Shareholders are being urged to use the annual general meetings of Pfizer and GlaxoSmithKline to put pressure on the companies to lower the price of their life-saving pneumonia vaccines.
ShareAction, the responsible investment charity, issued the call ahead of Pfizer’s AGM in New York on Thursday, and GSK’s annual meeting in London next week.
Médecins Sans Frontières (MSF) has just delivered petitions to both companies asking them to lower their vaccine prices to $5 (£3.43) for each child in developing countries, and plans to raise the issue at both AGMs.
Pneumonia is the single largest cause of death for children under five globally and kills almost 1 million children a year, it is estimated. The two pharmaceutical companies have dominated the market for the main pneumococcal vaccines for years.
Pfizer and the British company GSK have come under growing pressure from more than 50 countries and international health charities to reduce the high price of pneumococcal vaccines. The price tag was the main reason why the cost of fully vaccinating a child was now 68 times more expensive than it was in 2001, ShareAction said.
Ten vaccines are on the World Health Organisation schedule. Pneumococcal vaccines were added to the childhood vaccination schedule in 2006.
Pfizer had made more than $26bn in sales from pneumonia treatments since 2009 while GSK had made $3.5bn in that period, ShareAction said.
GSK’s latest results, published on Wednesday, showed that vaccine sales were strong in the first three months of this year, rising 23% to £882m, with sales of its pneumonia vaccine Synflorix up 48% to £91m.
MSF said that a small number of countries could get the pneumonia vaccines for $9 for three doses under the Gavi Alliance (a global health partnership), which is backed by the Bill & Melinda Gates Foundation, Unicef and the WHO. For other countries the price could be at least six times higher.
GSK said it was one of the largest contributors of vaccines to Gavi for treating several diseases, and had been offering Synflorix to the alliance at a “deeply discounted” price since 2010. It has lowered its price to Gavi, to $3.05 per dose from 2017 – a level which just covered its cost, the drugs firm said. It added that its pneumococcal vaccine was one of the most complex it had ever manufactured, essentially combining 10 vaccines in one.
However, Greg Elder, medical coordinator for MSF’s access campaign, said: “What’s the point of a life-saving vaccine if the most vulnerable people can’t afford it?”
ShareAction criticised the opaque pricing of both companies’ vaccines, which made it hard for countries to negotiate. Catherine Howarth, the charity’s chief executive, said: “These two pharmaceutical giants are found in many global investment portfolios. Our latest briefing brings their vaccine pricing tactics to investors’ attention.”
The €165bn Dutch pension fund PFZW has indicated that it will push for more affordable drugs, arguing that drugs manufacturers had a “social responsibility to price their products reasonably”.
Hillary Clinton has slammed the “predatory pricing” of some companies and vowed to limit the amount they can charge for their drugs if she wins in the US presidential elections.
Cheaper pneumonia vaccines, made by the Serum Institute of India, and South Korea’s Panacea and SK Chemicals in partnership with France’s Sanofi healthcare company, are set to come on to the market from 2018.
Countries including Algeria, Bosnia, Egypt, Indonesia, Jordan, Thailand and Tunisia, among others, have said they are unable to introduce the pneumonia vaccine because of its high price, MSF noted.
Vickie Hawkins, executive director of MSF UK, said: “Whilst the price of the pneumonia vaccine is clearly making a profit for GSK shareholders, it’s failing three-quarters of the world’s children. They remain unprotected against this deadly disease as a number of countries can’t afford to buy the vaccine – 2,500 children will die from pneumonia today.”
