United States, public-sector vaccine purchases fall under the aegis

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The Children's Vaccine Initiative: Achieving the Vision of CDC and DOD. Internationally, UNICEF and PAHO negotiate and manage the procurement of large amounts of vaccine for use in the developing world. The NVA will need to work closely with the global CVI, developing countries, AID, UNICEF, PAHO, WHO, and others to ensure that the vaccines it develops will meet their needs. The NVA could agree to buy a predetermined volume of vaccine, on the basis of projected needs in the target population, at a predetermined price. Or, alternatively, the NVA could act as a broker to put together the necessary funding from a variety of sources. Such arrangements could initially run for 3 to 5 years, but they could be negotiated for a longer term. The guaranteed vaccine procurement mechanism considered above closely resembles the DOD procurement process. During the 1950s and 1960s, DOD procurement played a critical role in launching a number of small start-up firms in the semiconductor and computer electronics industries (e.g., Texas Instruments and Fairchild Semiconductor, the forerunner of the Intel Corporation and many others). By providing large purchase orders to producers of semiconductors that met its specifications, the DOD enabled fledgling producers to expand their revenues relatively rapidly. These producers would have found it much more difficult to enter commercial markets for their devices, because these markets are associated with much higher marketing and distribution costs. Numerous analyses of the semiconductor and other high-technology industries have argued that the effects of DOD procurement were more important than the effects of DOD research and development contracts on the entry and growth of new firms in these markets (Flamm, 1987; Levin, 1982; Mowery et al, 1991). To the extent that the risk and financial burden of vaccine development and clinical trials have been assumed by the public sector and the market size has been defined, it would become possible to negotiate licensing agreements that guarantee lower vaccine prices. The commercial vaccine manufacturers that license vaccines from the NVA would focus on efficient, high-volume manufacture at the lowest possible cost. Monitoring and Evaluation The NVA would rely on the combined expertise of AID, CDC, NIH, UNICEF, PAHO, WHO, and national governments to conduct CVI vaccine monitoring and evaluation. As noted in Chapter 6, the use and performance of existing CVI vaccines could be assessed and the need for new CVI products could be determined. All organizations with an interest in childhood vaccines would be involved in defining the requirements for new CVI products, as outlined above in the section Setting Priorities and Product Characterization.

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The Children's Vaccine Initiative: Achieving the Vision Management and Organization To be successful, the NVA would require a unified management structure with the authority and resources to undertake CVI product development. U.S. government agencies and the private sector could loan personnel to the NVA, perhaps on a rotating basis, as needed. The NVA could also be a focal point for training U.S. and overseas nationals in various aspects of vaccine development and manufacture. Although the NVA would be a federal or federally supported entity, it would have to embody some characteristics not common to governmental organizations. For instance, it would need to be able to purchase supplies and equipment quickly, renovate facilities, and build new research laboratories and pilot production facilities. The NVA would need to have in-house regulatory expertise as well as staff experienced in negotiating issues related to intellectual property rights. In addition, it may be appropriate in some cases to limit the liability exposure of the NVA's manufacturing partners from claims of vaccine-related injury. The NVA must be able to hire staff at competitive salaries, license technology, and retain revenues from vaccine-product sales or licensing. One strategy may be to contract out the operation of the NVA pilot facility to the private sector—a so-called GOCO, a government-owned, contractor-operated entity. Although the NVA would not be expected to become entirely self-supporting, it is reasonable to expect that over time some NVA-related costs would be recovered. Although the NVA would have several entrepreneurial characteristics, it is crucial that it not fall prey to the very market forces that to date have prohibited the development of CVI vaccines. The governance of the NVA should be carefully considered to maximize its public health mission and entrepreneurial needs. Having a board of directors drawn from the public health community, government agencies, developing countries, academia, and the private sector could ensure that the NVA would not depart from its mission. The NVA must be organized in a way that enables it to work in partnership with commercial manufacturers. Appropriate partnerships for vaccine development, large-scale manufacturing, or marketing and distribution will be essential to making new vaccines available at an accelerated pace. Funding The creation of new facilities or the expansion of existing vaccine development capacities to accommodate the NVA would require substantial public funding (Table 7-1). The committee estimates that the up-front capital expense of establishing the NVA would range from $30 million to

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The Children's Vaccine Initiative: Achieving the Vision $75 million. The actual cost will depend on whether existing public-sector vaccine research and manufacturing capabilities are expanded or a new, freestanding unit is constructed and staffed. The proposed facilities should include applied research laboratories; pilot production capabilities for bacterial, viral, and parasitic vaccines (both at the bench-level scale and at a scale required to prepare sufficient amounts of vaccines for clinical trials); a sterile filling capacity; a quality control laboratory and quality assurance; and animal facilities. In addition, the facilities should be designed to permit different vaccines to be made. Each year, the NVA would spend between $25 million and $45 million on grants, contracts, and cooperative agreements to support its goals. Assuming annual operating costs and administrative services of $150,000 to $200,000 per person and a complement of 150 to 200 full-time staff (including contract officers; scientific R&D staff; program officers, regulatory affairs liaison, quality control, legal affairs, and administrative staff and facilities management personnel), the annual operating budget would total $30 million. Overall, the annual recurring costs would be between $55 million and $75 million. Additional funds would need to be provided for vaccine procurement guarantees. TABLE 7-1 Estimated Costs of the Federal Vaccine Authority Item Cost (millions of $) Capital costs     Refurbishing an existing R&D and pilot facility 5–7   Construction of a new R&D and pilot facility 10–15   Equipmenta 25–60     Total capital costs 30–75 Operating costs     Contract and grantsb 25–45   Annual operating expensesc 30     (Assume $150,000 x 200 people)         Total operating costs 55–75 a Equipment includes that needed for R&D and a facility that manufactures pilot lots of vaccine under current Good Manufacturing Practices, and quality control and quality assurance. b Assuming that funding of contract and grants would be parallel or greater than what the U.S. government currently spends on children's vaccine-related R&D, but less than most agency budgets for human immunodeficiency virus-related research. c Assuming that operating expenses are estimated using a modified Delphi process. Estimated staff required includes those for research, pilot production laboratories, quality control and quality assurance, regulatory and legal affairs, and administrative services.

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The Children's Vaccine Initiative: Achieving the Vision Location The committee spent a considerable amount of time discussing where a new entity charged with developing CVI vaccine products might be located. Over the course of these deliberations, it became clear that there were a number of existing agencies that might serve as a home to such an organization. It is also possible, the committee realized, that the NVA should be placed in a quasigovernmental or entirely independent setting. Points to Consider for Locating the CVI in an Existing Federal Agency In the process of discussing these various possibilities, there emerged a number of "points to consider" that define what the committee felt to be important characteristics of any potential home for the NVA. Each agency considered by the committee meets some of these criteria; none satisfies all of them, however. Rather than recommend a specific site for the new entity, the committee has decided to define some preliminary points to consider for locating the NVA (see the box "Points to Consider for Locating the NVA in an Existing Federal Agency"). The panel hopes that those charged with implementing its recommendations will use these points to consider when evaluating an appropriate location for the NVA. To assist in this process, the committee has tried to gauge how each of the agencies "fits" some of these criteria. Weighed against the points, each agency has pluses and minuses. Some of these are discussed below. Options U.S. Agency for International Development The U.S. Agency for International Development commits substantial resources to the support of immunization programs and vaccine-related research around the world. The agency is a funding entity and does not directly carry out activities itself. Thus, if it were to be given the responsibility for overseeing the NVA, it would need either to provide funding to an existing entity or to create a new operational unit. There are precedents for this at AID. For example, many years ago the agency created Family Health International (FHI) to carry out primarily clinical contraceptive research. The Contraceptive Research and Development Program (CONRAD), a program administered by the University of Virginia, conducts research at earlier stages of development that

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The Children's Vaccine Initiative: Achieving the Vision Points to Consider for Locating the NVA in an Existing Federal Agency • Correlation of the agency's mission to the mission of the NVA, particularly with regard to providing childhood vaccines to the developing world • Intellectual and corporate culture and history • Track record in developing and procuring vaccines • Willingness to participate in CVI • Avoidance of conflict of interest complements the work of FHI. Together, FHI and CONRAD have many collaborative projects with private industry and conduct studies throughout the world. They have also undertaken technology transfer projects and have been active in regulatory, quality assurance, and quality control issues. AID's direct involvement in the support of EPI programs, and its recent interest in CVI projects, means that it can provide a critical role in setting priorities. In addition, AID has been a major supporter of research on a malaria vaccine, a potential CVI product. AID could help to ensure the close coordination of U.S. vaccine-related activities with the programs of the global CVI. Centers for Disease Control and Prevention The Centers for Disease Control and Prevention plays a vital role in purchasing and distributing vaccines in the United States and in assisting states with planning and implementing their own immunization programs. CDC also has considerable expertise in disease surveillance. The agency has established relationships with the health ministries of a number of foreign countries. CDC conducts in-house vaccine-related R&D, much of it related to infectious diseases, and has a number of vaccine-related CRADAs with private industry. CDC has extensive experience in epidemiological surveillance, public health and disease prevention activities, and negotiating with commercial manufacturers for the purchase of vaccines. U.S. Department of Defense The U.S. Department of Defense (Army) has an integrated and successful vaccine development program that is already working on CVI vaccines for use in military personnel. The department's vaccine program is product development oriented and has a successful track record getting vaccine products developed, licensed, and utilized. DOD has

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The Children's Vaccine Initiative: Achieving the Vision contributed to the development of a number of U.S.-licensed vaccines, including those against meningococcal disease and typhoid fever, which are of use to the CVI. Among DOD vaccines in clinical trials are those against shigella, cholera, dengue, malaria, and human immunodeficiency virus. DOD has considerable experience in working with the private sector, with both development-stage firms and commercial vaccine manufacturers. DOD has some experience in technology transfer overseas, but limited experience in facilitating the local, production of vaccines. There are six DOD field laboratories around the world, each of which has the capacity to conduct and evaluate the results of vaccine field trials. DOD might fear that an expanded mission in vaccine development would divert resources from its primary mission: protecting U.S. military personnel. In addition, there could be concerns overseas, however unfounded, about vaccines developed by the U.S. military. U.S. Food and Drug Administration The U.S. Food and Drug Administration, through the Center for Biologics Evaluation and Research, is responsible for the scientific review of license applications for new biologics, including vaccines. FDA has unmatched expertise in the regulatory aspects of vaccine development. FDA has many years of experience in operating a successful in-house R&D program. Many of the studies which provided the basis for the development of the acellular pertussis vaccine were conducted in CBER laboratories. In addition, the agency has worked for many years to train foreign nationals in its laboratories, and FDA personnel participate actively in international consultations and in scientific committees at the WHO. There is the potential for conflict of interest if the new entity were housed at the FDA, since the agency would be reviewing the regulatory compliance of the same products it was developing. National Institutes of Health The National Institutes of Health, primarily through the National Institute of Allergy and Infectious Diseases, is the largest source of publicly funded vaccine research in the United States. NIH supports an extensive intramural research program and a larger program of extramural grants and contracts. Currently, NIH plans, encourages and supports CVI-related vaccine R&D. NIH has ties to overseas health and research organizations, and a number of investigators work informally with international colleagues. It also has limited capacity, primarily through contracts, to make small pilot lots of vaccine suitable for early-phase clinical testing. Inasmuch as CVI-related activities benefit U.S. citizens, the missions of NIH and NVA are complementary. As currently authorized, however, the

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The Children's Vaccine Initiative: Achieving the Vision NIH mission does not accommodate a major international effort. NIH's recent history has included efforts (through CRADAs, primarily) to reach out to and work with industry. NIH has a distinguished intellectual history in the area of biomedical research, including vaccine-related R&D. NIH and its grantees have also had considerable success in the area of basic research related to vaccines. The agency's experience in product development is less extensive, but is growing particularly through the use of CRADAs and since the establishment of the vaccine evaluation units (see Chapter 6). The National Vaccine Program The National Vaccine Program (NVP), located in the Office of the Assistant Secretary for Health (U.S. Public Health Service), is authorized to coordinate vaccine efforts in the United States. The NVP has no vaccine-related research or vaccine production capability. As authorized, the NVP was directed to develop and oversee the implementation of a National Vaccine Plan. Although the plan has not been released to the public, the concept of organizing and managing existing immunization resources in the United States is important and integral to the mission and functions of the NVA. To accommodate an initiative of the size and scope of the NVA, the NVP would have to be authorized to become an operational entity (with a research laboratory and pilot production facility), and support for the NVP would have to be substantially increased. (Funding for the NVP fell from $9.5 million in 1991 to less than $3 million in 1993.) In addition, the stature of NVP would need to be elevated significantly. Independent Organization In the past, the federal government has found it useful to charter new entities, such as the Tennessee Valley Authority, that are not bound by traditional government bureaucracy but that are responsive to public needs (see Appendix D). Establishing the NVA in a quasigovernmental or independent organization would have several advantages. A quasigovernmental home for the NVA would provide the new organization with much desired flexibility, including the ability to hire and fire at will, offer salaries competitive with those offered in the private sector, and purchase needed equipment with little bureaucratic delay. At the same time, the NVA would retain some of the benefits of being associated with the federal government, including regular appropriations and close linkages to other agencies with a role in the CVI. As a truly independent entity, the NVA would need to raise its own capital and would interact with the government like any other private organization. If the NVA were an independent or even a quasigovernmental organization, it would not benefit

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The Children's Vaccine Initiative: Achieving the Vision from 28 USC §1498, as discussed in the section Intellectual Property Rights and in Chapter 5, unless the U.S. government treated the organization as a contractor for the purposes of vaccine acquisition. The Henry M. Jackson Foundation, established by the U.S. Congress in 1983 and housed at the Uniformed Services University of Health Sciences in Bethesda, Maryland, is one example of such an arrangement. The foundation is a federally chartered, nonprofit, nongovernmental organization authorized to receive federal and nonfederal funds. In return, it carries out medical research and educational activities and consults on a contract basis for public and private sponsors, often through cooperative agreements. Flexibility is vital to the foundation's strength—it can employ both federal and nonfederal employees, receive patents, and negotiate licenses. * * * Vaccines are among the most cost-effective public health interventions available. Efforts to strengthen U.S. and global vaccination efforts will be based on the development of new and improved vaccines. The committee forwards the recommendation for a National Vaccine Authority having recognized and struggled with the burden and discomfort that the proposal of creating a new entity brings, most particularly at a time of limited resources and given national efforts to decrease government spending. The committee believes strongly, however, that the need and rationale for an entity like the NVA are compelling. An entity such as the NVA would fulfill a critical public health need and has the potential to protect children around the world while building on and strengthening public-and private-sector partnerships in the United States. The creation of an NVA will, for the first time, ensure the feasibility of a coherent program of development and production of CVI vaccines within the context and mandate of the 1986 legislation (P.L. 99-660) authorizing the NVP and requesting the National Vaccine Plan. The committee believes that the NVA, through a dynamic partnership between the public and private sectors, will offer the United States a new tool for ensuring the availability of novel vaccines and vaccine-related technologies for use in immunization programs around the world and in the domestic public health arena. The creation of an NVA-administered development and procurement program for CVI vaccines could greatly reduce the barriers to entry into vaccine production that many new biotechnology firms now face. By providing a market 'springboard,'' this program could support the growth of U.S. biotechnology firms, potentially contributing to expansion in sources of supply for other types of vaccine products, contributing to the growth of a U.S. biotechnology industry, and aiding in the bolstering of U.S. competitiveness in this important sector. In

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The Children's Vaccine Initiative: Achieving the Vision the committee's view, the United States can and should play a decisive role in achieving the vision of the Children's Vaccine' Initiative. NOTE 1.   The development of the first meningococcal vaccine is a good example of how the DOD approaches vaccine development and how the committee anticipates the NVA to function. Outbreaks of meningococcal meningitis had been a major problem for the United States in the mobilization of troops overseas throughout the 20th century. But in 1963, sulfonamide-resistant strains of meningococci became widespread in military recruits in the United States. Isolation of infected personnel and easement of crowding did little to stem the epidemics. The Walter Reed Army Institute of Research (WRAIR) responded by developing a major vaccine research and development program for meningococcal meningitis, under the leadership of Malcolm Artenstein. Over the next 6 years, the WRAIR conducted pioneering work on Group A, B, and C meningocci with a number of partners, most particularly the Rockefeller University. The WRAIR group was able to demonstrate both the technical feasibility of the vaccine and preliminary vaccine efficacy. The DOD was then able to attract private industry to invest in the manufacture and production of the vaccine. The meningococcal A and C vaccine is currently manufactured by private firms and sold to the DOD for use in military personnel. REFERENCES Flamm KJ. 1988. Targeting the Computer. Brookings Institution. Washington, D.C. Levin RC. 1982. The Semiconductor Industry. Government and Technical Progress: A Cross-Industry Analysis, Nelson RR, ed. New York: Pergamon. Institute of Medicine. 1992. Emerging Infections. Washington, D.C.: National Academy Press. Mower DC, Steinmueller WE. 1991. Prospects for entry by developing countries into the global integrated circuit industry: lessons from the U.S., Japan, and the NIES. CCC Working paper #91-8. Center for Research in Management. University of California at Berkeley.

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