2.1. Conditions of vaccine research and development

Although it is almost impossible to determine the exact amount of money involved in pharmaceutical research and development, the figure is tremendously high. Vaccines, however, provide only approximately 1-2 percent of the annual turnover of the industry (Grabowski and Vernon Reference Grabowski and Vernon1997; Institute of Medicine 2004).Footnote ⁴ Despite the fact that vaccines are spread and distributed all over the world, they have traditionally entailed low profits, at least compared to other drugs, for the pharmaceutical industry (Galambos and Sewell Reference Galambos and Sewell1995). This is due to several circumstances.

One is that vaccines are for the most part very effective. They give long, sometimes life-long, protection and although many vaccines have to be repeatedly injected, it is not a recurrent treatment. In other cases, most typically chronic diseases, the possible continuity of drug prescriptions creates incentives for pharmaceutical companies that vaccines cannot compete with. This creates a reimbursement problem for those companies that produce and sell vaccines. To some degree, there is compensation through the huge number of potential users, but this does not reduce the differences in profits between various drugs where vaccines score low.

Another difficulty is that the development costs for all new drugs are high – the average amount for each new pharmaceutical product to reach the market has been estimated at more than 800 million dollars (DiMasi et al. Reference DiMasi, Hansen and Grabowski2003). Nothing suggests that vaccines are easier, cheaper, or less demanding to produce than other drugs (Batson et al. Reference Batson, Glass, Seiguer, Bloom and Lambert2003; Grabowski and Vernon Reference Grabowski and Vernon1997). In the United States it is even more complicated to get a new vaccine, compared to other drugs, accepted.Footnote ⁵

During initial research and development of pharmaceutical products there seem to be more similarities than differences. Laboratory work, experiments, and tests are always necessary and expensive to carry out, and the procedures must be strictly regulated. Until a vaccine is produced and distributed there are no significant differences compared to other drugs. Thereafter, however, the divergences begin to show:

If we consider the relationship between fixed and variable costs for the manufacture of approved vaccines, we find that fixed costs are not influenced by the production level but remain the same regardless of the quantity. Assessments show that fixed costs for vaccines are 60 percent of the total cost; semi-variable costs and variable costs, i.e., costs that vary in accordance with the production size, are only 25 and 15 percent respectively (see Mercer Management Consulting [MMC] 2002).Footnote ⁶

Why are the fixed costs so much higher? The main reason is the complexity of the transformation of live organisms into the vaccine components, and the necessity of thorough quality control of the products throughout the process. All in all, the costs for research and development of vaccines are at least the same as for other pharmaceuticals. The manufacturing processes, however, are less standardized and less predictable, more comprehensive and hence more expensive. This of course will affect corporate earnings.

2.2. Conditions of distribution and use

To gain a thorough understanding of the financial problems involved in the vaccine area, medical and manufacturing failures need to be considered as well. For various reasons, such as insufficiently potent substances or negative side effects, vaccines have been withdrawn from the market on several occasions. Since 1933, more than 60 out of 146 vaccines licensed by the American authorities have been removed (Institute of Medicine 2004). Vaccine producers have also changed and improved their products with associated costs. One example is the MMR-vaccine, which has been substantially modified during the last few decades. Other vaccines have not successfully reached the market and/or the profits have been lower than expected (Galambos and Sewell Reference Galambos and Sewell1995).

It is clear that vaccines and vaccinations are special, influenced by certain irregular circumstances, but why have the price levels traditionally been lower for vaccines than for other drugs? One reason is that the vaccine market has been somewhat of a monopsony where there are several producers but only one customer. Although the vaccine industry was not totally dominated by only one customer, a few major actors governed the market thanks to the massive public procurement of vaccines. For instance, vaccines developed against infectious child diseases had 70 percent of the total vaccine market, and in general the responsible authority for public health programs purchased these vaccines. Hence there were few buyers and they were strongly motivated to reduce prices as much as possible in the cause of the common good. Studies have confirmed that the American government well into the 1990s succeeded in negotiating contracts where the average price reductions reached 40-50 percent of the regular price level (Grabowski and Vernon Reference Grabowski and Vernon1997).Footnote ⁷ These price reductions varied from one year to another, and from one drug to another.

As the risks were high, the costs substantial, the profits small, and the regulations strict, many pharmaceutical companies totally abandoned vaccine production. Other companies chose to merge their vaccine production units (Galambos and Sewell Reference Galambos and Sewell1995). On the American market for instance, there were more than 25 producers in the middle of the 1960s; a few years ago most of the vaccines were produced by only four major pharmaceutical firms: GlaxoSmithKline, Merck, Wyeth, and Avantis Pasteur (Institute of Medicine 2004). However, times might be changing. A general trend is that recent price negotiations result in smaller reductions today than, say, ten years ago.Footnote ⁸ As a consequence, the last ten years have shown an increasing interest in vaccine research and development.

2.3. New possibilities?

Today certain signs indicate that the traditional cost-policy is about to change and that new profits are at hand. Recently, basic vaccine research has taken a new direction and turned its efforts mainly towards cancer, DNA, and therapeutic treatments, a step that will most likely improve the finances of the pharmaceutical industry. Also new versions of older vaccines against infectious diseases, which traditionally have been poorly paid, today are being purchased at much higher prices. Likewise the new vaccines included in the vaccination programs are more expensive (Milstien and Candries Reference Milstien and Candries2002). Some examples are the recently developed vaccines against HPV (Gardasil) and pneumococcus (Prevnar). While the first, produced by Merck, is potentially more profitable as it is directed towards large user groups, the second one has already brought tremendous success to the pharmaceutical company (Wyeth) that produces it. Both of these vaccines are expected to bring huge profits to their firms and to revitalize the vaccine market. Another best-seller is Varivax by Merck, a vaccine against chickenpox. The common feature among profitable vaccines is their incorporation in the U.S. child and adolescent immunization schedule (CDC 2007). What these three vaccines have in common and what distinguishes them from, e.g. the MMR vaccines, are the much higher prices paid by both the CDC and the private sector combined with much smaller public price-reductions.Footnote ⁹

In an interview in 2007 the general director of the Swedish Institute for Infectious Disease Control (Smittskyddsinstitutet), Ragnar Norrby, said that five years earlier the vaccine market had been absolutely dead, but that in a short period of time it had become very hot, and that new and expensive vaccines have to be financially provided by the public health-care system (Hellbom Reference Hellbom2007).

To increase the prices then can be seen as one possible solution to stabilize the vaccine market. Nevertheless, it is complicated and particularly so when vaccination programs are considered. If the societal costs increase too much, the entire system of free or subsidized vaccinations, offered to all children, may collapse. In most countries the public healthcare systems are already under severe pressure to hold back the running costs for public health. If, instead, the care providers have to pay a larger amount of money themselves, there is an obvious risk that fewer children will be vaccinated. What the vaccine companies might gain in the short run later on would most likely jeopardize the levels of vaccination coverage necessary to sustain herd immunity and avoid epidemics.Footnote ¹⁰

Apart from raising the price level, there are other, though mutually opposing, ideas on how to create satisfactory incentives and find solutions to tricky problems in a poorly working pharmaceutical market (e.g. Kremer and Glennerster Reference Michael and Glennerster2004; Stratton et al. Reference Stratton, Durch and Lawrence2000). Some suggestions involve prolonged and extended patent rights for licensed vaccines to increase the time period for the companies’ profits of the products; others recommend tax reduction to firms engaged in vaccine R&D and/or societal protection against costly law processes and damages as a consequence of negative side effects (Rappuoli et al. Reference Rappuoli, Miller and Falkow2002; Stratton et al. Reference Stratton, Durch and Lawrence2000). It has also been argued that direct financial support to vaccine research from the state ought to increase in order to protect and develop medical options that would be neglected and unexplored if left to the private vaccine industry alone (Blume Reference Blume2005). Still other ideas have been the formation of a multinational research fund in support of the vaccine area (Archibugi and Bizzari Reference Archibugi and Bizzari2004), and also jurisdictions that regulate and guarantee a market for new vaccines (Levine et al. Reference Levine, Kremer and Albright2005).

The various proposals illustrate the political and ideological differences underlying the analyses of problems related to the research, development, and distribution of vaccines. There seems to be a broad consensus that basic vaccine research confronts severe difficulties, but the parties differ over whether the vaccine business as a whole should be a concern mainly for the state or the United Nations on the one hand, or for civil society on the other.

In sum, the financial problems discussed above are tricky although possibly not unsolvable. There are, however, certain social problems surrounding vaccination that, when taken into account, make the view more pessimistic.

3.1. The MMR case: medical debate and social turbulence

MMR is a triple vaccine to prevent measles, mumps, and rubella given in a single shot. As all three infectious diseases are very contagious and may cause serious complications, even death if the child's general health and nutritional conditions are poor, the MMR-vaccine was considered a breakthrough in inhibiting both epidemics and the severe side-effects caused by the diseases. It soon became a well-established routine as part of vaccination programs offered to all children over decades in most Western countries. Although it is always the parents who must decide whether to vaccinate a healthy child without foreseeing the consequences of the injected substance in each particular case, there were few objections to the procedure before the 1990s. Certainly, some parents chose not to vaccinate their child, and in a few countries such as Great Britain there had been resistance against vaccines for many years, but on the whole, the MMR-vaccine was generally accepted.

Vaccination programs are immensely effective to prevent epidemics. To reach herd immunity in the case of measles, which is essential to protect society from epidemics, 90 percent of a population has to be vaccinated. If something fails and the standardized vaccination routines are questioned, parents may hesitate to put their own child in danger and herd immunity would be at risk. This is exactly what happened in the MMR-case.

The background to the MMR-debate was a study by a British research group, published in The Lancet in 1998, with Andrew Wakefield as principal author. In this article a possible link between the MMR-vaccine (the measles part) and autism was suggested (Wakefield et al. Reference Wakefield, Murch, Anthony, Linnell, Casson, Malik, Berelowitz, Dhillon, Thomson, Harvey, Valentine, Davies and Walker-Smith1998). Although the authors were still recommending that parents vaccinate their children against measles, the particular association with MMR was at stake. Journalists immediately commented on the alarming report. They drew attention to both individual cases where stories in the media bore witness to parents’ experiences and also, in a more subtle way, to the complexity of vaccination programs.

It soon became clear that MMR had been a growing concern for quite some time among parents’ groups before Wakefield's study was published. Parents claimed to have noticed a dramatic change in their children shortly after they were vaccinated. Some of these parents got in touch with Dr. Wakefield of London's Royal Free Hospital, whose research was already suggesting possible links between the measles virus and the development of inflammatory bowel disease. Wakefield initiated clinical studies of a small number of children, studies that led to the article published by The Lancet. Here 12 cases were reported of previously normally developing children suddenly losing their language and social skills and developing autistic symptoms together with a bowel disease.

The article did not claim that these conditions were caused by MMR, only that additional research was needed to find out more about possible connections, such as, for instance, if the number of autistic diagnoses had increased since 1988 when MMR was introduced in Great Britain (ibid.). At a press conference shortly after the publication, Wakefield himself recommended that single vaccines should be offered instead of the triple until more research had been done (Horton Reference Horton2004b).

The medical research community immediately took the necessary steps from their point of view, i.e., they initiated further epidemiological studies, gathered relevant research results, improved their information campaigns to the health services, and so on. The research results were unequivocal – not one indicated that there is a causal connection between MMR and autism. Wakefield's research was harshly criticized by several colleagues (e.g. Afzal et al. Reference Afzal, Armitage, Ghosh, Williams and Minor2000; Fombonne and Chakrabarti Reference Fombonne and Chakrabarti2001; Madsen et al. Reference Madsen, Hviid, Vestergaard, Schendel, Wohlfahrt, Thorsen, Olsen and Melbye2002; Taylor et al. Reference Taylor, Miller and Farrington1999), some of the comments even published in The Lancet.Footnote ¹¹

Despite these actions a sudden decline in vaccination numbers in most Western countries occurred (cf. Wright and Polack Reference Wright and Polack2006; Swedish Institute for Infectious Disease Control 2005). MMR was questioned not only by groups critical of the vaccine but on a much larger scale. Vaccines began to be considered a possible threat instead of a blessing, and more and more parents hesitated to vaccinate their children. One of the reasons why MMR became an issue is quite ironic and has to do with the previous successes of the vaccination campaigns. Measles, for instance, which used to be (and still is in developing countries and among poor children in the Western world) an alarming epidemic disease has almost disappeared from the public's memory. Autism on the other hand has become one of the seemingly increasing diagnoses, partly due to a broader definition. Hence, social panic was hardly expected to evolve around possible outbreaks of measles, while autism is a much more terrifying diagnosis in a society rewarding social and communicative skills.

Media reports, television programs, questions from parents to authorities during this period of time are all very illuminating – children are suspected of being at risk as long as it is not clear what side-effects may possibly occur. This can be described as a risk/trust dilemma. In a recent European comparison, the social effects in Great Britain were most alarming: vaccination coverage was even lower in 2002 than in 1990. More than a decade of immunization work had vanished because of the changed trust-context of the MMR vaccine, and the number of people ill from measles increased (Fleck Reference Fleck2003).

To grasp why the MMR-case affected Great Britain to such an extent, its long history of vaccination resistance is most probably of significance (Durbach Reference Durbach2005; Gangarosa et al. Reference Gangarosa, Galazka, Wolfe, Phillips, Gangarosa, Miller and Chen1998; Leach and Fairhead Reference Leach and Fairhead2007). The most influential and best-organized parental network, Justice, Awareness and Basic Support (JABS), could make use of a rather well-established tradition of vaccine resistance (Bragesjö and Hallberg Reference Bragesjö and Hallberg2006 and Reference Bragesjö and Hallberg2009).

Previous experience of actions carried out by the authorities in other situations where risk and trust were concerned may also have played an important role. In Great Britain both Bovine spongiform encephalopathy (BSE) and genetically modified (GM) foods had caused intense debates and social worry to a much higher degree than in Sweden. How the British authorities managed these cases appears to illustrate “the government's inability to protect its citizens from the risks and uncertainties of late industrial society” (Leach Reference Leach2005).

In Sweden too, a similar drop in vaccination coverage was seen; in the 1990s around 95 percent of all children were vaccinated for MMR compared to 88.5 percent in 2002 (Swedish Institute for Infectious Disease Control 2005). As the crucial limit for herd immunity is around 90 percent for measles, the number of changed practices of parents was alarming (Linde and Johansen Reference Linde and Johansen2001). In statistics from January 2008, the coverage has increased to 96.2 percent (Swedish Institute for Infectious Disease Control 2008). Even if the MMR vaccination has recovered to its pre-Wakefield levels, there are still clear regional differences. In certain cities and parts of the country (as in the city of Södertälje and the county of Jämtland) the coverage is lower than required to achieve herd immunity. A recent study shows that Swedish parents to a large extent postponed the MMR vaccination after the widespread discussion of possible adverse effects linked to the measles vaccine (Dannetun et al. Reference Dannetun, Tegnell, Hermansson, Törner and Giesecke2004).

It is particularly interesting that in Sweden these effects came about without both a previous history of profiled vaccine resistance and a contemporary and vigorous anti-vaccination social movement. Instead, the disputes over child vaccination in Sweden were, above all, influenced by media reports and mainly television programs, where well-reputed journalists highlighted the topics, followed by studio debates with both medical experts and spokespersons for the citizens present (Reportrarna 1999; Kalla fakta 2000). After these programs were broadcast, awareness among the public rose quickly. For instance, the number of worried parents who got in touch with public health institutions was even larger in 1999-2000 than in the aftermath of the 1998 Wakefield article (Bragesjö and Hallberg Reference Bragesjö and Hallberg2006 and Reference Bragesjö and Hallberg2009).

The tensions surrounding the MMR vaccination were significant enough to cause acute social turmoil, threatening long-established vaccination practices and trust-based relationships between parents, public health services, and authorities in Sweden, too. The risk/trust issues were at the forefront, and public distrust threatened the child vaccination program. A reminder of the severity of these problems was recently brought up in a workshop directed at Swedish health care workers (The Swedish Institute for Infectious Disease Control 2007). Several of the invited speakers referred to the MMR case as an extremely difficult time, demanding extraordinary efforts. Looking back on these events, the infectious-disease-control physician Anders Lindberg of the Swedish National Board of Health and Welfare concluded that only a small incidence was needed to completely tip the balance between acceptable vaccine coverage and a situation out of control (Lindberg Reference Lindberg2007). Despite the fact that MMR is no longer a medical controversy, the experiences of the period of turmoil still inform infectious-disease-control work in Sweden.

Although the reactions in Sweden were similar to those in the U.K., the scope of the social controversy was more limited. It has been suggested that this has to do with national differences in governing processes between, say, the U.K. and Sweden. The argument is that the Swedish authorities are more willing to listen to the public than the British, who are more authoritarian.Footnote ¹² Of course other cultural differences may be just as important, such as how the political systems have evolved historically and how much room was allowed for oppositional groups in general.

From an outsider's point of view, it looks as if the most alarming situation was under control after a few years when the vaccination numbers started to increase again. It is hard to tell whether the damage to the vaccine industry in this case was significant as the controversy was quite rapidly closed. However, the situation must still be regarded as extremely fragile. This is so because knowledge is always in one respect or the other uncertain, and because knowledge is situated in society. Therefore the public's reactions are unpredictable.

3.2. Vaccination in a context of risk and trust complexities

Most sectors of modern society have to work within a trust/risk/uncertainty complexity, described by, for example, Anthony Giddens and Ulrich Beck in terms of “risk culture” (Beck Reference Beck1992; Giddens Reference Giddens1991). Social scientists subscribing to these general assumptions have investigated how beliefs about risk have affected the public's attitude towards vaccination. Extensive surveys have been carried out and key material analyzed, focusing on the public's opinions on risk and relations of trust (Casiday et al. 2005; Casiday Reference Casiday2007; Smith et al. Reference Smith, Yarwood and Salisbury2007), supplemented by detailed qualitative analyses of actions and reasons among parents and health professionals concerning risks and diseases (Leask et al. Reference Leask, Chapman, Hawec and Burgess2006; Poltorak et al. Reference Poltorak, Leach, Fairhead and Cassell2005). A common principle here is that risk must be handled and communicated with the greatest care in order to maintain a level of vaccination numbers (Burgess et al. Reference Burgess, Burgess and Leask2006; Offit and Coffina Reference Offit and Coffina2003; Petts and Niemeyer Reference Petts and Niemeyer2004; Serpell and Green Reference Serpell and Green2006). As a consequence, it is important to find out how parents have responded to information campaigns from the authorities. In some studies reluctant parents have been described as facing “a leap of faith” when confronted with decisions on vaccination (Brownlie and Howson Reference Brownlie and Howson2005 and Reference Brownlie and Howson2006; see also Hobson-West Reference Hobson-West2003 and Reference Hobson-West2007). In this way trust is tied up with the perception of risk.

As shown for instance by Calnan and Rowe (Reference Calnan and Rowe2007), there are possible or manifest tensions between trust and risk. More specifically trust has to be established according to social conventions (Shapin Reference Shapin1994), but in a risk-culture, uncertainties and unpredictable outcomes provoke challenges to trust-relationships. Vaccination programs fit nicely into this kind of complexity. While trust in modern medicine is essential for any patient to accept prescriptions from a doctor, vaccinations must be conceived as being absolutely safe to attract the public. Vaccines are used to prevent, not to cure, and herd immunity is most of all a common good. Here, trust is not just a matter of leaving difficult decisions to experts when the body fails, but to take an active stance in the interest of someone (else) who is healthy. To expose a child to viruses in order to avoid a possible but in no way inevitable disease outbreak, demands an extremely high level of trust in the safety and effectiveness of the course of action. Why put one's own child in danger through vaccination – although in solidarity of interest with unknown babies – if safety cannot be guaranteed?

Thus we are dealing with two kinds of risk assessment. One concerns the parents’ assessments regarding their own child, what we can call the person-centered kind. No matter what other merits a certain procedure may have, parents do not deliberately damage their own child. State authorities do a different kind of assessment, where the community rather than individuals is more in focus. This is not to say, of course, that the effects on individuals are unimportant, only that the common good has to be emphasized. With large-scale vaccination initiatives, there is always an innate tension between these two kinds of risk assessment (i.e. the person-centered and the collectivist). Depending on the social and medical context, this tension takes on different forms: in times when a certain vaccination practice becomes an issue (e.g. smallpox in the late nineteenth century, polio in the 1950s, pertussis in the 1970s, measles in the late 1990s, and more recently swine-flu), the person-centered risk assessment easily turns out to be predominant. Most often this is due to the possible threats and dangers that innocent and healthy children (and sometimes adults, as shown by the swine-flu example) are exposed to.

The tension between the two kinds of risk assessment is not a new phenomenon, but how they are balanced depends on external circumstances. As history shows, more than a hundred years ago the reaction in Great Britain against the smallpox vaccination followed the same pattern as the recent reaction. In those days, however, social conditions were very different from those in contemporary times. State authorities at the time claimed a general vaccination for the common good, which certainly was strongly opposed by the public due to adverse reactions and severe complications. Mostly the opposition expressed anger and despair on behalf of individuals, but they were spontaneous and had little effect on the state authorities. An authoritarian society marked by a generally low education level in combination with the lack of modern media and information technology, prevents well-organized and assembled actions from the citizens. As a consequence the person-centered view has no chance to prevail over risk assessments of the common good.

In today's society, with greater opportunities for citizens in the main to educate themselves, interact with each other, and question the authorities, the person-centered kind of risk assessment is facilitated. Moreover, when the research community presents contrary results, the person-centered kind of risk assessment is stressed because parents have to consider what is best for their own child without knowing the outcome. Each and every signal that there might be a problem with the vaccine in question will increase doubt about its value. To be aware of and deal with the tension between the two kinds of risk assessment is a tricky matter for all societies.

The introduction of new vaccines can provoke resistance, sometimes from the medical profession itself, sometimes from politicians, but even more so from the public. Nowadays the media often plays a key role in boosting anti-vaccination movements and highlighting interest groups, such as parents’ organizations, or individual cases. Through the worldwide use of the internet, it has also become easy to inform oneself about the risks and side effects of certain vaccines and take an interest in both single testimonies and ongoing controversies. As a result, the public is more vigilant and the vaccine market more exposed to suspicion than before.

A lack of trust in vaccination, we argue, not only affects the children who might be the victims of an epidemic outbreak, but in the long run also creates one more research-policy dilemma. Over and above the economic and medical problems the vaccine industry confronts regarding research, development, and distribution, another difficulty emerges: distrust from the public. If society's confidence in the vaccination system starts falling apart, the entire system is at risk. Although the concepts of risk and trust have been discussed as problematical (Leach and Fairhead Reference Leach and Fairhead2007),Footnote ¹³ we find them useful in this case, when applied in a descriptive rather than a normative sense.Footnote ¹⁴

We do not suggest that trust issues of vaccination policies and practices can be used as evidence of a general breakdown of trust in contemporary society. On the contrary, we argue that childhood vaccination is an atypical social intervention, and that problems of trust in connection to vaccination have a long and rich history. The case of MMR is a modern example of the social tensions surrounding vaccinations since its very inception. Drawing generalized conclusions on trust as such would hence be inappropriate.

But if we are to thoroughly understand the conditions facing vaccine research, development and use, the trust and risk-related issues imbedded in the majority of these conditions have to be stressed. They are most relevant to decision-makers, in private companies as well as within the public sector, when they structure the future vaccine R&D system (Stratton et al. Reference Stratton, Durch and Lawrence2000). Thus, the nature of trust and risk complexities as a fact of social reality is important to bear in mind when doing cost-effective analyses, making investments, and establishing research priorities.