Analysis of the Snake Antivenom Market: A commercial explanation of antivenom shortages and possible

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Analysis of the Snake Antivenom Market A
commercial explanation of antivenom shortages and
possible solutions

• Dr Nicholas Brown
• BSc, MBBS (UQ), MPhil (Cantab), GCSpMed

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Who am I?

• Clinician at the Royal Brisbane and Womens
  Hospital
• Graduate of University of Queensland (Medicine)
  and University of Cambridge (Bioscience
  Enterprise)
• Research at The University of Cambridge and
  University of Melbourne
• Special interests, relating to snakebites and
  antivenom
• Biotechnology and business in medicine
• Health policy
• Healthcare economics

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My Thesis

• Research questions
• What is the need for snake antivenom?
• What is the current snake antivenom market
• In Africa?
• Globally?
• What factors prevent greater antivenom
  availability?
• Commercial drivers and inhibitors
• Other
• What alternative economic model could provide
  sustainable commercial solutions to the antivenom
  problem?
• What is the role of Prequalification?

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The need for antivenom in SSA

• Incomplete and inaccurate epidemiological data
• gt 1 million snakebites each year
• gt500,000 envenomations needing treatment
• gt20,000 deaths (4)
• gt100,000 episodes of permanent disability (20)
• Amputation
• Blindness
• Necrosis
• Stroke
• Figures from WHO data

Photos courtesy of David Warrell
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Previous Opinions

• Less than 1 of the required antivenom for SSA is
  produced (20,000 ampoules)
• SSA will require gt2 million ampoules of antivenom
  to treat 500,000 patients
• Declining availability of antivenom is due to
  reduced supply not enough antivenom is being
  produced
• Manufacturers have reduced supply because of
• Poor profitability
• High expenses
• Onerous regulation
• There exists a great demand for antivenom
• High need high demand

The problem is not enough antivenom is being
produced
Photo courtesy of Liverpool School of Tropical
Medicine
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Results

• 6 antivenom producers for SSA (only 1 big
  pharma)
• 237,400 ampoules produced annually
• 65,760 treatments (13 of need)
• gt31,000 ampoules produced but no buyer
• 16,792 treatments excess
• Potential production capacity with current
  facilities
• 1.6 million treatments (gt300 of need)
• Wholesale cost per ampoule is US 18-200
• 40-640 per treatment

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Results 2

• Current SSA snake antivenom market value
• US 7.64m
• Cost to provide antivenom for all SSA, using most
  efficient methods
• 20m (500,000 treatments _at_ 40 each)
• In reality, probably 40-60m per year

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Results 3

• Only two manufacturers are profitable more could
  be with greater demand and output
• In 2008, one company has ceased production due to
  lack of demand
• Genuine realisation among producers of their
  humanitarian responsibilities to provide
  antivenom
• Willing to forgo large profits
• Manufacturers cannot increase output without
  greater market support and a guaranteed demand

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Take home message?

• Despite the immense need,
• Supply currently outstrips demand.
• The problem is
• Not enough demand for antivenom
• What does this mean?

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Uncoupling of need from demand
Demand for a product is generated by a
combination of its need, its perceived worth, and
affordability.
Despite a great need for antivenom many factors
have contributed to a severe downturn in demand
for antivenom.
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What needs to be done?

• 1) Improve demand!
• Reduce costs
• Optimise efficiencies
• Improve reputation
• Improve quality of product PQ
• Ban inappropriate and black market antivenoms
• Educate communities
• Rationalise use
• Educate healthcare personnel
• Involve traditional healers

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W.H.O. Prequalification

• Addresses quality standards
• Identifies reliable sources of AV
• Encourages involvement in the market
• Will help restore reputation and confidence in AV
• May help to reduce costs by improving efficiency
• Does not directly increase supply or demand
• A global alliance incorporating Prequalification
  will provide the required impetus, framework and
  infrastructure to improve the quality, confidence
  and reputation of antivenom (similar to GAVI)

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BUT

• Improving antivenom quality, confidence and
  reputation will not yield sustainable solutions
  unless there is
• Resolution of the economic factors.
• Even in countries where demand has been restored
  (and barriers of quality, reputation, cost,
  health training and community education have been
  overcome) there is still an AV shortage.
• Why?
• There is not enough financial support!

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A vicious cycle commercial poison
Is poor antivenom availability really a problem
of supply?
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Collapsed Market

• The antivenom market has been compromised by
  insufficient financial support, leading to
• Poor affordability
• Low demand
• Reduced supply
• It is low demand - a consequence of inadequate
  funding and poor demand - that has suppressed the
  antivenom market and reduces availability

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What needs to be done?

• 1) Improve Demand!
• 2) Guarantee market stability!
• Requires financial stimulus
• Efforts to improve output will prove futile until
  the market conditions are corrected
• Increased output will flow from increased demand
• Competition among producers will stimulate
  innovation, promote efficiency and keep the price
  low

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A Virtuous Cycle Commercial antidote
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The Triumphant Cycle

• A guaranteed market for producers
• Market confidence
• Competition sustainability
• Encourages innovation
• Better quality
• Lower prices
• Increased supply
• Improved affordability
• Improved availability
• More lives saved!

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Conclusion

• Current SSA AV output 13 of requirement
• Cost per treatment 40-640
• Total SSA annual AV requirement 20M-60M
• Producers keen to increase supply
• Potential capacity gt300 of need
• Limited by demand
• Antivenom supply currently outstrips demand
• (16,792 treatments un-utilised)

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Conclusion

• The great need for antivenom is not translated
  into market demand
• The solution to the antivenom crisis lies in
  restoring market demand
• only then will output improve
• but only if there is sufficient funding
• Sources of high quality, reputable and affordable
  antivenoms do exist, but remain unavailable
  because poor funding

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Conclusion

• Results support the hypothesis that
• The shortage of antivenoms in sub-Saharan
  Africa is a consequence of poor market demand,
  and requires a financial stimulus to catalyse a
  sustainable, virtuous cycle
• (eg. GAVI-like alliance)

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Thank you!
No conflicts of interest to report No known
commercial-in-confidence contained in this report
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Global antivenom producers

• 37 producers globally
• Mostly snake, but also scorpion and spider
  antivenom
• 2.6 million ampoules, but lt250,000 treatments
• Cost of ampoules range 8 - 1,388
• Cost of treatments range 25 - 14,000
• Total global antivenom market gt 100 M

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What needs to be done

• Guarantee demand and a sustainable market!
• Establish a global fund for purchasing antivenom
  (IFFIm)
• Establish a global alliance of manufacturers,
  governments, NGOs, academic and business experts
  to contribute according to their capabilities
  (GAVI)
• Review and standardise production processes
• Provide orphan drug incentives to manufacturers
• Enable innovation within the regulatory process
• Ensure adequate infrastructure
• Requires support and co-operation from
  governments, NGOs and industry.

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The Manufacturing Process
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200 cm
Maximum size
Naja nigricollis (Black-necked Spitting Cobra)
200-350mg (large)
Venom amount
Character
Alert and aggressive
gt80
Rate of envenoming
40mg of venom is lethal
Lethality
Cytotoxic neurotoxic blindness
Clinical effects
Neurotoxic or necrotic effects
Cause of death
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The supposed vicious cycle
Manufacturers reducing supply and deserting the
market because of low profit margins
It is assumed that the problem with the antivenom
market is poor supply