(b) Reimbursable costs shall include, but not be limited to: (1) Costs resulting from the production of vaccine that fails, through no gross negligence of the contractor, to meet the specifications of the contractor because it is refused certification by the Bureau of Biologics of the Food and Drug Administration. (2) Costs incurred prior to execution of the contract in order to meet the reasonably anticipated delivery dates for the vaccine under the Program. (3) Imputed interest on working capital, at rates determined by the Secretary of Treasury pursuant to P.L. 92-41, 85 Stat. 97. (4) Actual and unrecoverable costs due to interruption of production or sale of other biologicals in order to devote staff and facilities to the production of vaccine for the Program. 3. Profit will only be allowed on A/Victoria/75 vaccine and shall be negotiated at arm's length based on the contractor's degree of risk, difficulty and complexity of performance, type of contract, and cooperation with the Government in meeting the needs of this health emergency. 4. Any insurance premium amount which is included in the price of any procurement of swine flu vaccine under the Program and which is refunded to the contractor under any retrospective, experience-rating plan or similar rating plan shall in turn be refunded to the Government. DAVID MATHEWS, Secretary. Dr. COOPER. Let me indicate all the other immunizations that we give or recommend, including in the flu area, B/Hong Kong which is made available through the regular private sector. The Federal Government does not have that kind of capability by itself. I am not saying that anyone who makes a vaccine should not make a profit. I am not really proposing that. Mr. WAXMAN. The Members of Congress who were faced with the difficult insurance issue determined that since the taxpayers of this country were to take on a financial liability that we never before had taken on, that we were going to require in the national emergency the drug manufacturers to do this work without making a profit, to do it for cost, for them to sacrifice because everyone was going to have to sacrifice. Suddenly a bill came over where they are going to make some profit. I did not understand it. I am interested in the record when we get that answer. I want to ask you another question. I am looking at your informed consent sheet- "Many people ask questions about flu vaccination during pregnancy. An advisory committee of the Public Health Service examined this question and reported that "There are no data specifically to contraindicate vaccination with the available killed virus in pregnancy. Women who are pregnant should be considered as having essentially the same balance of benefits and risk regarding influenza vaccination and influenza as the general population.' I wonder if that is really informing someone of the risks? Tell me what you would say to a pregnant woman who wants to know whether she should take this vaccine? Dr. COOPER. Do you want to know? I would say go ahead and take it. Mr. WAXMAN. My question is, Why don't we say to women that on balance we recommend you take it? Dr. COOPER. Because this is a legal instrument that has to have all the specifics in there. It was devised for that specific purpose. I don't know of all possible studies that could be done that could show something at some point in time. I think recent history in exposure of the human race to other things has amply demonstrated you can't always predict what is going to happen 20 years from now. I acknowledge that. I think that is what they are talking about in making the language specific. I have been asked this by people who have called me many times, both physicians and patients, and I tell them that they have to go to their doctor for the translation of that if it is not clear to them what is being said, and get advice from their physician. Mr. WAXMAN. I ask you to reread that paragraph because I didn't understand it to be a legal document but information for a specific patient to be vaccinated. I don't know that that really indicates that message. Dr. SENCER. This came about as a result of our consultations with the Commission on Protection of Human Subjects. If you look at the next sheet, important information about swine influenza vaccine, it says In contrast with some other vaccines, flu vaccine can be taken safely during pregnancy. The Commission on Protection of Human Subjects felt he had not spelled that out in sufficient detail and asked that we use the recommendation from our advisory committee. Mr. WAXMAN. I again suggest to you you might well try to put yourself in a position of someone trying to be informed of the risk. Dr. COOPER. Absolutely. We were asked to go back to the Commission and respond to what their consultations would be. They wanted the specific language of the recommendation included in an addendum. Mr. WAXMAN. We have two drug manufacturers out of the four sort of holding back as I understood earlier testimony on production schedule for one reason or another. Has either of these companies related to you their dissatisfaction with having to work for cost only and not for profit and given that as a reason for slowing down? Dr. COOPER. No, sir. I have not been the only one talking to anybody in the company. In my discussions with leaderships of those companies, much to the contrary, they told me that they did not wish to make any profit on this particular program. Dr. SENCER. Mr. Waxman, in the June contract proposals several of the companies indicated they would make it for cost even before the law was passed. Mr. WAXMAN. Did they indicate the same in terms of A-Victoria? Dr. COOPER. No; I did not ask them in terms of that. Mr. WAXMAN. Isn't it the case you are having more problems negotiating the contracts because of that funny difference that was put in the Senate version which the Congress passed saying you can have profit here but only cost there? Dr. COOPER. The audit criteria that have to be established on that made it more difficult to establish this criteria. Mr. WAXMAN. So, the Senate maybe held back the progress of this program by trying to provide profits and gave you another concern to think about in the negotiation? Dr. COOPER. I would say I was delighted that the Senate passed that bill and sent it over for action, and this committee and the chairman should be complimented for expediting its passage. Mr. WAXMAN. You did not care about the extra work you had to go through? Dr. COOPER. I would be delighted to do that kind of extra work in the interest of the health of the American people. Mr. ROGERS. Mr. Broyhill. Mr. BROYHILL. Thank you, Mr. Chairman. Dr. Cooper, as you know, I have been a supporter of the program. I agree with you that there is sufficient danger that we do need to get a program like this under way. I am glad to see that purchase orders are now complete. I do understand that there was a mistake made by one of the manufacturers and that a couple million doses were incorrectly made. It is the intention of the taxpayer to pick up the tab for those two million doses? Dr. COOPER. 2.5. It is not our intention to do that if in fact they were incorrectly made. Mr. BROYHILL. Thank you, Mr. Chairman. Mr. ROGERS. Is there any evidence of any swine flu infection in animals at all? Dr. SENCER. Yes, sir, there have been swine flue outbreaks in swine in several States this summer. Unfortunately, we don't know what the significance of this is because there has not been good surveillance of animal influenza in the past. We don't know whether this is the usual occurrence or whether this is abnormal. Mr. ROGERS. Is there any evidence at all that an epidemic in people sometimes follows an epidemic in animals or not? Dr. SENCER. We have not seen this in the past. This has been one of the theories advanced many years ago that this was a way in which new strains of influenza could come about. We do know in addition to hogs, that turkeys, birds also suffer from influenza. Mr. ROGERS. As I understand it then, you have entered into letters Dr. SENCER. Could I correct something I have said along that line, sir? We did in our letter contract specify the amount of vaccine that we would purchase from each of the manufacturers. This was passed based on the proposals made to us saying what they could provide. We said we would purchase that quantity from each one. We have written to each of the manufacturers saying "We request you submit proposals on the maximum number of doses of vaccine over and above what is presented to the Center for Disease Control. The Government's intent is to increase current quantities agreed to in order to reach a larger segment of the population. Mr. ROGERS. When was that letter? Dr. SENCER. September 2. Mr. ROGERS. Have you had any response? Dr. SENCER. We have had the response that if we can Mr. ROGERS. From 2? Dr. SENCER. That if we can extend to January 15, we can get this additional amount of vaccine. Mr. ROGERS. Does that include Merrell-National? Dr. SENCER. No, sir. Dr. COOPER. They have indicted they will consider it. They have not indicated they will start up again. Parke-Davis has not indicated that they will. Mr. ROGERS. Thank you very much. We appreciate your presence here. We hope that the contract with the other company will be concluded and that additional doses, if necessary, will be contracted for. Dr. COOPER. Thank you. [The following letter was received for the record:] DEPARTMENT OF HEALTH, EDUCation, and Welfare, Hon. PAUL G. ROGERS, Chairman, Subcommittee on Health and the Environment, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D.C. DEAR MR. CHAIRMAN: Thank you for your letter of September 13 on behalf of Ms. Marcia Greenberger about her testimony before the Subcommittee on the subject of consent forms to be used in the National Influenza Immunization Program (NIIP). Ms. Greenberger's major concern is with the statement, "In contrast with some other vaccines, influenza vaccine can be safely taken during pregnancy." The medical evidence for the statement can be summarized as follows: The influenza vaccines being used in the United States are "killed virus" vaccines and cannot transmit infection to the mother or fetus. Many women have been vaccinated during pregnancy, but there have been few published studies. I am enclosing copies of three studies for your convenience. Hardy, et al., mentioned no untoward effects on mother or fetus among 34 immunized pregnant individuals. Heinonen, et al., document no increase in malignancy in offspring in a long term followup of 2,291 mothers immunized against influenza. In an extensive review of the Engligh language literature, we have uncovered no case reports implicating influenza vaccine as a cause for maternal or fetal illness or death. This situation is in contrast to vaccination during pregnancy with other antigens, notably rubella. The statement as written is intended to contrast these two situations, so that in providing information about influenza vaccine, we do not create the impression that all other vaccines are equally safe. There have been no tests of the current swine influenza vaccine itself in pregnant women, nor would this have been possible under the time constraints of the program. Because the only difference in the preparation of this year's vaccine from that of past years is in the type of antigen, there is no expectation that it would be more reactogenic. In trials conducted on 5,000 individuals with this influenza vaccine in the spring of 1976, there were no high fevers reported in adults. To our knowledge, there have been no studies concerning influenza immunization and subsequent fertility, nor any reason to suspect there might be a problem. On the other hand, the risk of not immunizing pregnant women prior to an influenza epidemic must be considered. Since 1911, much has been written in the medical literature concerning poor outcome of pregnancy, increased maternal deaths, and infant mortality secondary to infection by influenza virus. Considerable data indicate that the 1918 version of swine influenza did cause increased maternal, fetal, and infant mortality (see enclosed study by Harris). In fact, in past years, pregnant women have been included in the high risk category for receiving influenza vaccine, based primarily on such anecdotal information as described above. In reviewing the literature, the Advisory Committee on Immunization Practices (ACIP) decided in June that the data on the effect of influenza in pregnancy were suggestive but not conclusive of an increased risk to the mother and fetus. Pregnant women were removed from the priority list to receive the vaccine. In her final paragraphs, Ms. Greenberger suggests that special training be given for answering questions, and further monitoring of consent procedures be done. These issues are already part of the plans of the NIIP. After consultation with the National Commission for the Protection of Human Subjects of Biomedical and Behavioral Research, we developed and distributed a supplemental statement which will accompany the basic consent forms. It uses the exact wording of the ACIP without contrasting this information with vaccination with other antigens. Sincerely yours, THEODORE COOPER, M.D., EDITOR'S NOTE.-Enclosures referred to are as follows: "The Effect of Asian Influenza on the Outcome of Pregnancy, Baltimore, 1957-1958," Janet M. B. Hardy, M.D.C.M., F.A.P.H.A.; Edward N. Azarowicz, PhD.; Anna Mannini, Dr. Biol.; Donald N. Medearis, Jr., M.D.,; and Robert E. Cooke, M.D., American Journal of Public Health, Vol. 51, No. 8, August 1961. "Immunization During Pregnancy Against Poliomyelitis and Influenza in Relation to Childhood Malignancy," Olli P. Heinonen, Samuel Shapiro, Richard R. Monson, Stuart C. Hartz, Lynn Rosenberg, and Dennis Slone, from International Journal of Epidemiology, Vol. 2, No. 3, Oxford University Press. "Influenza Occurring in Pregnant Women, A statistical study of thirteen hundred and fifty cases," John W. Harris, M.D., Journal of American Medical Association, April 5, 1919. Mr. ROGERS. Our next witnesses are Robert F. Hendrickson, vice president, operations, Merck Sharp & Dohme, accompanied by Clarence A. Abramson, who is counsel for Merck Sharp & Dohme; Frederic D. Lamb, general counsel, Merrell-National Laboratories, accompanied by Roger Clark, counsel; Frank Markoe, Jr., executive vice president and general counsel of Warner-Lambert, accompanied by Dr. Eugene Timm of Warner-Lambert and Thomas D. Finney, Jr., counsel; Burton J. Gray, vice president for administration, Wyeth Laboratories, accompanied by Charles N. Ross, counsel. We welcome you gentlemen to the committee. I know that you have statements. Without objection, your statements will be made part of the record at the appropriate point. Perhaps if we could have a spokesman from each company, give us quickly an outline of what his company's has done, and what is the prospective outlook for each company's contribution to the program. I think if we could just cover those points and then get into questioning that will be helpful to the committee. Perhaps we could start with Mr. Hendrickson. STATEMENTS OF ROBERT F. HENDRICKSON, VICE PRESIDENT, OPERATIONS, MERCK SHARP & DOHME, DIVISION OF MERCK & CO.; ACCOMPANIED BY CLARENCE A. ABRAMSON, COUNSEL; FREDERIC D. LAMB, VICE PRESIDENT AND GENERAL COUNSEL, MERRELL-NATIONAL LABORATORIES, DIVISION OF RICHARDSONMERRELL, INC.; ACCOMPANIED BY ROGER CLARK, COUNSEL; FRANK MARKOE, JR., EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL, WARNER-LAMBERT CO., IN BEHALF OF PARKE, DAVIS & CO., A SUBSIDIARY OF WARNER-LAMBERT CO.; ACCOMPANIED BY DR. EUGENE TIMM, AND THOMAS D. FINNEY, JR.; WASHINGTON COUNSEL; AND BURTON J. GRAY, VICE PRESIDENT FOR ADMINISTRATION, WYETH LABORATORIES, DIVISION OF AMERICAN HOME PRODUCTS; ACCOMPANIED BY CHARLES N. ROSS, COUNSEL Mr. HENDRICKSON. Mr. Chairman, I do have a prepared statement which is quite short. If you do wish, we will simply submit it for the record. Mr. ROGERS. Yes. We can just talk. We might as well get to the point. [Mr. Hendrickson's prepared statement follows:] STATEMENT OF Robert F. HENDRICKSON, VICE PRESIDENT, OPERATIONS, MERCK SHARP & DOHME, DIVISION OF MERCK & Co., INC., WEST POINT, PA. Mr. Chairman and members of the committee: My name is Robert F. Hendrickson. I am Vice President, Operations, of Merck Sharp & Dohme, the division of Merck & Co., Inc. that produces influenza |