By Rashna Mahzabin
The CoronaVirus outbreak worldwide has shed light on the vaccine industry. The fast-growing vaccine industry has become a centre of attention in the global arena.
The vaccine market has grown sixfold over the past two decades, worth more than $35 billion today, according to AB Bernstein. The firm said the industry has consolidated to four big players that account for about 85% of the market. For every dollar invested in vaccination in the world’s 94 lowest-income countries, the net return is $44. This oligopoly has been built through significant market consolidation driven primarily by the complexities of the manufacturing and supply chain.
The growth in the global vaccines market is mainly attributed to the high prevalence of various diseases, increasing government initiatives towards immunization, technological advancements in the vaccine industry, and a strong pipeline for vaccines. In addition, increasing epidemic potentials, growing focus on therapeutic vaccines, and emerging markets will further provide significant opportunities for the various stakeholders in this market. However, longer timelines and high cost for vaccines development are likely to hinder the market growth.
On the basis of indication, the pneumococcal disease segment commanded the largest share of the overall vaccines market in 2019. The large share of this segment is mainly attributed to the factors such as rising incidence of pneumococcal diseases like pneumonia, meningitis, febrile bacteraemia, otitis media, and sinusitis; development of quality vaccines such as PPSV23; and various initiatives by the government organizations and private sectors to prevent and control an outbreak of pneumococcal diseases.
On the basis of valence, the multivalent vaccines segment accounted for the largest share of the overall vaccines market in 2019 and is poised to grow at a faster CAGR during the forecast period. New product launches and focus of key players on multivalent vaccine’ research & development are the major factors contributing to the largest share and fastest CAGR of the multivalent vaccines market segment.
On the basis of antigen, subunit and conjugate vaccines segment accounted for the largest share of this market in 2019 due to long term immunity and low-risk rate associated with the subunit vaccines along with the increasing demand for immunization.
One of the crucial and significant drivers for market growth is the increasing supply of vaccines across the globe to meet the unmet needs and abide by the immunization policies to eradicate endemic diseases. Pharmaceutical companies, government foundations, international organizations, and hospitals are strongly focused on providing cost-effective and regular immunization to people worldwide. Government surveillance in all the countries has become active in ensuring that every individual is vaccinated by recommended vaccines at a minimum cost or no cost. For instance, the pneumococcal conjugate vaccine was rolled out by the Universal Immunization Programme (UPI) to 21 lakh children in Himachal Pradesh and parts of Bihar in India. Escalating demand for vaccines is one of the key factors for the rising contribution in the billion dollars market value of the vaccines. Moreover, government funding and company investments are boosting the R&D sector for launching novel vaccines.
Another critical factor driving the vaccine market is the competitive pipeline, including products of major as well as emerging players. Being a vast and heterogeneous market, the players are struggling in getting approvals from the regulatory bodies for their products. Continuous R&D and focus on launching novel vaccines in the market is the current challenge accepted by every company. Increasing demand for effective vaccines against diseases such as malaria, dengue is the forefront aim of pharmaceutical companies. Companies such as Novavax, Inovio Pharmaceuticals, and Bavarian Nordic are among the top 10 players expected to have opportunities for their pipeline products in the foreseeable period. GSK, Merck, Sanofi, and Pfizer also have potential pipeline candidates that are expected to contribute positively to the vaccines market growth.
Ability to elicit an appropriate immune response, long term protection, and simplified large scale manufacturing are responsible for higher production, sales, and demand of recombinant/subunit/conjugate vaccines. These vaccines are also generally preferred as they pose no risk of pathogenicity. Additionally, recombinant/conjugate/subunit vaccines are anticipated to have a higher CAGR as well owing to the availability of various delivery systems options. Recently, USFDA approved Vaxelis, a combination vaccine against DTP. This vaccine was developed by Sanofi and MSD under joint-partnership.
To be sure, while vaccine companies can see periods of high growth, real innovation is needed to be long-standing winners in a market that requires major capital and faces cheaper alternatives from emerging markets.
FEW BIG PLAYERS
These companies have jumped into the race to combat the deadly coronavirus, working on vaccine or drug programs. Investors have been flocking to some biotech names amid market volatility in hopes that their initiatives to develop treatment and prevention for the coronavirus could come to fruition at some point. Sanofi is teaming up with the U.S. government to develop a vaccine for the new virus, hoping its work on the 2003 SARS outbreak could speed up the process. GlaxoSmithKline said that it is partnering with the Coalition for Epidemic Preparedness Innovations for a vaccine program. Still, any commercial treatment for the coronavirus could be years away. Experts have warned despite recent advances, the public shouldn’t expect a coronavirus vaccine to hit the market until early next year. According to reports, Sanofi and GlaxoSmithKline both have a stable vaccine portfolio, including shingles, flu, pertussis and polio vaccines, that will keep driving revenue.
Merck’s vaccine business generated $8.4 billion of revenues in 2019, the segment has been growing at an annual rate of 9% since 2010. Experts forecast, Its human papillomavirus vaccine Gardasil 9 will be the biggest selling vaccine of all time. Gardasil 9 will take over the HPV market given competition is limited – supply is the only decelerator.