Vaccinations, Costs and Profits
Most Immunizations Not Profitable For Doctors or Companies
Oct 19, 2009
Vaccinations help prevent serious infectious illness. Use of vaccines has eradicated polio and greatly reduced the rates of many formerly common childhood illnesses such as measles, mumps, diphtheria and rubella. Most pediatricians recommend a series of vaccinations starting within several days of a child’s birth.
In recent years, however, vaccines have served as both a source of profit and a source of loss for many doctors and companies.
The Gardasil Vaccine
Some vaccines have made both doctors and manufacturers a great deal of money. For example, the Gardasil vaccine has been developed to help prevent cervical cancer as well as reduce the incidence of genital cancers and genital warts in women of childbearing age. A report in Forbes Magazine noted that Merck, the makers of the Gardasil vaccine, expects to earn roughly $1.5 billion in profits directly as a result of the vaccine administration to young women.
But many other vaccinations are not even as remotely as profitable for drug companies or the doctors who give them to their young patients.
A report in the April 29th, 2009 issue of the National Center for Policy Analysis noted that “of the 12 pediatric vaccines recommended for all children, there have been severe shortages of more than half,” a situation the author of the report links to low profit margins for most vaccinations. The report goes on to note that most vaccinations are manufactured by only a handful of makers such as Merck because the profit margins are so low.
As a result, even many pediatricians have been sometimes reluctant to buy and store vaccines for administration to their patients.
Physicians Reluctant to Purchase Vaccines
According to survey in the December 6th 2008 issue of Pediatrics, the Journal of the American Academy of Pediatrics entitled Primary Care Perspectives on Reimbursement For Childhood Immunizations by Gary Freed, more than half of physicians who responded to a survey reported “that their practice had delayed the purchase of specific vaccines for financial reasons (49%) and experienced decreased profit margin from immunizations (53%) in the previous three years.”
In addition to purchasing the actual vaccine itself, many doctors must also pay to store the vaccine and pay personnel such as pediatrics nurses to help give the vaccine to patients. The report notes that many insurers will reimburse only for the actual cost of the vaccine itself and not any of the other costs that a physician may incur as a result.
While some vaccines have a clear potential for enormous profits, others remain less than profitable for both physician and manufacturers alike. Health officials should investigate methods to help manufacturers make a reasonable profit from vaccinations while at the same time insuring access to such public health measures for all children.
Sources:
Forbes Magazine September 12th, 2008
Pediatrics Primary Care Perspectives on Reimbursement For Childhood Immunizations Vol. 122 No. 6 December 2008, pp. 1319-1324 (doi:10.1542/peds.2008-2033), Gary Freed M.D., Anne E. Cowan MPH and Sarah J. Clark MPH
National Center for Policy Analysis April 29th, 2009 Matt Baumann What’s Behind Vaccine Shortages?
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