What's So Interesting About that Big Gates Grant for a Pneumonia Vaccine

When it comes to the world of vaccines and immunizations, one funder stands head and shoulders above the rest. Since the 1990s, the Gates Foundation has committed billions of dollars to both the development and delivery of life-saving vaccinations for underserved populations in the developing world. Bill Gates is known for his obsession with preventive medicine as the simplest, most inexpensive and most effective way to give all children a shot at a healthy life.


Now, in its latest bid to address yet another highly contagious and easily preventable disease, the Bill and Melinda Gates Foundation announced a commitment of up to $89 million for the development of a vaccine against viral pneumonia. More specifically, the grant, awarded to Novavax, Inc., will support development and regulatory licensing efforts for the RSV F Vaccine.

RSV—short for respiratory syncytial virus—is the leading cause of pneumonia in infants, both in the U.S. and the developing world. According to a press release from Novavax:

RSV is the most common cause of lower respiratory tract infections and the leading viral cause of severe lower respiratory tract disease in infants and young children worldwide, with estimated annual infection and mortality rates of 64 million and 160,000, respectively. In the US, RSV is the leading cause of hospitalization of infants. 

To obtain this generous grant, Novavax has cut a deal with the Gates Foundation: In exchange for help overcoming regulatory hurdles to obtain a license, Novavax will make the vaccine affordable and accessible to people in the developing world. Commenting on the deal, Keith Glugman, director for pneumonia at the Gates Foundation said:

We felt that this was a worthwhile investment to make sure that if the vaccine does work, and if it is licensed, that it will be made available to infants in the developing world virtually simultaneously with the developed world.

This arrangement is an interesting one. For starters, the notion that the vaccine would be available almost instantly within the developed world is a huge deal. Vaccines, once developed in a country like the U.S., can take years to reach underserved populations in developing nations. Many developing countries just don’t have the resources to devote to introducing new vaccines, so making the vaccine accessible immediately has tremendous implications in terms of saving lives.

The second, perhaps more obvious component of this arrangement is the price deal. While we would all like to think that a vaccine developer with the power to save millions of lives would do everything to make the vaccine affordable and accessible no matter what, that’s just wishful thinking.

A lot of us experienced a WTF moment recently when hedge fund manager turned Pharma CEO (turned public enemy No. 1) Martin Shkreli, decided to boost the price of an essential toxoplasmosis drug by 5000 percent. It was one of the most obvious cases of profiteering—made uglier any time Shkreli opened his mouth—but it reignited a long-running conversation about profits vs. people in the world of pharmaceuticals.

It’s a curious dichotomy and difficult reality to swallow—one that everyone working in preventive medicine will understand all too well—the solutions exist, they’re often just really expensive.

Related: Can Helmsley Help Bring Down the Cost of HPV Vaccines?

Last year, humanitarian aid organization Médecins sans Frontières (MSF) publicly railed against two pharmaceutical companies over the price of their pneumococcal vaccine. Citing statistics showing that even at the current lowest global prices, the cost to fully vaccinate a child today is 68 times more expensive than it was in 2001, MSF called on drug makers GlaxoSmithKline and Pfizer to reduce the price from $7 to $5 per child in developing countries. 

But Bill Gates, something of an old hand when it comes to working with pharmaceutical companies, is first and foremost a businessman. Responding to MSF and like-minded critics in an interview with the Guardian, Gates noted that immunizations are the most cost-effective solution that exists in health care, and warned that such vocal criticism would only serve to deter pharmaceutical companies from developing life-saving vaccines in the first place.

This general thing where organizations come out and say, ‘hey, why don’t vaccines cost zero?’ – all that does is that you have some pharma companies that choose never to do medicines for poor countries, because they know that this always just becomes a source of criticism. So they don’t do any R&D on any product that would help poor countries. Then they’re not criticized at all, because they don’t have anything that these people are saying they should price at zero.

The man has a point. 

Whether or not big pharma has a moral obligation to provide low-cost vaccines is clearly, if not unfortunately, debatable. But the fact remains that too many people around the world don't have access to the life-saving interventions that exist and work. And if you've got to cut a few deals with big pharma along the way to change that, well, so be it.