India drugmakers give flu vaccines a second shot
MUMBAI (Reuters) - Indian drugmakers, which in 2010 rushed to make cheap flu vaccines against the newest strain of H1N1 in response to an outbreak that waned before they could be brought to market, are looking to recover some of their investments amid a new outbreak of the deadly virus in India.
The 2009 global outbreak of the novel H1N1 virus, thought to have originated in swine, claimed over 17,000 lives including 2,725 in India between May 2009 and November 2010, when the government asked local manufacturers to come up with affordable preventatives.
Five Indian companies -- Cadila Healthcare, Panacea Biotec, Bharat Biotech International, Jubilant Life Sciences and Serum Institute of India -- invested more than 1 billion rupees ($19 million) to develop vaccines but sold less than 400 million rupees worth.
The latest outbreak, which is far smaller than that of 2009, has claimed 57 lives in India so far this year, according to the Indian health ministry.
Sporadic cases of infections with the new flu virus have also cropped up over the last six months in southeast Asia and Latin America, with Mexico alone reporting 29 deaths.
"This time, we are planning to produce about half a million doses but still, recovery of costs is not possible," said Adar Poonawalla, executive director of unlisted Serum Institute of India, the world's fifth-largest vaccine maker by volume.
Serum, whose chairman, Cyrus Poonawalla, ranks as India's 17th richest person according to Forbes, had to destroy about 2 million doses in 2010 after the unsold vaccines passed their expiration date.
"It's a cheap vaccine... I offered it even free of cost but still people did not take it," said Executive Director Adar Poonawalla, the son of the company's chairman.
Serum invested about 500 million rupees in 2009 and 2010 to develop and manufacture Nasovac, which was priced at about 190 rupees per dose, and sold about 200 million rupees worth.
The company is hoping eventually to sell the vaccine to the World Health Organization, which requires that a manufacturer have made a vaccine for three years before it will consider buying it.
"If the plant gets WHO pre-qualification, say in a year's time, then we may look at exports," the younger Poonawalla said.
Vaccines tend to be low-profit, low-margin products sold in large quantities to institutions, governments and non-profits.
Those sold on a retail basis tend to fetch higher margins.
Panacea Biotec, a Delhi-based vaccine maker, this month received a 100 million rupee order from the Indian government to supply its vaccine against the novel H1N1 PandyFlu and is also looking for retail opportunities.
Cadila Healthcare plans to start cautiously and make small quantities of its VaxiFlu-S initially, a senior executive said.
It had sold vaccines worth up to 80 million rupees but stopped production in late 2010 after demand receded.
"The cost recovery can happen only if there is a major outbreak and we can convince people to buy vaccines... not otherwise," said the Cadila official, who declined to be identified as he is not authorized to speak with the media.
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