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Vaccine supply and procurement

Underlying the GAVI business model is an intention to ensure a lasting impact on vaccine markets to the benefit of the developing world. The Alliance strategy for 2011-2015 now includes an explicit goal to shape vaccine markets. GAVI and its procurement partners support this goal through efficient procurement of quality vaccines while ensuring sustainable supply at affordable prices to GAVI countries.

On July 4 GAVI will launch a public consultation on the draft Vaccine Supply and Procurement Strategy. The consultation will be open until Sunday 24th July 2011. All stakeholders and interested individuals are invited to share their views and provide comments.


The Value of Pooling Demand and Purchasing
The majority of procurement on behalf of the Alliance is conducted by UNICEF, while GAVI-eligible countries in the Americas are sourcing their vaccines through the Pan American Health Organization (PAHO) Revolving Fund.

GAVI’s role in the global vaccine market is evidenced by the initial impact the Alliance has had in changing the production and supply base, accelerating price declines in some vaccines and supporting the application of tiered pricing that enables poor countries to pay significantly less than higher income countries for the same vaccine.

The hepatitis B, tetravalent and pentavalent vaccines illustrate how these dynamics play out, with pneumococcal vaccines as an example of how innovative financing mechanisms can influence the market. However, GAVI’s ability to shape particular vaccine markets though the magnitude of its procurement though UNICEF depends on various factors, including the number and capacity of manufacturers, the vaccine complexity and GAVI’s relative market power in terms of volume and revenue.

Revision of Supply and Procurement Strategy
Previously, GAVI's Supply and Procurement Strategy for Hib and HepB containing vaccines was approved by the Alliance Board in 2005 and has at its core three broad objectives: (i) Ensuring a sustainable quantity of supply through a diverse supplier base; (ii) Selecting products and presentations that best meet the needs of countries; and (iii) Achieving a long-term affordable price that can eventually be sustainably financed by developing countries. Moreover, GAVI's procurement principles provide additional guidance for decision making by GAVI’s procurement partners.

In view to move towards a more active market management approach, GAVI is currently in the process of revising its vaccine supply and procurement strategy for 2011 to 2015. A draft version of the strategy will be presented in September for the Programme and Policy Committee to consider. The PPC will then present the strategy to the Board for decision in November 2011.

Information transparency
GAVI recognises the importance of timely, transparent and accurate information sharing on expected vaccine demand and supply dynamics. It therefore welcomes vaccine suppliers’ agreement to make pricing information more transparent. UNICEF publishes the vaccine prices paid to individual manufacturers.