Procurement of vaccines by the Department of Health (1209-I) Public Accounts Committee 20 October 2003

Q26 Mr. Gerry Steinberg (City of Durham): Clearly, the questions that have been asked up to now are the main thrust of the report and I basically want to continue along the same line that the questions have been asked because I get the impression, frankly, that if the Labour Party had not received the £100,000 in a donation and then PowderJect had not got the contract, we would not be doing this report this afternoon. That is no criticism of the National Audit Office, I can assure you. I have no trouble with that at all, absolutely none whatsoever. If suspicions are aroused, then it is only right that they should be looked at. It is exactly the same as pre-1997 when the last government was in power and ex-ministers became directors of privatised firms and ministers became directors of firms that were getting huge contracts and the privatised industry was giving donations to the Tory Party. There were suspicions then. Now, as long as it is open and transparent and it is seen that nothing is wrong, I have no trouble with that at all. However, there are things that worry me and things that have to be explained to ensure that people are satisfied that there was nothing funny going on at the time. The Chairman covered in particular on page 24 the four main points which immediately put doubts in our mind that there were certainly worries about the procedures and you have explained that. I am not allowed to put words into your mouth but would you say that this report came clearly after everything was revealed and after the contract had been awarded and would you say that the other companies were just peeved at not getting the contract and were looking for ways to criticise the Government and criticise the way things were done or do you see them as genuine criticisms?

Sir Nigel Crisp: Can I just respond to your first point by saying that I too welcome this report because I do not want doubts cast on the professionalism of the staff on the left and right of me and I think this report shows that we have a thoroughly professional approach to buying vaccines which brings in all the experts in the country and indeed I know that colleagues provide advice to other governments externally. So, I think it is a thoroughly professional operation, as I say, to the left and right of me. In terms of the particular criticisms which I think it is fair to say came mainly from one company, to some extent, it is what you get after a tender is let. It does not necessarily surprise me to hear that some people who did not win a contract are complaining afterwards. It happens.

Q27 Mr. Gerry Steinberg (City of Durham): Can you assure us, for example, that PowderJect did not get any extra information than the other companies had? In other words, that PowderJect had exactly the same information and exactly the same treatment as the other companies had and there was no sort of private, confidential talks with PowderJect and there was no other information given to them? Can you tell this Committee that, as far as you are aware and as far as you are concerned, every company that was interested had exactly the same information and were treated in exactly the same way?

Sir Nigel Crisp: Can I assure you that my colleagues work to a script in terms of meeting people and that absolutely, to the best of my knowledge and that of my colleagues here, there were no other meetings outside those. It is a standard script.

Q28 Mr. Gerry Steinberg (City of Durham): Was the Lister strain for the vaccine that we were talking about only provided by PowderJect or was it possible to be produced by the other companies? Did they have a monopoly at the time?

Dr Troop: They were the only ones who could provide it in the short term. The others indicated that they might be able to produce it but they did not and, picking up the point of trying to make sure that we had this protection early, to be able to obtain vaccine that met the new manufacturing standards as early as possible seemed to us very important if we were going to protect the country.

Q29 Mr. Gerry Steinberg (City of Durham): So, what you are saying is that other countries could have produced exactly the same vaccine as PowderJect. PowderJect did have a monopoly on this and basically they were the only company that could provide the Lister strain.

Dr Troop: In the timescale. There was an issue about timing here. We made it very clear to all the companies that we wanted to obtain the vaccine as soon as possible and PowderJect were able to come forward with a supply of vaccine in the very short term which would enable us to enhance our stocks very quickly and we felt that was important to protect the population.

Q30 Mr. Gerry Steinberg (City of Durham): Frank also made the point, which I agree with and which came to my mind, as it did to him when he was reading the report, that, once there had been this uproar about PowderJect and the awarding of the contract, the natural reaction then is to say, "We will make damn sure that they do not get another contract because we are not going to go through that again." So, it could work out to be unfair to PowderJect in the next tendering procedures because they are being denied the opportunity on the basis that perhaps it was not done right in the first place. Are we given a guarantee that that did not happen?

Dr Troop: I should add that we do buy other vaccines from a number of these companies including PowderJect. They have been awarded other contracts.

Q31 Mr. Gerry Steinberg (City of Durham): We are aware of that.

Dr Troop: So, it depends on the particular criteria. If that were the case, we would not have been awarding the subsequent contracts which we have done. So, as Dr Salisbury said, it made no difference in this particular one and certainly they have been able to enjoy contracts since then.

Q32 Mr. Gerry Steinberg (City of Durham): What struck me was that, in the report, it keeps saying - and let me get this right - that the fact that they could not guarantee delivery did not mean that they were not going to get the contract in the first instance. Yet, you said to Frank and in the report that the reason why PowderJect did not get the contract in the second place was because they could not guarantee delivery. So, that is a little contradictory from the first contract.

Dr Troop: In the first contract, they were able to provide for us vaccine from Bavarian Nordic which met the modern manufacturing processes. For the second round, we were asking for a vaccine that would be licensable and -

Q33 Mr. Gerry Steinberg (City of Durham): Can I just butt in there because I am sure that I am going to run out of time very quickly. In the new contract - and that is Aventis - they have not licensed the product yet and there is no guarantee that they will get the licence. So, you have awarded a contract to a company that say they can deliver but with an unlicensed product and ignored a company that has a licensed product that might not be able to deliver.

Dr Troop: No. The one from PowderJect is not licensed. There are no licensed products out there at the moment from anyone.

Q34 Mr. Gerry Steinberg (City of Durham): I think you have now explained that very well. In the last few minutes that I have, I want to change the subject slightly and I would like you to turn to page 30 and Case Study 1. This is quite worrying, is it not? If you take the background to the situation, we have seen an increase of 21% in the cases of TB and, in 2001, there were approximately 7,000 new cases diagnosed, but you are having great difficulty getting the vaccine. Then, in the next study on the following page, which worries me to death as well, it says that with one of the most important vaccines given to babies at two, three and four months, there were manufacturing problems and disruptions in availability. I have just had a baby grandson and he has just been vaccinated, but I would be horrified if I were to take him to the doctors and was told that there was no vaccine. It is a little like a third-world country, is it not? Are we going to start getting donations from Bangladesh and Ethiopia to ensure that our kids are being immunised? Why is there a shortage and what, in the name of Heaven, are you going to do about it?

Sir Nigel Crisp: I will ask Dr Salisbury to address the wider point of how we maintain supply of vaccines with these two as examples.

Dr Salisbury: First, we do have strategies to do our utmost to maintain continuity of supplies of vaccines. Vaccines are difficult to manufacture; they are biological products and sometimes it is only at the every end of the whole of the manufacturing process that you find that there is a fault with the product and then they have to start all over again. They are not straightforward things to manufacture and this is true of any part of the world with any suppliers.

Q35 Mr. Gerry Steinberg (City of Durham): But you have been doing this for donkey's years, have you not?

Dr Salisbury: Sometimes that is true and other vaccines change, but that does not stop the problem. They are biological products and sometimes there are manufacturing problems that are unexpected. Where the DTP vaccine is concerned, that is the one that is given at two, three and four months, what I think perhaps you have not appreciated from this is that actually there were no interruptions in supply because we found an alternative supplier and made sure that we did have continuity of supply. We do our utmost to make sure that we have more than one supplier wherever possible, so that if one manufacturer has difficulties, we can turn to another to make good. Sometimes, that is not possible where there is only a single licensed supplier. That was the case for BCG. There was only one supplier and they had increasing difficulty in making vaccine that matched the specifications. I think it is fairly convoluted to work out but it is in fact the same company we are talking about for the smallpox vaccine, as it happens. In the event, they made it clear that if they were to be able to continue to manufacture vaccine, BCG, that matched the good manufacturing practice requirements, they would require a huge investment in their Merseyside manufacturing plant and they clearly saw that the consequence of that would be an enormous increase in the price. We then immediately took steps to try to find alternative suppliers. Alternative suppliers have to have a product which is either licensed or licensable before we can go forward in buying it and we approached one other European company that said that, although they had the product, they were not interested in bringing it to the UK market. There are reasons for that, probably to do with the very old data that they had that would not suffice for a current licence. We therefore scoured all of the markets to look for alternatives and we found that the State Serum Institute in Denmark was able to produce vaccine and we were therefore able to go ahead and get supplies. With the BCG programme, I can assure you that nothing upsets me more than having no vaccine.

Q36 Mr. Gerry Steinberg (City of Durham): It upsets parents, I suspect.

Dr Salisbury: I feel very responsible if there are shortages, but the BCG vaccine programme is not quite so age dependent as the infant programme with DTP. Of course it is a problem if we have to suspend part of the programme and, as I say, it is something that we would do our utmost to avoid, and we found an alternative supplier, came back in with extra quantities of vaccine and used our computerised databases in order that we could identify the children who had missed out the year before and they were called back and then we were able to catch up the programme. It is difficult sometimes when there are shortages.

Q37 Mr. Gerry Steinberg (City of Durham): That was a very long and comprehensive reply for which I am very grateful but, in a very, very short answer, can you therefore reassure me, my colleagues and parents in this country that they have nothing to fear?

Dr Salisbury: Vaccine is a biological product. We cannot guarantee that they will always be available. For the last two years, the United States has had severe vaccine shortages that we have not faced. We do our utmost to ensure continuity, we have strategies to deal with shortcomings such as stockpiling of vaccines, but we cannot guarantee that there will never be a problem.

Mr. Gerry Steinberg (City of Durham): That is not all that reassuring.