Children will get AstraZeneca's nasal spray vaccine rather than injections under the new scheme, which is expected to cost more than 100 million pounds ($155 million) a year and cover to up to 9 million children once it is fully established.

The roll-out is likely to take some time, however, since the drugmaker will not have the capacity to deliver enough new vaccine until 2014 at the earliest.

Health experts broadly welcomed the move but said it would be important to keep up constant monitoring of responses and work ahead of time to ensure the plan is accepted by the public.

Peter Openshaw of the centre for respiratory infection at Imperial College London said although there were "areas of debate" about vaccinating healthy children as well those in high-risk groups, he nevertheless strongly supported the plan.

"Not only would it protect children against flu but it would also reduce the circulation of flu in the population and ... protect those at high risk of severe disease," he said.

The vaccine, sold under the brand name Fluenz in Europe and FluMist in the United States, is made by AstraZeneca's MedImmune unit and has been available for the past decade in the U.S. This is the first big contract for the product outside America.

While the list price for the vaccine is 14 pounds ($22) a dose, Britain's National Health Service is likely to have negotiated a substantial discount, which may limit the profit boost for AstraZeneca from the contract.

Fluenz contains live attenuated flu virus strains, which are weakened so as to not cause illness.

In several clinical studies it has proved more effective in children compared with traditional injectable vaccines containing inactivated strains made by companies such as GlaxoSmithKline, Sanofi-Aventis and Novartis.

SCHOOL BREEDING GROUNDS

Healthy children do not die of seasonal flu as often as old people do, but they can get so ill they need to go to hospital. Schools also act as a breeding grounds for flu, which can then be brought into the home to infect other family members.

Adam Finn, a professor of paediatrics at Britain's Bristol University said he thought the all-children vaccination plan was a good one.

"We know it's effective and safe and flu can be a serious illness in childhood, not just in old age," he said.

He added that with more than a year until the program is fully established, health authorities have time to do more research on how well the program will work and be accepted.

But David Elliman, consultant in community child Health, Great Ormond Street Hospital, said he had "immense concerns" about the amount of human resources likely to be needed to implement the program.

"School nurses are already very hard stretched and come nowhere near delivering the basics from the Healthy Child Program," he said in an emailed comment.

He was also worried that the evidence behind the policy decision had not been made public. "Until that ... is published, it is difficult for people to comment on whether this is an appropriate decision," he said.

($1 = 0.6441 British pounds)

(Reporting by Ben Hirschler; editing by Chris Wickham and Jane Merriman)

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