Flu Vaccine Memorandum
Flu Memorandum To: Representative Henry Waxman House Committee on Government Reform From: Senior Policy Analyst Date:9/18/2012 Re:Influenza Shortage Distribution Recommendations This memo outlines ways to address the recurring shortages of the influenza vaccine that occurred in the United States between 2000 and 2004. There were two important contributing factors to these vaccine shortages.
First, there has been a significant reduction over the past few decades in the number of companies that choose to manufacture the flu vaccine.Second, the government has taken a laissez-faire approach to managing the distribution of the vaccine, even in times of shortage. In order to fully accomplish our overarching goal – to maximize stability and availability of the flu vaccine, particularly to Americans who are at highest risk of complications from the virus – I believe proper distribution of the flu vaccine must be more accessible to more channel of distribution to maintain an adequate supply of the flu vaccine. In order to do this, legislation must ensure that adequate supply of the vaccine is available during various flu seasons.Legislation must also encourage effective collaboration with private companies as they are the primary distributors of flu vaccine as well. In this memo, I recommend imposing a window period for the priority distribution of the flu vaccine to high-risk Americans in the event of a shortage. I also recommend exploring further the idea of providing government incentives to create a lucrative environment so that producing vaccine is a more enticing market for private companies to enter.
Flu Vaccine Memorandum Essay Example
Primary Issues in Addressing the Flu Vaccine Distribution and Manufacturing As you consider policy solutions to bring greater stability the U.S. influenza vaccine supply, I propose that you take into consideration three underlying issues: Diminishing numbers of vaccine manufacturers In recent years, the number of companies that manufacture the flu vaccine has been reduced significantly, from 25 companies three decades ago to only five as of 2003. With a smaller universe of manufacturers, ensuring that an adequate supply of the vaccine is available for the 90 million Americans at the greatest risk of complications from the virus has become more challenging.Those manufacturers that have ceased to produce the vaccine have cited low profits, unpredictable demand and overly burdensome regulations as reasons for their decisions to stop manufacturing the vaccine. For example, pharmaceutical giant Merck & Co. abandoned the flu vaccine business almost twenty years ago.
Wyeth pulled out last year after throwing away about one-third of the flu vaccine it made for the 2002-2003 season because it did not sell. That leaves just three established companies in the business–the French firm Aventis Pasteur SA, Chiron Corporation, and Medimmune, Inc.With such a limited set of manufacturers, problems at just one lab could imperil the ability of the entire U. S. health care system to deliver vaccines to all who need them, as was the case when the U. S. learned that vaccines produced by Chiron in Liverpool were contaminated.
While the oversight by the Federal Drug Administration was also to blame for this debacle, we cannot ignore that our overreliance on just a few manufacturers is at the root of the instability of our vaccine supply. Poor RegulationsPoor regulation has led to a discrepancy in the production, sale, and distribution of the flu vaccine, which are currently operated by private enterprises. Vaccine distribution, when left to existing private enterprises Chiron and Aventis, resulted in uneven distribution of medication in 2004. If the Department of Health is unaware of how flu supplies are shipped and to who they are shipped to, there is no way the Department of Health and Human Services can intervene in assisting companies to distributing the vaccinations.In addition, poor regulation policies such as the Food and Drug Administration approval and certification process, has led to delays in acquiring supplies of flu vaccine. Delayed supplies become unused or sold for low prices because of a lack of demand for delayed vaccine amongst the public. Legislation required to address the flu vaccine crisis must propose government/private collaboration measures for production/sale/distribution of the vaccine.
Limited government role in vaccine distribution The private sector controls almost exclusively the distribution of the nfluenza vaccine in the United States. The federal government does not currently operate a centralized system for the purchase, distribution and delivery of the vaccine; instead, individual medical providers purchase vaccines directly from a manufacturer or through a distributor. This fragmented system became problematic in 2004 when some providers purchased their entire supply of vaccine from Chiron, leaving them with no vaccines to offer. Federal agencies also currently lack the authority to enforce priority distribution of the vaccine to vulnerable groups, even in the event of a shortage.Therefore, in a time of limited vaccine supply, Americans at the highest risk of complications from the flu have the same likelihood of getting a vaccine as healthy young adults. Policy Alternatives and Analysis I have developed three alternatives based on a review of reports and news articles written during the period of 2000-2004, I focused my analysis on evaluation criteria of alternatives in considerations of cost, effectiveness and political feasibility. Alternative #1 – Maintain the status quo Under this alternative, current policy and legislation would remain the same with no intervention from the government or its agencies.
Federal regulations would remain as they are, distribution would continue to be handled by the private sector, and people would have to get vaccinated using the current means available to them Alternative #2 – Provide Tax Breaks for Vaccine Manufacturers In order to incentivize the production of the flu vaccine by a greater number of manufacturers, the federal government could provide tax exemptions for manufacturing companies and proposals for federal/state grants for creation of new vaccine facilities.As there are more companies manufacturing flu vaccine, and in an efficient way, the risk of a flu vaccine supply shortage will decrease. Purported legislation will create an incentive for more pharmaceutical companies to embark upon establishing flu vaccine manufacturing facilities. If a company successful incorporates a flu vaccine facility, they are to receive a tax break with a rate determined by the quantity of vaccine they produce and by their delivery time of distribution. The more vaccine they produce and efficiently distribute, the higher the rate of tax exemptions they will receive.Government officials will be responsible for monitoring companies’ production as companies must give an account of their activities. Federal and state grants will be sent to private companies through request for proposals process.
In providing subsidies in the form of tax breaks to vaccine manufacturers implies a sizable cost to the federal government at a time when there is significant opposition to increasing spending. Political challenges may emerge on both sides of the aisle, with conservatives opposing measures that add to the national debt and liberals opposing tax incentives for large, multinational pharmaceutical companies.On the positive side, by providing subsidies, the federal government might have greater leverage to pressure companies to locate their labs in the United States, rather than overseas, which might hold additional advantages, including a cost savings that could result from expanded access to the flu vaccine, without which more high-risk Americans might need to seek more expensive care. Alternative #3 – Priority Distribution Window in Times of Emergency Currently, the Federal government can only recommend that priority for the delivery of flu vaccines be given to high-risk populations, even during vaccine shortages.The Congress could grant the authority to implement required priority distribution when shortages occur. Under this policy, once Department of Health and Human Services determines that the U. S.
’s vaccine supply may not be great enough to meet demand, it could impose a window period at the beginning of the flu season during which only those defined as high-risk by the Centers for Disease Control and Prevention would be legally eligible to receive the vaccine.During this window period, Department of Health and Human Services could also work with states and cities to sponsor public education campaigns that encourage high-risk groups to get vaccinated as early as possible, and remind Americans that are not at risk but still choose to receive a vaccination each flu season to understand the importance of first protecting our most vulnerable. While this appears to be the least costly of the three alternatives rather than keeping the status quo it presents there are other challenges to consider.In addition to some general political opposition to expanded government mandates, you should also anticipate concerns from doctors and other medical providers, who have expressed an unwillingness to turn away healthy adults that insist on getting the flu shot. Recommendation I know that you are most concerned with cost, effectiveness and political feasibility of the vaccine supplied to the American public. I recommend that you pursue giving Department of Health and Human Services the authority to impose a priority distribution window for the flu vaccine in times of shortage (Alternative #3).While this alternative will not immediately address some of the underlying concerns that have led to flu vaccine shortages, it will help ensure that if shortages occur in the future, that those most at risk will have the best chance of being protected.
Compared to the others, the cost of Alternative #3 does appear to be lower and the political hurdles more surmountable. According to my analysis, Alternative #2 would face such substantial opposition that it should not be considered at this time.