Facing the Vaccine Shortage

...Influenza vaccines are changed each year to match the flu strains most likely to strike the following winter...

...The Ann Arbor Veterans Affairs Medical Center had received an unusually small vaccine shipment...

...Nevertheless, the jury returned a verdict against the pharmaceutical company for $200,000...

...Curing influenza, on the other hand, is a lucrative business...

...But most medical errors go undetected and unreported...

...These became increasingly important as a growing band of bacteria began to resist penicillin's charms...

...The story of our medication shortages begins in Mission, Texas, with a girl named Anita Reyes...

...This collective financial reckoning is the most pervasive externality of medical care...

...Recognizing that a large number of children were going without inoculations, President Bill Clinton created a $585 million entitlement program under Medicaid that enabled the Federal government to purchase vaccines at a discounted price for children...

...Told to try his luck again in a couple of weeks, he left frustrated and angry...

...During the trial, Wyeth's expert witnesses demonstrated that the virus isolated from Anita's stool on the day she was admitted to the hospital was "probably wild," meaning there was a question about whether it had originated from the vaccine...

...When youngsters get infections that could have been prevented by a shot, society ultimately pays for their hospital bills with higher taxes and insurance premiums...

...More important, people come to their physicians for help, not shopping...

...Here the flip side is a rarer positive externality: If enough kids are vaccinated against, say, whooping cough, those who are not become less susceptible to the disease as well, since less of it is being passed around...

...Ann Boulis, a sociologist, is currently a postdoctoral fellow in health sendees research at the Philadelphia Veterans Affairs Medical Center...

...But pharmaceutical executives do not wish sickness on anybody...

...Sometimes more harm is done to the public by shutting manufacturing plants than by allowing them to stay in operation while they improve their procedures...

...The supply would have been adequate, though, were it not for the fact that as of March 2000, only four manufacturers were licensed to make flu vaccine in the U.S...

...MANY FREE-MARKET advocates argue that manufacturers could not survive if vaccines had to be financially accessible to everyone...

...Lawyers, however, had a different take: To them, an unvaccinated child who contracted polio was a tragedy, but a vaccinated child who came down with polio was a cause for litigation...

...Peter A. Ubel is a physician at the Ann Arbor Veterans Affairs Medical Center and Associate Professor of Medicine at the University of Michigan, where he directs the Program for Improving Health Care Decisions...

...But we all know this is not what happens...

...Hence, as with the flu vaccine shortage, there was no public outcry to alleviate the problem...

...they simply seek to concentrate their resources on manufacturing what is most profitable...

...During the '90s boom...

...and factor VIII, a clotting protein crucial to hemophiliacs...

...There were no availability problems in the late '80s and early "90s, because firms could churn out vaccines with less fear of liability, but a significant percentage of parents could not afford to have their children inoculated against preventable diseases...

...Having served in the Army for almost a decade, he felt he deserved better treatment...

...That is another reason why free-market notions do not work for health care...

...The committee could be housed in the Centers for Disease Control (CDC), but in any event should not be made part of the FDA, since it may have to evaluate the FDA's role in specific problem areas...

...The number of American children who contracted mumps, for example, skyrocketed from 2,982 in 1985 to 12,848 in 1987...

...health care and the importance of maintaining adequate reserves of antibiotics and vaccines...

...If consumers were footing the bill, they would clamor for penicillin over its high-priced competitors...

...Absolving companies from liability for unavoidable misfortunes improved vaccine profitability...

...Her parents sued Wyeth Laboratories, charging that its vaccine had caused the girl's polio...

...injectable steroids...

...If health care functioned the same way, a patient with strep throat would select among available indicated antibiotics on the basis of cost and quality...

...the problem is only growing as health care costs rise and drug companies struggle to maintain profitability...

...For starters, most health care purchases are subsidized by insurance...

...Nevertheless, the government needs to act...

...Since it was impossible to know the number of lives lost as a direct result of not getting a flu shot—many people with chronic afflictions die from respiratory infections every year—there was not much of an uproar about last fall's public health fiasco...

...For 11 months penicillin G was in desperately short supply...

...Gaines' experience was repeated across the country—a serious matter, because the influenza virus does not merely cause the achy, sneezy, sniffly thing called "the flu...

...In addition, FDA practices, now skewed toward keeping harmful products out of the marketplace, ought to be revisited...

...Lawmakers should create financial incentives that enable pharmaceutical firms to produce inexpensive vital medications...

...Fourteen days later, she contracted the disease and became paralyzed from the waist down...

...The danger of that kind of dominance was magnified in June 1999, when the FDA found Marsam's penicillin plants in violation of mandated practices and closed them...

...In people with chronic illnesses it often leads to bacterial pneumonia, which kills 20,000 Americans each winter...

...Yet in reality numerous economic transactions have wide-reaching effects, or externalities...

...The post-September 11 anthrax scare, perhaps more than any other single event, highlighted the deficiencies in U.S...

...One condition of a perfectly free market is that purchasing decisions should affect solely the buyers and sellers...

...It made children automatically eligible for Federal compensation if they suffered a known adverse reaction to a common vaccine...

...Unfortunately, in February the Bush Administration proposed a $340 million reduction in the CDC's nonbioterrorism budget—a move in the wrong direction...

...Yet ironically, that resistance has kept penicillin from slipping into oblivion...

...If these steps prove insufficient more aggressive government intervention will be necessary, including taking over production of important vaccines in short supply (as was once done with the anthrax vaccine...

...Immediate efforts are in order, as we have seen, to help the nation avoid further medication shortages...

...In those instances, too, it has been very difficult to identify victims of the scarcities, so relatively little political pressure built to end them...

...So strep throat sufferers do not complain when given an expensive antibiotic, and penicillin loses ground in the marketplace...

...In an attempt to insulate the producers of all vaccines from legal action, President Ronald Reagan signed the National Childhood Vaccine Injury Act in November 1986...

...The government should also establish a standing committee on health care scarcity...

...will almost surely face continued medication shortages...

...Consider automobile pollution...

...On the contrary, that enables it to start pushing the more costly, next-generation alternative...

...Still, most Americans think all children should receive basic medical care...

...But before his turn came the vaccine supply had run out...

...But drug companies, in their pursuit of ever higher profits, deluge doctors with information about how their latest superdrug is better than penicillin for some subset or other of patients, while downplaying the economic and public-health consequences of the new drug's widespread use...

...Yet prices still rose steeply...

...The first superstar antibiotic, penicillin saved thousands of lives after its introduction in the 1940s...

...Currently we are contending with inadequate supplies of tetanus, diphtheria and whooping cough vaccines...

...The same forces that contributed to the flu vaccine shortage have recently brought about a serious scarcity of penicillin...

...some important anesthetics...

...In a completely free market, an informed buyer determines what she is willing to pay for specific goods...

...Thus the time may be right to try to adjust the balance of government and market forces in U.S...

...She received her polio vaccination on May 8, 1970...

...Shots were restricted to patients with serious illnesses...

...public health system require an infusion of serious funds...

...The tenfold difference in price between penicillin and its rivals, though, is often absorbed by insurers...

...This pressure drove corporations to abandon low-margin products like flu vaccines.When a company had a new and potentially moneymaking vaccine on line, it was more costeffective to divert personnel from flu vaccine production rather than hire additional employees...

...But they also cut into the profits of vaccine makers, and their ranks began to dwindle again in the '90s...

...Many parents won substantial settlements against vaccine manufacturers in the '70s, significantly reducing industry profits...

...In such situations, free-market proponents usually grant the need for limited government intervention, like fuel efficiency regulations...

...According to the Infectious Disease Society of America, 90 per cent of infectious disease physicians were forced to prescribe more expensive antibiotics in that period...

...These actions were intended to compensate for the inherent inability of the free market to deliver basic vaccines to low-income children...

...That had a crucial impact on the 2001 flu vaccine shortage...

...If anything prevents medicine from being a free-market item, it is patients' necessary reliance on their doctors for medical advice...

...States followed suit with similar schemes...

...A cynic might point out that drug makers have a perverse incentive to let people contract the flu so they can sell their expensive remedies...

...investors expected high returns from their pharmaceutical holdings...

...In the late '80s they increased between 200 and 300 per cent...

...Therefore, penicillin is used for common infections to conserve the effectiveness of new highpowered antibiotics for more serious cases...

...At the time of Anita's illness public health specialists already knew the vaccine might harm some recipients, but had concluded that its benefits far outweighed the danger of such rare cases...

...This encouraged generic antibiotic purveyors in India and China to enter world markets, depressing profit margins for established Western drug companies and prompting consolidation...

...The Vaccine Injury Act thus did a better job of protecting manufacturers than patients...

...But virtually everyone associated with public health care has to recognize that it will never fit the free-market formula, leaving no alternative to careful regulation...

...generic seizure medicines...

...There are no simple solutions to shortages, and any new remedies are likely to have unforeseen effects...

...Like many stars, it eventually ceded the spotlight to younger, sexier competitors...

...These actions should be incremental, and should involve close cooperation with the pharmaceutical industry whenever possible...

...Health care is loaded with externalities, as exemplified by childhood vaccines...

...By 1997 penicillin prices had fallen almost 50 per cent and one firm, Marsam, controlled over three-quarters of the U. S. penicillin market...

...The industry is not troubled by antibiotic resistance...

...There is precious little money in flu vaccines...

...They might even clamor enough to raise its cost to the level where it would be more lucrative to produce...

...As a result, by 1977 more than half the U.S...

...As costs escalated and Federal funding failed to keep pace, immunization rates dropped...

...Public clinics had to shorten their hours, limit the doses they provided, and raise the age for vaccinating children...

...New medications dramatically diminish the severity of the virus, but at many times the cost of the vaccine...

...In 1987 patents expired on seven of the world's top-selling antibiotics...

...Last fall's scarcity was partly a consequence of biologic bad luck: The pertinent viruses were unusually difficult to grow...

...vaccine makers quit the market...

...What's more, the Food and Drug Administration (FDA) subsequently ordered two of them to cease production for violating "good manufacturing practices.' Another factor was the consolidation of vaccine providers spurred by the surging stock market...

...With the help of appropriate experts, it could spot potential shortfalls and propose countermeasures...

...The more physicians prescribe an antibiotic, the more likely that bacteria will develop an immunity to it...

...Left alone, the U.S...

...Not always being familiar with the alternatives raised the risk of mistaken applications...

...Literally hundreds of antibiotics have been invented over the past 50 years...

...Drivers cannot reimburse innocent bystanders for contaminating the air...

...To handle new threats and simultaneously do a better job with existing ones, the components of the U.S...

...Even some die-hard Chicago-school economists hold this view not because their hearts bleed for the unvaccinated, but because of what they call the "externalities'" associated with forgoing immunization...

...Prior to 9/11, President George W. Bush tended to view much of the world through the lens of the free market...

...Today, despite its having recommended CDC cuts, the Administration no longer seems inclined to consider the Federal government as an evil wherever it treads...

...Over the past five years hospitals and clinics in the United States have also experienced shortages of tetanus vaccine and antibiotics such as penicillin...

...To fully understand the implications of the situation, though, one has to trace its development...

...When a doctor prescribes a pricey new antibiotic, a patient has every reason to believe that good old-fashioned penicillin is not up to the task...

...health care...

...The pharmaceutical industry is one of the mostprofitable in the world...

...Gaines, who suffers from emphysema, qualified...

...The laws of supply and demand are skewed by health insurance and by how patients and doctors make decisions...