IDEAS home Printed from https://ideas.repec.org/a/spr/pharme/v42y2024i2d10.1007_s40273-024-01396-6.html
   My bibliography  Save this article

The Value of Flexible Vaccine Manufacturing Capacity: Value Drivers, Estimation Methods, and Approaches to Value Recognition in Health Technology Assessment

Author

Listed:
  • Frederick McElwee

    (Office of Health Economics
    University of Oxford)

  • Anthony Newall

    (UNSW Sydney)

Abstract

Expanding flexible vaccine manufacturing capacity (FVMC) for routine vaccines could facilitate more timely access to novel vaccines during future pandemics. Vaccine manufacturing capacity is ‘flexible’ if it is built on a technology platform that allows rapid adaption to new infectious agents. The added value of routine vaccines produced using a flexible platform for pandemic preparedness is not currently recognised in conventional health technology assessment (HTA) methods. We start by examining the current state of play of incentives for FVMC and exploring the relation between flexible and spare capacity. We then establish the key factors for estimating FVMC and draw from established frameworks to identify relevant value drivers. The role of FVMC as a countermeasure against pandemic risks is deemed an additional value attribute that should be recognised. Next, we address the gap in the vaccine-valuation literature between the conceptual understanding of the value of additional FVMC and the availability of accurate and reliable tools for its estimation to facilitate integration into HTA. Three practical approaches for estimating the value of additional FVMC are discussed: stated and revealed preference studies, macroeconomic modelling, and benefit–cost analysis. Lastly, we review how value recognition of additional FVMC can be realised within the HTA process for routine vaccines manufactured on flexible platforms. We argue that, while the value of additional FVMC is uncertain and further research is needed to help to better estimate it, the value of increased pandemic preparedness is likely to be too large to be ignored.

Suggested Citation

  • Frederick McElwee & Anthony Newall, 2024. "The Value of Flexible Vaccine Manufacturing Capacity: Value Drivers, Estimation Methods, and Approaches to Value Recognition in Health Technology Assessment," PharmacoEconomics, Springer, vol. 42(2), pages 187-197, July.
    • Handle: RePEc:spr:pharme:v:42:y:2024:i:2:d:10.1007_s40273-024-01396-6
    DOI: 10.1007/s40273-024-01396-6
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s40273-024-01396-6
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s40273-024-01396-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Joanna Coast & Richard Smith & Anne‐Marie Karcher & Paula Wilton & Michael Millar, 2002. "Superbugs II: how should economic evaluation be conducted for interventions which aim to contain antimicrobial resistance?," Health Economics, John Wiley & Sons, Ltd., vol. 11(7), pages 637-647, October.
    2. Rachel Glennerster & Christopher M. Snyder & Brandon Joel Tan, 2023. "Calculating the Costs and Benefits of Advance Preparations for Future Pandemics," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 71(3), pages 611-648, September.
    3. He, Hua & Pindyck, Robert S., 1992. "Investments in flexible production capacity," Journal of Economic Dynamics and Control, Elsevier, vol. 16(3-4), pages 575-599.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Richard Chapman & Richard Xie, 2024. "Advancing Methods to Measure and Reward Healthcare Innovation," PharmacoEconomics, Springer, vol. 42(2), pages 183-185, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Santos, Lúcia & Soares, Isabel & Mendes, Carla & Ferreira, Paula, 2014. "Real Options versus Traditional Methods to assess Renewable Energy Projects," Renewable Energy, Elsevier, vol. 68(C), pages 588-594.
    2. Jan A. Van Miegham, 1997. "Investment Strategies for Flexible Resources," Discussion Papers 1201, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    3. Abadie, Luis M. & Chamorro, José M., 2008. "Valuing flexibility: The case of an Integrated Gasification Combined Cycle power plant," Energy Economics, Elsevier, vol. 30(4), pages 1850-1881, July.
    4. Xingang Wen & Peter M. Kort & Dolf Talman, 2017. "Volume flexibility and capacity investment: a real options approach," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 68(12), pages 1633-1646, December.
    5. Alejandro Mosiño, 2012. "Using Chebyshev Polynomials to Approximate Partial Differential Equations: A Reply," Computational Economics, Springer;Society for Computational Economics, vol. 39(1), pages 13-27, January.
    6. Kuzmina, Olga & Kuznetsova, Olga, 2018. "Operational and financial hedging: Evidence from export and import behavior," Journal of Corporate Finance, Elsevier, vol. 48(C), pages 109-121.
    7. Suárez, Freddy F. & Cusumano, Michael A., 1954- & Fine, Charles H., 1991. "Flexibility and performance : a literature critique and strategic framework," Working papers 3298-91., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    8. Di Corato, Luca & Moretto, Michele, 2011. "Investing in biogas: Timing, technological choice and the value of flexibility from input mix," Energy Economics, Elsevier, vol. 33(6), pages 1186-1193.
    9. Lucy Abel & Bethany Shinkins & Alison Smith & Andrew J. Sutton & Gurdeep S. Sagoo & Ijeoma Uchegbu & A. Joy Allen & Sara Graziadio & Eoin Moloney & Yaling Yang & Peter Hall, 2019. "Early Economic Evaluation of Diagnostic Technologies: Experiences of the NIHR Diagnostic Evidence Co-operatives," Medical Decision Making, , vol. 39(7), pages 857-866, October.
    10. Kristina Aluzaite & Marta O. Soares & Catherine Hewitt & Julie Robotham & Chris Painter & Beth Woods, 2025. "Economic Evaluation of Interventions to Reduce Antimicrobial Resistance: A Systematic Literature Review of Methods," PharmacoEconomics, Springer, vol. 43(6), pages 631-646, June.
    11. Olga Kuzmina, 2013. "Operating Flexibility and Capital Structure: Evidence from a Natural Experiment," Working Papers w0197, New Economic School (NES).
    12. Pindyck, Robert S, 1991. "Irreversibility, Uncertainty, and Investment," Journal of Economic Literature, American Economic Association, vol. 29(3), pages 1110-1148, September.
    13. Sels, A.T.H., 2006. "Foreign direct investment as an entry mode. An application in emerging economies," Other publications TiSEM 583ca9b5-1691-425d-8f77-0, Tilburg University, School of Economics and Management.
    14. Philip C. Jones & Timothy J. Lowe & Rodney D. Traub & Greg Kegler, 2001. "Matching Supply and Demand: The Value of a Second Chance in Producing Hybrid Seed Corn," Manufacturing & Service Operations Management, INFORMS, vol. 3(2), pages 122-137, April.
    15. Di Corato, Luca & Montinari, Natalia, 2014. "Flexible waste management under uncertainty," European Journal of Operational Research, Elsevier, vol. 234(1), pages 174-185.
    16. Cortazar, Gonzalo & Casassus, Jaime, 1998. "Optimal Timing of a Mine Expansion: Implementing a Real Options Model," The Quarterly Review of Economics and Finance, Elsevier, vol. 38(3, Part 2), pages 755-769.
    17. Cesare Dosi & Michele Moretto, 2001. "Is Ecolabelling a Reliable Environmental Policy Measure?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 18(1), pages 113-127, January.
    18. Nasakkala, Erkka & Fleten, Stein-Erik, 2005. "Flexibility and technology choice in gas fired power plant investments," Review of Financial Economics, Elsevier, vol. 14(3-4), pages 371-393.
    19. Nagy, Roel L.G. & Hagspiel, Verena & Kort, Peter M., 2021. "Green capacity investment under subsidy withdrawal risk," Energy Economics, Elsevier, vol. 98(C).
    20. Dawn Barnes-Schuster & Yehuda Bassok & Ravi Anupindi, 2002. "Coordination and Flexibility in Supply Contracts with Options," Manufacturing & Service Operations Management, INFORMS, vol. 4(3), pages 171-207, May.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:pharme:v:42:y:2024:i:2:d:10.1007_s40273-024-01396-6. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.