A U.S. Army decision to grant Sanofi Pasteur SA an exclusive license to develop a Zika vaccine has momentarily been stalled as criticism for the decision grows.
At least eight organizations and individuals including Médecins Sans Frontières have publicly expressed concern that the exclusive, royalty-bearing but revocable license could curb innovation in the vaccine space and could mean higher prices for providers.
The Army has since extended the comment period for its decision, first announced on Dec. 9, 2016, to mid-March.
Under U.S. law, exclusive licenses are granted when there is a necessary incentive to bring investment to an invention or promote its use.
MSF, also known as Doctors without Borders, believes that this is not the case with the Zika vaccine. In a Jan. 23 letter to the Army Medical Research and Materiel Command, it noted that the government's Biomedical Advanced Research and Development Authority has already issued millions of dollars for several pharmaceutical companies to develop a Zika vaccine. Sanofi received $43 million in BARDA funding in 2016.
MSF also said Sanofi would be likely to receive a priority review voucher from the FDA, as well as the different tax credits and exclusivities normally associated with orphan drugs, all giving it a significant incentive without the license.
The financial risk and investment that Sanofi will need to make is limited and predictable, but the potential profitability is considerable, MSF said.
However, both the U.S. Army and Sanofi said it is too early to tell what the risk and investment could be. The vaccine, dubbed the Zika purified inactivated virus, is being developed and tested with the Walter Reed Army Institute of Research and is still in phase 1 trials.
"It is important to understand that this Army technology is just one of many Zika vaccine development efforts competing in the United States and abroad. We have a long way to go, in terms of time and money, to reach a point where a Zika vaccine might be approved for public use," Lori Salvatore, public affairs officer for the Army's Medical Research and Material Command, told S&P Global Market Intelligence.
She said the Army has filed patent applications for the vaccine technology but has not received approval from the U.S. or an international patent office yet.
"The federal government needs a nonfederal partner with the research and production capabilities and the willingness to invest their own substantial funding to most quickly get this product to the market and available for public use," Salvatore said.
Susan Watkins, senior director of communications for Sanofi, said that even with BARDA funding, the company is still devoting human and other resources to take the vaccine through phase 2 development.
"We're still assuming financial and opportunity risks because there is no clear path to commercialization at this time, as the epidemiology of this infectious disease is still a moving target," Watkins said.
"The nature of the epidemiology and spread of the virus will impact the degree of profitability. Further, by partnering with public health agencies, we are sharing inherent risks," she added. Watkins told S&P Global that Sanofi is hoping to start phase 2 trials in 2018.
International groups are also channeling significant funding toward the development of high-priority vaccines. The Coalition for Epidemic Preparedness Innovations, launched earlier in January, is raising $1 billion toward vaccine development for Zika and five other deadly viruses. The coalition listed Sanofi among seven partners in the biopharmaceutical space that were preparing proposals.