This blog is also available in Russian.
Authors: Eka Paatashvili and Vladimer Getia
As countries transition from Gavi support, sustaining access to affordable and high-quality vaccines is one of many challenges they face. Fully self-financing countries need to maintain their immunization programs while also committing increased funds for new vaccine introductions. Vaccine price and quality are key factors in the decision to introduce new vaccines. Countries with small populations face particularly acute challenges accessing affordable vaccines, as their small market size may not be as attractive to suppliers, resulting in low or no response to tenders from suppliers and higher prices.
Georgia, which transitioned to fully self-financing in 2018, has a high performing national immunization program but still faces challenges related to procurement of vaccines. Many of their vaccines are procured through UNICEF Supply Division, but when the country decided to introduce hexavalent vaccine (DTP-HepB-Hib-IPV), it was not yet available through UNICEF procurement. Despite Georgia’s smaller market size, they were able to successfully self-procure the hexavalent vaccine at a competitive and affordable price. Here are some of the key actions by Georgian stakeholders that resulted in this important achievement.
1. Use knowledge about demand trends in your country to select the appropriate product
When the Polio Eradication and Endgame Strategic Plan 2013–2018 recommended introduction of at least one dose of inactivated polio vaccine (IPV) Georgia made it a national priority to include IPV in its national immunization program. Public scrutiny of vaccines is high in Georgia, so the Ministry of Health (MoH) wanted to ensure high confidence and acceptance with any new vaccine introduction. Georgia’s National Immunization Technical Advisory Group (NITAG) recommended the introduction of the hexavalent vaccine (DTP-HepB-Hib-IPV) over introducing IPV vaccine alone for several reasons: 1) It would avoid possible rejection due to the extra injection; 2) There was already high trust and acceptance of the hexavalent vaccine in the private sector; and 3) It avoided the risks associated with the potential global supply shortage of IPV vaccine. The NITAG’s recommendation for the introduction of the vaccine was adopted by the ICC, with strong support from influential stakeholders on the ICC such as the Director General of the NCDC and the Minister of Health. Following this decision to introduce the hexavalent vaccine, the MoH assessed the market landscape to determine its strategy to effectively negotiate an affordable price.
2. Analyze available market information to enhance price negotiating power
Supply of the hexavalent vaccine is limited to just two manufacturers – GlaxoSmithKline (GSK) and Sanofi Pasteur. The MoH, with support from WHO, researched the global market and leveraged available information to analyze price acceptability. Research showed that since manufacturers have price tiers that are based on countries GNI and cohort size, Georgia, with its modest GNI, could negotiate a competitive price. Having access to global market price data was crucial for the preliminary price discussions with the two manufacturers, which resulted in prices comparable to those offered to larger markets.
3. Build strong relationships with key stakeholders and provide reliable data to secure political and financial commitment
Following preliminary price discussions, the MoH presented the Ministry of Finance (MoF) with a forecasted cost and budget impact analysis to get the financial authorization to proceed to tender. Despite the competitive price offer, the introduction of the hexavalent vaccine was projected to double the existing immunization program budget, meaning strong political support would be required to receive approval for additional funding. The MOH, with support from the Parliamentary Committee on Health and Social Affairs and Sabin Vaccine Institute, held numerous meetings with key decision makers in Parliament and the MoF to advocate for additional funding. Arguments around hexavalent vaccine safety, the importance of assuring parents’ confidence, and ensuring a stable long-term supply ultimately convinced decision-makers to commit the necessary funds for the vaccine. Following the receipt of the financial commitment, selective tenders were sent to both GSK and Sanofi. Although GSK chose not to respond, the price received from Sanofi was competitive and affordable.
4. Implement smart regulation and procurement policies to attract suppliers and obtain competitive vaccine prices
Since 2009, Georgia has instituted reforms to simplify and streamline their pharmaceutical regulation and procurement processes in order to attract more suppliers to the Georgian market, enhancing market conditions for pharmaceutical manufacturers, including vaccine manufacturers. These reforms include fast track registration, reduced registration fees, multi-year contracting, and the exclusion of pharmaceutical products from VAT and import taxes. Additional procurement practices were introduced to encourage international participation by improving flexibility and transparency:
- E-platform for online participation and accountability
- International access to the procurement database and reports
- Acceptance of international electronic tender documentation in English
- Elimination of the requirement to have representation of a local agent
During the initial discussions and procurement process, the manufacturer and the government were able to build a relationship based on mutual trust and common interests. This led to further successful negotiations for competitive prices to allow introduction of booster doses.
In conclusion, a combination of smart regulation and procurement processes allowed Georgia to access competitive prices for a high-quality vaccine despite being such a small market, while purposeful advocacy supported by a history of strong implementation and budget execution helped convince key decision-makers to commit the necessary funding.