Important note: Information in this article was accurate in April 2001. The state of the art may have changed since the publication date. IAVI Report - April / June 2001
Earlier this year, IAVI conducted a series of interviews with representatives of ten pharmaceutical and biotech companies and industry organizations. Participants were asked about the potential effectiveness of tax and other financial incentives to stimulate research, development, production, and delivery of HIV vaccines.
The majority of those interviewed felt that tax credits alone would have minimal impact on industry R&D decisions. But many commented that tax incentives could be effective as part of a package of interventions, especially programs to establish a paying market for vaccines. As one interviewee said, "Nothing on the push side makes a difference if you don't have a market. You need a combination of things."
Several participants thought that biotech companies were more likely than pharmaceuticals to respond to financial incentives, which would have relatively greater impact on a small company's bottom line. Since biotechs often struggle to raise sufficient capital for research, the economics of vaccine research can be as daunting as the science—so financial incentives could play an important role in generating and maintaining research projects.
For big pharma, creation of a paying market for vaccines in developing countries, along with purchase and delivery of currently available vaccines, emerged as top priorities. As one interviewee commented, "my big pharma friends say that if you want incentives to be credible, then apply them to our business today," by buying and delivering vaccines available now. But other industry representatives said that tax credits and other "push" mechanisms which subsidize R&D could help even large companies maintain existing long-term, high-risk research programs, including those for HIV, TB, and malaria vaccines.
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©2001. The IAVI Report.
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