AMC supply agreements

The following paragraphs are intended to provide specific information with regards to the first Advance Market Commitment (AMC) supply agreements. The names of the participating companies are listed in alphabetical order.

• GlaxoSmithKline Biologicals: following the first call for AMC supply offers, published on 4 September 2009, on 23 March 2010, GlaxoSmithKline (GSK) Biologicals signed a provisional supply agreement (PSA) with UNICEF. Under the PSA, GSK committed to supply 30 million doses annually (annual supply commitment) from January 2012 for a period of up to 10 years.
  
  Consequently 15% of the AMC funds were allocated to this manufacturer according to the AMC terms and conditions. The tail price for this agreement is US$ 3.50.
  
  This agreement remained provisional until the candidate vaccine was deemed AMC eligible by the AMC Independent Assessment Committee (IAC) on 16 April 2010.

• Pfizer Inc: on the same date, Pfizer Inc. signed a PSA with UNICEF. Under the PSA, Pfizer Inc. committed to supply 30 million doses (Annual Supply Commitment) annually from January 2013 for a period up to 10 years. Consequently 15% of the AMC funds were allocated to this manufacturer according to the AMC terms and conditions.
  
  The tail price for this agreement is US$ 3.50. This agreement remained provisional until the candidate vaccine was deemed AMC eligible by the AMC Independent Assessment Committee on 23 August 2010.

Capacity Development Period

In addition to those PSAs, GSK and Pfizer Inc. agreed to provide in total 7.2 million doses, 24.2 million doses, and 20 million doses for the years 2010, 2011 and 2012 as part of the AMC capacity development period.
 

The capacity development period is defined as the period during which suppliers develop dedicated manufacturing capacity to serve Gavi eligible countries.

Incentivise manufacturers

UNICEF opted not to award the full quantities of the Gavi Strategic Demand Forecast for 2014 in response to this first tender.

In order to incentivise manufacturers to accelerate the development of new vaccines, to contribute to the creation of a healthy market with multiple suppliers, and to enhance the possibility to access lower tail prices through future offers, quantities have been reserved for award at a later point in time.

With the conclusion of this first procurement round under the AMC, 70% of the AMC funds remained unallocated and available for successive rounds of calls for offers.

The following paragraphs are intended to provide specific information with regards to the starting date of supply, suppliers’ names, doses allocated, and amount of AMC funds that remain unallocated. The names of the participating companies are listed in alphabetical order.

On the week starting 12 December 2011, UNICEF as procurement agency on behalf of Gavi confirmed the entry into new supply agreements with GlaxoSmithKline (GSK) Biologicals and Pfizer Inc.

GSK will start supplying 18M doses annually (Annual Supply Commitment) from 2014 for a period of 10 years. The tail price for this agreement is US$3.50. Consequently 9% of the AMC funds are allocated to this manufacturer under this agreement according to the AMC terms and conditions. The total doses awarded to GSK under two supply agreements amounts to 48M annually.

Pfizer will start supplying 18M doses annually (Annual Supply Commitment) from 2014 for a period of 10 years. The tail price for this agreement is US$3.50. Consequently 9% of the AMC funds are allocated to this manufacturer under this agreement according to the AMC terms and conditions. The total doses awarded to Pfizer under two supply agreements amounts to 48M annually.

Capacity Development Period

In addition to those supply agreements, GSK and Pfizer Inc. have agreed to provide in total 9 million doses for each of the years 2012 and 2013 as part of the AMC capacity development period.

Shaping markets through providing incentives to manufacturers

UNICEF has opted not to award the full quantities of the Gavi Strategic Demand Forecast for 2016 in response to this second tender. In order to incentivize manufacturers to accelerate the development of new vaccines, to contribute to the creation of a healthy market with multiple suppliers, and to enhance the possibility to access lower tail prices through future offers, quantities have been reserved for award at a later point in time.

Status of allocation of PCV

52% of the AMC funds corresponding to US$780M remain unallocated and will be available for successive rounds of calls for offers.

Status on overall supply commitments

Total contracted supply

The following paragraphs provide specific information with regards to awarded suppliers, the starting date of supply, doses awarded, and amount of AMC funds that remain unallocated.

On 24 July 2013, UNICEF, in its capacity as Gavi’s procurement agency, confirmed its entry into new supply agreements with GlaxoSmithKline Biologicals (GSK) and Pfizer Inc.

GSK will start supplying 24 million doses annually (Annual Supply Commitment) from 2015 for a period of 10 years. Consequently 12% of the AMC funds are allocated to this manufacturer under this agreement according to the AMC terms and conditions. The tail price for this agreement is US$3.40. The total doses awarded to GSK under its three supply agreements amounts to 720 million.

Pfizer will start supplying 26 million doses annually (Annual Supply Commitment) from 2016 for a period of 10 years. Consequently 13% of the AMC funds are allocated to this manufacturer under this agreement according to the AMC terms and conditions. The Tail Price for this agreement is US$3.40 in 2013 and US$3.30 from 2014 onwards. The total doses awarded to Pfizer under its three supply agreements amounts to 740 million.

In addition, Pfizer has agreed that the reduced Tail Prices outlined above can be applied to all doses remaining to be procured under its first and second supply agreements. To access Pfizer’s reduced Tail Price, Gavi has provided a financial guarantee for the Tail Price component, equivalent to 80% of the total contracted quantities in the period between 2013 and 2015. The standard AMC commitments of 20%, 15% and 10% in the first three years of each supply agreement will be counted towards the financial guarantee. It has also been agreed to accelerate the procurement of doses at US$ 7.00 under the new supply agreement to ensure that all doses at that price will have been procured before 2016.

Capacity Development Period

As part of these supply agreements, GSK and Pfizer Inc. have agreed to provide a total of 42 million doses during the AMC capacity development period.

Shaping markets through providing incentives to manufacturers

UNICEF has opted not to award the full quantities of the Gavi Strategic Demand Forecast for 2017 in response to this third tender and has only awarded quantities to meet the approved demand. Quantities have been reserved for award at a later point in time in order to incentivize manufacturers to accelerate the development of new vaccines, to contribute to the creation of a healthy market with multiple suppliers, and to enhance the possibility of accessing lower tail prices through future offers.

Status of AMC funding

27% of the AMC funds corresponding to US$405 million remain unallocated and will be available for later calls for offers. During Q3 2013, Gavi and UNICEF will determine if there is a need to issue a new tender based on demand presented through applications to Gavi.

Status on overall supply commitments

^[1] Date of signature represents the first Monday of the week during which UNICEF signed the supply agreements.
^[2] On 17th March 2016, GSK announced that they are reducing the tail price of their pneumococcal vaccine (PCV-10) to US$3.05 per dose from 2017.
^[3] Once Pfizer’s third supply agreement becomes effective, doses procured under these supply agreements will be purchased at US$3.40 in 2013 and US$3.30 from 2014 onwards.

Total contracted supply as of July 2013^[3], in millions

^[3] It should be noted that contracts are amended annually based on actual supply and demand to ensure that the total quantity on the supply agreements remain unchanged.

The following paragraphs provide specific information with regards to the awarded supplier, the starting date of supply, doses awarded, and amount of AMC funds that remain unallocated.

On 5th April 2018, UNICEF, in its capacity as Gavi’s procurement agency, confirmed its entry into a new supply agreement with Pfizer Inc. Pfizer will start supplying 19 million doses annually (Annual Supply Commitment) from 2018 for a period of 10 years. Consequently 9.5% of the AMC funds are allocated to this manufacturer under this agreement according to the AMC terms and conditions. The Tail Price for this agreement is US$2.95 for the 4-dose vial presentation from 2018 onwards. The total doses awarded to Pfizer under its four supply agreements amounts to 930 million.

In addition, Pfizer has agreed that the Tail Price outlined above can be applied to all doses (supplied in a 4-dose vial) remaining to be procured under its first, second and third supply agreements.

SHAPING MARKETS THROUGH PROVIDING INCENTIVES TO MANUFACTURERS

UNICEF has opted not to award the full quantities of the Gavi Strategic Demand Forecast for 2020-2021 in response to this fourth tender and has only awarded quantities to meet the approved demand. Quantities have been reserved for award at a later point in time in order to incentivise manufacturers to accelerate the development of new vaccines, to contribute to the creation of a healthy market with multiple suppliers, and to enhance the possibility of accessing lower tail prices through future offers.

STATUS OF AMC FUNDING

18.5% of the AMC funds corresponding to US$262.5 million remain unallocated and will be available for later calls for offers. Gavi and UNICEF will determine if there is a need to issue a new call for supply offers based on demand presented through applications to Gavi.

STATUS ON OVERALL SUPPLY COMMITMENTS

[1] On 17th March 2016, GSK announced that they are reducing the tail price of their pneumococcal vaccine (PCV-10) to US$3.05 per dose from 2017.

[2] Following various price reduction announcements from Pfizer, doses procured under Pfizer supply agreements were purchased at US$3.40 in 2013 and US$3.30 from 2014 onwards. In 2017, doses procured under Pfizer supply agreements were purchased at US$3.05 for the 4-dose vial and from 2018 onwards, the price is further reduced to US$2.95 for the 4-dose vial.

TOTAL CONTRACTED SUPPLY AS OF APRIL 2018[3], IN MILLIONS

[3] It should be noted that contracts are amended annually based on actual supply and demand to ensure that the total quantity on the supply agreements remains unchanged.