GSK to make vaccine in Singapore to fight pneumonia

SINGAPORE, June 9 (Reuters) - GlaxoSmithKlyne (GSK.L) plans to start producing vaccines from 2011 in Singapore to fight pneumonia-causing bacteria, which kills more than 1 million children each year around the world.

The world's second biggest drugmaker opened a S$600 million ($411 million) plant in the city-state on Tuesday, its second global site to manufacture the pneumococcal conjugate vaccine after Belgium.

GSK would take up to two years to test run the plant before commercial production starts, CEO Andrew Witty said.

"It is going to take a year or two to finally make sure all the production processes are running at the appropriate level of quality," Witty told reporters.

The pneumococcal conjugate vaccine protects infants and children under age 2 from the bacterium streptococcus pneumoniae, which causes diseases like pneumonia, meningitis, bronchitis, acute sinusitis and inflammation of the inner layer of the heart or endocarditis.

Those kill nearly a million children worldwide each year, 90 percent of them in developing countries.

The vaccine was introduced in 2000 in the United States and resulted in a sharp drop in pneumococcal disease in children, but is still unavailable in many underdeveloped countries, where it is most urgently needed, because of high costs.

Witty said GSK's new policy on price flexibility would make its vaccines and other drugs more affordable to poor nations.

"Vaccine is particularly important, a potential important product line for the emerging markets and Asia," he said.

Witty welcomed a World Health Organisation recommendation last week that oral rotavirus vaccines be included in all national immunisation programmes, but said they would not make a significant contribution to GSK's revenues.

"I am excited about that. It's great news, but that in itself isn't going to be a commercial opportunity, because obviously we are talking about product at much lower price being supplied to the developing world," Witty said.

WHO's new global guidance, aiming to avert half a million diarrhoeal deaths and 2 million hospitalisations a year, is expected to boost demand form Merck's (MRK.N) and RotaTeq, GSK's Rotarix vaccines in Africa and Asia.

Rotavirus is a leading cause of severe gastroenteritis, including vomiting and diarrhoea, in infants and young children. The contagious infection kills an estimated 1,600 children under the age of 5 every day, mostly in Africa and Asia.

($1=1.460 Singapore dollar) (Reporting by Nopporn Wong-Anan; Editing by Tan Ee Lyn and Jerry Norton) (nopporn.wong-anan@thomsonreuters.com, +65 6403 5665))