Glaxo charges £6 for £1 swine flu vaccine

It costs GlaxoSmithKline around £1 to produce the vaccine but it charges up to £6 per dose. The company would not confirm how much it is charging the NHS. The Government has ordered 60 million doses, meaning the drug giant's total profit is likely to run into the hundreds of millions.

Glaxo has sold £700 million worth of the H1N1 vaccine worldwide so far this year and can expect to sell billions more as foreign governments desperately stock up.

The company today announced profits of £2.4 billion for the last three months alone. It has also sold £60 million of its anti-viral flu treatment Relenza, which reduces the length and severity of the disease and is recommended for pregnant women with swine flu.

Liberal Democrat health spokesman Norman Lamb said: "This is clearly a bonanza for the company. They have done the work so should legitimately benefit, but this is a staggeringly substantial return. I will write to the National Audit Office to determine whether we got the best deal for the taxpayer."

But Andrew Witty, the £1-million-a-year chief executive of GSK, denied his company was profiteering. He said: "We've been preparing and investing in something like this pandemic situation for a very long time. We've spent £1.2 billion on vaccine technology in the last four years.

"We've deliberately been very responsible about pricing — the vaccine is not being sold at a special premium and we have been very proactive about making sure there is enough capacity to produce the huge number of vaccines required."

He added: "We have been spending on vaccines for the past 18 years, far longer than any other drug firm. It has been a tremendously long investment."

Susi Squire of the Taxpayers' Alliance said: "We need an assurance from the Government that they have got the most competitive rate out of GlaxoSmithKline. It is good to hear that a company is doing well in the recession, but is it because they are charging over the odds for these vaccines?"

Geoff Martin of London Health Emergency said: "It's a scandal that any company could use the swine flu pandemic as an opportunity to jack up profits.

"The Government should step in and impose a windfall tax on private companies that have hit the jackpot as a result of the flu crisis."

The drug company also admitted charging Western countries more for the vaccine than developing countries. Spokesman Stephen Rea said: "We expect the UK to pay more than developing countries. We're not going to shun the fact that we are profitable, but it's only through those profits that we can carry out research to enable us to respond to pandemics when they break out."

Glaxo also pledged to donate 50 million vaccine doses to the World Health Organisation for distribution among the poor.

The drug giant refused to say how many of its own staff have contracted the disease but said it had provided some employees with free Relenza and Tamiflu.

Glaxo today said it is on track to deliver the Government's order of 60 million vaccine doses by the end of the year, and will begin to distribute them in September. Regulators will have only months to test the inoculation —vaccinations normally have trials lasting up to two years.

The company admitted that bringing the drug to market so quickly could affect quality.

Mr Rea said: "We expect there to be problems. Side-effects might include pain where the inoculation is given, and fainting. With a vaccine on this scale, other problems may be linked to it too.

"While the vaccine still has to go through clinical trials, there will be a balance between how extensive they are and regulators feeling a need to speed up its availability. We might not have the luxury of time on our hands."