20. The Department relies on ten different suppliers for sixteen essential vaccines. The main reasons for the narrow market are the high and increasing cost of vaccine development and production, mergers between manufacturers and a relatively low profit margin compared with other pharmaceutical products. The vaccine industry is global, and it is hard to prevent companies from narrowing their product line or leaving the market. Limited competition, and near monopolistic conditions for supply of some vaccines, have made it more difficult to secure competitive prices and value for money. Furthermore, reliance on a single supplier has made the Department more vulnerable to interruptions in supply. Where possible, the Department aims to award contracts to more than one supplier, subject to their satisfying qualifying criteria for safety, efficacy, availability and price. Even so, in eleven cases the Department is still dependent on a single supplier (Figure 1).[28]

21. In most cases the Department's suppliers have delivered vaccines as required, but there have been instances, for example with Measles, Mumps and Rubella (MMR), and Bacillus Calmette-Guerin (BCG) vaccines, when there have been supply shortages. The Department manages the vaccine supply by monitoring stock levels and comparing the rate at which vaccines are being drawn down, mostly by GPs, with forecasts from manufacturers, on at least a monthly basis, on their ability to satisfy contracts. If stocks appear likely to be threatened, the Department has a capacity to switch from a demand ordering system, under which GPs order vaccine, to a system under which GPs receive a weekly allocation of vaccine according to the size of the population for which they are responsible. This system guards against excessive ordering that might otherwise occur when there are shortages. However, vaccines are biological products that are difficult to make, and sometimes faults are only identified at the end of the manufacturing process. Recovery from failure of a production batch can take months, and because of the increasing centralisation of manufacturing could rapidly lead to an international vaccine shortage. So, while current UK stocks are fairly healthy, the Department is unable to guarantee that there would never be shortages.[29]

22. A key part of the Department's strategy to manage the risk of shortages is to establish alternative sources of supply. For one of the most important vaccines given to babies when they are 2, 3, and 4 months old (Haemophilus influenzae type b, Diptheria, Tetanus, and wholecell Pertussis), disruptions in supply during 1999 were overcome by finding an alternative supplier, and there was no disruption to the vaccination programme.[30] Similarly, shortages in supply of the MMR vaccine were met from the Department's existing stockholding until further supplies could be obtained from an alternative manufacturer.[31]

23. There has been one case, however, where in the last recourse the Department suspended part of the vaccination programme. The Bacillus Calmette-Guerin (BCG) vaccination is part of the Department's childhood vaccination programme against Tuberculosis (TB). It is also offered selectively to higher risk groups, such as babies born into ethnic groups at higher risk of tuberculosis, and new entrants from, and visitors to, parts of the world where the disease is prevalent. In September 1999, the Department suspended the routine schools-based vaccination programme because manufacturing problems had left insufficient supplies to maintain both this and the targeted vaccination of higher-risk groups. The immunisation programme finally recommenced in September 2001. Because the BCG vaccination, given to children between the ages of 10 and 14, is not as age-dependent as the infant vaccination programmes it was possible to recall children who had previously missed out. In this example, the manufacturer had experienced increasing difficulties in making vaccine that reached specifications, and had indicated that they would be unable to continue production without a substantial investment in the manufacturing plant, which would have led to a correspondingly large increase in the price of the vaccine. The Department was ultimately able to find an alternative supplier, although this still left them dependent on a single company.[32]

24. Notwithstanding the BCG programme, the Department concedes that the recent increase in the incidence of tuberculosis is worrying. Until about five years ago there were about five and a half thousand cases a year, but this has risen to almost seven thousand cases a year (Figure 2). The strains of tuberculosis now being seen have also come from different parts of the world than have previously been found, and there are different patterns in different parts of the country. The Department has been trying to work with colleagues internationally to map, using DNA profiles, incidences of different strains of the disease. Some indigenous tuberculosis has never gone away, but there have been a number of cases originating from sub Sarahan Africa and Asia, particularly the Indian subcontinent. However, the vaccine has always had a limited effect, and a small amount of drug-resistant tuberculosis has also started to appear.[33]

25. Containment of the disease is particularly difficult because it is necessary to keep people on treatment for six months. This is hard to maintain when working with less stable populations, such as people going in and out of prison, or with the occasional individuals who decline treatment. The Home Office has been running a pilot scheme at Dover to monitor people entering the country for tuberculosis, but this is not straightforward, as people do not always show symptoms when they arrive. The Department is exploring a number of ways, however, to identify and treat people early, before it becomes an established disease. The Department recognises that a substantial effort is needed to keep the disease under control and the Chief Medical Officer is publishing an action plan to carry forward the work.[34]

29   Qq 34-37, 82-84, 91; C&AG's Report, para 3.30 Back

30   Qq 20, 82, 35; C&AG's Report, para 3.33 (case study J) Back

31   Q 118; C&AG's Report, para 3.31 (case study H) Back

32   Qq 35-36; C&AG's Report, para 3.32 (case study I) Back

33   Qq 94-102 Back

34   Qq 105-108 Back