acceptable to regulators. Although not directly responsible for these results, the firm may nevertheless have to answer to its shareholders for them. Industry is concerned also about who owns the rights to products developed with public-sector collaboration and what role government should play in setting the prices for those products. Having access to intellectual property and an exclusive license on a technology is a tremendous incentive for industry to invest in vaccine development. However, the high price of the resulting products may limit their availability in most parts of the developing world.

One fundamental difference between industry and the public sector is the former’s need to define and penetrate a market. The vaccine industry, particularly biotechnology companies dependent on venture-capital funding, is very sensitive to the availability of commercial opportunity. In the case of human vaccines, three-quarters of current revenues come from just two regions of the world: Europe and the United States. ²⁷ Much of the remaining money now made from vaccine sales is sheltered in several large markets—like those of Japan and China—that are virtually closed to the outside world. Vaccine purchased by the Pan American Health Organization and UNICEF accounts for roughly 5 percent of worldwide vaccine revenues. Presently, a relatively small share of the world’s vaccines is sold to developing-world nations.

The public sector can provide both “push” and “pull” to enhance the productivity of vaccine research and production. A major push factor is the