Policy Research Working Paper #13 June 2007

Forecasting Demand for

Preventive HIV Vaccines in India
IAVI Public Policy Department
and
IAVI-India

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Forecasting Demand for Preventive HIV Vaccines in India

Copyright © 2007 International AIDS Vaccine Initiative. All rights reserved.

ISBN: 978-0-9792432-2-6

This paper was written by Gian Gandhi, Shilpa Vuthoori, and Pranay Lal (IAVI).

The authors wish to thank Christoph Kaufmann, Dave Matheson, Wendy Woods, and Michael Yeh
(Boston Consulting Group) for their significant contributions to all aspects of this research,
particularly the modelling work and primary data collection.

Special thanks to Paul Wilson (Columbia University) for his invaluable input to shape the
methodology, validate the model, and strengthen this paper. Special thanks also to Jonathan Grund
(IAVI) for his assistance with the synthesis and analysis of primary data that informs this research.

The authors also wish to thank the advisors who helped steer this research: Martha Ainsworth,
David Bishai, Ricardo Bitran, Laura Efros, Ruth Levine, Susan McKinney, Angeline Nanni, Patricia
Roberts, Chutima Suraratdecha, and all of those who gave their time to be interviewed to inform
this research (Appendix I). The authors are grateful to Vijay Samant, DCS Reddy, and Denis Broun,
who reviewed our paper and provided valuable perspectives on the challenges of vaccine
development, implementation of health care programmes, and the HIV/AIDS epidemic in India.

Finally, the authors would like to thank Jean-Louis Excler, Tom Harmon, Robert Hecht, Sonali
Kochhar, Eva Roca, Kate Taylor, and Holly Wong at IAVI for their clarifications and generous
assistance with refining earlier drafts of this paper.

This study and report were made possible in part by the generous support of the American people
through the United States Agency for International Development (USAID) under Cooperative
Agreement No. GPO-A-00-06-00006-00. The contents are the responsibility of the International
AIDS Vaccine Initiative and do not necessarily reflect the views of USAID or the United States
Government.

Information in this document may be reproduced or copied without permission, provided the
International AIDS Vaccine Initiative, Inc. (IAVI), is acknowledged as the source. However,
reproduction of substantial portions of this report, or any use of the material other than for
education or non-commercial purposes, requires prior authorization in writing.

To request additional print copies of this working paper or other information from IAVI please
contact:

Publications Unit
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New York, NY 10038 USA
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The full text of this report is also available online at the IAVI website at:
http://www.iavi.org/India_Demand_Forecast

IAVI’s mission is to ensure the development of safe, effective, accessible, preventive HIV vaccines
for use throughout the world.

Printed on recycled paper.

Forecasting Demand for Preventive HIV Vaccines in
India

Policy Research Working Paper #13

June 2007

IAVI's Policy Research Working Paper series disseminates the findings of works in
progress to promote the exchange of ideas about the effective development and
global distribution of vaccines to prevent HIV infection.
Table of Contents

List of Tables ii
List of Figures iii
Acronyms iv
Glossary v
Executive Summary 1
I. Introduction 4
1.1 Background
1.2 Research overview and scope
1.3 Previous demand assessments for HIV vaccines in India
II. Determinants of demand and methodological framework 6
III. Expert consultation 8
3.1 Rationale and objectives
3.2 Interview methods and interviewee selection
3.3 Interview results
IV. Demand forecasting model 15
4.1 Model overview
4.2 Public sector adoption and implementation assumptions
4.3 Private market modelling assumptions
V. Results and discussion 24
5.1 Overview
5.2 Vaccine profile demand scenarios: public versus private markets
5.3 Results and implications for donors and policymakers
5.4 Revenue forecasts and implications for private industry
5.5 Sensitivity analyses
VI. Summary/conclusions 38
References 40
Appendix I. List of interviewees and collaborators 43
Appendix II. Vaccine profile specification 45
Appendix III. Interviewee categories, rationale and judgments 46
Appendix IV. India’s country profile descriptor information and assumptions 47
Appendix V. Algorithms to define endogenous country-level behavioural parameters 48

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List of Tables

Table 1. Key determinants of demand 6

Table 2. Minimum acceptable level of vaccine efficacy 11
Table 3. Ranges for the minimum acceptable levels of protective duration and 11
maximum price per dose
Table 4. Target age range for populations at lower risk of exposure to HIV 12
Table 5. Efficacy and duration of protection, by scenario 16
Table 6. Prices of existing vaccines in India 16
Table 7. Summary of India’s country profile descriptor values 17
Table 8. Summary of India’s public sector adoption and implementation 21
behaviours
Table 9. Summary of India’s private market adoption and usage behaviours 23
Table 10. Relative contribution to cumulative demand of private versus public 26
initiatives
Table 11. Volume of demand in India across scenarios 26
Table 12. Policy-environmental scenario specifications and effects on demand 30
Table 13. Cumulative and peak sales revenue in India 34
Table 14. Relative contribution of private market versus public market 35
programmes to revenue
Table 15. Sensitivity analyses parameter values 36
Table A1. Lower and upper bounds of vaccine profile 45
Table A2. Efficacy-implementation threshold matrix for high-risk programme 48
Table A3. Efficacy- implementation threshold matrix for general programme 48
Table A4. Duration of protection- implementation threshold matrix 48
Table A5. Price- implementation threshold matrix 48
Table A6. Regulatory/licensure lag matrix 48
Table A7. API-prevalence-GNI scores 49
Table A8. Intermediate high-risk programme implementation lag value 49
Table A9. Hepatitis B implementation 49
Table A10. Intermediate low-risk programme implementation lag value 49
Table A11. Upper age limit of low-risk target group matrix 50

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List of Figures
Figure 1. Methodological demand framework, from need to projected demand 7
Figure 2. Is the AIDS epidemic plateauing in India? 9
Figure 3. Behavioural disinhibition concerns with partial efficacy vaccines 14
Figure 4. Total annual demand forecasts for India (given various vaccine 25
profile assumptions)
Figure 5. Total annual demand by vaccination strategy (Medium Scenario) 27
Figure 6. Separating the effects of each vaccination strategy (Medium 27
Scenario)
Figure 7. Funded versus unfunded complete courses (for the Medium 29
Scenario)
Figure 8. Demand forecasts for policy-environmental scenario specifications 31
Figure 9. Vaccine profile sales revenue forecasts 34
Figure 10. Change in cumulative demand from sensitivity analyses on model 36
parameters

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Acronyms
AIDS Acquired immunodeficiency syndrome
API AIDS program effort index
ARV/ART Antiretroviral therapy
CAGR Compound annual growth rate
CSW Commercial sex worker
EMEA European Medicines Agency
EPI Expanded Programme on Immunizations
FDA U.S. Food and Drug Administration
FSW Female sex worker
GAVI Global Alliance for Vaccines & Immunizations
GDP Gross domestic product
GNI Gross national income
GOI Government of India
HIV Human immunodeficiency virus
HPV Human papillomavirus
HSV-2 Herpes simplex virus-2
IAVI International AIDS Vaccine Initiative
IDU Injecting drug user
IEC Information, education, and communication
MSM Men who have sex with men
NACO National AIDS Control Organisation (India)
NGO Nongovernmental organisation
NPT New preventive technology
NRA National regulatory authority
PPP Purchasing power parity
PrEP Pre-exposure prophylaxis
R&D Research and development
Rs Indian rupees
SACS State AIDS Control Societies (India)
UIP Universal Immunisation Programme
UNAIDS Joint United Nations Programme on HIV/AIDS
UNDP United Nations Development Programme
VCTC Voluntary counselling and testing centre
VEI Vaccine effect on infectiousness
VEP Vaccine effect on disease progression
VES Vaccine effect on susceptibility
WHO World Health Organization
WTP Willingness to pay
WTV Willingness to be vaccinated

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Glossary
Term
Adoption lag
Behavioural disinhibition
Catch-up vaccination
strategy
Determinants of demand
First-generation preventive
HIV vaccines
High-risk vaccination
programme
Implementation lag
Long-term stable demand
Loss to follow-up
Low-risk vaccination
programme
Peak year of demand
People fully vaccinated
Political will
Private market
Programme implementation
lag
Public market
Regulatory lag
Re-vaccination strategy
Definition / Explanation
The time between licensure of the vaccine by the FDA or
EMEA and licensure in India and the point at which the
vaccine is licensed for use (at a minimum in private
markets), in India.
When vaccinated individuals believe they are protected
from HIV infection and therefore engage in behaviours that
put them at greater risk of exposure to HIV.
A vaccination strategy aiming to vaccinate those missed or
not eligible for a routine vaccination. A catch-up strategy
targets any residual population outside of the routine
recipient population(s).
Enabling factors and constraints that facilitate or limit
demand.
The first set of preventive HIV vaccines that are licensed for
use.
Public vaccination programmes implemented to target
(vaccinate) populations at greater risk of exposure to HIV.
The time between licensure of a vaccine and commencement
of a public vaccination programme.
The level of total annual doses or courses of a vaccine at
which demand is stable, (i.e., when there is no significant
change from year to year in levels of demand).
The proportion of those vaccinated who do not return for a
needed revaccination.
Public vaccination programmes targeting certain
populations at lower risk of exposure to HIV.
The year during the forecasting period when demand
reaches its highest level.
The total number of people who receive a complete course
of the HIV vaccine within a given period. This is equivalent
to the total number of courses (not doses) received.
The level of policymaker support for public policy
initiatives.
The market for a vaccine that is not funded or subsidized by
public funds and not implemented as a public health
programme. In this analysis, the private market represents
individual demand from those willing and able to pay for
the vaccine and also willing to be vaccinated.
See implementation lag above.
Vaccine demand or utilisation funded by the public sector.
The time between regulatory approval in the U.S. or Europe
and national regulatory approval in India.
The vaccination strategy employed to maintain protection
when a vaccine with a limited duration is used.
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 Term Definition / Explanation
Routine vaccination strategy The vaccination strategy employed to vaccinate new
entrants to certain sub-populations as part of an annual
programme. The routine vaccination strategy may vary in
approach depending on the sub-population (e.g., school-
based programmes for adolescents or vaccination, harm
reduction programmes for injecting drug users (IDUs), or
outreach/condom promotion programmes for sex workers.
Targeting The selection of specific population groups for vaccination
based on such criteria as risk of exposure, age, etc.
Vaccine profile The key vaccine characteristics that describe the vaccine,
including efficacy, duration of protection, price per dose,
dosing regime, and clade-specificity.
Wastage factor The amount of vaccines lost due to inefficiencies in storage,
transport, or usage (e.g., poor cold chain system, faulty
syringes, etc.)

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Executive Summary
At the end of 2005, an estimated 5.2 million people were living with the human
immunodeficiency virus (HIV) or acquired immunodeficiency syndrome (AIDS) in India,
representing 12-15% of the global burden of disease from HIV/AIDS. Vigorous prevention
programmes are reported to be slowing the spread of the epidemic in parts of India.
Despite these efforts, however, more than a quarter of a million people died of AIDS-
related illnesses and thousands of others were newly infected with HIV in India during
2005.

Under these circumstances, there is an urgent need for stronger and more effective HIV
prevention methods, including an HIV vaccine. Ongoing research and development
(R&D) for HIV vaccines needs to remain a high priority in the search for new preventive
technologies. The eventual launch of such a vaccine could make an enormous difference in
reversing the epidemic and saving millions of lives. To make such an impact, however, an
HIV vaccine needs to be widely available and accessible and must be implemented quickly.
Demand forecasts for products still in an early stage of development, such as an HIV
vaccine, can provide a valuable decision-making tool to help achieve these goals.

A consultation was conducted in 2006 to assess the preferences and perceptions of Indian
policymakers and policy influencers which could affect demand for a first-generation
preventive HIV vaccine in India. The aim of the consultation was to understand (1) how
the country might adopt and implement an HIV vaccine, and how public and private
markets might react to an HIV vaccine with given characteristics, (2) which groups might
be targeted by the government to receive such a vaccine, and (3) how quickly the vaccine
might become available and be taken up in various population groups.

The consultation findings suggested the following: Given the multiple regulatory approvals
needed to secure licensure for an HIV vaccine in India, it is likely that it would take 2-3
years for the vaccine to be implemented in India after initial licensure in the United States
and Europe (assuming the vaccine is effective across all strains of HIV-1). However, the
regulatory review process in India might be expedited if India continues to participate in
HIV vaccine clinical trials beyond the current Phase I trial.

Based on the results of the consultations, it seems unlikely that the Indian public sector
(national and state-level) would endorse the use of an HIV vaccine in its programmes if the
efficacy or duration of protection is below certain levels, or if the price per course is above
a certain value. Vaccine efficacy of at least 50% would be necessary to persuade the public
sector to mount a vaccination programme for groups at higher risk of exposure to HIV --
groups such as commercial sex workers and injecting drug users. Those consulted for the
study indicated that an even higher level of efficacy -- at least 70% -- would be needed to
convince the public sector to subsidize and promote the use of the vaccine in the broader
adult population groups which face relatively lower risks of HIV infection. In this
instance, epidemiological, behavioural, and cultural factors specific to India point to the
fact that the government might decide to target only adolescents and young adults under
26 years of age, rather than promoting the vaccine for all sexually-active adults.

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Consultations suggested that an HIV vaccine with an efficacy threshold as low as 30%
efficacy could nevertheless be seen as acceptable and be taken up by paying individuals in
the private market.

Finally, a vaccine would need to have a duration of protection of at least three years and a
price paid by the Government of India (GOI) to suppliers of US$20 (Rs 880) per course or
less, in order for decision-makers to use the HIV vaccine in public programmes.

Implementing HIV vaccine programmes could be delayed by safety concerns and fears
about behavioural disinhibition, i.e., worries that vaccinated individuals would believe
that they are fully protected from HIV infection and thus engage in riskier behaviour.
Overcoming this worry could be crucial to ensuring rapid vaccine introduction and uptake
in India. To do so, a partially efficacious vaccine may have to be introduced in tandem
with vigorous informational, education, and communication (IEC) interventions to
mitigate the anticipated adverse effects of behavioural disinhibition. Such interventions
could be complex and costly to implement, and would add to the overall price tag for an
HIV vaccination programme in India.

On the basis of these qualitative interview findings, the International AIDS Vaccine
Initiative (IAVI) and its consultants from the Boston Consulting Group developed a model
to generate baseline forecasts and other scenario analyses which allow policy-makers to
explore the effects of varying epidemiological, regulatory, and health systems assumptions
on demand projections.

For vaccines of medium and higher efficacy (50% and 70%, respectively), peak demand in
India from public and private markets is projected to range between 15.2-41.5 million
persons fully vaccinated per year. Total cumulative demand over three decades for such
vaccines is estimated at 221-788 million complete courses -- these are robust levels of
demand. If the efficacy of a first-generation vaccine falls below 50%, however, anticipated
demand could drop significantly, since the GOI would not initiate a public sector-
sponsored programme for a vaccine with such limited efficacy. Under these circumstances,
demand is projected to be restricted to the private market and over 30 years is estimated to
amount to only 24 million complete courses.

Assuming tiered pricing between public and private markets (US$10 and $50 per dose,
respectively), demand for medium and higher efficacy vaccines could generate annual sales
revenues that peak at US$415-$911 million (Rs 1,831-4,017 crore) just seven years after
launch. Even levels of demand for a low-efficacy vaccine (30%) could translate into
significant revenues for suppliers, with average annual sale revenues projected to be about
US$58 million (Rs 255 crore). These revenue projections suggest that under certain market
conditions, a first-generation HIV vaccine could account for as much as 1.1-2.4% of
expected total annual biopharmaceutical market sales in India.

Given that the consultation findings depicted significantly divergent perceptions of the
future HIV epidemic in India, we ran scenarios to assess the effect of various
epidemiological changes on demand. These indicated that should HIV prevalence remain
unchanged from today, average annual baseline demand would be 15 million complete
course administered per year. Should the epidemic worsen significantly, the GOI might
seek to use an additional 45 million complete course per year.

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Efforts to address regulatory, health systems delivery capacity, and political constraints
could increase access to and use of an HIV vaccine by almost 46 million additional people
each year over a 30-year period, compared to a vaccine with a medium efficacy. These
efforts include strengthened and expedited regulatory processes, expanded capacity of the
government health and vaccine delivery system, and greater political and public financial
support for HIV vaccines. Without significant increases in financial investment by the GOI
or international donors to fund such initiatives, almost two-thirds of the potential gains in
access would not materialize.

To achieve the aforementioned increases in demand and access, much lead time is required
to foster dialogue and implement policy change. Since the search for an HIV vaccine is still
likely to take several more years, there is an opportunity to engage vaccine developers,
donors, and Indian health care system officials in such a dialogue now, using tools such as
this forecasting model.

Like all mathematical models, this forecasting model is limited by the quality and
availability of data, the inherent uncertainty of the future, and the resulting assumptions
that have been made. Over time, lessons can be learned and valuable data gathered as
new vaccines such as that for the human papillomarivus (HPV) and other HIV preventive
technologies are introduced in India. Richer information would enable more precise and
reliable forecasts. In turn, these forecasts could lead to better-informed strategic decisions
to prepare for and eventually maximise access to and use of a much needed HIV vaccine.
IAVI and its partners are fully prepared to work with the Indian authorities to strengthen
such forecasts over the coming years.

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I. Introduction
1.1 Background

Demand has historically been estimated for products that are close to, or already on, the
market. Exploring demand forecasts for a product still in an early phase of research and
development (R&D) (Longhi et al. 2006), such as a preventive HIV vaccine, is also
important:

x To provide product developers with credible estimates of future market potential and
better evaluate the acceptability of pipeline candidates to guide R&D portfolio
management and manufacturing investment decisions;
x To help donors design R&D incentives that include realistic market scenarios; and
x To provide information to national health officials to prepare delivery infrastructure
for future vaccines well before they are introduced.

1.2 Research overview and scope

To assess the potential demand for a health intervention, an understanding of the
determinants of demand as well as how a country may respond to these drivers is essential.
The International AIDS Vaccine Initiative (IAVI) has undertaken policy research to
identify the key determinants of demand for an HIV vaccine and to create a framework to
conceptualize how these determinants affect demand (IAVI 2007a).

To better understand how India might adopt and implement a first-generation preventive
HIV vaccine, researchers interviewed experts to assess the preferences and perceptions of
those who make and influence policy. These interview findings have been synthesized
along with published data to tailor the conceptual framework and create a demand
forecasting model capable of creating scenarios to assess demand and revenues associated
with an HIV vaccine in India, given a variety of policy and market conditions in the
country.

This research does not attempt to address the following issues:

x Second-generation "follow-on" HIV vaccines, the associated competitive dynamics,
and the impact on market demand over time;
x The therapeutic use of an HIV vaccine designed, tested, and licensed for preventive
use;
x The effect of other new preventive technologies (NPTs), such as microbicides, pre-
exposure prophylaxis (PrEP), and herpes simplex virus (HSV-2) suppression therapies,
on HIV vaccine demand — even though these other NPTs might be available in India
by the time an HIV vaccine is launched;
x The social, epidemiological, and financial impacts of HIV vaccine introduction.

1.3 Previous demand assessments for HIV vaccines in India

Only one published study exists that assesses potential demand for an HIV vaccine in
India (Seshadri et al. 2003). The study assesses the demand for a vaccine in the four

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southern states of Andhra Pradesh, Karnataka, Maharashtra, and Tamil Nadu, focusing
on eight potential target groups, including children and early adolescents (newborn to 14
years old). Using estimates of coverage for existing HIV prevention programmes and other
health care programmes for each target group, and assuming the ability of an HIV
vaccination programme to capitalise on existing interventions, the study estimates demand
as well as the financial implications of introducing a single-dose HIV vaccine that costs
US$10 per dose.

The study provides very useful insights into the potential demand for a preventive HIV
vaccine, but its design and assumptions require reappraisal in light of changing scientific
opinion. The study does not consider the impact of efficacy and duration of protection on
demand for HIV vaccines. Furthermore, the study considers what now seem to be unlikely
target groups (children) and overlooks more applicable populations at higher risk of
exposure to HIV, such as injecting drug users (IDUs) and men who have sex with men
(MSM). Finally, the regional focus of the study was useful at the time, since the HIV
epidemic disproportionately affects Southern India (NACO 2004). However, given how
fast the epidemic is growing in northern states (in particular Nagaland, Manipur, and
Mizoram), a forecast for the entire subcontinent provides significant additional value
(NACO 2004).

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II. Determinants of demand and methodological framework
Key determinants or drivers of demand (Table 1) were identified after a review of prior
studies (IAVI 2005) and discussion with researchers as part of a wider global demand
forecasting study (IAVI 2007a). These determinants were incorporated into a
methodological framework (Figure 1), which informed the structure of the forecasting
model. The framework was based upon the notion that the determinants act as
constraining factors that limit final demand to some fraction of the total population in
need.
Table 1. Key determinants of demand
Key Determinant Description
Population requiring the intervention (e.g., not already infected, at most
Need
risk, etc.)
Vaccine characteristics Product profile
Political will Policymaker support
Capacity Health care system capacity and effectiveness
Government (and donor) funding to pay for public sector vaccine
Funding demand; or
Private individuals' willingness to pay for the vaccine
Acceptability Individual beliefs and attitudes: their willingness to be vaccinated
The intended recipient population(s) for the public sector vaccination
Targeting
programme(s)
The need for an HIV vaccine depends upon the national epidemiological and demographic
situation. Need is determined by the incidence, prevalence, and disease burden in a
country. Countries with higher prevalence, large disease burdens, and growing epidemics
are those with the greatest need for a preventive HIV vaccine.

The vaccine's characteristics determine how well, for how long, and for whom the vaccine
will work; how easy it will be to transport, store, and administer; and what it costs. These
factors are important to policymakers because they influence both the social benefits and
risks and the cost of vaccinating a population. Such information often guides public sector
decisions about whether or not to use the vaccine, and if it is to be used, by whom.

Political will is a crucial determinant of demand because it plays an important role in

prioritizing and implementing public health initiatives. Amongst other things, a lack of
political will can impede the licensure process of a vaccine, prevent rapid incorporation of
a vaccine into national public health initiatives, and limit funding for purchasing vaccines
or financing delivery costs.

Capacity refers to the availability of resources (monetary or otherwise) available for use
within the health care system to introduce public health programmes (e.g., vaccination
campaigns) and deliver such health technologies as an HIV vaccine. Capacity determines
the availability and ease of access to an HIV vaccine via public markets. From the
introduction of other health care interventions, we know that capacity constraints can
cause recipient populations in some countries to receive vaccinations years later than those
in other parts of the world.

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Funding from national governments or from international donors is essential to guarantee
that desired levels of demand in public markets can be financed in low- and middle-income
countries. Funding constraints can affect the extent to which a public health care
intervention is available and accessible. In privately funded markets, funding constraints
are described by individuals' willingness to pay (WTP).

The beliefs and attitudes of individuals play a large part in determining a vaccine's
acceptability. Acceptability to individuals and the wider society is an important
determinant of demand. Unless people are willing to be vaccinated, potential demand will
not translate into actual demand and utilization. Lack of acceptance may impede
voluntary vaccination (resulting in lower coverage) or limit completion of a full course of
vaccination (resulting in lower compliance).

The targeting and vaccination strategies employed by policymakers identifies the intended
recipient population(s) for the vaccine and how to reach these populations, based on
policymakers' perceptions of the extent of the epidemic and their preferences regarding the
vaccine's profile (efficacy, safety, duration, price, etc.).
Figure 1. Methodological demand framework, from need to projected demand

x Future State Number of people who would need an AIDS vaccine

of Epidemic Driver: Epidemiological characteristics

x Efficacy
x Duration Number of people for whom a vaccine is
x Dosing appropriate given the product profile
x Price Driver: Vaccine characteristics
x Cost

x Political will
x Adoption speed/lag
x Funding
Number of people who
x Capacity can access vaccination
x Implementation lags Multiple drivers: 'Policy
x Reach/coverage environment characteristics'
x Targeting

x Coverage Number of people likely to

x Compliance take vaccine given attitude
and behaviour
Driver: Acceptability

Final demand is a fraction of

the population in need

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III. Expert consultation
3.1 Rationale and objectives
A consultation of experts was conducted to ensure that the demand forecasts incorporate
"ground-level" attitudes and perceptions as well as the likely actions of stakeholders who
determine or influence health and finance policy decisions across India.

The aim of the expert interviews was to understand:

x Policymakers' preferences and reactions to first-generation vaccine profiles;
x Health care decision-making structure and prioritization in India;
x Health technology licensure/approval processes and implementation time frames;
x Policymakers' perceptions about the future state of the epidemic;
x Policymakers' preferences for targeting strategies if an HIV vaccine became available;
and
x Strategies envisaged to deliver and fund future vaccination programmes.

3.2 Interview methods and interviewee selection

Forecasting demand for global public health products such as an HIV vaccine is a complex
problem involving a plethora of unknown variables. In such instances, forecasting experts
often break the problem down into its component parts and assess smaller parts of the
bigger problem (MacGregor and Armstrong 1994). Following this methodology, assessing
demand for an HIV vaccine was broken down into specific questions about the key
determinants of demand described above. Questions about these determinants were then
compiled into a semi-structured interview guide.1

To determine the likely range of vaccine characteristics that might describe a first-
generation HIV vaccine, an initial consultation was conducted with HIV vaccine R&D
experts from around the world. This identified several key vaccine characteristics: (1)
efficacy, (2) dosing schedule, (3) duration of protection, and (4) price per full course of
vaccination. In addition, other characteristics (e.g., safety, clade specificity, and delivery
and storage requirements and associated costs) were also considered. However, for
simplicity, it was assumed that the vaccine would be safe (with no serious adverse effects)
and would confer cross-clade protection. Appendix II details the characteristics and range
of hypothetical first-generation HIV vaccine profiles tested during the interviews.

Individuals from multiple stakeholder groups in India representing those who might
influence the adoption and implementation of an HIV vaccine were interviewed. In all, 43
interviews were conducted across stakeholder groups in India. The interviews were
conducted in New Delhi (22), Chennai (7), and Mumbai (9), with five interviews
conducted with stakeholders based in other parts of the country. The 43 interviews were
divided amongst the following stakeholder groups: 13 civil society representatives; seven
health technology developers, manufacturers, suppliers; five representatives of donor and

1
Available on request.

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multilateral institutions; seven government representatives; and 11 representatives of
research and academic institutions (see Appendix III for further details).

The findings from the expert consultations were synthesised and formed the basis of many
of the forecasting model assumptions described in the next section.

3.3 Interview results

3.3.1 Perceptions of the future HIV epidemic in India

Perceptions of the future nature of the HIV epidemic are important because they help
show whether need will increase, decrease, or stay at the same level as today. The level of
need is a crucial driver of demand, as described above.

There were significantly divergent views among public sector stakeholders (government
officials and policymakers), representatives of civil society, and representatives of donor
and multilateral institutions about perceptions of the HIV epidemic in India and whether it
has started to plateau, as has been suggested in recent research (Kumar et al. 2006) (Figure
2).

Figure 2. Is the AIDS epidemic plateauing in India?

100%

No
33% No No
80% 43% 44%
Percent of Respondents

No
60% 80% No
90%

40% Yes
67% Yes Yes
57% 56%
20%
Yes
20%
Yes
10%
0%
Government Industry Research Donor & Civil Society
Representatives & Academia Multilateral
Community
Stakeholder Group

Most respondents across all stakeholder groups feel that the epidemic is unlikely to spread
as virulently as it has in many parts of Africa. However, every respondent believes that
HIV will remain a serious public health crisis in India, even if prevalence has already
peaked.

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3.3.2 Health care decision-making structure in India

Indian health care system policies and programmes are both vertical and horizontal in
nature: The vertical GOI-controlled programmes address diseases of national concern and
are grouped under what is known as the "Union List." Approximately 75% of all
vaccinations in India are distributed through vertical programmes, with the remaining
25% distributed through private market channels. As a political priority, a vertical
programme determined by the National AIDS Control Organisation (NACO) carries out
HIV treatment and prevention policy. These national policies are administered by 38 State
AIDS Control Societies (SACS), which operate in all states of India and Union Territories,
as well as in three large cities.

The consultation results suggest that if an HIV vaccine is licensed in India, policy is likely
to be set by the NACO programme. Additionally, there may be horizontal programme
components administered via SACS as part of a wider initiative (e.g., associated
counselling). Nonetheless, these findings suggest that delivery of future HIV vaccines is
likely to be determined at a national level via a vertical programme and suggest that the
forecasting model should take a national (as opposed to regional or state-specific)
perspective.

3.3.3 Health technology approval processes and adoption timeframes

Responses seem to suggest that approval from the U.S. Food and Drug Administration
(FDA) or the European Medicines Agency (EMEA), and possibly World Health
Organization (WHO) prequalification, would be required to secure approval in India. In
the absence of Indian Phase III trials, bridging studies (safety and immunogenicity) in an
Indian population would also be required. Approval from the Recombinant DNA
Committee and the Genetic Engineering Approval Committee might be required,
depending on the vaccine technology. Given the multiple levels of approval both
internationally and nationally, these findings suggest that an HIV vaccine would be
licensed for use in India (adopted) at least two to three years after initial licensure in the
U.S. and the European region.

Most respondents feel that HIV vaccine regulatory approval would be expedited if India
continues to participate in HIV vaccine discovery and development beyond current Phase I
trial activities. One biopharmaceutical industry representative suggests:
The key to faster adoption would be to include Indian participants in Phase III trials
… Then the need for bioequivalent studies would be negated and the developers would
actually save themselves the time required for the additional study plus could also
reduce approval time by the Drug Controller General to less than one year.

Researchers outside the private biopharmaceutical industry also commented on the

importance of involving India in the development and manufacturing process. For
example, one says:
A 'Made in India' stamp is important for faster adoption. If a vaccine is developed in
partnership with India or is being manufactured in India, it would make a difference.

10
 It will also help overcome the 'Guinea Pig Syndrome' to which Indians are very
sensitive.

3.3.4 Minimum acceptable level of vaccine efficacy

There was significant variation of opinion among stakeholder groups about the minimum
acceptable level of vaccine efficacy (Table 2). Efficacy was understood to mean two things:
First, the vaccine prevents infection in those vaccinated prior to exposure by a fixed
percentage (known as the 'vaccine effect on susceptibility', VES); and second, the vaccine
also lowers transmissibility if infected after being vaccinated (known as the 'vaccine effect
on infectiousness', VEI) by the same magnitude as VES. For further details, refer to
Appendix II.

Table 2. Minimum acceptable level of vaccine efficacy

Average Minimum Acceptable Level of Vaccine Efficacy
Stakeholder Group
Populations at Higher Risk Populations at Low Risk
Civil society 30% 60%
Donors/multilaterals 40% 70%
Government 50% 80%
Research & academia 50% 80%
Industry representatives 60% 70%
Average 50% 70%

Most agree that efficacy levels will be major determinants of the target populations.
Overall, responses suggest that the minimum acceptable threshold of efficacy must be 50%
before the GOI would sanction use of an HIV vaccine for populations at higher risk of
exposure to HIV, while in populations at lower risk of exposure, the minimum acceptable
efficacy threshold might be as high as 70%.

3.3.5 Minimum acceptable duration of protection and maximum acceptable price

Most stakeholder groups feel that a vaccine with a duration of protection of at least three
years will be necessary. Across all stakeholder groups, the range for prices deemed to be
acceptable to the public sector is between US$1-$10 per dose (Table 3), assuming a two-
dose vaccine. Unlike efficacy, these do not vary much when respondents consider different
target groups.

Table 3. Ranges for the minimum acceptable levels of protective duration and maximum price per
dose
Minimum Acceptable Maximum Acceptable
Stakeholder Group Duration of Protection Price Per Dosea
(Years) (US$)
Civil society 1-5 years $1-2
Donors/multilaterals 1-3 years $1-2
Government 5 years $1-10
Research & academia 3-5 years $1-2
Private sector industry 3-5 years $1-10
a
Assumes a two-dose vaccine.

11
3.3.6 Targeting

Most stakeholder groups feel that the GOI would favour targeting populations at higher
risk of exposure to HIV first and foremost and only consider targeting populations at
lower risk if vaccine efficacy is high (t70%). When populations at lower risk are
considered, only adolescents and young adults (13- to 26-year-olds) will be targeted (Table
4). This is because there seems to be a prevailing view amongst those interviewed that once
an Indian is married (typically by the age of 26), the risk of contracting HIV significantly
diminishes, thereby removing the need for an HIV vaccine.2

Table 4. Target age range for populations at lower risk of exposure to HIV
Target Age Range for Populations at
Stakeholder Group
Lower Risk
Civil society 13- to 26-year-olds
Donors/multilaterals 16- to 21-year-olds
Government 14- to 25-year-olds
Research & academia 16- to 26-year-olds
Private sector industry 15- to 19-year-olds
Overall age range 13- to 26-year-olds

3.3.7 Implementation lag and uptake speed

There is uncertainty about the likely speed of implementation of HIV vaccine programmes
and the subsequent uptake of the vaccine in India following regulatory approval.
Respondents cited a host of confounding factors that could slow or expedite
implementation and uptake. These include:

x Concerns about potential behavioural disinhibition (see subsection 3.3.9);

x The fact that HIV is a key political priority and hence political will would ensure
appropriate resourcing and no delays; and
x India's continued involvement in HIV vaccine clinical research would ease safety
concerns, provide experience in the use of the vaccine, and ensure relatively rapid
implementation and uptake.

As such, there was no clear view amongst respondents about implementation lags and the
speed of uptake.

3.3.8 Coverage

Civil society and multilateral representatives are doubtful about the ability of public sector
HIV vaccination programmes to reach and cover populations at higher risk of exposure
because these populations are unlikely to present themselves at state-run institutions. As
such, nongovernmental organisations (NGOs) may represent the only viable delivery
channels for interventions (education, condoms) targeting populations at higher risk.

2
That said, some stakeholders, particularly from civil society groups and multilateral organisations, feel that
social norms are changing and that married women are increasingly being infected by husbands who are not
monogamous. They feel that broader prevention (and vaccination) programmes may be necessary to protect
these increasingly vulnerable populations.

12
The obvious place to administer an HIV vaccine to adolescents would be through schools
and colleges. However, access to high schools and higher education, as well as high drop-
out rates, suggest that such vaccination programmes might not adequately cover large
portions of this target population.

All of this suggests that the target populations for an HIV vaccine are likely to be hard to
reach. We thus conclude that maximum coverage rates in India are likely to be no greater
than 40%.

3.3.9 Other implementation issues

Many respondents stressed concerns about behavioural disinhibition. Behavioural

disinhibition refers to the increase in high-risk sexual behaviour among vaccine recipients
in response to perceptions of safety conferred by the vaccine as a protective barrier. For
example, a public health expert said:
A 70 percent efficacy is acceptable, 50 percent is the bare minimum, but the greater the
inefficacy, the greater the negative effects of behavioural disinhibition.
Future studies should continue to assess the likelihood of behavioural disinhibition and
add to the growing body of evidence demonstrating that such concerns are minimal or
unfounded (Aral 2006; Bartholow et al. 2005). A significant number of stakeholders feel
that in the absence of data to the contrary, behavioural disinhibition would occur if a
partially efficacious vaccine were launched and suggest that the vaccine would therefore
need to be introduced in tandem with other IEC interventions to mitigate the expected risk
(Figure 3).
A vaccine that is not highly efficacious will have strong challenges for an educational
effort both to address partial efficacy as well as to address behavioural disinhibition.
People are looking for a substitute for condoms rather than for something in addition
to their use. (industry/private sector stakeholder)

Several experts, particularly those from civil society organisations, say that the necessary
health outreach and communication could be undertaken alongside current IEC services.
However, many note that many existing IEC programmes are under-funded and require
additional resources to build capacity if they are to become effective.

Respondents across all stakeholder groups mention that many current service promotion
communications do not reach intended audiences, and in particular, key populations at
higher risk. Several point to voluntary counselling and testing centres (VCTCs) across
India that have been unable to effectively reach the majority of potential beneficiaries and
remain under-utilized. For these reasons, many feel that serious communications
challenges must be addressed in tandem with the wide-scale implementation of any
partially effective vaccine.

13
Figure 3. Behavioural disinhibition concerns with partial efficacy vaccines

60%
National Average Across All
Stakeholder Groups
40%
50%
Percent of Stakeholders Expressing Concern

Researchers Civil Society

& Academics 50%
50%
40%
Donors &
Multilateral Government
Institutions & Policy
30% 40% Makers
40%

20%

10%
Industry
Representatives
0%
0%
Stakeholder Group

14
IV. Demand forecasting model
4.1 Model overview
IAVI created a model to estimate global demand based upon the aforementioned key
determinants of demand and findings from the expert consultation. This model aims to
reflect how India might respond to the availability of an HIV vaccine. It also provides a
national picture of HIV vaccine demand, with outputs defined according to whether
demand originates in public or private markets.

Assessing public and private demand is important because these markets respond
differently to the determinants of demand. The timing, volume, and value of demand from
each market may differ significantly and should be viewed separately.

Public market demand is described by two programmes: (1) the high-risk population
programme and (2) the low-risk population programme. The private market is viewed as a
single programme. The contribution to demand by each of the programmes is determined
by three types of information: vaccine profile descriptors, country profile descriptors, and
country-level behavioural parameters.

The model allows users to change the values for the descriptors and the parameters. Its
flexibility enables users to explore the effects of changing the assumptions, the underlying
data, and the predictive algorithms of the model.

4.1.1 Vaccine profile descriptors

Three key vaccine characteristics have been identified: efficacy, duration of protection, and
cost (vaccine plus delivery costs). Different combinations of these characteristics were used
to produce three vaccine profile scenarios (Table 5). These scenarios — Low, Medium
(baseline), and High — were assembled to represent the broad array of product profile
characteristics that a first-generation preventive HIV vaccine might take.

In the Low Vaccine Profile Scenario (hereafter the Low Scenario), we assume that the
vaccine has a 30% level of efficacy, which vaccine experts regard as the lowest level that
might be acceptable to regulators, and a duration of protection of three years. In the
Medium Scenario, which also represents our baseline scenario, the efficacy is assumed to
be 50%. In the High Scenario, we assume that efficacy is 70% and the duration of
protection is five years.

These vaccine profile scenario assumptions represent realistic and achievable but also
aspirational goals. The ranges of efficacy and duration are certainly in line with current
scientific expectations, although there is little certainty about the dosing regimen or the
delivery and storage requirements. Ideally, the vaccine would require as few doses as
possible and be stable at room temperature. However, scientific thinking suggests that
first-generation HIV vaccines will require a prime plus boost combination (i.e., at least
two doses). Many vaccines also require some sort of refrigeration.

In each of these scenarios, it is assumed that India's public market price is fixed at US$10
per dose, which would be borne by the GOI (possibly with support from donors), while
the private market price is assumed to be US$50 per dose (except in the High Scenario, in

15
which the private market price is assumed to be US$10 per dose). The private market price
is what consumers not patronising GOI-sponsored vaccination programmes would pay.
The prices chosen for the analysis are based on current pricing structures for newly
licensed vaccines (Table 6). For simplicity, no price decline is assumed over time in either
the public or private markets.
Table 5. Efficacy and duration of protection, by scenario
Vaccine Profile Scenarios

Low Medium High

Vaccine efficacya 30% 50% 70%

Duration of protection 3 years 3 years 5 years

Dosing schedule
2-dose prime-boost combination
(for a full vaccination course)
US$50/dose US$50/dose US$10/dose
Private market
b (Rs 2,200/dose) (Rs 2,200/dose) (Rs 440/dose)
Price per dose
US$10/dose
Public Market
(Rs 440/dose)
Delivery/storage requirements
Single vial/cold chain of 2-8ºC
(upon which delivery costs are loosely based)
US$0.01/dose
Private market
(Rs 0.44/dose)
Delivery costb US$3.00/dose
Public market: high risk
per dose (Rs 1.3/dose)
US$2.00/dose
Public market: low risk
(Rs 0.88/dose)
a
The vaccine's efficacy is assumed to be effective against all HIV strains or subtypes.
b
Based on conversion using exchange rate as of January 1, 2007, of US$1 = 44.12Rs (OANDA n.d.). This
conversion and rate of exchange is used throughout the rest of the report.

These pricing assumptions may reasonably reflect the cost of investments and risks to
producers of an HIV vaccine and are also in line with what is being charged in private
markets for some of the newer vaccines in India (Table 6). However, these prices are very
high compared to what the GOI is used to paying for vaccines implemented through
public programmes.

Table 6. Prices of existing vaccines in India

Estimated Public
Vaccine Brand Name Private Market Retail Price Range
Market Price
Anti-rabies vaccines Rabivax, US$6-10 (Rs 293-437)/coursea US$6 (Rs 300)/ coursea
Raksharab US$45 (Rs 2,000)/courseb
Rabipur US$35 (Rs 1,550)/coursec
Hepatitis B vaccine GeneVac-B US$20-30 (Rs 875-1,400)/ coursed
Engerix B US$1-3 (Rs 70-180)/ coursee
JE vaccine US$0.20-1 (Rs 8-45)/coursef
Chickenpox vaccine Varilix US$25-30 (Rs 1120-1345)/ coursee
Hepatitis A Havrix US$13-16 (Rs 598-712)/ coursee
Meningococcal Quadrimeningo US$11-15 (Rs 510-650)/ coursee
vaccine
TB vaccine BCG US$0.55 (Rs 25)/ coursee
Oral polio vaccine OPV US$1.65 (Rs 73)/ coursee
Measles vaccine M-VAC Sii US$0.75 (Rs 33)/ coursee
a c e
Chennai Online 2004 Maya 2006 Dhanasiri et al. 2007
b d f
Belgaumkar 2007 Tribune News Service 2002 Ramachandran 2006

16
4.1.2 Country Profile Descriptors

The country descriptors underpin the model, describing the demographic, epidemiological,
political, and financial situation in India. These descriptors comprise data from published
sources on:

x Demography: population, subpopulation sizes;

x HIV/AIDS epidemiology: prevalence, burden;
x Political will: AIDS program effort index (API) score;
x Ability to pay: purchasing power parity (PPP)-adjusted Gross National Income (GNI)
per capita;
x Health care system capacity: PPP-adjusted GNI per capita; and
x Funding: projected government and donor funding.

The demographic information is used to estimate the size of target populations. The
epidemiological information is used to capture the extent of the epidemic and describe the
need for the vaccine. Given that political will is difficult to quantify, the API score is an
approximate measurement of a country's level of effort to implement AIDS treatment and
HIV prevention programmes. Income as measured by PPP-adjusted GNI per capita is used
as a proxy for ability to pay, as well as a measurement of health care capacity. Finally,
projected government funding is based on a proportion of national income, a proxy for
budgetary constraints that might limit achievable demand (Table 7).

Table 7. Summary of India’s country profile descriptor values (See Appendix IV for details on
sources and assumptions)
Criterion Proxies Value(s) for India
Demography N/A In 2015, the following populations in India are estimated
to be:
o High-risk: 131 million
o Low-risk (13-26 yrs): 237 million
o Low-risk (13-49 yrs): 614 million
o Total: 1,280 million
Need Prevalence per capita Assumed to have a low prevalence (0.5%) in 2015.
(Equivalent to an absolute prevalence of around 6.6 billion
people)
Political will AIDS Program Index (API) API score of 59; (i.e., medium political will)
Capacity and ability National income per capita Income per capita of $1,292
to pay - PPP adjusted (i.e., medium income/capacity/ability to pay)
Projected GOI National income In 2015, the corresponding hypothetical funding
funding for health allocations are as follows:
care budget &  1.19% of GDP spent on health: US$1,656.0 billion
predicted allocation  1% of health budget spent on HIV/AIDS: US$19.7
to HIV/AIDS billion
programmes & HIV  25% of HIV/AIDS budget available for spending on
vaccine HIV vaccine: US$49.3 million
o If Low Scenario, 15% of HIV/AIDS budget spent on
vaccine: US$7.4 million
o If Medium Scenario, 50% of HIV/AIDS budget spent
on vaccine: US$24.6 million
o If High Scenario, 73% of HIV/AIDS budget spent on
vaccine: US$36.0 million

17
The country descriptor data assume static values, some of which are categorized according
to their value (high, medium, or low) (Appendix IV). This categorization is necessary for
applying the algorithms (Appendix V) that define the behavioural parameters.

4.1.3 Country-level behavioural parameters

The behavioural parameters describe India's public sector adoption (licensure) and
implementation behaviour, as well as private market demand and utilisation behaviour.

The public sector adoption and implementation behaviour parameters describe the:

x Minimum acceptable levels of key vaccine characteristics (efficacy and duration) below
which countries would not license and/or implement the vaccine;
x Maximum acceptable price above which countries would not license and/or implement
the vaccine;
x Time to local regulatory approval;
x Time to initiate public vaccination programmes;
x Vaccination strategy;
x Levels of achievable coverage; and
x Time it takes each country to achieve these levels of coverage.

The private demand and utilisation behaviour variables describe the:

x Willingness to pay (WTP) for the vaccine;

x Willingness to be vaccinated (WTV); and
x Compliance.

The behavioural parameters can be defined by the user or by a set of algorithms (internal
to the model) described in Appendix IV. The parameters that are used in the baseline
analyses presented here are based on a mixture of all three and are described in more
detail in the following sections.

4.2 Public sector adoption and implementation assumptions

4.2.1 National regulatory approval time

The model assumes that approval occurs first in North America and Europe through the
FDA and EMEA in 2015. But assuming the U.S. and European licensure processes occur
before India's overlooks the possibility that a vaccine might be developed outside of the
U.S. or Europe or that a clade C-specific vaccine might be developed. In either case, Indian
biomedical regulatory authorities might license the vaccine ahead of the FDA and EMEA
(if these licensing authorities license such a vaccine at all).

Should FDA/EMEA approval take place first, the baseline regulatory approval time for
India is assumed to be two years after this point. Compared to historical lags in approval
and implementation, this fast approval time is justified by the political prioritisation of
AIDS, as well as the presence of HIV vaccine clinical trials in India, which would likely
remove the need for local bridging studies.

18
The model assumes that the approval time depends on the vaccine's efficacy level.
Vaccines with an efficacy of 30% or less have an approval time of one year longer, while
vaccines with 70% or better efficacy would have an approval time of one year less than
the baseline. National regulatory authorities (NRAs) may approve highly efficacious
products more quickly because the clinical and scientific evidence is stronger and requires
less scrutiny and time to assess. We assume that the vaccine would need to demonstrate a
minimum level of efficacy of 30% in any particular target population in order to be
licensed anywhere in the world.

4.2.2 National implementation decisions

Although implementation decisions are based on a variety of factors, including the risk-
benefit profile of the intervention and the implications of this profile for cost-effectiveness
and affordability, the model assumes that public sector implementation decisions are based
solely on the acceptability of the vaccine's profile (in terms of efficacy, duration, and price
per dose). If the vaccine profile meets minimum acceptable thresholds across all three
profile dimensions, the GOI will implement it in a particular target population.

The model assumes that the minimum acceptable level of efficacy (efficacy threshold)
varies by target population. Therefore, given a particular level of vaccine efficacy, the GOI
might implement the vaccine in only the populations at higher risk of exposure to HIV as
opposed to more broadly in lower risk populations. Based on the findings from the expert
consultation, the model assumes that these implementation thresholds are set at 30% and
70% efficacy (for high-risk and low-risk programmes, respectively), with a minimum
duration of protection of three years and a maximum acceptable price to the public sector
of US$10 (Rs 440) per dose.

4.2.3 Vaccination programmes: recipient populations

Because current scientific opinion assumes that preventive HIV vaccines would be
administered to HIV-uninfected individuals, the population to be vaccinated includes those
confirmed as HIV-negative. However, since HIV testing prior to vaccination will be
logistically difficult and expensive, the starting population in this model is the total
population. This assumes two distinct population groupings: populations at higher risk of
exposure to HIV, and populations at lower risk of exposure.

Populations at higher risk of exposure to HIV

It is assumed that the populations at higher risk include female sex workers (FSWs), IDUs,
and MSMs. The size of these populations is based on three UNAIDS-commissioned studies
of prevalence in each of these populations (FSWs: Population Division of the Department
of Economic and Social Affairs n.d.; IDUs: Vandepitte et al. 2006; MSM: Aceijas et al.
2004). These populations have been estimated to total almost 131 million persons in India
by 2015 (Table 7). Although other groups might also be target recipients (e.g., migrant
workers, truck drivers, health care workers), they are not included in our model, due to a
lack of available data.

Populations at lower risk of exposure to HIV

Interview findings suggested that the GOI is likely to target certain populations at lower
risk of exposure to HIV: adolescents and young adults who are not yet married. Young
adults who have married are deemed to no longer be a target population because they are

19
assumed to be at such low risk of exposure that it is no longer necessary to vaccinate
them. For purposes of the baseline analysis, low-risk populations are defined as those
outside the high-risk populations 13 to 26 years old, which is estimated to be about 237
million persons in 2015 (Table 7). This age range seems appropriate given social norms in
India: the average age of sexual debut is 13 to 15 years old (WHO 2004), while the
average age of marriage is 18.7 years for females and 23.4 years for males (UNFPA 2005),
and 91% of women live with their husbands by 25 years of age (International Institute for
Population Sciences 2000).

4.2.4 Programme implementation lags

Even after a vaccine has been approved for licensure by national regulatory authorities,
there may be secondary implementation lags that further delay product emergence in
public markets. These delays would occur because officials are waiting to learn from the
experience of implementation in other countries or because of the time it takes for them to
adequately scale up delivery infrastructure. Within the model, the lag to implement a
particular public-sector vaccination programme depends upon the population targeted.
High-risk population programmes would presumably be initiated first, as suggested in the
interview findings. These would then be followed by low-risk population programmes.
With no clear view about how long these lags might be, we assume that experience from
clinical trials and continued political impetus will prevail and ensure that implementation
lags are relatively short (i.e., two years to initiate high-risk programmes and three years to
initiate low-risk programmes after licensure).

4.2.5 Post-licensure decision uptake speed

Separate from the licensure approval decision and implementation lags is the speed or
intensity with which the implementation of the vaccination strategy might occur. The
uptake speed describes the time to achieve the maximum achievable rate of coverage. It is
assumed that India would be able to achieve the maximum expected coverage five years
after initiating the high-risk programme and five years after initiating the low-risk
programme.

4.2.6 Vaccination strategy

In this model, three types of vaccination strategy are considered: a primary routine annual
vaccination strategy, a catch-up vaccination strategy, and a re-vaccination strategy.

x Routine vaccinations refer to the approach employed to vaccinate new entrants to

certain sub-populations in an annual programme. For example, if adolescents 13 to 16
years old are the sole target group, then a routine strategy might involve a school-
based programme that vaccinates every 13-year-old in school each year. Alternatively,
a routine strategy targeting IDUs might focus on individuals using needle exchange
programmes who had not already received an HIV vaccination.
x Catch-up vaccinations involve vaccinating those missed or not eligible for a routine
vaccination. The catch-up strategy targets any residual population outside the routine
recipient population(s). To continue the example from above, if adolescents 13 to 16
years old are the target group, then the catch-up strategy would attempt to vaccinate
those 13-year-olds missed by the routine vaccinations offered that year, as well as

20
 those 14 to 16 years old who weren't vaccinated when they were eligible for a routine
vaccination.
x Re-vaccinations are required when vaccines have a limited duration. If an HIV vaccine
is assumed to provide five years of protection, individuals will need to be re-vaccinated
every five years while they are in the eligible population. If a primary routine
programme involves an adolescent group 15 to 19 years old, with a five-year duration
of protection, no re-vaccination is required. On the other hand, if the general
population, aged 15 to 49 years, is targeted, then a vaccine with a five-year duration
would involve up to seven re-vaccinations for each individual.

Two further assumptions regarding re-vaccination have been made. First, in the absence of
clinical evidence, re-vaccination is assumed to require only a single dose. Second, only
75% of people requiring a re-vaccination are assumed to return.

4.2.7 Coverage, vaccine acceptability, compliance, and wastage

The model is designed to enable analysis of demand with respect to coverage, vaccine
acceptability, compliance, and wastage by target population as well as by vaccination
strategy. However, due to lack of available data, we consider only coverage and wastage
in the analyses presented here. In addition, the coverage rate assumed, which describes the
proportion of the target population who receive a full course of vaccination, accounts to
some extent for imperfect compliance to a multi-dose vaccination course.

Coverage rates in the model for target populations at lower and higher risk of exposure
for both routine annual strategies and catch-up strategies are both assumed to be 40%.
We assume a wastage factor of 10% within the model. Hence for every ten people who are
fully vaccinated, one course is wasted.
Table 8. Summary of India's public sector adoption and implementation behaviours
Adoption/implementation High-risk (vulnerable Low-risk (adolescent/general
behaviour population) programme population) programme
Minimum acceptable level of
50% 70%
vaccine efficacy
Minimum acceptable level of
3 years 3 years
vaccine duration
Minimum acceptable price per US$10.00 US$10.00
dose (Rs 440) (Rs 440)
Local regulatory approval lag
2 years
after FDA/EMEA approval in
(therefore approved in India in 2017)
2015
2 years 3 years
Programme implementation lag (beyond local regulatory approval (beyond local regulatory approval
lag; i.e. high-risk programme lag; i.e. low-risk programme
implemented in 2019) implemented in 2020)
Eligible age range of target
16-49 years 13-26 years
population
Time to peak coverage
(following programme 5 years 5 years
implementation)
Loss-to-follow-up rate 25%
Wastage factor 10%
Maximum coverage rate 40%

21
4.3 Private market modelling assumptions
The private market for a vaccine is neither funded nor implemented by the public sector. It
is driven by individuals who are willing and able to pay for the vaccine, and is likely to
include firms purchasing the vaccine for their employees as part of health care benefits.
However, due to a lack of information on all potential private markets, only individual
private demand is considered here.

Licensure (Adoption) Decision: The efficacy and duration thresholds in the private market
are set to the minimum levels realistic for a first-generation vaccine: 30% and three years,
respectively. It is assumed that if a vaccine achieves these minimum standards, it would be
licensed, and individuals would be able to buy the product via private markets, even in the
absence of public programmes.

An individual is assumed to be willing to pay a specified proportion of his or her income,

irrespective of the vaccine profile. This threshold is set in the baseline so that the cost of a
full course of the vaccine in the private market is always 50% or less of an individual's
weekly income. In the Low and Medium (baseline) scenarios, the vaccine price in the
private market is set at US$50 per dose (Rs 2,200). An individual would need to have an
annual income of at least US$10,400 (Rs 4.6 lakhs) to buy vaccine via the private market.
The proportion of persons demanding the vaccine via the private market would be those
16 to 49 years old at or above that income level. If the private market price drops to
US$10 per dose (Rs 440), as is the case in the High Profile Scenario the minimum annual
income necessary to afford the vaccine would be US$2,080 (Rs 0.9 lakhs).

It is assumed that if a low-risk public programme is initiated, then 50% of those 13-to-26-
year-olds willing and able to pay for the vaccine via the private market will demand the
vaccine via the public programme, since rational individuals will seek to minimize their
expenditures. Although the GOI could introduce means testing to avoid to ensure that the
programme is used only by lower-income individuals, this option has been ignored for the
purposes of this model.

Regulatory Lag: For the private market, the regulatory lag is the same as for public
initiatives: If the FDA or EMEA approves the technology in 2015, the HIV vaccine will be
licensed about two years later in India.

Private Programme Lag: The model assumes no private programme implementation lag.

Willingness to be Vaccinated (WTV): The proportion of Indians WTV in the private

market represents those who believe they need the vaccine and are willing and able to pay
for it. This proportion of people who might believe they need the vaccine is set at 10%,
the same percentage used to describe the size of the populations at higher risk of exposure
to HIV.

Maximum Coverage: In the private market, we assume that 100% of those who are
willing to be vaccinated can be covered.

22
Uptake Speed: We assume that the uptake speed in the private market depends on the
GOI's decision to implement the vaccine. If the vaccine is implemented in public
programmes, then we assume that uptake is fast (three years to achieve maximum
coverage following licensure in India). If the GOI does not implement the vaccine, as is the
case for low-efficacy vaccines (30%), then we assume uptake speed will be slow: six years
to achieve maximum coverage following licensure. These assumptions are based on the
premise that without GOI endorsement, private individuals may be more cautious about
using a low-efficacy vaccine.

Compliance: We assume that 80% of those who choose to purchase an HIV vaccine
through a private health care provider will complete a course of two or more doses.

Re-vaccinations: Like the public initiatives, the baseline forecasts in the model assume that
25% of those who require re-vaccination are lost to follow-up, and those who are
revaccinated require only a single dose.

Table 9. Summary of India's private market adoption and usage behaviours

Adoption/usage behaviour Private market

Local regulatory approval lag 2 years
(years after FDA or EMEA) (same as public markets)
Minimum acceptable level of vaccine efficacy 30%
Minimum acceptable duration of protection 3 years
WTP threshold (for $50/dose vaccine) Annual income > $10,400
WTP threshold (for $10/dose vaccine) Annual income > $2,080
Programmatic implementation lag N/A
3-6 years
Uptake speed
(depending on vaccine profile)
Switching from private to public market
50%
programmes when latter become available
Compliance rate 80%
Re-vaccination loss-to-follow- up rate 25%

23
V. Results and discussion
5.1 Overview
India-specific demand forecasts are generated from expert consultation findings and the
model described above. They highlight the relative importance of the key determinants of
demand and illustrate the types of analyses that can be undertaken using the demand
forecasting model.

We did not intend to generate a single estimate or number to reflect demand. Rather,
generating various forecasts illustrates the magnitudes of demand given a range of
assumptions about the future technical, epidemiological, economic, and socio-political
environment that India might face when a first-generation HIV vaccine becomes available.

The results of the vaccine profile scenario are considered first, comparing the relative
contributions of the public and private markets in India. These are then considered in
revenue terms from the perspective of private industry (i.e., vaccine developers,
manufacturers, and suppliers). Finally, the results are considered from the perspective of
the GOI, donors, and other multilateral institutions. Future GOI funding scenarios, the
future epidemic scenarios, and the policy intervention scenarios are also described and
discussed.

5.2 Vaccine profile demand scenarios: public versus private markets

The three vaccine profile assumptions (Table 5) describe vaccine efficacy and duration of
protection and its price in the public and private markets. Figure 4 illustrates how these
vaccine profile scenarios affect the demand forecasts for India over a 30-year time horizon.
In general, more favourable vaccine profiles (higher levels of efficacy and duration) result
in higher levels of demand in India.

24
Figure 4. Total annual demand forecasts for India (given various vaccine profile assumptions)
45

40
Number of Complete Courses (Millions)

High Vaccine Profile

(70% efficacy, 5 year duration, Price=WTP)
35

30

25

20

15
Medium Vaccine Profile
(50% efficacy, 3 year duration, Tiered pricing)
10

5
Low Vaccine Profile
(30% efficacy, 3 year duration, Tiered pricing)
0
0 5 10 15 20 25 30

Years Since FDA/EMEA Licensure

The forecasts illustrated throughout this report measure national demand in terms of
complete courses received. We assume that all vaccine profiles are based on a two-dose
(prime-boost) regimen. To convert the number of complete courses into doses, the
assumptions regarding a 10% wastage factor should be noted. This means that the total
number of doses demanded is more than twice the total number of courses.

The forecasts indicate low levels of demand in the Low Vaccine Profile Scenario, modest
levels of demand in the Medium Vaccine Profile Scenario, and high levels of demand in the
High Vaccine Profile Scenario. The variability in the magnitude of demand can be
explained:
– by the acceptable thresholds of vaccine characteristics by market type (public or
private) and target population (high or low risk) as described in Tables 8 and 9; and
– by the relative contribution to cumulative demand of private versus public initiatives
described in Table 10.

(NB: The acceptable thresholds of vaccine characteristics in India mean that a vaccine
must be at least 50% efficacious for the GOI to implement it in high-risk populations and
70% efficacious for implementation in low-risk populations; see section 4.2 for further
details).

The model assumes that the GOI would not be willing to use low-efficacy vaccines (30%
efficacy) in public markets. Therefore, in the Low Vaccine Profile Scenario, all of the
demand forecasted (100%) originates from the private market. In the Medium Vaccine
Profile Scenario, where the vaccine efficacy is 50%, there is demand from both the private

25
market (11%) as well as the public high-risk population programme (89%). However,
only in the High Vaccine Profile Scenario, where vaccine efficacy is assumed to be 70%,
does the demand for an HIV vaccine in India comprise private (6%), high-risk (21%), and
low-risk (73%) population components. Since the low-risk programme targets a broad
population (all 13- to 26-year-olds), the volume of demand in the High Vaccine Profile
Scenario is significantly higher than in the other scenarios.

Table 10. Relative contribution to cumulative demand of private versus public initiatives
Vaccine Profile Scenarios
Low Medium High
Millions of courses 24.0 24.4 49.8
Private market
(% of market) (100.0%) (11.1%) (6.3%)
High-risk population Millions of courses - 196.6 162.9
programme (% of market) - (88.9%) (20.7%)
Public market
Low-risk population Millions of courses - - 575.6
programme (% of market) - - (73.0%)

In all three vaccine profile scenarios, demand peaks seven to eight years after vaccine
launch (Table 11). This is due to a combination of regulatory and implementation lags and
the time to achieve maximum coverage.

Table 11. Volume of demand in India across scenarios

Vaccine Profile Scenarios
Low Medium High

Peak year of demand (year of maximum annual courses demanded) 8 7 7

Demand during peak year, in millions of courses 1.2 15.2 41.5

Cumulative total demand over 30-year period, in millions of courses 24.0 221.1 788.3

Average annual "steady-state" demand over 30 years, in millions of

0.8 7.1 25.4
courses

5.3 Results and implications for donors and policymakers

5.3.1 Composition of demand by vaccination strategy

Figure 6 provides a breakdown of the relative contribution of the three different

vaccination strategies (routine, catch-up, and re-vaccination) for the Medium Vaccine
Profile Scenario over the 30-year period. The first years after vaccine licensure are
dominated by the catch-up strategy, which comprises more than 50% of total demand for
the first 10 to 12 years. However, after year 12, the catch-up vaccination strategy no
longer contributes to demand, at which point India’s demand is made up entirely by the
other two strategies, particularly re-vaccinations. The re-vaccination strategy accounts for
the oscillating peaks and troughs visible in the Medium and High forecasts in Figure 5, as
demand increases and decreases with each re-vaccination cycle. These peaks are more
pronounced in the earlier years reflecting the steep rise and fall first experienced as a result
of the initial catch-up strategy (Figure 5). The initial effect of the catch-up strategy and
subsequent effects on the re-vaccination strategy are more clearly apparent when the three
strategies are separated out (Figure 6).

26
 Figure 5. Total annual demand by vaccination strategy Figure 6. Separating the effects of each vaccination strategy
(Medium Scenario) (Medium Scenario)
16 16
Re-vaccination Strategy
Primary Routine Vaccination Strategy
14 Catch-up Strategy 14

12 12

10 10

8 8

6 6

4 4

Number of Complete Courses (Millions)

Number of Complete Courses (Millions)

2 2

0 0
0 5 10 15 20 25 30 0 5 10 15 20 25 30

Year since EMEA/FDA Licensure

27
27
It may be important for policymakers to understand the effect of these different strategies
on demand over time, particularly if different delivery mechanisms are required for each of
these strategies. For example, routine vaccinations may occur at schools for populations at
lower risk and at sexual health clinics or VCTCs for populations at higher risk. Catch-up
vaccinations, on the other hand, might be delivered via some mass campaign-based
vaccination approach that moves from town to town attempting to capture all those
missed or not eligible for routine vaccination. Analysis of forecast volumes over time
better enables policymakers to prepare for the initial introduction of large-scale catch-up
strategies and to ensure that the health care system has the adequate delivery capacity for
routine and re-vaccination strategies in subsequent years. Finally, if health programme
officials have control over the coverage and hence the annual numbers of people
vaccinated via the catch-up strategy, they might spread the catch-up vaccination
programme out over a longer period to avoid the initial peak and subsequent decline. This
would ensure that vaccination delivery capacity was not stretched thin in the short term
and possibly underused in the longer term.

5.3.2 Funding

While projections of demand in India provide valuable information to decision-makers, it

should be noted that the forecasts illustrated assume no funding constraints. The model
framework is capable of assessing the effect of funding constraints on demand, however,
because donor and government future funding allocations for HIV and AIDS in India have
not been considered as part of our baseline analyses. More realistic forecasts of demand
will require an understanding of the effect of a funding-constrained environment. This is
important because the cost of the vaccine to the GOI might exceed its ability to pay, in
which case access to an HIV vaccine may be limited, and only a proportion of the
projected demand will materialise.

The GOI's financial capacity and funding allocations are described in Table 7. This
suggests that up to US$123 million (Rs 542 crore) annually would be available to spend
on an HIV vaccine, although the actual amount spent would depend on the quality of the
vaccine.

To contextualize these funding estimates, in 1999-2000 the GOI spent US$44 million (Rs
194 crore) on vaccines, salaries, maintenance, supplies and consumables, transportation
and associated IEC for all childhood Expanded Programme on Immunizations (EPI)
interventions; e.g. BCG, DTP3, and measles vaccines (GAVI Alliance 2001). Assuming
GOI spending on EPI vaccines grows at the same rate as India's gross domestic product
(GDP), i.e. 6.9% annually, then spending in 2015 on these vaccines will reach US$120
million (Rs 530 crore). This means that if an HIV vaccine received the allocations
described above, the GOI's immunisation budget would need to double.

Using the basic assumptions for GOI funding (Table 7 and Appendix IV), and assuming
no additional funds from donors, the scenario illustrated in Figure 7 compares demand for
the Medium Vaccine Profile Scenario in a funding-constrained versus -unconstrained
environment. The funding-constrained scenario considers the magnitude of funding
necessary to cover the costs of the vaccine itself as well as its delivery. (The assumed costs
of both vaccine and delivery are described in Table 5). The shortfall in funding occurs
during the eight years around peak demand and results in a cumulative total of 47.1
million courses being unfunded in this time period. This suggests that the GOI and

28
international donors might need to prepare to address significant funding challenges to
realise the desired levels of demand suggested by these forecasts.

In the past, the GOI has consistently financed over 95% of routine immunisation costs.
The remaining proportion, covering supplementary campaigns and evaluation surveys, is
paid for by such donors as UNICEF and USAID (IAVI 2007b). If immunisation budgets
require dramatic increases, the GOI and international donors will need to significantly
increase their funding commitments.

Finally, the scenarios modelled assume a cost of US$2-3 per dose delivery, based on the
presumption that each dose of the vaccine is stored and delivered using a single vial under
conditions that meet cold chain delivery and storage refrigeration requirements of 2 to
8ºC. However, some of the current vaccines in clinical testing must be stored at -70ºC and
may involve three or more doses. Clearly, actual delivery costs may turn out to be
significantly higher than those modelled here, and funding challenges may be even greater.
Figure 7. Funded versus unfunded complete courses (for the Medium Scenario)

16

14
Number of Complete Courses (Millions)

12

Unfunded Total
10
Funded Total

0
0 5 10 15 20 25 30

Year Since EMEA/FDA Approval

5.3.4 Policy changes to strengthen demand

Changes in the regulatory process, political environment, and health care system might
also significantly impact future demand for an HIV vaccine. Specifically, expedited
regulatory approval, expedited public programme introduction, improved political will,
and increased coverage could improve the delivery of an HIV vaccine to those who need it
most. The model specifications used to reflect these types of policy-environmental changes
and resulting four demand scenarios for India are described in Table 12 and Figure 8. The
baseline scenario in this scenario analysis and subsequent sensitivity analyses is
synonymous with the “Medium Vaccine Profile Scenario” in the vaccine profile scenarios
above.

29
 Table 12. Policy-environmental scenario specifications and effects on demand

30
Change
Average from
annual Change from baseline
a Peak year Cumulative Total demand baseline peak cumulative
Scenario Model Specification
demand demand cumulative (over 30- year demand demand
(Years 1- 10) demand year period)
Courses Courses
Courses Courses Courses Courses (% change) (% change)
Baseline scenario - 15.1m 66.7m 221.1m 7.1m - -
Expedited Reduce regulatory lag in
-0.4m 5.3m
regulatory public and private markets 14.7m 86.3m 226.4m 7.3m
(-3%) (+2%)
approval processes from 2 years to 1 year
Decrease the time to
introduce public
vaccination programmes
Expedited public
(following national
vaccination
regulatory approval) from
programme 26.1m 743.1m
2-3 years to 1-2 years; 41.2m 235.1m 964.2m 31.1m
introduction & (+173%) (+336%)
increase political will
improved political
classification from medium
will
to high (changing the API
score, a proxy for political
will, from 57 to 67)
Double GOI funding
available for an HIV
vaccine from 1% to 2% of
Increased coverage the projected total annual 18.9m 139.4m
34.0m 123.2m 360.5m 11.6m
and funding health care budget; increase (+125%) (+63%)
maximum coverage rate
across all programmes
from 40% to 65%
Combined policy All of the above 66.6m 1412.2m
81.7m 478.1m 1,633.2m 52.7m
changes modifications (+441%) (+639%)
a
Only specifies variables where different from baseline values.

30
 Figure 8. Demand forecasts for policy-environmental scenario specifications

90

80
Combined policy
changes
70

60

50
Improved coverage &
improved funding
40

30 Expediting the time to programme

introduction & improved political
will

Number of Complete Courses (Millions)

20

10
Expedited regulatory
approval processes
Baseline
0
0 5 10 15 20 25 30
Years Since EMEA/FDA Licensure

31
31
Expedite regulatory approval processes: Expediting regulatory approval has relatively little
effect on overall demand (an additional 5.3 million complete courses demanded in India
over the 30-year period), though it does cause a shift in the demand curve; in this scenario,
the uptake pattern commences two years earlier than the baseline scenario. Perhaps the
most significant implication of this is that volume of demand increases by approximately
30% during the first 10 years of this scenario compared to the baseline scenario, even
though cumulative demand for the entire forecast is relatively unchanged. Since the first 10
years following product launch are likely to be a period of market exclusivity, expediting
regulatory approval can significantly increase the already substantial market potential of
HIV vaccines.

Expediting regulatory approval might be achieved by India's continued participation in

discovery and development activities of first-generation HIV vaccines beyond current
Phase I trial involvement, because data generated in India would be immediately available
for review. In addition, national and international regulatory processes might be
streamlined using measures similar to those employed by the FDA to allow drugs for
serious and life-threatening diseases to reach the market earlier. For example, policies
could encourage early interactions between vaccine developer/sponsor and the GOI's
regulatory agencies, resulting in improved trial design and data collection and reducing
delays in regulatory submission reviews.

Expediting public vaccination programme introduction and increased political will: These
changes have the largest single impact — an increase of 336% — on cumulative demand
over the baseline scenario. They increase peak year demand by 173% over the baseline
scenario, resulting in demand during the peak year of 41.2 million courses. Expediting the
public vaccination programme introduction creates demand sooner and demand peaks
earlier. This increases the cumulative volume of demand during the 30-year period over
baseline levels. Increasing political will has the same effect.

Expediting the time to public vaccination programme introduction might be possible

through advanced planning and preparation for HIV vaccines and through learning from
the experience of introducing and implementing other preventive and therapeutic
technologies. For example, there are lessons to be learned from India's Universal
Immunisation Programme's (UIP) system of procurement and distribution, including both
its successes and failures. And while an HIV vaccine programme is unlikely to utilise the
established childhood immunisation system, it could perhaps be integrated into the
extensive network of voluntary counselling and testing and antiretroviral therapy (ART)
centres. Combining the three prevention and treatment interventions could offer
significant synergies (IAVI 2007b).

Strengthening political will might require policymakers to increase focus and relative
prioritization on HIV vaccine introduction. This might mean an HIV license application is
prioritized by regulators, and additional funding may be made available for purchasing
vaccines or financing delivery costs. Some of the responsibility for generating stronger
political support lies with advocates, community leaders, scientists, and others who can
educate and influence policymakers about the importance of an HIV vaccine programme.

Increased coverage: Increased coverage also has a marked effect — an increase of 63% —
on demand in the scenario analysis above. Increasing coverage doesn't reduce the

32
regulatory lag and doesn't change when the vaccine is introduced in India. However, it
does increase the rate of uptake of the vaccine and the maximum achievable coverage
(from 40% to 65%). This therefore translates into significantly higher demand.

Increased coverage might be achieved by scaling up delivery and outreach infrastructure

for the expected target populations of an HIV vaccine. Since health services for
populations at higher risk of exposure to HIV are often delivered by NGOs, increasing
coverage for an HIV vaccine used in these populations might improve the resources
available to some NGOs that do outreach. For the 13- to 26-year-old populations at lower
risk of exposure who might be targeted, it might be necessary to create or adapt
appropriate delivery infrastructure. This might use and build upon infrastructure
developed for the new HPV vaccine if this is targeted toward adolescent populations.

The combination of all of these policy changes profoundly impacts demand forecasts,
resulting in a six-fold increase (639%) over the baseline forecasts. Improving political will
positively affects the regulatory approval speed and the level of achievable access
(coverage) and also shortens the time to begin national vaccination programmes (i.e., it
reduces programme implementation lags). However, 64% of cumulative demand over the
30-year period would not be covered by GOI funds, given current funding assumptions.
Therefore, in order to realise the potential gains, policymakers and international donors
alike need to strategically plan how to address potential funding constraints that might
otherwise limit demand and access.

5.4 Revenue forecasts and implications for private industry

As a rapidly growing economy, India's market for health technologies is still growing fast
and hence provides increasing opportunities for suppliers. The market opportunity for
future HIV vaccines in India has, until now, not been adequately quantified. Elucidating
the potential market magnitude might help multinational R&D organisations determine
whether to include trial participants from a country like India, or in the future, might
inform investment decision-making to determine manufacturing scale. The sheer
magnitude of India's population means that gaining a good understanding of market
demand and revenue potential in this market alone is an important consideration for
biopharmaceutical and investment analysts in the context of the wider global picture.

5.4.1 Revenue scenarios

Revenue scenarios3 were generated on the basis of the demand forecasts for the vaccine
profile scenarios above and the pricing assumptions described in Table 5. The results of
these projections are illustrated in Figure 9 and described in Table 13 below.

3
All revenue scenarios described in this section are undiscounted.

33
Figure 9. Vaccine profile sales revenue forecasts
1000
Potential Pre-Generic
Market Exclusivity Period
900

800
Annual Sales Revenue (Millions $USD)

700

600
HIGH Vaccine Profile
Revenue Scenario
500

400

300
MEDIUM Vaccine Profile
Revenue Scenario
200

LOW Vaccine Profile

100 Revenue Scenario

0
0 5 10 15 20 25 30
Years Since EMEA/FDA Licensure

Table 13. Cumulative and peak sales revenue in India

Vaccine Profile Scenarios
Low Medium High
Peak revenue in US$ millions $124.7 $415.0 $910.5
(Indian rupees) (Rs 550 crore) (Rs 1,831 crore) (Rs 4,017 crore)
Average annual sales revenue in US$ millions
(over years 0-10) $54 $163 $322
(Indian rupees) (Rs 239 crore) (Rs 721 crore) (Rs 1,423 crore)
Average annual sales revenue in US$ millions
(over years 0-30) $58 $153 $428
(Indian rupees) (Rs 255 crore) (Rs 677 crore) (Rs 1,888 crore)
Cumulative sales revenue in $US millions (over
$4,754 $13,263
30-year period) $1,792
(Rs 20,977 (Rs 58,519
(Indian rupees) (Rs 7,906 crore)
crore) crore)
Cumulative total demand in doses (millions) 35.8 329.5 1,326.3

Peak annual revenue is reached seven years after launch in India for all three vaccine
profile scenarios. In these peak years, revenue from vaccine demand in India reaches
US$124.7 million (Rs 550 crore) in the Low Scenario, US$415 million (Rs 1,831 crore) in
the Medium Scenario, and US$910.5 million (Rs 4,017 crore) in the High Scenario. To put
these figures into context, market research conducted last year estimated India's
biopharmaceuticals market value at US$8.8 billion in 2005 (Espicom Business Intelligence

34
Market Report 2007) and is expected to reach US$20.8 billion4 in 2015 and US$38.1
billion in 2022, the year of peak sales revenues (Research And Markets 2005). This means
that in the years of peak sales for the Medium and High scenarios, HIV vaccine revenues
would represent 1.1% and 2.4%, respectively, of total Indian pharmaceutical market
sales, a significant amount for a single product.

The revenue forecasts underline the significant market potential of HIV vaccines,
irrespective of vaccine profile. During the first 10 years following product launch, which is
likely to be the period of market exclusivity or patent protection in India, average annual
sales revenues range between US$54 million to US$322 million (Rs 239-1,423 crore).
These revenue estimates highlight the importance of being the first entrant to take
advantage of the value and opportunities in both public and private markets.

Table 14 below describes the relative contribution of private and public demand to sales
revenue. When compared with Table 10, this breakdown underscores the fact that even
low levels of demand from the Low Scenario can generate significant revenue. Although
the private sector contributes only 11% of total demand in the Medium Scenario, it
accounts for nearly 40% of revenue.

Table 14. Relative contribution of private market versus public market programmes to revenue
Vaccine Profile Scenarios

Low Medium High

Private Market 100.0% 38.4% 5.9%

High-risk (vulnerable)
- 61.6% 19.3%
population programme
Public Market
Low-risk (adolescent)
- - 74.8%
population programme
Average annual US$ value of private market $57.8m $58.9m $25.3m
(Indian rupees) (Rs 255 crore) (Rs 260 crore) (Rs 171 crore)
Average annual US$ value of public market(s) - $47.3m $201.3m
(Indian rupees) - (Rs 417 crore) (Rs 1,162 crore)

5.5 Sensitivity analyses

Sensitivity analyses help us understand how our baseline assumptions (acceptable levels of
vaccine characteristics, coverage rates, targeting, political will, and epidemiology in India)
might affect projected demand.

Table 15 presents the baseline assumptions and the upper and lower boundaries of the
model parameters tested in the sensitivity analysis. Figure 10 depicts the results of these
analyses in comparison to the baseline scenario.

4
Assuming 9% growth per annum (IAVI 2007a).

35
Table 15. Sensitivity analyses parameter values
Original Baseline Values Sensitivity Analyses Values
High-risk Programme Low-risk Programme
Model Parameter High-risk Low-risk
Programme Programme Upper Lower Upper Lower
Value Value Value Value
Minimum acceptable
50% 70% 70% 30% 95% 50%
level of efficacy

Maximum achievable
40% 60% 20% 60% 20%
coverage rate
Epidemic character
Constant prevalence (at Increase in Decrease in Increase in Decrease in
(flat vs. increasing/
0.9%) prevalence prevalence prevalence prevalence
decreasing prevalence)

(NB: The sensitivity of demand to both licensure/adoption and implementation lags has
not been assessed since these lags will affect only the timing of peak demand. Furthermore,
since lags only come into effect after acceptable vaccine characteristics have been met,
unless these thresholds are altered simultaneously in a two-way sensitivity analysis or
scenario assessment, the effect of changing lags alone will be minimal.)

Figure 10. Change in cumulative demand from sensitivity analyses on model parameters
700%
Upper Value
621%
600%
Percent Change in Cumulative Demand

500%
from Medium Scenario

400%
Lower Value
317%
300%

200%
Upper Value
51%
100%
Lower Value
0%
0%

-100%
Upper Value Lower Value
-89% -49%
-200%
5.5.1: Changing Efficacy 5.5.2 Changing Maximum 5.5.3: Changing Epidemic
Thresholds Achievable Coverage Trajectory

Model Parameter

36
5.5.1 Effects of changing the minimum acceptable level of efficacy

Setting the minimum acceptable levels of efficacy for the low- and high-risk programmes
to the upper values (defined in Table 15) decreases demand by 89% because neither set of
public programme thresholds is met by the baseline vaccine profile and only private
market demand remains. Using the lower values for vaccine efficacy thresholds, demand
significantly increases because the low-risk programme is now implemented, whereas in
the baseline, it is not. These analyses underscore the importance of policymaker
preferences with respect to vaccine profiles. HIV vaccine advocates, including vaccine
developers themselves, might consider illustrating to policymakers the value and benefits
of partially efficacious vaccines (for example, through epidemiological modelling). This
may enable policymakers to make more informed decisions about what constitutes
acceptable levels of efficacy.

5.5.2 Effects of changing maximum achievable coverage rates

The upper and lower bounds for coverage rates increase and decrease demand by around
50%, respectively. These results suggest that Indian policymakers should focus on
improving delivery mechanisms to achieve higher rates of coverage for future adult and
adolescent vaccines. This might occur through efforts to strengthen national health care
capacity, improve and expand outreach services to high-risk populations, and improve the
effectiveness of distribution systems for low-risk populations.

5.5.3 Effects of changing the epidemic's trajectory

The stakeholder interviews highlighted the divergent opinions that exist amongst Indian
experts about the future of the HIV epidemic. The hepatitis B vaccine in India
demonstrated how controversy over prevalence and diverging perceptions of public health
need can hinder the adoption and implementation of a new health technology, which
resulted in a 10-year lag between the WHO recommendation to start a hepatitis B
vaccination programme in India and its actual launch (IAVI 2007b; Steinbrook 2007).

Current estimates and projections of the HIV epidemic in India are far from perfect,
despite the expansion of surveillance sites (Chandrasekaran et al. 2006; Dandona et al.
2006). The current uncertainty and conflicting perceptions of prevalence and need
highlight the importance of sensitivity analyses of varied HIV prevalence projections.
Results suggest that no change in demand occurs if the epidemic trajectory declines. In this
instance, need is lower, but not significantly lower to dampen demand for the vaccine for
high-risk populations. However, as prevalence increases, the model suggests that demand
increases more than in any of the other sensitivity analyses (i.e., by 621% over the baseline
case). This translates into 1.6 billion cumulative courses over the 30-year period. Should
the epidemic worsen, the GOI would seek to vaccinate an additional 45.7 million people
per year, requiring a huge investment in delivery capacity and a quantum leap in funding.

37
VI. Summary/conclusions
Consultations were conducted amongst multiple stakeholder groups, including
policymakers, academics, biopharmaceutical executives, and donors, to assess how India
might adopt and implement a first-generation preventive HIV vaccine. Interviews were
conducted across the country to ascertain how both public and private markets might
react to an HIV vaccine, which potential target groups might receive the vaccine, and how
quickly the vaccine might eventually be made available. The consultation and interview
findings suggest the following:

ƒ Licensure/Adoption Process: Given the multiple levels of approval necessary both

internationally and nationally to secure licensure in India, it is possible that an HIV
vaccine would be approved in India at least two to three years after initial licensure in
the U.S. and Europe. However, an HIV vaccine could be expedited through the
regulatory review process via a number of policy interventions contingent on India's
continued participation in HIV vaccine clinical trials, negating the need for local
bridging studies.
ƒ Acceptable Vaccine Characteristics: The level of efficacy necessary for India to license
an HIV vaccine is likely to vary by target population. Thresholds will be lower (50%
efficacy) if a vaccine is to be used solely in populations at higher risk of exposure to
HIV, and higher (70% efficacy) if it is also used in populations at lower risk.
Furthermore, a vaccine must have a duration of at least three years to secure use in
public markets, and such a vaccine would only be acceptable if prices are between
US$1 to $10 per dose.
ƒ Targeting and Delivery: Populations at higher risk of exposure to HIV are likely to be
the initial target recipients of publicly funded vaccination programmes. If populations
at lower risk are targeted, it is likely that only adolescents and young adults (those
under 27 years old) will be recipients. If a partially efficacious vaccine is launched in
India, delivery programmes may need to include educational interventions to prevent
behavioural disinhibition. This may significantly increase health care capacity needs
and costs for implementing simultaneous vaccination and education programmes.

IAVI created a model to estimate global demand based upon the key determinants of
demand and the expert consultation findings. The model provides a national picture of
HIV vaccine demand and revenue.

ƒ Demand and Revenue Forecasts: Baseline forecasts suggest that demand in India for
an HIV vaccine with an efficacy of 50 to 70% could range from 15.2 million to 41.5
million courses in the peak year. Assuming tiered pricing between public and private
markets (US$10 to $50 per dose), these levels of demand could result in peak year
sales revenues of US$415.0 to 910.5 million (Rs 1,831 to Rs 4,017 crore). These
results imply that under certain market conditions, a first-generation HIV vaccine
could account for up to 1.1 to 2.4% of the total Indian pharmaceutical market value.
ƒ Scenario Analyses: Should the prevalence of HIV remain unchanged in India from its
current 0.9%, average annual baseline demand over 30 years is projected at 15.2
million persons fully vaccinated per year. Should the epidemic worsen significantly, the
GOI might seek to vaccinate an additional 45.7 million people per year over baseline

38
 levels to halt further increases in new infections. Efforts to address regulatory,
infrastructural, and political constraints could increase access to and use of an HIV
vaccine by up to 45.6 million additional people each year over a 30-year period.

Potential Benefits of this Research

To achieve these increases in demand and access, much lead time is required to implement
policy change. Since the search for an HIV vaccine is still likely to take several more years,
an opportunity currently exists to engage vaccine developers, donors, and Indian health
care system officials with their R&D, funding, and preparatory endeavours.

This forecasting model could help decision-makers in both Indian and international
institutions develop both immediate and longer-term strategic action to streamline
regulatory systems, improve health care capacity and infrastructure, and increase political
will and financial commitment. Such policy changes will help to ensure the development of
and eventual access to safe, effective, accessible, preventive HIV vaccines for use in India
and throughout the world.

Next Steps

Consultation and Feedback: Consultation with key stakeholders and users of the model
will enable a more sophisticated assessment and approach to modelling many of the key
determinants of demand in future research.

Consideration of the Complex Epidemiological Landscape and Other Target Populations:

Due to current data limitations, the forecasting model presented here overlooks a number
of target groups especially important in India. These include migrant workers, truck
drivers, clients of sex workers, health care workers, military personnel, and private
employers. Identifying and incorporating reliable estimates of the size of these groups and
how a vaccine might be delivered to them would improve the model's ability to more
accurately assess demand for an HIV vaccine across India.

Moreover, since this model provides a national picture based upon national inputs, it does
not address the regional variability of HIV. Regional and local data are important inputs
to efforts to plan and implement HIV vaccine programmes.

Consideration of Other New Preventive Technologies: The forecasting model assumes that
only existing HIV interventions are available in India at the time of HIV vaccine
introduction. The demand estimates for a future HIV vaccine will need to be refined once
the timing and magnitude of demand for other new preventive technologies now in
development, such as microbicides and PrEP, become clearer.

Progressing from Demand/Impact to Cost-Effectiveness: Both developers and public

health policymakers are concerned about cost-effectiveness as they make strategic and
tactical decisions. These demand scenarios can be combined with future impact modelling
for India along with future cost modelling to generate cost-effectiveness estimates.

Lessons Learned from the Introduction of Other New Vaccines: IAVI hopes to learn from
the implementation of new vaccines such as the HPV vaccine to improve our
understanding of health system issues in India that must be addressed for successful
preparation and implementation, particularly in adult and adolescent populations.

39
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42
Appendix I. List of interviewees and collaborators
Title, First, Surname Position / Affiliation
Team Leader and Technical Advisor, Reproductive Health,
Dr. Dinesh Agarwal
UNFPA, New Delhi
Assistant Professor, Center for Healthcare Effectiveness Research
Dr. Dan Barth-Jones and the Department of Internal Medicine at the Wayne State
University, School of Medicine, Detroit
Professor, Finance and Accounting and Public Systems Group,
Prof. Ramesh Bhat
Indian Institute of Management, Ahmedabad
Dr. Lori Bollinger Vice President Futures Institute, Glastonbury
Dr. Nirupa Borges Project Director, Mumbai District AIDS Control Society, Mumbai
Dr. Denis Broun Country Coordinator, UNAIDS, New Delhi
Dr. Prakash P. Doke Director, Health Services, Government of Maharashtra, Mumbai
Coordinator, CEHAT, Centre for Enquiry into Health and Allied
Mr. Ravi Duggal
Themes (CEHAT), Mumbai
Senior Advisor, HIV Vaccines, HIV, TB, & Reproductive Health,
Dr. Jose Esparza
The Bill and Melinda Gates Foundation, Seattle,
Project Manager, YRG Care for AIDS Research and Education,
Mr. A.K. Ganesh
Chennai
Ms. Vidhya Ganesh Chief, HIV/AIDS, UNICEF, New Delhi
Prof. N.K. Ganguly Director General, Indian Council of Medical Research, New Delhi
Mr. Gopi Gopalakrishnan Country Director, Janani/DKT International, Mumbai
Ms. Anjali Gopalan Executive Director, NAZ Foundation, New Delhi
Mr. Anand Grover Project Director, Lawyers Collective HIV/AIDS Unit, New Delhi
Head, Health Policy Research Unit, Institute of Economic Growth,
Dr. Indrani Gupta
New Delhi
Dr. M.D. Gupte Director, National Institute of Epidemiology, Chetpet, Chennai
Economist, WHO, Immunizations, Vaccines & Biologicals, HIV
Dr. Raymond Hutubessy
Vaccines, Geneva
Group Leader, Mammalian Biology and Virology, International
Dr. Shahid Jameel
Centre for Genetic Engineering and Biotechnology, New Delhi
Dr. Amar Jesani Coordinator, Centre for Research in Ethics and Rights, Mumbai
Dr. S.V. Kapre Executive Director, Serum Institute of India, Pune
Dr. Ashok Khar Head (R&D), Shanta Biotech, Hyderabad
Dr. P. Krishnamurthy Project Director, AIDS Prevention and Control Project, Chennai
Dr. Raj Kumar Director, Immunisation - PATH India, New Delhi
Head, Social Consulting, Hindustan Latex Family Planning
Dr. Sanjeev Kumar
Promotion Trust, New Delhi
Dr. Homayoun Madjrouh Managing Director, Sanofi Pasteur, New Delhi
CEO, Hindustan Latex Family Planning Promotion Trust,
Mr. G. Manoj
Hyderabad
Dr. P. Manorama Director, Community Health Education System, Chennai
Former Director General & Secretary, Council of Scientific &
Dr. R.A Mashelkar
Industrial Research, New Delhi
Former Secretary, Health, Ministry of Health and Family Welfare,
Mr. Rajiv Misra
Government of India, New Delhi
Dr. S.N. Misra Deputy Director, Clinton Foundation, New Delhi

43
Title, First, Surname Position / Affiliation
Medical Officer, Immunization and Vaccine Development, WHO-
Dr. Pem Namgyal
SEARO, New Delhi
Director, WHO Department of Immunization, Vaccines and
Dr. Jean-Marie Okwo-Bele
Biologicals, Geneva
Acting Coordinator, WHO-UNAIDS HIV Vaccine Initiative.
Dr. Saladin Osmanov
WHO, Geneva
Dr. R.K. Pal National Programme Officer (Hep. B), WHO-India, New Delhi
Dr. Samiran Panda Vice President, SPARSHA, Kolkata
Mr. Manoj Pardesi President, NMP+, New Delhi
Vice Chancellor, Director, Medical Education & Research,
Dr. Mrudula Phadke
Mumbai
Principal Executive, Sir Dorabji Tata Centre for Research In
Lt. Gen. D. Raghunath
Tropical Diseases, Bangalore
Mr. Askok Row Kavi Chairman, The Humsafar Trust, Mumbai
Joint Secretary, Department of Health and Family Welfare,
Ms. Supriya Sahu
Government of Tamil Nadu, Chennai
Professor and Head of Department, Dept. of Experimental
Dr. N.M. Samuel Medicine, The Tamil Nadu Dr. M.G. R. Medical University,
Chennai
Deputy Secretary (Employment), Government of Maharashtra,
Dr. Sanjay Sawant
Mumbai
Mr. D.G. Shah Secretary General, Indian Pharmaceutical Alliance, Mumbai
Vice Chairman & Managing Director, Novartis India Limited,
Mr. Ranjit Shahani
Mumbai
Dr. Suneeta Singh Senior Public Health Specialist, The World Bank, New Delhi
Dr. Suniti Solomon Director, YRG Care for AIDS Research and Education, Chennai
Health Policy and Economics Officer, PATH Japanese Encephalitis
Dr. Chutima Suraratdecha
Project PATH, Seattle
Dr. Soumya Swaminathan Deputy Director, Tuberculosis Research Centre, Chennai
Former Director of Madras Institute of Development Studies,
Dr. A. Vaidyanathan
Chennai
Senior Programme Associate, Horizons – Population Council, New
Dr. Ravi K. Verma
Delhi
Senior Project Officer, Strategic Information Section, UNICEF,
Dr. Neff Walker
New York
Project Manager, Initiative Public-Private Partnership Projects
Dr. Roy Widdus
Global Health Futures Network, London
Assistant Clinical Professor of Population and Family Health,
Dr. Paul Wilson Mailman School of Public Health, Columbia University, New
York

44
Appendix II. Vaccine profile specification
Table A1 describes the lower and upper bounds of vaccine characteristics to describe
possible first-generation vaccines. These were developed through informal discussion with
scientific experts and were used to guide discussion during the expert consultations.
Table A1. Lower and upper bounds of vaccine profile
Vaccine Characteristic
Parameter Assumptions
Lower Bounds Upper Bounds
1. Vaccine is imperfect (partially efficacious)
Efficacy & VES/VEI = 30% VES/VEI = 70%
mechanism of 2. Vaccine prevents infection in those efficacy in efficacy in
action vaccinated prior to exposure by a fixed preventing infection preventing infection
percentage (VES) in low-risk groups in low-risk groups
3. Vaccine also lowers infectiousness after
being infected (VEI) by same magnitude as
VES VES/VEI = 15% VES/VEI = 35%
efficacy in high-risk efficacy in high-risk
4. Assume VES/VEI effects work differentially groups groups
in low- and high-risk groups
Vaccine doubles time of disease progression to
AIDS after being infected (VEP). VEP = 200%a

1. Duration of effect would be 2 years or

Duration of longer 2-year duration 5-year duration
protection (and 2. Vaccine effect lasts for a certain number of
effect on years and doesn't wane before then
revaccination) 5 doses for 5-year 2 doses for 5-year
3. Revaccination would be required every 2-5 protection protection
years
4. Assume that for revaccination, only a
single dose is required
1. Based on pricing of a range of old and new
Price per dose existing vaccines US$2 US$50

2. Assessed global prices for hepatitis B

vaccine (HBV), new pneumococcal
conjugate vaccine, and EPI vaccines
3. No price decline from launch needs to be
assumed
Two dosing schedules hypothesized
Dosing schedule Prime + 2 boosters Prime + 1 booster
x 3-dose vaccine represents less favourable
(including re- 0-, 1-, 6- month 0-, 1- year schedule
dosing profile
vaccination
x 2-dose schedule is viewed as more optimistic schedule
requirements)
of the two scenarios
x 1-dose re-vaccination

All vaccine profiles considered would be

Clade specificity Complete and uniform cross-clade
effective against any strain prevalent in any
protection for all countries and populations
country
Safety No serious adverse effects Similar to a placebo
Delivery/ storage
requirements and US$1 per full US$6 per full
delivery costs vaccination course vaccination course
Single vial/cold chain of 2-8ºC
(McGreevey et al. (CIA n.d.)
2004)

a
During the consultation interviews, it became clear that many respondents found it difficult to appreciate the
different mechanisms of vaccine effect (VEI, VES and VEP) - and as such, disease modifying effects (VEP) were
removed and are not considered within these analyses.

45
Appendix III. Interviewee categories, rationale, and judgments
Interviewee Description & Rationale for
Category Approaching
Country- or region- These were often government
specific officials in the Ministry of
policymakers Health or Ministry of Finance. A
range of individuals were
targeted, encompassing advisors
to senior officials, but not the
elected officials themselves. It
was assumed that it would be the
senior civil servants whose
technical expertise would
influence and shape future
policies by providing expert
advice to elected officials.
Academics Academics, particularly those
who serve as advisors to the
government, were targeted
because of their influential role
in policymaking.
Local HIV/AIDS- NGO representatives working
related NGO specifically in the field of HIV
leaders and staff and AIDS or with the
populations affected by HIV
were approached given their
intimate knowledge of capacities
and challenges in dealing with
these communities and getting
treatment and prevention
programs to them.
Key opinion These interviewees generally held
leaders, advisors, academic posts and either
and HIV/AIDS advised policymakers directly or
experts through their research.
Local & Developers understand the local
international licensure, implementation and
vaccine developers delivery processes and have
& biotechnology views on the size of the market
groups today and in the future
Global and regional These interviewees were thought
policymakers (e.g., to be able to provide broader
WHO, UNAIDS, regional perspective on the
UNDP etc.) epidemiological need, the
effectiveness of other vaccination
campaigns, HIV prevention, and
AIDS treatment programmes.
Representatives
from the donor
community
46
Judgments sought on the following issues…
x Criteria governments use when considering adoption of
health technologies
x What characteristics for an AIDS vaccine would be
acceptable for their country
x Funding for vaccine and HIV/AIDS prevention
x Targeting of an AIDS vaccine
x Distribution mechanisms
x Insight into the future epidemiological, economic, and social
trends within a country (dependent on their areas of
expertise)
x Criteria a country uses to make health technology adoption
decisions
x Targeting policies that might be recommended for an AIDS
vaccine
x Political will with respect to AIDS treatment and HIV
prevention
x Need for a vaccine, particularly among vulnerable
populations
x Perceptions of the future state of the epidemic
x The country’s ability to reach vulnerable populations
x Levels of achievable coverage in various risk groups
x Insight into lag time between adoption and implementation
of programmes (time to scale-up)
x Future states of the epidemic in their country/region
x Political will with respect to HIV treatment and prevention
x Criteria used to decide whether to adopt a vaccine
x Vaccine targeting
x Level of achievable coverage
x Vaccine profile and market opportunity and commercial
viability in particular country or region
x Insight on adoption and implementation patterns of other
technologies
x Local regulatory requirements
x Lags between product development, licensure, and rollout
x Importance of clinical trials
x Health care delivery systems
x Anticipated future local "biopharma" market developments
x Global and regional financing for vaccine or AIDS
prevention programmes
x Fast vs. slow adopters/implementers of new health
technologies
x Regional epidemiological trends
x Future funding scenarios
x Criteria used to decide whether to fund a vaccine
x Perceptions of the future states of the epidemic in their
country/region
x Political will with respect to treatment and prevention
 Appendix IV. India’s country profile descriptor information and assumptions
Criterion Proxies Source(s) Assumptions and/or Cut-offs (High/Medium/Low) Value(s) for India
Demography N/A CIA World Factbook (CIA n.d.), Assumes a compound annual growth rate (CAGR) of 1.5% per In 2015, the following populations in
UN Population Division World annum to calculate population magnitudes in 2015. India are estimated to be:
Population Prospects (Population With current scientific opinion assuming that preventive AIDS
Division n.d.); Sexually vaccines would be administered to uninfected individuals, the Total: 1,280 million
Transmitted Infections Supplement starting population constitutes those whose HIV status has been High-risk: 131 million
on the Data, Methods, & Tools confirmed as HIV-negative. However, pre-vaccination HIV- Low-risk (13-26 yrs): 237 million
Used to Produce the 2005 UNAIDS testing is likely to be logistically difficult and expensive. Low-risk (13-49 yrs): 614 million
/ WHO HIV/AIDS estimate Therefore, the starting population in the model is derived from
(Vandepitte et al. 2006, Aceijas et the total population, irrespective of HIV-status (CIA n.d.).
al. 2004, Caceres et al. 2006)
Need Pre-valence UNAIDS-WHO: 2006 Report on Assumes a flat CAGR for rate in 2015 Assumed to have a low prevalence
per capita the Global AIDS Epidemic x High: >5% (0.5%) in 2015.
(UNAIDS 2006) x Medium: between 1%-5%
x Low: between 0.2%-1% (Equivalent to an absolute number of
x Very Low: 0.2% around 6.6 million people).
Political will AIDS UNAIDS-USAID-WHO-POLICY Scores vary between 0 and 100 API score of 59;
Program Project; 2003 (USAID 2003) x High: API 67 (i.e., Medium Political Will)
Index (API) x Medium: API 55 - 66
x Low: API 54
Capacity and ability to National World Bank data (World Bank Assumes a CAGR of 6.9% per annum for rate in 2015. Based Income per capita of $1,292
Pay income per n.d.) on World Bank cut-offs for 2005 in US$: (i.e. medium income/capacity/ability
capita - PPP x High: $10,066 to pay)
adjusted x Medium: $826-10,065
x Low: $825
Projected GOI funding National World Bank data (World Bank Assumes: In 2015, the corresponding
on health care budget & income n.d.) x 6.9% GDP growth per annum hypothetical funding allocations are
predicted allocation to x 1.19% of GDP spent on health as follows:
HIV/AIDS and HIV x 1% of health budget spent on HIV/AIDS x US$49,300,000,000
vaccine x Maximum of 25% of HIV/AIDS budget spent on AIDS x US$493,000,000
vaccine
x Based on government attitudes about the vaccine profile, x US$123,000,000
some proportion of the AIDS vaccine funding "pot" is
actually spent on vaccine. On the basis of the vaccine
profiles described in Table 5 above:
x Low profile = 15% of funds spent on the HIV vaccine x US$19,000,000
x Medium profile = 50% of funds spent on the HIV vaccine x US$62,000,000
x High profile = 73% of funds spent on the HIV vaccine x US$90,000,000

47
47
Appendix V. Algorithms to define endogenous country-level
behavioural parameters
Tables A2 to A5 describe how the model transforms the Country Profile Descriptors to
define the Country Behavioural Parameters for the minimum acceptable thresholds of
efficacy and duration of protection and maximum acceptable level of price for government
implementation of an HIV vaccine.

Table A2. Efficacy-implementation threshold matrix for high-risk programme

Prevalence (%)
Political Will
Very Low Low Medium High
(API Score)
<0.20% 0.20 - 0.99% 1.00 - 4.99% >5.00%
Low  54 50% 50% 50% 50%
Medium 55 - 66 50% 50% 30% 30%
High  67 50% 50% 30% 30%

Table A3. Efficacy- implementation threshold matrix for general programme

Prevalence (%)
Political Will
Very Low Low Medium High
(API Score)
<0.20% 0.20 - 0.99% 1.00 - 4.99% >5.00%
Low  54 90% 80% 70% 50%
Medium 55 - 66 80% 70% 50% 50%
High  67 70% 50% 50% 30%

Table A4. Duration of protection- implementation threshold matrix

Prevalence (%)
Political Will
Very Low Low Medium High
(API Score)
<0.20% 0.20 - 0.99% 1.00 - 4.99% >5.00%
Low  54 5 yrs 3 yrs 3 yrs 3 yrs
Medium 55 - 66 3 yrs 3 yrs 2 yrs 1 yrs
High  67 3 yrs 2 yrs 1 yrs 1 yrs

Table A5. Price- implementation threshold matrix

Prevalence (%)
Income
Very Low Low Medium High
(PPP-adjusted GNI/capita)
<0.20% 0.20 - 0.99% 1.00 - 4.99% >5.00%
Low $825 $1 $2 $10 $10
Medium $826-10,065 $2 $10 $10 $10
High  $10,066 $50 $50 $50 $50

Table A6 describes how the model transforms the Descriptors (in this case, need
[prevalence] and political will [API score]) to define the regulatory lag by country.

Table A6. Regulatory/licensure lag matrix

Prevalence (%)
Political Will Very Low Low Medium High
(API Score) 0.20 to 1.00 to
<0.20% 0.99% 4.99% >5.00%
Low 54 5 years 5 years 4 years 3 years
Medium 55 - 66 4 years 3 years 2 years 1 years
High 67 4 years 2 years 1 years 1 years

48
Tables A7 to A9 describe the calculation process for determination of the high-risk
programme implementation lag. The model takes a composite score, derived by adding
values for levels of political will (API), need (prevalence), and income (GNI/capita).

Table A7. API-prevalence-GNI scores

API Score Value Prevalence Value GNI/capita Value
Very Low 1
Low 1 Low 2 Low 1
Medium 2 Medium 3 Medium 2
High 3 High 4 High 3

This composite score informs an intermediate lag value.

Table A8. Intermediate high-risk programme implementation lag value

Composite Intermediate Lag
Score Value #1
1 6 years
2 6 years
3 6 years
4 5 years
5 4 years
6 3 years
7 2 years
8 1 year
9 1 year
10 1 year

A second intermediate lag value is derived from the year of hepatitis B vaccine
implementation.

Table A9. Hepatitis B implementation

Year of Intermediate Lag
Implementation Value #2
1900 0 yrs
1997 1 yr
2003 2 yrs

The summation of these two intermediate lag values provides the high-risk programme
lag.

Table A10 describes the low risk programme implementation lag calculation. A third
intermediate lag value is derived from the API, prevalence, and GNI values only (listed
above) and used to inform the low-risk programme lag.

Table A10. Intermediate low-risk programme implementation lag value

Composite Intermediate Lag
Score Value #3
1 3 years
2 2 years
3 1 year

49
The low-risk programme lag is the sum of the intermediate lag value#3 and the high-risk
lag (described on the previous page).

Table A11 describes how the model transforms the Descriptors (in this case, need
[prevalence] and political will [API score]) to define the upper age limit of the low-risk
target group.

Table A11. Upper age limit of low-risk target group matrix

Prevalence (%)
Political Will
Very low Low Medium High
(API score)
<0.20% 0.20 - 0.99% 1.00 - 4.99% >5.00%
Low  54 26 years 26 years 49 years 49 years
Medium 55 - 66 26 years 26 years 49 years 49 years
High  67 26 years 26 years 49 years 49 years

50
Notes
Notes
IAVI Public Policy Publications Series

Policy Research Working Papers

#1 Global Investment and Expenditures on Preventive HIV Vaccines: Methods and September 2004
Results for 2002
#2 Promoting R&D in Preventive Health Technologies: Opportunities for the Indian March 2005
Pharmaceutical and Biotechnology Sector
#3 Demand for a Preventive HIV Vaccine: A Review of the Literature April 2005
#4 Estimating the Global Impact of an AIDS Vaccine October 2005
#5 Modeling the Impact of AIDS Vaccines: A Review of the Literature October 2005
#6 Methodologies for Modeling the Impact of a Preventive AIDS Vaccine in October 2005
Developing Countries: Recent Studies
#7 An Advance Market Commitment for AIDS Vaccines: Accelerating the Response May 2006
from Industry
#8 The Impact of an AIDS Vaccine in Developing Countries: A New Model and October 2006
Preliminary Results
#9 A Review of European Commission Funding for HIV/AIDS, Tuberculosis and December 2006
Malaria Health Technology R&D
#10 HIV Vaccine Research & Development: Modeling the Path to Speedier Success December 2006

#11 Accelerating AIDS Vaccine R&D in India: An Assessment of Obstacles and Possible April 2007
Solutions
#12 The Introduction of New Health Technologies in India May 2007

#13 Forecasting Demand for Preventive HIV Vaccines in India June 2007

Policy Discussion Papers

#1 Speeding the Manufacture of an HIV Vaccine: Policy Issues and Options January 2005
#2 Putting it Together: AIDS and the Millennium Development Goals September 2005

Joint Publications
Adding It All Up: Funding for HIV Vaccine and Microbicide Development, 2000 to 2005 August 2006
AIDS Vaccine Development in Japan: Challenges and Opportunities May 2006

IAVI also publishes a series of Public Policy Briefs on these and other topics. For a complete list of
IAVI published materials, please see www.iavi.org.