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NBER Working Papers and Publications
|May 2005||Advanced Purchase Commitments for a Malaria Vaccine: Estimating Costs and Effectiveness|
with Ernst R. Berndt, Rachel Glennerster, Michael R. Kremer, Jean Lee, Ruth Levine, Heidi Williams: w11288
To overcome the problem of insufficient research and development (R&D) on vaccines for diseases concentrated in low-income countries, sponsors could commit to purchase viable vaccines if and when they are developed. One or more sponsors would commit to a minimum price that would be paid per person immunized for an eligible product, up to a certain number of individuals immunized. For additional purchases, the price would eventually drop to short-run marginal cost. If no suitable product were developed, no payments would be made. We estimate the offer size which would make the revenues from R&D investments on a malaria vaccine similar to revenues realized from investments in typical existing commercial pharmaceutical products, as well as the degree to which various contract models and assum...