The Bill and Melinda Gates Foundation (Seattle, WA, USA) announced on September 21 the availability of $168 million in grants to fight malaria, including $100 million earmarked to develop vaccines through the public-private partnership Malaria Vaccine Initiative (Seattle, WA, USA). The charitable sector, by financing early-stage development, has lowered the risk in creating vaccines for diseases prevalent in developing countries. As a result, targeting neglected diseases has now become attractive to biotech companies that are willing to explore new markets.
Creating vaccines for developing countries has not traditionally attracted small biotech companies that typically require high-price markets in order to recoup R&D costs. Recent donations from charitable organizations, such as the Gates Foundation (endowed with $25 billion), have changed the landscape of drug development, and not only for malaria. "Charities have created a vaccine market specialized in diseases from developing countries such as tuberculosis and malaria. These diseases have, up until now, been overlooked by the industry as a potential market," says Jaap Goudsmit, CSO at vaccine company Crucell (Leiden, The Netherlands).
Third-party funding has helped bridge the development gap between fundamental research in neglected diseases and its industrial application through public-private partnerships that associate nonprofit organizations, governments and industry (see Table 1). "Gates has taken a lot of the risk from product development by putting money in interim development," says Carol Nacy, CEO of Sequella (Rockville, MD, USA), a company specializing in tuberculosis. Sequella works in parallel with the Aeres Foundation (Rockville, MD, USA), a private group that identifies potential tuberculosis drugs from basic research funded by the National Institutes of Health. It then performs proof of principle experiments in humans, going as far as phase 2 efficacy studies, in order to make the product appealing to potential biotech and pharma partners.
Table 1.
Select biotech companies involved in public-private partnerships
As a result, biotech and pharmaceutical companies are more likely to take over development of such vaccines at these later stages, whereas they would not have during the early, riskiest stage of development. "We're prepared to take greater risks because it is not our shareholder's money," says Jeffrey Almond, senior vice president of discovery research and external research and development at Aventis Pasteur (Lyons, France), which is developing a dengue vaccine with Acambis (Cambridge, UK) by adapting the biotech firm's existing yellow fever technology.
But a few partnerships have discovered some intellectual property (IP) roadblocks when attempting to fill the development gap for vaccines that target the developing world. Drug development for most indications requires some IP consolidation, and companies are generally happy to foot the bill in courtrooms when there is a large market at stake. "Because there is little market value for IP on malaria antigens, patenting them can actually hinder rather than promote innovation," says Melinda Moree, director of MVI.
Successes in developing a vaccine technology for neglected diseases can have further benefits, in addition to the positive publicity that such an achievement would generate. "Third-party funding helps us validate our technology," says Vijay Samant, CEO of Vical (San Diego, CA, USA), which has used its plasmid DNA vaccine technology to do research for a malaria vaccine backed by US Navy funding. Once validated, the technology might be applied to vaccines for lucrative markets.
For companies targeting niche markets, there are a number of opportunities in the developing world. "The SARS epidemic has been a catalyst in generating interest for the prevention of other diseases such as influenza, or flu," says Gurinder Shahi, CEO of life science consultancy Bioentreprise Asia (Singapore). Indeed, "a flu vaccine market is emerging because of SARS," agrees Goudsmit. He believes that only by vaccinating people against flu will it be possible to distinguish people affected by SARS, because both conditions have similar symptoms at an early stage of the disease. Although governments may foot the bill for a flu vaccine as a preventative measure, middle-income private markets also constitute an untapped opportunity in Asia, says Shahi.
But companies can also make profits by adapting vaccines to the needs of developed countries. Indeed, the emergence in developed countries of diseases from developing countries has generated dual markets that, until now, existed only for travelers' vaccines, such as diarrhea and yellow fever vaccines. For example, companies such as Crucell, Bavarian Nordic (Copenhagen) and Acambis are currently focusing on vaccines against the West Nile virus, and SARS has attracted a number of vaccine players (Nat. Biotechnol. 21, 720, 2003) as such diseases become an economic burden to countries affected. In addition, the US BioShield proposal now pending before Congress would, if enacted, pony up $6 billion in public fundsto address infectious diseases, such as Ebola, that are now considered security issues (Nat. Biotechnol. 21, 216, 2003).