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Pharmaceutical industry

Taxpayer Subsidy for Cervical Cancer Vaccine Challenged

Strategic Insights

— 2 min read

The proposed government subsidy for a cervical cancer vaccination program has come under fire, with critics arguing that only half of the $625 million demanded by companies CSL Limited and Merck will go towards the program itself, while the rest will cover marketing, research and development, and profit. The controversy centers around the pharmaceutical benefits advisory committee's (PBAC) decision to reject the proposal due to concerns over cost and long-term effectiveness. Prime Minister John Howard has attempted to diffuse the situation by promising government subsidies for the vaccine, but Labor, backbenchers, patient groups, and Australian of the Year Ian Frazer have criticized the decision.

Key Takeaways:

  • The proposed subsidy of $625 million over four years will only half-cover the costs of the vaccination program, with the remaining funds going towards marketing, research and development, and profit.
  • The pharmaceutical benefits advisory committee (PBAC) rejected the proposal due to concerns over cost and long-term effectiveness.
  • The Gardasil vaccine, developed by CSL Limited and Merck, has been proven to protect against two strains of the human papilloma virus (HPV) that cause 70% of cervical cancer.
  • The vaccine costs $460 for a course of three shots.
  • A school-based immunisation program was planned for 2008, but may be delayed due to the controversy.
  • A group of federal senators from all parties has called for an urgent review of the PBAC's decision.
  • David Henry, a professor of clinical pharmacology at Newcastle University and former advisory committee member, believes that those calling for government intervention are "playing into the hands of the drug companies".
  • CSL's Dr. David has revealed that the company does make a profit from the vaccine, but the exact amount is not disclosed due to a confidentiality agreement with Merck.

Statistics:

  • The proposed subsidy of $625 million over four years will cost taxpayers approximately $156 million per year.
  • The vaccine costs $460 for a course of three shots.
  • The advisory committee rejected the proposal due to concerns over cost, with the vaccination of 2 million women between the ages of 12 and 26 projected to cost $625 million over four years.
  • The annual cost of the vaccination program is estimated to be $34 million per year after the initial four-year period.
  • The Gardasil vaccine has been proven to protect against 70% of cervical cancer cases.

Sources:

  • "PM tries to defuse row over cervical cancer vaccine" - The Canberra Times, date not specified
  • "Taxpayer subsidy for cervical cancer vaccine challenged" - The Australian, date not specified
  • "CSL public affairs director Rachel David" - The Canberra Times, date not specified
  • "David Henry, a professor of clinical pharmacology at Newcastle University and former advisory committee member" - The Australian, date not specified
  • "Gardasil, developed by CSL Limited and Merck" - The Canberra Times, date not specified
  • "Pharmaceutical Benefits Advisory Committee (PBAC)" - The Australian, date not specified

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