RTI Project Number

0208665.001

Influenza Vaccine Manufacturing

Issue Brief

October 2005

Prepared for

Amy Nevel, MPH

Senior Public Health Policy Analyst

Office of Science and Data Policy

Assistant Secretary for Planning and Evaluation

Department of Health and Human Services

Mail Stop 445F

200 Independence Ave., SW

Washington DC 20201

Prepared by

Christine Layton, PhD, MPH

Nancy Lenfestey, MHA

RTI International\*

Health, Social, and Economics Research

Research Triangle Park, NC 27709

\*RTI International is a trade name of Research Triangle Institute.

Contents

Page

1\. Introduction [2](#introduction)

2\. Key Issues Facing Influenza Vaccine Manufacturers
[2](#key-issues-facing-influenza-vaccine-manufacturers)

3\. Brief Biology of Influenza and History of Influenza Vaccination
[2](#brief-biology-of-influenza-and-history-of-influenza-vaccination)

3.1 The ABCs of "Flu" [2](#the-abcs-of-flu)

3.2 Drifting and Shifting [2](#drifting-and-shifting)

3.3 History of Influenza Vaccination
[2](#history-of-influenza-vaccination)

4\. Influenza Vaccine Manufacturing 101
[2](#influenza-vaccine-manufacturing-101)

4.1 Influenza Vaccine Manufacturing Process
[2](#influenza-vaccine-manufacturing-process)

4.2 Structure of the Industry [2](#structure-of-the-industry)

5\. Manufacturer Decision Making [2](#manufacturer-decision-making)

5.1 Quantity Produced [2](#quantity-produced)

5.2 Investment in New Technologies [2](#investment-in-new-technologies)

5.3 Entry Into and Exit from the U.S. Influenza Vaccine Market
[2](#entry-into-and-exit-from-the-u.s.-influenza-vaccine-market)

6\. Summary and Conclusion [2](#summary-and-conclusion)

References [2](#references)

List of Figures

Number Page

[1. Influenza Vaccine is Unique 2](#__RefHeading___Toc118275820)

[2. Influenza Virus Showing Neuraminidase and Hemagglutinin on Exterior
2](#__RefHeading___Toc118275821)

[3. Timeline of the Vaccine Manufacturing Process
2](#__RefHeading___Toc118275822)

[4. Vaccine Manufacturing Process 2](#__RefHeading___Toc118275823)

[5. Influenza Vaccine Doses Produced and Distributed for the U.S. Market
1999--2004 2](#__RefHeading___Toc118275824)

List of Tables

Number Page

[1. U.S.-Licensed Influenza Vaccines for 2005--2006
2](#__RefHeading___Toc118281449)

[2. Major U.S. Vaccine Manufacturers in 1980 and 2002
2](#__RefHeading___Toc118281450)

[3. Influenza Vaccine Production 2](#__RefHeading___Toc118281451)

[4. Influenza Vaccines, Manufacturers, and Seasons during which each
Vaccine Was Sold 2](#__RefHeading___Toc118281452)

[5. Advantages and Disadvantages of Cell Culture and Reverse Genetics
2](#__RefHeading___Toc118281453)

This issue brief is one of five produced for the Assistant Secretary for
Planning and Evaluation (ASPE) by RTI International. The contents of
these briefs is based on research involving a review of literature
including peer-reviewed journals, media reports, and other nonreferenced
sources (including those identified using the World Wide Web search
engine Google) as well as confidential interviews with 30 key informants
representing influenza vaccine manufacturers, wholesalers, community
immunizers, state and local public health officials, and other experts.
The other briefs in the series are

-   *Influenza Vaccine Economics*

-   *Influenza Vaccine: Who Buys It and Who Sells It*

-   *Influenza Vaccine Demand: The Chicken and the Egg*

-   *Influenza Vaccine Overview: Summary and Assessment.*

This issue brief was written by Christine Layton, PhD, MPH, and Nancy
Lenfestey, MHA.

# Influenza Vaccine Manufacturing

# Issue Brief

## 1. Introduction

Influenza vaccine manufacturers have experienced intense scrutiny in
recent years. Uncertain demand, short turnaround in vaccine production,
evolving regulatory requirements, rising production costs, and mergers
and acquisitions represent a few of the challenges facing manufacturers
in this dynamically changing industry. This issue brief provides an
overview of the following areas:

-   key issues facing influenza vaccine manufacturers;

-   biology of the influenza virus and history of influenza vaccination;

-   influenza manufacturing process;

-   structure of the industry and nature of the influenza vaccine
    market; and

-   factors that influence manufacturer decision making---quantity of
    vaccine produced, investments in new technologies, and entry into
    and exit from the U.S. influenza vaccine market.

## 2. Key Issues Facing Influenza Vaccine Manufacturers

Vaccines are different from pharmaceuticals (Figure 1). As one key
informant explained, "... manufacturing the vaccine \[is\] not just like
turning on a spigot and some chemicals come out and you can stamp out
some pills." Among vaccines, influenza vaccine is unique in that

-   influenza vaccines are reformulated each year to match the
    circulating strain(s) of virus anticipated in the upcoming season;

-   due to annual reformulation, influenza vaccines expire at the end of
    each influenza season; and

-   influenza vaccines have typically been administered prior to the
    start of the influenza season (approximately October--December).

The seasonality of the vaccine and need for annual reformulation
contributes to the widely perceived precarious nature associated with
the influenza vaccine manufacturing industry. Limited profitability when
compared to pharmaceuticals and financial vulnerability stemming from
unpredictable demand pose tremendous risks to manufacturers in the
market. Additional discussion of these risks and challenges are noted in
subsequent sections of this brief.

[]{#__RefHeading___Toc118275820 .anchor}Figure 1. Influenza Vaccine is
Unique

![](media/image1.wmf){width="2.6979166666666665in" height="2.5in"}

## 3. Brief Biology of Influenza and History of Influenza Vaccination

### 3.1 The ABCs of "Flu"

Influenza is an infectious disease that occurs primarily in the winter
months in the northern hemisphere. Although influenza is often thought
to be a mild illness, it causes an average of 226,000 hospitalizations
(Thompson et al., 2004) and 36,000 deaths annually (Thompson et al.,
2003).

Three types of influenza can infect humans: A, B and C. Influenza A
causes regular outbreaks---most notably pandemics---and can also cause
disease in some livestock (pigs, horses, chickens, and ducks) and some
wild birds. Influenza B most often creates sporadic outbreaks among
groups most at risk of influenza-related complications (e.g., residents
of nursing homes). Influenza C is widespread, but does not commonly
cause symptoms.

Influenza viruses are further identified by the proteins on the viruses'
exterior. These proteins are neuraminidase (N) and hemagglutinin (H),
shown in Figure 2. Strains of the influenza virus are generally
distinguished by these exterior proteins. Three types of hemagglutinin
(H1, H2, and H3), and two types of neuraminidase (N1 and N2) are
generally associated with outbreaks of influenza in humans. Such
nomenclature results in strains being defined with names such as
influenza type A, H3N2, which has been circulating in recent years.

[]{#__RefHeading___Toc118275821 .anchor}Figure 2. Influenza Virus
Showing Neuraminidase and Hemagglutinin on Exterior

![](media/image2.jpeg){width="3.001388888888889in"
height="3.001388888888889in"}

Source: Hessische Intellectual Property Offensive, n.d. Used with
permission.

### 3.2 Drifting and Shifting

Like other viruses, influenza undergoes frequent genetic mutations.
Depending on the degree to which the virus mutates, it is described as
"antigenic drift" or "antigenic shift." Antigenic drift is a gradual
process in which surface proteins (the antigens) are added to the virus.
As a consequence, the antibodies in the animals (and humans) that
developed following previous vaccination or exposure to influenza
virus---in response to specific surface proteins---cannot protect the
body because they do not "recognize" the altered virus, and infection
and viral replication may occur. This process of antigenic drift is the
major reason why it is necessary to create a new influenza vaccine every
year---to ensure that the vaccine will most accurately match the virus
strain circulating in a given year.

Antigenic shift is a more abrupt, major change that can occur in
influenza A viruses.[^1] In antigenic shift, a new hemagglutinin and/or
neuraminidase protein occurs. When this happens, animals (and humans)
have little or no innate protection against the new influenza virus.
Pandemics, world-wide disease outbreaks, are associated with antigenic
shift. In 1918, a "Spanish Flu" pandemic was associated with an H1N1
influenza virus. In 1957, the "Asian Flu" pandemic was associated with
an H2N2 influenza virus. In 1968, the "Hong Kong Flu" pandemic was
associated with an H3N2 influenza virus.

### 3.3 History of Influenza Vaccination

Scientists have attempted to control infectious diseases since the
1700s. Nevertheless, it was not until around 1930 that the viral cause
of influenza was identified (Sanofi Pasteur, 2005). Development of the
influenza vaccine is credited to a team effort between Drs. Thomas
Francis, Jr. (1900--1969) and Jonas Salk (1914--1995). While serving as
a professor and chair of the Department of Bacteriology at the New York
University College of Medicine in 1938, Dr. Francis, a physician,
virologist, and epidemiologist, began working with Salk (a medical
student at the time), and became the first American to isolate the human
influenza virus. In 1941, Dr. Francis was appointed director of the
Commission on Influenza of the United States Army Epidemiological Board.
Together with Salk, the two researchers made important contributions to
the successful development, field trial, and evaluation of protective
influenza vaccines used in the armed forces during World War II. Public
health experts feared a repeat of the influenza epidemic of 1918--1919;
however, development of the vaccine controlled the spread of influenza,
thereby preventing another public health catastrophe (Centers for
Disease Control and Prevention \[CDC\], 2005a; Academy of Achievement,
2005). Influenza vaccine was not commercialized in the United States
until 1945 (Sanofi Pasteur, 2005).

## 4. Influenza Vaccine Manufacturing 101

### 4.1 Influenza Vaccine Manufacturing Process

Two types of influenza vaccine are licensed for use in the United
States: trivalent inactivated influenza vaccines (TIVs) contain
fragments of viral proteins (the Hs and Ns), and live attenuated
influenza vaccines (LAIV) use the whole virus, which has been weakened.
Although these two vaccine types produce similar immunity against
influenza, they are approved by the U.S. Food and Drug Administration
(FDA) for different groups, and different manufacturers' products are
approved for use among different age groups. Table 1 shows that only one
vaccine licensed in the United States is currently approved for use
among all age groups.

As previously noted, fluctuations in which strains of influenza are most
common require production of a new vaccine each year. Production of
influenza vaccines follows a very stringent timeline. During late
winter, the FDA's Vaccines and Related Biologic Products Advisory
Committee (VRPAC), uses guidance from the National Vaccine Advisory
Committee (NVAC) and surveillance information from the World Health
Organization (WHO) and the Centers for Disease Control and Prevention
(CDC) to select the three strains that will be included in the following
season's influenza vaccine. CDC monitors and identifies the three
strains (two A and

[]{#__RefHeading___Toc118281449 .anchor}Table 1. U.S.-Licensed Influenza
Vaccines for 2005--2006

  ------------- ------------------ ------------------- --------- ------- --------- ------ ---------- --- --------- -------- -----------
                                   **Approved Age of                                                                        
                                   Recipient**                                                                              

  **Vaccine     **Product          **6                 **4               **5--17          **18--49       **50+              **No. of
  Type**        (Manufacturer)**   months--3 years**   years**           years**          years**        years**            Projected
                                                                                                                            Doses**

  Inactivated   Fluarix (GSK)                                                             X          X             8M       

                Fluvirin (Chiron)                                X                 X      X          X             18-26M   

                FluZone (Sanofi    X                             X                 X      X          X             60M      
                Pasteur)^a^                                                                                                 

  LAIV          FluMist                                                            X      X                                 3M
                (MedImmune)^b^                                                                                              
  ------------- ------------------ ------------------- --------- ------- --------- ------ ---------- --- --------- -------- -----------

^a^ In 2004, Sanofi merged with Aventis Pasteur to create the Sanofi
Aventis Group. The vaccine division of the Sanofi Aventis Group changed
its name to Sanofi Pasteur.

^b^ FluMist is approved for use among those 5 to 49 years of age who are
otherwise healthy and not pregnant.

Source: CDC, 2005c.

one B strain) predicted to cause serious illness in the United States
during the following winter (Lister, 2004).

Because inactivated influenza vaccines make up the majority of influenza
vaccine produced for the U.S. market, our description of the influenza
vaccine manufacturing processes will focus on inactivated influenza
vaccine. However, it is important to note that the timeline for LAIV
production is similar to that of the inactivated vaccine (see Figure 3).
This process is illustrated in Figure 4.

The vaccine manufacturing process can be summarized by the following
phases:

-   **January--May.** CDC provides influenza reference viruses to FDA,
    which in turn distributes them to manufacturers. From the reference
    viruses, manufacturers create seed viruses, which are adapted to
    replicate efficiently in the manufacturer's production process.
    Large amounts of the influenza virus are prepared for vaccine
    production by injecting each seed virus in fertilized chicken eggs.
    To satisfy FDA requirements and ensure the safety and efficacy of
    the vaccine, the eggs are specially produced, assuring that
    appropriate precautionary measures are taken with regard to
    sanitation, transportation, and incubation. Upon incubation and
    sufficient growth of the virus within the eggs over a period of
    several weeks, the eggshell is opened and the egg white is removed
    to harvest the virus. Harvested egg fluids are then processed to
    concentrate, purify, and inactivate the virus (Wareing & Tannock,
    2001). Each egg produces one to two doses of vaccine. Additional
    measures are taken to purify and standardize vaccine potency
    (Salinsky, 2004; Lister, 2004; Influenza.com, n.d.).

[]{#__RefHeading___Toc118275822 .anchor}Figure 3. Timeline of the
Vaccine Manufacturing Process

![](media/image3.png){width="6.490277777777778in" height="5.1875in"}

-   **June--July.** FDA tests each manufacturer's strains to determine
    the yield of the virus, ensure its purity, and determine that the
    potency is sufficient for immunization. The three separate strains
    are then combined into one, and vials and syringes are filled.

-   **August.** The vaccine is packaged and stored in cold temperatures
    for shipment, usually in beginning in September.

-   **October--November.** Vaccinations are made available to the
    public. Immunity develops approximately 2 weeks after vaccination
    (Influenza.com, n.d.).

One manufacturer provided the following summary of the manufacturing
timeline:

We need to know and be done with the order of all those things
\[ordering of eggs and supplies, filling, packaging, and testing\] by
the end of July. We'll do the egg piece through the first half of
August, and then we need 2 to 3 weeks in advance to have ordered those
eggs. Typically we're done with the egg piece sometime in early August

[]{#__RefHeading___Toc118275823 .anchor}Figure 4. Vaccine Manufacturing
Process

![](media/image4.jpeg){width="4.616666666666666in"
height="5.938194444444444in"}

Source: Treanor, (2004). Used with permission.

> *and then we continue to fill, finish, and release throughout October
> and November. If you keep going later and later, you start impacting
> the start for the next season. We stop producing in November and we
> usually pick the strains for the next season in December.*

Once the influenza vaccine for a given season is made, manufacturing
facilities require time to prepare for the next season. As one key
informant explained

> *We also need a few weeks to shut down the plant for cleaning and
> maintenance. You can't run it 24-7 without having to do maintenance,
> that's why it's risky.*

In interviews, key informants repeatedly commented on the complexity of
the influenza vaccine manufacturing process and its vulnerability to
challenges, which include but are not limited to the following:

-   The number of eggs required to produce the number of doses expected
    by the market must be estimated approximately 6 months before
    inoculation with the vaccine seed. (Lister, 2004; Salinsky, 2004).

-   Manufacturers face the challenge of successfully growing the virus
    while avoiding the growth of other contaminants (Lister, 2004).

-   Quantifying the new antigens may become a critical bottleneck in the
    production cycle since it requires several complicated steps late in
    the production process (Gerdil, 2003).

-   Problems in which new strains fail to grow sufficiently in the eggs
    can result in production delays (Salinsky, 2004).

-   Some strains of influenza (most notably avian influenza) are lethal
    to birds and therefore will not grown in chicken eggs.

In essence, making influenza vaccine is a highly complicated process
involving biological components that offer less control than other
pharmaceutical products. As one manufacturer explained,

> *... These are living organisms that sometimes behave differently.
> It's like one year you grow some tomatoes and they look great and the
> next year conditions may change, and it's a living organism and you
> may not have such great tomatoes. It's not that easy; it's very
> complex to manufacture biologics.*

### 4.2 Structure of the Industry

#### 4.2.1 History of the Vaccine Market

Edward Jenner, a physician from the British countryside, is credited
with performing the world's first vaccination in 1796. Jenner used pus
from a cowpox lesion on a milkmaid's hand to successfully inoculate an
8-year-old boy against smallpox. This discovery laid the scientific
foundation for modern vaccinology.

As acceptance of Jenner's discoveries became widespread across Europe,
kings and presidents considered vaccines a matter of national pride and
enthusiastically endorsed large-scale vaccination campaigns to
demonstrate their progressive thinking and commitment to promoting the
health of their subjects. However, the societal value of vaccines was
soon recognized for their impact on national security and productivity.
Awareness of the benefits of vaccines led to mandatory vaccination in
numerous countries. Smallpox vaccination became a requirement in Europe
and North America during the 19th century, and a series of childhood
vaccinations became obligatory for attending public schools in the 20th
century (Stern & Markel, 2005). The last indigenous case of smallpox
occurred in 1977, making smallpox the first disease eradicated from the
globe by immunization (Fenner, 1988).

Despite vaccines' capacity to not only prevent but eradicate some
diseases, many pharmaceutical and biotechnology companies have avoided
or discontinued the manufacturing of vaccines because of current
economic and regulatory hurdles (Stern & Markel, 2005). Over the past 50
years, pharmaceutical companies have acquired companies primarily
devoted to the manufacture of vaccines, including Lederle and Praxis
(Offit, 2005). The dwindling number of manufacturers contributed to the
influenza vaccine shortages encountered in recent years. In 1980, 17
vaccine manufacturers were licensed in the United States; in 2002 the
number was 5. Table 2 shows the decline in the number of vaccine
manufacturers. In 2004, only four commercial companies produced
childhood vaccines, and vaccines against seven childhood
vaccine-preventable diseases have a single manufacturer (Orenstein,
Douglas, Rodewald, & Hinman, 2005; Giffin, Stratton, & Chalk, 2004).

[]{#__RefHeading___Toc118281450 .anchor}Table 2. Major U.S. Vaccine
Manufacturers in 1980 and 2002

+-----------------------+----------------------+----------------------+
| **Major U.S. Vaccine\ |                      | **Major U.S.         |
| Manufacturers in      |                      | Vaccine\             |
| 1980**                |                      | Manufacturers in     |
|                       |                      | 2002**               |
+-----------------------+----------------------+----------------------+
| -   Merck, Sharp, &   | -   American         | -   Merck & Co.,     |
|     Dohme             |     Cyanamid         |     Inc.             |
|                       |                      |                      |
| -   Pasteur Vaccines  | -   Praxis           | -   Sanofi           |
|                       |                      |     Pasteur^a^       |
| -   Merieux Institute | -   Parke-David      |                      |
|                       |                      | -   GlaxoSmithKline  |
| -   Connaught         | -   Chiron           |     (GSK)            |
|                       |                      |                      |
| -   Armomd Frappe     | -   Behring          | -   Wyeth-Ayerst     |
|                       |                      |                      |
| -   SmithKline        | -   Biocine          | -   Chiron           |
|                       |                      |                      |
| -   SSW               | -   Novartis         |                      |
|                       |                      |                      |
| -   Human Vaccine     | -   Wellcome         |                      |
|     Institute         |                      |                      |
|                       |                      |                      |
| -   Wyeth-Ayerst      |                      |                      |
+-----------------------+----------------------+----------------------+

^a^ In 2004, Sanofi merged with Aventis Pasteur to create the Sanofi
Aventis Group. The vaccine division of the Sanofi Aventis Group changed
its name to Sanofi Pasteur.

Source: Shaw, 2004

#### 4.2.2 Current State of the Influenza Vaccine Market

Nearly all of the influenza vaccine in the world is produced in nine
countries.[^2] In 2003, these nine countries had 12 percent of the
world's population but produced more than 95 percent of the world's
influenza vaccine. Of all the influenza vaccine produced in 2000, nearly
70 percent was distributed to Canada, the United States, Western Europe,
Australia, and Asian countries---most notably Japan and Korea. In 2003,
the proportion was nearly the same (71 percent) (Fedson, 2005b).

This globalism is reflected in the nationalities of the manufacturers
and locations where the vaccines are actually produced. Table 3 shows
that vaccines approved for the U.S. market during the 2005--2006
influenza season were made in three different nations by companies based
in three different nations. No currently licensed, inactivated influenza
vaccine is produced by a U.S.-based manufacturer in a U.S.-based
production facility. Although this arrangement is not problematic during
annual influenza vaccine production, some are concerned that in a case
of pandemic influenza, any effective vaccine(s) would be nationalized.
In such a situation, vaccine would likely remain in the nation of its
manufacture.

[]{#__RefHeading___Toc118281451 .anchor}Table 3. Influenza Vaccine
Production

  ------------------- ------------------ ---------------- ----------------
  **Influenza Vaccine **Nation in Which  **Nation in      **Number of
  Product Name        Manufacturer is    Which Product is Doses Produced
  (Manufacturer)**    Based**            Produced**       (as estimated
                                                          for
                                                          2005--2006)**

  Fluarix (GSK)       United Kingdom     Germany          8M

  Fluvirin (Chiron)   United States      United Kingdom   18 to 26M

  FluZone (Sanofi     France             United States    60M
  Pasteur)                                                

  FluMist^a^          United States      United States    3M
  (MedImmune)                                             
  ------------------- ------------------ ---------------- ----------------

^a^LAIV

Due to a number of factors described more thoroughly in the companion
brief *Influenza Vaccine Economics*, as of the 2004--2005 influenza
season, three manufacturers were licensed in the United States: Sanofi
Pasteur,[^3] Chiron, and MedImmune (Knight, 2004). As seen in Table 4,
the number of influenza manufacturers has declined due to mergers,
acquisitions, and exit from the market altogether. A limited number of
vaccine manufacturers creates a vulnerable influenza

[]{#__RefHeading___Toc118281452 .anchor}Table 4. Influenza Vaccines,
Manufacturers, and Seasons during which each Vaccine Was Sold

<table>
<colgroup>
<col style="width: 14%" />
<col style="width: 0%" />
<col style="width: 21%" />
<col style="width: 5%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
<col style="width: 4%" />
</colgroup>
<tbody>
<tr class="odd">
<td></td>
<td colspan="2"></td>
<td colspan="13"><strong>Influenza Season<sup>a,b</sup></strong></td>
</tr>
<tr class="even">
<td colspan="2"><strong>Vaccine Trade Name</strong></td>
<td><strong>Manufacturer</strong></td>
<td><blockquote>
<p><strong>1993–94</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>1994–95</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>1995–96</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>1996–97</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>1997–98</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>1998–99</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>1999–00</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>2000–01</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>2001–02</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>2002–03</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>2003–04</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>2004–05</strong></p>
</blockquote></td>
<td><blockquote>
<p><strong>2005–06</strong></p>
</blockquote></td>
</tr>
<tr class="odd">
<td colspan="2">Fluarix</td>
<td>GlaxoSmithKline (GSK)</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td><strong>•</strong></td>
</tr>
<tr class="even">
<td colspan="2">FluMist<sup>c</sup></td>
<td>MedImmune Vaccines, Inc.</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
</tr>
<tr class="odd">
<td colspan="2">Fluogen</td>
<td>Parkedale Pharmaceuticals Inc.<sup>d</sup></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td><strong>•</strong></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2"></td>
<td>Parke-Davis</td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="2">FluShield<sup>e</sup></td>
<td>Wyeth Laboratories, Inc.</td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2">Fluvirin<sup>f</sup></td>
<td>Chiron Corporation</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td><sup>g</sup></td>
<td><strong>•</strong></td>
</tr>
<tr class="odd">
<td colspan="2"></td>
<td>Evans Vaccines Ltd.</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td><strong>•</strong></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2"></td>
<td>PowderJect Pharmaceuticals plc</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="2"></td>
<td>Medeva Pharma Ltd.</td>
<td></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2">Fluzone</td>
<td>Sanofi Pasteur Inc.<sup>h</sup></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
</tr>
<tr class="odd">
<td colspan="2"></td>
<td><p>Connaught</p>
<p>Laboratories</p></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td><strong>•</strong></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2">Flu-Imune</td>
<td>Lederle Laboratories</td>
<td><strong>•</strong></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
</tbody>
</table>

^a^ Vaccine Adverse Event Reporting System (VAERS) data used in this
table include manufacturer and trade name information taken only from
specific incidence reports of vaccine adverse reactions. Data that did
not specify specific influenza seasons were not used.

^b^ Influenza seasons 1993--1994 through 2000--2001 (CDC, 1993, 1994,
1995, 1996, 1997, 1998, 1999, 2000). Influenza seasons 2001--2002
through 2004--2005 (FDA, 2005b).

^c^ Wyeth and MedImmune had a collaboration for the commercialization of
FluMist for the 2003--2004 influenza season. The companies announced the
dissolution of their collaboration in April 2004.

^d^ Parkedale Phamaceuticals, Inc., was ordered to discontinue
production of influenza vaccine following a 2000 FDA inspection.

^e^ 1993--1994 trade name not available. Wyeth left the market after
losing \$50 million over the prior three influenza seasons; 2001--2002
was the worst season, during which the company lost \$30 million and had
7 million doses of the vaccine that never sold (Ferguson, 2004).

^f^ In 2003, Chiron acquired PowderJect as a wholly owned subsidiary. In
2001, PowderJect acquired Medeva---which had previously acquired Evans
Medical Ltd.---and restored the Evans name to Evans Vaccines Ltd., a
wholly owned subsidiary of PowderJect. Prior to this, Evans Medical Ltd.
had acquired the vaccine business of Wellcome. For more information on
company acquisitions and mergers, see *Vaccine Identification Standards
Initiative: Manufacturer Abbreviations* (CDC, 2003).

^g^ On October 5, 2004, Chiron's influenza vaccine plant was forced to
cease production by government regulators due to contamination issues.

^h^ In 1999, Aventis Pasteur, Inc., obtained FluZone vaccine ownership
from Connaught Laboratories, Inc. In 2004, Sanofi merged with Aventis
Pasteur to create the Sanofi Aventis Group. The vaccine division of the
Sanofi Aventis Group changed its name to Sanofi Pasteur.

vaccine supply chain (National Vaccine Advisory Committee, 2003; Danzon,
Periera, & Tejwani, 2005).

The 2004--2005 influenza vaccine shortage proved to be a recent example
of the detrimental effects that may result within an industry with such
a small number of suppliers. In October 2004, Chiron's Liverpool,
England, factory, which sold 90 percent of its vaccine to the United
States, was shut down by U.K. regulators for contamination of its
vaccine. Closure of the factory reduced the vaccine supply by 48 million
doses, approximately half of the anticipated supply needed for the
2004--2005 influenza season.[^4] By the time the contamination was
discovered, it was too late to increase production at other facilities
(Danzon et al., 2005; DesRoches, Blendon, & Benson, 2005; Enserink,
2004).

Even in less dramatic circumstances, delays in vaccine distribution can
also create problems. In the 2000--2001 influenza season, production
problems resulted in shipment delays. This created a de facto shortage
of influenza vaccine (U.S. General Accounting Office, 2001; Layton,
Honeycutt, Levy, Kessler, & Liao, 2001).

The most doses ever produced for the United States was 95 million in
2002. Nevertheless, 183.3 million doses would be needed to provide
vaccine to all the groups recommended by the Advisory Committee on
Immunization Practices (ACIP). Figure 5 illustrates the number of doses
manufactured and distributed between 1999 and 2004 (CDC, 2005b).

#### 4.2.3 Nature of the Influenza Vaccine Market

When asked about the most predictable element of the influenza vaccine
market from year to year, one manufacturer responded by saying, "The
predictable part of it is that we know it's always going to be
different." As with other vaccines, the number of influenza vaccine
manufacturers has dwindled in recent years, down to three manufacturers
in the 2004--2005 influenza season. Given that one manufacturer (Chiron)
was forced to cease production during that season, only two
manufacturers (Sanofi Pasteur and MedImmune) supplied vaccine. Only one
of the two (Sanofi Pasteur) had a vaccine that was approved for
administration to all age groups. In the 2005--2006 influenza season,
CDC predicts that there will be four licensed manufacturers. In addition
to Chiron's anticipated return to the U.S. market, in late August 2005,

[]{#__RefHeading___Toc118275824 .anchor}Figure 5. Influenza Vaccine
Doses Produced and Distributed for the U.S. Market 1999--2004

![](media/image5.wmf){width="6.333333333333333in" height="4.28125in"}

^a^Targeted population includes those 65 years of age or older, children
6 to 23 months of age, and those 2 to 64 years of age with chronic
illnesses.

Sources: CDC, 2005c; Santoli, 2005.

GlaxoSmithKline (GSK) received FDA approval to enter the U.S. vaccine
market (CDC, 2005d; FDA, 2005a).

Compared to other product lines that vaccines may compete against within
a company, low profit margins and high financial risk often cause
vaccines to appear unattractive (Knight, 2004; NVAC, 2003).
Consequently, costs associated with innovation may not be worthwhile
unless they can be recouped in sales over several years (Danzon et al.,
2005). Interviews with manufacturers revealed that a commitment to
public health and the societal value of vaccines serve as fundamental
reasons for remaining in the business.

See the companion brief, *Influenza Vaccine Economics*, for a detailed
analysis of the influenza vaccine market.

## 5. Manufacturer Decision Making

### 5.1 Quantity Produced

A common theme noted in the majority of interviews conducted with
manufacturers was the notion of unpredictable demand as the principal
bottleneck in vaccine supply. Influenza vaccine production has increased
substantially since the mid-1980s, a period in which roughly 20 million
doses were distributed annually. This increase may be attributed in part
to Medicare Part B coverage of the vaccine and its administration
beginning in 1993. However, although influenza vaccination rates have
increased, they remain unpredictable because less than 50 percent of the
recommended population is vaccinated (Danzon et al., 2005).

Interviewed manufacturers stated that they could provide sufficient
supply if given a clear indication of the level of demand with adequate
advance notice. Given the inability to use influenza vaccines for more
than one season, manufacturers are hesitant to produce more vaccine than
they predict can be sold in a given season.

Calculating exact demand (how much can be sold) for influenza vaccine is
more challenging than calculating demand for childhood vaccines because
the groups for whom influenza vaccine is recommended do vary somewhat
from year to year. As such, is it difficult to calculate a specific
cohort to whom the vaccine will be administered, as one expert
explained,

... we don't have other signals in society that tell us what the size of
the market is going to be. We have that for all of the pediatric
vaccines simply because demographers can tell us what the birth cohort
is going to be every year so we know 5 years from now how many babies
are going to be born ... and \[we\] multiply it by 3 and know the number
of doses of vaccine you're going to have to give for a primary series
... We don't have that kind of signal for the demand of flu vaccine.

A vaccine manufacturer commented,

\[we\] ... go by the seat of our pants. The vaccine companies have to
look at how much they sold last year .... They sort of eyeball that
number and they take a guess. They say, "Let's increase it by 5%." Then
somebody says, "Lets be cautious. We might get stuck. This is not our
most interesting product anyway. Let's just increase it by 3%." So they
make very conservative assumptions about the growth of the market.

Another manufacturer explained that it tried to balance an interest in
promoting public health while making pragmatic business decisions,
stating,

Clearly, our organization is extremely public health oriented. At the
same time, it's a business, and you're not going to see GM make 5
million Cadillac Escalades when there's no demand for them. So it's kind
of odd that the government would expect all those years for us to
continue to throw millions of doses of vaccine away every year and not
eventually take a hit on it.

Because vaccine manufacturers do not want to make more vaccine than they
anticipate they can sell in a given influenza season, they rely on what
is known as prebooking. Prebooking is used by purchasers and providers
to, in essence, "reserve" influenza vaccine months before the influenza
season. A more complete explanation of prebooking and other issues
related to purchase and distribution of influenza vaccine is in the
companion brief *Influenza Vaccine: Who Buys It and Who Sells It.* One
manufacturer explained, "This year we delayed prebooking to determine
whether others would be in the market. We delayed as long as we could
until April and completed prebooking in May."

### 5.2 Investment in New Technologies

Given the challenges apparent in the current, egg-based approach to
influenza vaccine production, scientists are investigating a variety of
ways to improve the means by which influenza vaccines are produced and
administered, including updated techniques for vaccine production such
as mammalian cell culture techniques and reverse genetics.

#### 5.2.1 Cell Culture

During the 2004--2005 influenza season, many media reports mentioned
cell culture as a means of overcoming the shortcomings of egg-based
production. Vaccines have been produced using cell cultures since the
1950s. Vaccines for polio, measles, mumps, and rubella are all examples
of cell-cultured vaccines. In the mid-1990s, researchers started to
report using cell culture to produce influenza vaccines (GSK, 2005).
Some of the reported benefits of this technology include equivalent or
better efficacy with lower contamination risk, more controlled setting,
less waste, and ability to provide surge capacity by restarting
production within a season should problems arise (Tree, Richardson,
Fooks, Clegg, & Looby, 2001; Lister, 2004; Rosenwald, 2004). An
additional advantage is that cell culture may be more reliable when
viruses will not grow well in egg culture. In fact, some viruses can
kill the eggs, halting viral growth (and therefore vaccine production in
those eggs). This problem would potentially be significant in case of an
avian influenza strain. Key informants and others caution that although
the technique may enable the virus to grow more uniformly and
predictably, it may not significantly enhance the turnaround time for
producing the vaccine (Brown, 2004). Furthermore, there are challenges
to producing yields in sufficient amounts, and some are concerned about
the possibility of introducing unknown contaminants, so-called
"advantageous agents" from mammalian cell lines. One example of
advantageous agents contaminating vaccine is seen in the discovery of
SV40 in polio vaccine in the late 1950s and early 1960s.[^5]

#### 5.2.2 Reverse Genetics

Another promising technique in the FDA approval process is reverse
genetics (RG). A trial-and-error process is currently used to obtain
virus strains with the proper characteristics needed for vaccine
production. The RG process clones and combines the desired parts of the
viral genome to create virus strains with the correct combinations of
traits to stimulate immunity and promote growth in eggs (Lister, 2004).
One advantage of RG is that the process for preparing reference virus
strains can take as little as 15 to 20 days (instead of the many weeks
needed for the current genetic reassortment approach) (Fedson, 2005a, p.
192). The techniques necessary for RG are associated with patents. At
least two academic institutions and one pharmaceutical company
(MedImmune) hold the intellectual property (IP) rights for RG. Although
MedImmune has agreed to permit use of its RG technology to produce
reference virus strains for research or for public health purposes, all
patent holders require royalty payment for RG-developed reference
strains used for commercial development. As a result, the additional
cost associated with royalty payments makes it unlikely that
commercially developed, RG-engineered influenza vaccines would be
sufficiently profitable to make them appealing for development (Fedson,
2005a). Nevertheless, in case of a public health emergency, it appears
likely that these issues would not prohibit development of
vaccines---albeit as a response to rather than prevention of a public
health threat.

The advantages and disadvantages of cell culture and reverse genetics
are summarized in Table 5.

#### 5.2.3 **Intranasal Vaccines**

The FDA approved an LAIV for intranasal administration in 2002. Although
not a new vaccine technology, per se, the fact that it uses a new
approach (live attenuated) to stimulating an immune response and a new
means of administration (intranasal) makes it worthy of mention.

[]{#__RefHeading___Toc118281453 .anchor}Table 5. Advantages and
Disadvantages of Cell Culture and Reverse Genetics

+------------+-----------------+--------------------+----------------+
|            | **Advantages**  | **Disadvantages**  | **Comments**   |
+------------+-----------------+--------------------+----------------+
| Cell       | Process may be  | Achieving          | The U.S.       |
| Culture    | several weeks   | sufficient yield   | government has |
|            | to few months   | remains a          | provided       |
|            | faster          | significant        | funding to     |
|            |                 | challenge          | support        |
|            | Useful in the   |                    | cell-culture   |
|            | case of avian   | Requires initial   | vaccine        |
|            | influenza       | research           | development    |
|            |                 | investment         | for influenza  |
|            |                 |                    |                |
|            |                 | Potential for      |                |
|            |                 | mammalian cell     |                |
|            |                 | contamination      |                |
+------------+-----------------+--------------------+----------------+
| Reverse    | Process may     | Proprietary        |                |
| Genetics   | take as little  | technique          |                |
|            | as a few weeks  |                    |                |
|            |                 | No history of      |                |
|            |                 | commercialization  |                |
+------------+-----------------+--------------------+----------------+

Intranasal vaccines stimulate the local immune system of the upper
respiratory tract, whereas injected vaccines stimulate a systemic immune
response characterized by appreciable levels of antibodies to influenza
virus surface proteins circulating in the blood (Cox, Brokstad, & Ogra,
2004). Influenza vaccines administered intranasally stimulate a
longer-lasting and broader range of immune responses compared to the
injected, inactivated influenza vaccines (Belshe et al., 2000; Gaglani
et al., 2004; Halloran et al., 2003; Nichol et al., 1999), but have not
stimulated high levels of circulating antibodies (Gaglani et al., 2004).
LAIV administered intranasally offers some practical advantages for
administration such as averting the need for needle disposal and
storage---on the other hand, its current formulation, which must be
stored frozen, offers some practical disadvantages.[^6] An additional
disadvantage, compared to inactivated influenza vaccine, is that LAIV is
more costly (about twice the price). Additional research on the immune
system may lead to the identification of new approaches for fighting
infections and selecting potential antigens more effectively and
precisely (Landry & Heilman, 2005).

While an increased interest in the development of alternatives to needle
administration of vaccines has resulted in promising new discoveries in
recent years, slim profit margins (when compared to other pharmaceutical
"blockbusters"), fixed market size, and a relatively long research and
development period caused many companies to lean toward producing more
profitable drugs that people take daily, instead of vaccines that are
administered once a year (NVAC, 2003; Rosenwald, 2004).

#### 5.2.4 Other Approaches

Other options for future vaccine development include an influenza
vaccine with cross-antigen protection that would not require annual
revaccination and influenza vaccines made with subunit or DNA viruses
(Girard, Cherian, Pervikov, & Kieny, 2005).

### 5.3 Entry Into and Exit from the U.S. Influenza Vaccine Market

The opportunities and barriers to entry into and exit from the U.S.
influenza vaccine marketplace exist within a broader context of the
pharmaceutical industry. Whereas vaccine companies were once independent
business entities, over the years through mergers and acquisitions (see
Section 4.2) vaccine production has become the business of small units
within larger pharmaceutical companies. The decision of a pharmaceutical
company to enter into or exit from a given economic market is based
largely on economic motivators. "The drugs most coveted by
pharmaceutical companies are ... those taken every day for life, such as
the ones for lowering cholesterol or keeping blood pressure in check"
(Lax, 2004, p. 262). With the knowledge that profit is a significant
motivator, it is easier to understand vaccine manufacturers' desires to
cushion the potential financial risks unique to the influenza vaccine
market. As such, one would anticipate that manufacturers would be eager
to obtain outside support for research and development activities.

#### 5.3.1 Opportunities

Many manufacturers indicate that government incentives in the form of
grants, tax incentives, education programs, guaranteed market and price,
and government buy-back programs are needed to bolster the fragility of
the current influenza vaccine system (NVAC, 2003; Knight, 2004). Some
manufacturers feel that tax credits to offset costs of clinical trials
or facility renovation/construction may encourage new manufacturers to
enter the market. One manufacturer stated,

> *... You need to ensure that there are more people in the market who
> can obtain licensure and more modern production capabilities. HHS is
> making clear steps to do this. They \[NIH\] just let out two large
> RFPs \[to support development of cell culture-based influenza
> vaccines\], which we've applied for which essentially give companies a
> free ride because they pay for all the development costs and costs
> associated with obtaining licensure.*

Creation of a government surplus purchase program is one means of
shifting some of the risk of overproduction from the manufacturer to the
government. Manufacturers may be more inclined to increase the amount of
overproduction if the government devised a system to purchase unused
surplus at the end of the influenza season (Lister, 2004).

Without such incentives, many potential market entrants lack the capital
to proceed with the lengthy and costly process of bringing a product to
market. One manufacturer reported,

> *It's very difficult for new entrants like us to enter the market
> without incentives. We've been working on this the last 3 years, but
> we've been limited because we don't have the money to move this
> forward. You see, Wall Street doesn't see the immediate return on this
> type of investment.*

Another explained that public agencies can support the vaccine industry
by increasing demand for influenza vaccine through public education
campaigns and provider reimbursement:

> *The government can help us by ensuring that the market grows by doing
> things like educating and providing appropriate reimbursement. If the
> government can play that significant role and ensure that more people
> get immunized through these types of efforts, you're going to see that
> manufacturers are going to invest, compete, and reinvest, and realize
> that it's going to remain profitable and worthwhile to continue to
> grow their business.*

In 2003, FDA established a committee to investigate options for working
with overseas governments to harmonize regulations for vaccine approval.
Proponents feel that efforts should be made to obtain mutual recognition
of lot release tests for various vaccines by harmonizing the content and
format for submitting license applications in the context of the
International Committee on Harmonization (NVAC, 2003). One manufacturer
commented,

I think down the road it will make things easier if there is one general
approach. My idea is that when there is harmonization, things will
become easier and more manageable. Maybe it can create some flexibility
in supply as well.

#### 5.3.2 Barriers

Given the volatile demand; high development, approval, and manufacturing
costs; and the perception of low return on investment in the vaccine
industry (compared to other pharmaceuticals), many manufacturers are
reluctant to enhance their current production technology (Danzon et al.,
2005; NVAC, 2003). "Keep in mind that influenza vaccine has always been
a very cheap product, and so there never has been much incentive to
modernize the technology for producing it," noted one manufacturer.
Another informant stated,

> *It takes \$100--150 million to bring a new product to market from
> scratch. If you only make \$50 million in profit a year on that
> product, that's a tough sell to management. They want to know what the
> return on investment is, and that profit margin may not meet their
> qualifications.*

The time, labor, and costs associated with the regulatory approval
process are described as a barrier to manufacture by some. As one
manufacturer described,

> *To guide a product through to regulatory approval is very expensive.
> You have to establish a vaccine safety database of 80,000, but each
> subject costs \$2000, so that can add \$160 million right there to
> address FDA concerns related to vaccine safety. Before a product can
> be brought to market, we have to test it on 40,000 to 80,000
> subjects.*

Moreover, slight modifications to production processes or packaging may
require expensive product reviews. Frequent FDA inspections of
production facilities and costs associated with facility upgrades,
needed to adhere to current Good Manufacturing Processes (cGMP),
increase the costs of vaccine production (Sloan, Berman, Rosenbaum,
Chalk, & Giffin, 2004). Consequently, some argue that regulatory costs
stifle development of better technologies for manufacturing vaccines
(Knight, 2004). However, one expert in the area of vaccine manufacturer
with whom we spoke clarified that it was not the costs of meeting cGMP
that were a barrier but the costs associated with the necessary clinical
trials for safety. Licensed vaccine manufacturers with whom we spoke
would not (for proprietary reasons) provide specific answers concerning
costs associated with production, so we were unable to precisely explain
the costs associated with the regulatory (or other) processes.

## 6. Summary and Conclusion

In summary, the process by which influenza vaccine is manufactured is
more complicated than that for other pharmaceutical products---even
other vaccines. This is due to several reasons, most notably because,
unlike other vaccines, "Flu vaccine is new every year. It's different
from every other vaccine, and there are unique challenges every year.
Making vaccines is not an easy process ... " As another expert key
informant explained, "For manufacturing the vaccine, it's not just like
turning on a spigot and some chemicals come out and you can stamp out
some pills. These are living organisms that sometimes behave
differently. It's very complex to manufacture biologics."

Key informants recommended that our analysis and reporting of the
influenza vaccine issues emphasize the complexity not only of the
manufacturing process, but all other related factors as well. Such
factors include economic issues---"From everything you hear and see,
there's not as much profit as with other pharmaceuticals. There's a lot
more \[financial\] risk with vaccines. ... There's a lot more oversight
and review (rightfully so for biologics) by the FDA." Another explained,

We are a for-profit, publicly traded company. What I like to tell people
is that neither Santa Claus nor UNICEF is listed on the NYSE. If you
have a money-losing product and there are others making it, it's time to
kiss it goodbye.

Some of the economic risk that manufacturers face could be reduced by
some means of financial support.

... to ensure adequate vaccine supply, the government needs to share the
risk or at least the consideration of some kind of buy-back mechanism.
Negotiate in the early part of the season how many doses the
manufacturers will produce, which, if left unsold at the end of the
season, the government would purchase at some predetermined price.

In addition, there is the complicated relationship between influenza
vaccine supply and demand. As explained more thoroughly in the companion
brief *Influenza Vaccine Demand: The Chicken and the Egg*, demand
appears to be the tail that wags the dog as far as supply is concerned.
If demand for vaccine is sufficient, manufacturers will meet the demand
with sufficient supply. One of the ways to increase demand was mentioned
in several interviews.

Recommendations drive demand, and demand drives supply, it's that
simple. If there are strong, clear recommendations for who should get
flu vaccine in place, then the demand will be there, and if the demand
is there, we'll ramp up and meet that demand with adequate supply.

Many key informants noted the significance of recommendations from ACIP
and/or CDC and how they act to drive vaccine demand. Although such
recommendations can serve to increase demand by defining broader target
groups for immunization, recommendations can also be part of a larger
campaign of public information.

I really think that there needs to be a lot more education. The
government can play a much larger role in educating the public of the
importance of the influenza immunization and the importance of the
disease. One great example of how effective a role the government can
play in terms of leadership is last year ... they had Julie Gerberding
on the public service announcements, in front of the press, and \[at\]
meetings ... making sure the priority groups got immunized first in the
case of a shortage. I think that was relatively successful. I think it
was pretty effective because we had CDC getting out in front, telling
people what they should be doing.

There were also those who thought that the ideal is a so-called
"universal recommendation." "The only way of leveling this thing out so
that it's a workable situation is to have a consistent, perhaps
universal recommendation so that you know you will have this every
year," one key informant contended.

Immunization tops the list of the 10 great public health achievements
during the last century (CDC, 1999). Despite this achievement, due to a
variety of factors, each year less than half of those who are at highest
risk for influenza-related complications are vaccinated. Meanwhile,
influenza is the leading cause of mortality due to infectious disease
(CDC, 2005a), causing an average of 36,000 deaths (Thompson et al.,
2003) and 226,000 hospitalizations annually (Thompson et al., 2004). As
such, influenza vaccine manufacture is the cornerstone of reducing
influenza-associated mortality.

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[^1]: Influenza A viruses undergo antigenic drift and shift; Influenza B
    viruses undergo only antigenic drift.

[^2]: The nine countries that produce 95 percent of the world's
    influenza vaccine are Australia, Canada, France, Germany, Italy,
    Japan, the Netherlands, the United Kingdom, and the United States.

[^3]: In 2004, Sanofi merged with Aventis Pasteur to create the Sanofi
    Aventis Group. The vaccine division of the Sanofi Aventis Group
    changed its name to Sanofi Pasteur.

[^4]: Although the overall vaccine supply was cut nearly in half,
    Chiron's vaccine was not approved for use in children less than 4
    years of age. Because all of the vaccine approved by the FDA for
    administration to children 6 to 23 months of age (the newly defined
    ACIP target group) was made by Sanofi Pasteur, no actual shortage of
    influenza vaccine occurred for the 6 million children in this group.

[^5]: Between 1955 and 1963, U.S. polio vaccine was produced with cell
    culture techniques using cells from monkeys. In the early 1960s,
    researchers discovered a virus found in monkeys (SV40) in some polio
    vaccines. Subsequently, SV40 was found in some human cancers
    (Stratton, Almario, & McCormack, 2002). Although scientific
    evidence---including an examination by the Institute of
    Medicine---does not support the assertion that contaminated polio
    vaccine has caused cancers in humans, the incident does illustrate
    the point that cell culture-based vaccines are not without risks.

[^6]: MedImmune is developing a second-generation intranasal vaccine
    that will not require frozen storage. It is anticipated that this
    formulation will be available during the 2007--2008 influenza
    season.