Firms invest in AIDS treatments, but few in a vaccine

It would seem a drug company's dream.

Develop a vaccine for AIDS, the virulent disease that has infected 1 million people in this nation and 12 million worldwide. The successful company would make a major contribution to mankind -- and rake in bundles of money. Right?


Well, if so, why are U.S. pharmaceutical giants pumping millions of dollars into drugs to treat AIDS patients -- and spending only a small fraction of that amount to find a vaccine?

"They are paid to get their 10 to 15 percent return on equity every year," said Geert Kersten, president of Cel-Sci Corp. an Alexandria, Va. biotech company that is in trials for its own vaccine. "They are not paid to take a risk."


There are other reasons for the drug companies' caution, researchers and analysts say. An AIDS vaccine, once thought to be around the corner, now appears to be a decade-long quest with no certain result.

Even if an effective vaccine is developed, there are a host of other obstacles. How will a vaccine be tested -- and on whom? What's the potential liability in testing vaccines for such a deadly disease? Is the financial reward really that great?

With pharmaceutical giants stymied by such risks, biotechnology companies have taken over the struggle to find an AIDS vaccine.

As many as 35 biotech companies once were seeking a vaccine. That number has been whittled down to about a dozen, and only a handful appear to be in serious contention. Those include MedImmune Inc. of Gaithersburg, Immune Response of LaJolla, Calif., Chiron, MicroGeneSys Inc. of Meriden, Conn., Genentech

Inc. of San Francisco, and its partner Univax Biologics Inc. of Rockville.

Biotech's tools are well-suited to making an AIDS vaccine. Through genetic engineering, researchers can make a replica of the HIV virus, one that does not contain the potent elements that infect people and cause AIDS.

In theory, when a vaccine is injected into the body, the immune system thinks it is being attacked by the real virus and begins to create antibodies, which act as warriors ready to do battle.

That seems simple enough. But making an AIDS vaccine is difficult because the HIV virus is so tricky. Unlike other viruses, HIV hides in cells, so the body's immune system has a hard time seeing that it must launch an assault. Meanwhile, the virus keeps mutating, so any vaccine must go after various strains.


And any vaccine probably will have to alert the body's white blood cells -- so-called killer T-cells -- to find and destroy bits of the virus that antibodies don't get.

Many scientists believe that a vaccine won't be available to the public for at least a decade. And don't expect the first generation of the vaccine to be perfect, says Mary Lou Clements, director of the Center for Immunization Research at ,, the Johns Hopkins School of Public Health and Mental Hygiene. It may provide only 50 percent protection and require several shots.

Today, the National Institutes of Health counts 43 experimental HIV vaccines, some of which are entering the first stages of clinical trials on human beings. But most are still in the early stages of animal testing.

Besides the scientific difficulties in developing a vaccine, companies face formidable barriers in getting a vaccine to market.

Suppose a person who agrees to be a test subject is given a vaccine and develops the disease. Could the person successfully sue the company? That question has yet to be answered, says Amy Berler, vice president of equity research at Alex. Brown & Sons.

If a vaccine is being tested for the flu, the worst that can happen is a person goes home "and throws up for a couple days," she said. But with AIDS, researchers would have to say, "Oh dear, I am sorry, you die."


Then there is the issue of patents. Some companies carry patents or licenses to an entire process that could be used to develop a vaccine. Suppose scientists discover they need to combine the properties of two, or even three, vaccines owned by different companies. Vaccine development could be stymied by problems with patents and intellectual property rights.

"It is a mess right now," Dr. Clements said. "I think it is holding things up, but how you get around it, I don't know."

Once a company gets past the science, the liability and the patent issues, what is the chance of making money?

"The need is enormous, and the market is large," said Patricia E. Fast, a doctor and chief of vaccine in the division of AIDS at the National Institutes of Health in Bethesda.

But profitability is another question. Some researchers believe that the government would limit the amount a drug company could charge for the vaccine, so it could be made available to as many people as possible.

And even if the international market is large, "Who is going to pay for it in the Third World, and how are you going to refrigerate it to get into the heartland?" Ms. Berler asked.


Meanwhile, pharmaceutical giants have been willing to wait and watch the biotechnology companies duke it out, Dr. Kersten said.

"They let us take the risk, and they don't mind paying a lot of money to the one who is successful," he said. "As the whole field becomes clearer, you will then see the big guys come in and pay incredible amounts of money." The companies will help manufacture and market the product.

John Doorley, a spokesman for Merck & Co., says his company has a significant investment in the research and development of an AIDS vaccine. The company, which has an annual research budget of $1 billion and 4,000 scientists, has devoted 5 percent of its basic research talent to coming up with treatments and vaccines for AIDS.

But he acknowledged that the company's focus has been on treatments rather than vaccines, because scientists believed that a treatment was closer. And he said it would be difficult to calculate how much of the work on the vaccine is done at !B MedImmune and Repligen Corp. of Cambridge, Mass. -- biotech companies with which Merck has formed collaborative ventures.

Several other drug companies have invested money in the research of biotech companies. And Dr. Clements believes that some large drug companies may be searching for a vaccine, but are so secretive that they won't talk about it.

Still, the lack of giant drug companies in the race may not reduce the chance of finding a vaccine, says Jeffrey Laurence, an associate professor of medicine at Cornell University and a scientific consultant for the American Foundation for AIDS Research. The greatest need is not necessarily financial might, he says. "I think we just need new ideas."