NEWS SCAN: DoD award for vaccine plant, flu pandemic's cost to health insurers

Aug 10, 2010

DoD awards $21 million for North Carolina vaccine plant
Medicago Inc. of Quebec announced today that it has been awarded a $21 million grant from the US Department of Defense (DoD) to build a vaccine plant in Research Triangle Park, N.C., to manufacture virus-like-particle (VLP) influenza vaccines faster than conventional vaccines can be made. The 90,000-square-foot facility will be jointly developed by Medicago, the DoD's Defense Advanced Research Projects Agency (DARPA), and Alexandria Real Estate Equities. Medicago will chip in $7.5 million and be required to demonstrate that it can manufacture 10 million doses of its plant-based VLP flu vaccine a month. The effort is part of DARPA's Accelerated Manufacture of Pharmaceuticals program, which was launched in 2005 to protect the country against emerging biological threats, including pandemic flu. Andy Sheldon, Medicago president and CEO, said in a press release that the DARPA grant bolsters the company's plan to participate in the $7-billion-a-year pandemic and seasonal influenza vaccine market.
Aug 10 Medicago press release

Report: Severe pandemic could cost US health insurers $290 billion
The next influenza pandemic could cost the US health insurance industry $290 billion if severe and $49 billion if moderate, according to a recent report sponsored by the Society of Actuaries. The report's preparer, Jim Toole of MBA Actuaries Consulting Services, estimated costs for a moderate pandemic, similar to 1957, and a severe pandemic, akin to 1918. For the former, 209,000 US deaths were projected (with deaths assumed in younger people and seniors), and for the latter, 1.9 million deaths (with more fatalities in the very young and those aged 20 to 40). The scenarios also assumed that all US regions would be effectively hit at the same time, although Toole writes, "There is no way of determining the virulence of a pandemic or its distribution patterns by age until it occurs." However, for the just-ended flu pandemic, which did not exhibit the "U"-shaped age-group pattern of 1957, the report states, "The moderate scenario in this report might serve as the high end of an expected range for costs attributable to the 2009–2010 flu season (seasonal and H1N1 pandemic) based on information currently available." By way of comparison, the report puts the cost to the industry of seasonal flu at $17 billion. The report concludes, "More emphasis needs to be placed on practical steps that should be taken to prepare for a pandemic, and, more importantly, how the health insurance industry can position itself for recovery."
Society of Actuaries report

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