III. Survey Results: What Industry Wants from Government

A. A Question of Leadership

A substantial share of the expertise to develop, produce and distribute vaccines lies with private pharmaceutical and biotech companies. But government researchers and health officials have equally important, multiple responsibilities in the pursuit of an HIV vaccine.

Publicly funded researchers and labs have classically provided the basic scientific research which allows private efforts to pay off. Government can also fund clinical trials of HIV vaccines. But the public sector must also help create an investment climate which will harness private sector expertise. Publicly funded incentives can be an opportunity to address equity issues when these incentives are negotiated as part of a package which includes price breaks or other guarantees to expand access to vaccines by at-risk, low income and uninsured populations.

Many are looking to government to provide scientific leadership on vaccine research, and to mobilize communities for vaccine trials. And government could choose to play a more active role in the actual design and development of vaccine products.

Our final set of questions asked what steps government could take to increase private sector investment in vaccine research and development. Again, our questions were based on ideas suggested in earlier writings.

B. What Government Should Do

Our first question was an attempt to get a reading of respondents' ideas before they were prompted with specifics. It was the most open ended: "What can government do to help?" We received a variety of responses, most often clustering around the ideas of: providing public funds, economic incentives for research, and improving the investment climate (11); doing basic scientific and immunological research (6); providing leadership (4); and broadening the focus of research beyond protein envelope approaches (4).

The need for direct government funding was heard from large and small companies alike. An employee of a major pharmaceutical told us that, "given all the disincentives for industry to do something...the emphasis for public funding becomes more acute." From an employee at a smaller biotech, "For us, the only source for money for this comes from the US government. The investment community, where we get most of our capital, venture capital, institutional investors, view the scientific risk and long term nature of the development program as the greatest disincentive to invest. They don't want to wait around for fifteen years to see a return." An employee at another comparatively small company insisted that, "there should be some big incentives for small companies where innovative strategies are coming from. The risk is less for larger companies. I don't have a lot of empathy for large companies who can enter this area and it would be drop in the bucket." The importance of visible leadership also emerged as a recurring theme in responses to this and other questions.

C. Specific Actions

Next we asked people about the value of specific actions government might take. We asked, "How important would each of the following government actions be to increase investment in vaccine development?"

1. Tax deductions or credits for investments

Given that these were employees of private companies being interviewed, we were not surprised that responses tended to be supportive of this approach. Nine of 16 responding thought deductions or credits would be very or moderately helpful, two ranked their usefulness as low, and four were not sure. One interviewee said sufficient deductions and credits already exist in the United States. There were no consistent trends between large and small companies. One representative of a large pharmaceutical said tax deductions would be "good for large companies, but small companies don't have big tax bills."

2. Expedited review by FDA

Several respondents seemed to view lengthy delays in the FDA review process as an issue mostly in the past, and this suggestion received the second lowest overall support. Four of 13 responding said it was very or somewhat important; seven ranked it low in importance; and two did not know. Respondents noted that "it's sort of happened" and "it's not really a problem."

3. Creating uniform international standards for licensing

 

Inconsistent, or nonexistent, standards of safety and efficacy for vaccine licensing have been named as an impediment to investment. As officials at NIAID have observed, lack of clarity about the ultimate goal is the one uncertainty business has a difficult time tolerating. Yet in our survey the concept of uniform international licensing standards received limited support. One of 14 said it would be very important; seven said somewhat important; six said it would be of little or no importance.

4. Expanded patent protection

Expanded patent protection would allow a vaccine manufacturer a longer period of exclusive marketing of their product, and more time to recoup their investment and show profits. Support also varied for this proposal. Two of 15 responding ranked it high; four said it would be helpful or moderately helpful; five ranked it of low importance; and four said they did not know. One interviewee worried that expanded patent protection or orphan drug status for a vaccine might be unseemly, "...a vaccine could potentially be very profitable...there's a fear of how it would look for a corporation to profit from an AIDS vaccine, for example Burroughs Wellcome and their AZT pricing...[an HIV vaccine] would be a billion dollar product, so orphan drug status doesn't make sense, but some kind of economic incentive is necessary."

5. Guaranteed purchases of vaccine supplies by government

The logic behind this approach is that companies may be concerned about the ultimate size of the market for an HIV vaccine - at least the market which could pay for the product. Guaranteed purchases would ensure a market size adequate to justify investment. But, as noted in the previous section of this report, concerns about the lack of a market for HIV vaccines may have been exaggerated, and we found only limited support for the guaranteed purchase approach. Three of 15 responding listed this as very important; four said it was somewhat important; and six ranked it of low or no importance; one said government purchase of an HIV vaccine was "expected;" and one respondent did not know. "If there is a vaccine, it will be sold," said one company representative. Another raised the concern that guaranteed government purchasing might serve as a disincentive if companies became overly concerned about the potential for price fixing by government.

6. International coordination of vaccine research and distribution

It's hard to argue against this idea, and it is a role that many agencies, including NIAID, UNAIDS, IAVI, OAR, and the Department of Defense, have attempted to play. Eight of 12 respondents said it would be very or somewhat important; three said it would be of little or no importance; and one did not know.

7. Direct contracting between government and industry for specific research

This idea has appeal because it would allow government aggressively to identify gaps in vaccine R&D and strategically fill those gaps utilizing expertise in the private sector. It is also a model which has some precedent: the HIV vaccine work of Pasteur-Merieux, Connaught, Chiron, Genentech, Therion and others has benefited from direct government financing. This approach also has serious potential pitfalls: Will NIAID or another government agency identify an appropriately broad array of research, or choose to fund a more narrow range of approaches? Will public financing be used as an opportunity to secure expanded access to vaccines by low income populations, or as a give away to billion dollar multinational pharmaceuticals? Will companies with extensive vaccine expertise be interested in contract work to which strings are attached (such as subsidized pricing, or partial patent ownership by government)?

 

Perhaps not surprisingly, the industry representatives we spoke to were far more supportive of this potential government action than any other we suggested. All 17 of those responding said this approach would be very or somewhat important; seven of those said it would be very important.

 

Several companies noted that past government financing by the US, France, and Canada was one of the driving forces behind current HIV vaccine research. Widespread support for this approach also begs a rather big question: if our interviewees are convinced there is a substantial market for HIV vaccines, why do they expect their work to be subsidized? And if it is, how are the fruits of that work to be shared?

8. Greater clarity about thresholds for moving to Phase II and III trials

This approach is a central piece of NIAID's plan to foster better relations with industry. NIAID staff are working with industry representatives to negotiate specific "milestones" which, if attained, will move different candidate vaccines to late stage human trials. These milestones would change with scientific knowledge, but would serve as relatively stable markers for product evaluation and development. The industry staff we spoke with for this survey voiced strong to moderate support for the overall concept. Seven of 12 respondents said the idea was very or somewhat important; two said it was of low importance; one said "safety should be the threshold"; and two said they did not know. There was also praise for NIAID's current efforts to set milestones: "The effort begun in 1995 to be serious about long term plans...what they are doing is very helpful."

 

However, one respondent questioned the long term validity of those agreements, and several of those interviewed said the June 1994 NIAID decision not to proceed with Phase III trials of the Genentech and Chiron gp120 products had been "a damper" on industry interest.

9. Increased assistance securing animal models for research

Animals remain essential for pre-clinical testing of vaccine candidates, even though one of the frustrations of HIV vaccine research has been the lack of predictive animal model. High cost and limited availability of these animals has been noted as one impediment to research. Our survey elicited relatively strong support for greater assistance with access to animals for research. Eight of thirteen responding said this would be very or somewhat important; five ranked it of low importance. Since animal testing is considered a critical first step in assessing the safety of products before human trials, we were a bit taken aback by one interviewee who responded to our question by saying animal models are, "not needed. We can use humans. The virus is specific for humans. Why not just find volunteers from high-risk groups?"

10. Need for changes in vaccine trial networks

Though industry representatives voiced various frustrations about working with government ("All government programs could be better managed."), when we asked a specific question about the NIAID clinical trial networks, few had complaints to voice. No one ranked reform of these programs a high priority. One of ten ranked it of medium importance; four ranked it of low importance or "OK as it is"; three did not know; one called for increased "centralization" and another said "alternative approaches" and "leadership" were needed.

D. The Pros and Cons of Working with Government Agencies

Many of the people we interviewed reported reasonably good experiences with US government agencies and several offered praise for individuals at NIH. The pros of working with government included the availability of funding, the chance to exchange information with others, the presence of knowledgeable scientists, and facilitation of primates studies and human clinical trials. One employee of a large pharmaceutical noted that, "NIH...goes to great lengths to bring people together."

Cons included dealing with a "big, slow bureaucracy," and putting up with "reporting structures and unending regulations." An employee of a large pharmaceutical argued that, "There needs to be increased authority given to lower levels [in government] to make decisions without tons of committees."

One theme that emerged was a concern that pharmaceutical companies are not included in NIH planning. Industry scientists wanted to be taken more seriously as scientists and thinkers and to be involved in decision making in a greater capacity than as mere providers of product. Again, concerns about overall leadership and a perceived lack of direction in government efforts emerged.

E. Ranking Specific Actions Government Should Take

Three interviewees reminded us of a key issue from the "obstacles" section of the interview which we neglected to include here: the need for a liability system to provide industry with some protection from lawsuits. Four others said direct contracting between government and industry was the most important idea we had listed. Additional items noted were: leadership, guaranteed purchase of vaccine, basic scientific research, and improving the investment climate.

 

F. Government Leadership

The responses to this question were most remarkable in the emphatic unanimity of opinion expressed about the need for increased active government leadership. Without this key ingredient, many interviewees believed the search for an HIV vaccine would be seriously impeded.

We were surprised to find most interviewees volunteering these perspectives unasked, and so will let their comments speak for themselves:

"Government needs to bring together companies and communities and countries for clinical trials....What it takes is a person with credibility and assets to work with a company to absorb some of the financial risks...There needs to be someone who sees this as his or her job: bringing partners together; building links between companies, communities and governments. [NIAID staff] need to get out of their offices and say to companies 'we will work with you.'"

"We don't have anyone in the entire government who has been asked to assume responsibility to get a vaccine. No one's salary or bonus depends on it. No one is on the line on this issue. No one is in charge."

"We need someone like Jonas Salk who took it upon himself to try it out. But his problem was easy to solve. People are frustrated and an easy answer is not there."

"It takes a person. Not a committee."

The answers to this last set of questions suggest that the efforts of NIH and other government agencies to improve working relationships with industry-based HIV vaccine researchers are appreciated, but that they do not go nearly far enough. Creation of a clinical trials network, growing clarity about thresholds for moving ahead with clinical trials, and FDA reform are beginning to have an impact, and NIH's role as a funder of basic research remains essential.

But according to the industry representatives we spoke with, important deficits remain. Measures to improve investment, leadership, and the inclusion of industry in planning are necessary.

IV. Corporations with HIV Vaccine Programs

Table of HIV Vaccine Effort by Company

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