Global vaccine alliance Gavi has announced a $1bn package to support African vaccine manufacturers, a move expected to boost JSE-listen Aspen Pharmacare and state-backed Biovac.
Gavi’s decision to create the African Vaccine Manufacturing Accelerator (AVMA) is the culmination of a long-running campaign by the AU to reduce the risk of member nations being last in line when jabs are in short supply, as they were during the Covid-19 pandemic.
Africa has limited vaccine manufacturing capacity and relies on imports for 99% of its needs.
Aspen and Biovac are among only a handful of African players now in a position to compete for Gavi business via the AVMA. The programme will provide milestone payments and pay a premium per dose but stops short of providing the advance market commitments initially sought by the AU. The AU had urged Gavi, which procures the lion’s share of Africa’s vaccines, to guarantee that it would purchase at least 30% of the continent’s requirements from African suppliers.
The AVMA is intended to help African manufacturers compete with established players such as the Serum Institute of India that already enjoy economies of scale, and buffer companies from the risk of investing in products that ultimately see weak demand, as Aspen experienced with Covid-19 vaccines.
The financing instrument will support at least four African vaccine manufacturers to win tenders for the production of over 800-million vaccine doses over 10 years. It will pay milestone payments when manufacturers’ vaccines are given the green light by the World Health Organisation, and “accelerator payments” of $0.30-$0.50 per dose, depending on the type of vaccine and whether or not the company imports or makes its own drug substance.
Priority vaccines include those for cholera, malaria, measles combined with rubella, a hexavalent shot offering protection against six diseases, yellow fever, rotavirus, pneumococcal disease and ebola.
Gavi said it was sending a powerful signal to global markets that it will support African vaccine manufacturing.
Aspen Pharmacare head of strategic trade Stavros Nicolaou said it was a historic announcement marking an important step towards reducing global vaccine inequity.
Aspen would be in a position to bid for pneumoccoal, hexavalent, rotavirus and meningities vaccines, he said. The company secured a licensing agreement in August 2022 from the Serum Institute to manufacture and sell these four childhood vaccines for Africa, using its near idle Covid-19 vaccine lines at its Gqeberha facility.
Aspen reached an agreement with Johnson & Johnson in late 2020 to bottle its Covid-19 vaccine, and subsequently to make an Aspen-branded version for Africa, but the expected orders never materialised.
Funds for the AVMA come from the surplus left in the Covid-19 vaccine-sharing mechanism Covax, financed by governments around the world. Subsiding African vaccine manufacturers with these funds would improve African independence and sovereignty, said Nicolaou. “It is a very good investment for African governments. The cost of not having vaccines far outstrips the premium paid,” he said.
Biovac CEO Morena Makhoana said there had been international resistance to the AU’s push for Gavi to provide African vaccine manufacturers with advance market commitments which would guarantee a market for their goods, but the AVMA nevertheless provided welcome support to emerging vaccine manufacturers. Biovac, when expecting bidding for the cholera vaccine, signed a deal last year with the International Vaccine Institute to develop and produce oral cholera vaccines, he said.
The AVMA was approved by Gavi’s board last week after consultation with partners that include the AU and the Africa Centres for Disease Control and Prevention and is due to be launched in June 2024. Gavi’s board also approved plans for a $500m “first response” fund that will be used in the event of a new pandemic, and $290m for a campaign to catch up on routine childhood immunisations that were badly disrupted by the pandemic.
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