Why pay $15 a treatment when vaccines today cost less than $1?
One way or another, society needs to pay for the R&D costs of developing new vaccines that will bring about the better health that the world enjoys today. Vaccines without large rich-country markets will be more expensive, at least in the short term, in developing countries, than existing vaccines which have been able to recover their development costs elsewhere. Hence the advance market commitment creates a two-stage pricing structure, in which a high price at the outset — which is subsidised by the sponsors – is followed by a guaranteed, affordable lower price in the long run. Over the long run, the total price paid for the vaccine may be less than for other vaccines, even if the price is higher at first.
