As early as next year, more modern and more effective vaccines will hit the market, thanks to investments by the U.S. government and pharmaceutical companies. And even bigger scientific advances are expected in the next decade, including a "universal" flu vaccine given every five to 10 years that would fight many strains of a virus, making annual shots all but obsolete.

Experts say it could take eight to 10 more years of testing before a universal flu vaccine would be ready. Meanwhile, they expect advances that could still incrementally improve the level of protection vaccines offer and shorten manufacturing times.

In the last 12 months, the U.S. Food and Drug Administration has approved two new seasonal flu vaccines that protect against four predominant strains of flu instead of three. One is a shot made by GlaxoSmithKline and the other is a nasal spray made by AstraZeneca.

In late November, the FDA approved Novartis' new flu vaccine grown in cultures of dog kidney cells instead of the conventional chicken eggs, a faster and more reliable manufacturing process that could help build stockpiles in the event of a pandemic.

And this past week, the FDA green-lighted the first gene-based flu vaccine by Protein Sciences Corp, which uses genetic engineering to grow portions of the virus in insect cells. "This means there are going to be more manufacturers and more types of vaccine available in future flu seasons," FDA Commissioner Dr. Margaret Hamburg said in a teleconference on Friday.

Flu vaccines have not been high-revenue generators for major pharmaceutical companies compared with big-selling drugs for diabetes, heart disease, rheumatoid arthritis and cancer. Vaccines are expensive to make, and the flu can mutate significantly from season to season. In a mild flu season, companies can be left with millions of unsold doses if the flu season is mild.

Interest in vaccines spiked after a particularly deadly strain of bird flu known as H5N1 re-emerged in 2003, raising the threat of a global pandemic that could kill millions. At the time, there were just two vaccine manufacturers located on U.S. soil.

A year later, U.S. flu vaccine supplies were devastated by contamination at a plant in Liverpool, England. That helped underscore the need for America to have its own manufacturing capabilities, said Robin Robinson, director of the U.S. Biomedical Advanced Research and Development Authority, or BARDA, a part of the U.S. Department of Health and Human Services (HHS).

Part of the fear was that in a pandemic, countries might be tempted to commandeer all flu vaccines made within their borders, leaving the U.S. exposed. "We needed to develop new vaccines using modern technologies that would make not only more vaccine available sooner, but also make it more effective," Robinson said.

A FASTER, SAFER PROCESS

Current flu vaccines are mostly grown in fertilized chicken eggs using a 60-year-old method that requires hundreds of millions of eggs. The technique can take up to six months and is an arduous process, prone to manufacturing problems.

First, experts at the World Health Organization and the FDA have to predict which flu strains will be causing most of the illness in the coming season. Then, they make seed strains of the flu from people who are infected, which must then be manipulated into a form that will grow in live chicken eggs.

At every step there is risk for contamination. In some years certain flu strains have refused to grow readily in eggs, and the end product only protects 50 to 70 percent of people who get it. The vaccine for the current flu season is estimated to have a 62 percent effectiveness rate.

With newer methods, companies can skip the egg portion of the process altogether.

In 2006, HHS provided more than $1 billion in contracts to six manufacturers to develop cell-based flu vaccine technology in the United States. Although its use in flu vaccines is new, cell-based vaccine technology has been around for years, offering a faster, more reliable alternative to egg culture.

In 2009, spurred by difficulties in growing vaccine for the H1N1 swine flu pandemic, HHS provided Novartis with nearly $500 million to build the first U.S. facility capable of producing cell-based vaccine for seasonal and pandemic flu in the United States. Novartis picked up the rest of the estimated $1 billion price tag.

The following year, Novartis opened a plant in Holly Springs, North Carolina, which was approved to make pandemic doses of H5N1 bird flu vaccine in late 2011. Last November, Novartis' Flucelvax became the first cell-based flu vaccine to win U.S. regulatory approval.

Novartis made a limited supply of the new vaccine available for this flu season, and more will be sold once the plant is licensed for seasonal flu production.

Baxter International Inc, one of the initial six companies to win an HHS grant, is almost ready to apply for approval in the United States for its cell-based flu vaccine Preflucel, which is already approved in 13 European countries.

TINKERING WITH GENES

The United States has also backed new approaches that use genes or proteins to make vaccine.

In 2009, HHS' five-year, $147 million investment helped bail out then-struggling Protein Sciences, and the tiny biotech has now produced the first gene-based vaccine to win FDA approval.

"The new technology offers the potential for faster start-up of the vaccine manufacturing process in the event of a pandemic, because it is not dependent on an egg supply or on availability of the influenza virus," Dr. Karen Midthun, director of the FDA's Center for Biologics Evaluation and Research, said in announcing the approval on Wednesday.

Protein Sciences says its vaccine, called FluBlok, has three times the active ingredient traditional vaccines have and contains no preservatives, which some people object to. It can also sidestep some of the risk of infection associated with vaccines grown in eggs.

Instead of using the whole virus, Protein Sciences makes its vaccine using a single flu gene known to evoke a strong immune response. The company places this into a harmless insect virus called baculovirus. The virus grows inside insect cells, which are then purified to become a basic part of a human vaccine.

Two other genetically engineered flu vaccines are also under development. One by Novavax of Rockville, Maryland, uses bits of genetic material grown in caterpillar cells called "virus-like particles" that mimic a flu virus.

The other HHS partner is VaxInnate Corp, a private company in Cranbury, New Jersey, run by Wayne Pisano, former chief of Sanofi's vaccine operations in Swift Water, Pennsylvania.

In 2011, HHS awarded VaxInnate a five-year, $196 million grant to make a vaccine that combines a bacterial protein called flagellin, a potent stimulator of the immune system, with a very small portion of flu virus called hemagluttinin, the outside part of the flu protein that gives flu viruses the "H" in their names.

VaxInnate's flu vaccine is in mid-stage clinical trials. On Wednesday the company signed a license agreement with Emergent BioSolutions Inc, which also has a contract with HHS.

Robinson expects both the Novavax and VaxInnate vaccines to be available in the later part of the decade.

LESS FREQUENT, MORE EFFECTIVE SHOTS

HHS is now focusing on a universal flu vaccine that could be given every five to 10 years, much like a tetanus shot, and protect against most types of flu, including seasonal varieties and the highly mutated kinds that cause pandemics.

Only about a third of the U.S. population gets inoculated against the flu, but a universal flu vaccine could vastly increase acceptance. Although several teams have tried and failed, scientists at the National Institute of Allergy and Infectious Disease and others are making good progress, according to Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Disease, a part of the National Institutes of Health.

Work by Fauci and Dr. Gary Nabel, former head of NIH's Vaccine Research Center who just joined Sanofi as chief science officer, showed that a portion of the flu virus that is usually hidden from the immune system may be the key.

Fauci describes the hemagluttinin part of the flu virus as bulb-shaped with a stem on one end, sort of like a dandelion that has gone to seed or a lollipop on a stick.

Most vaccines target proteins on the bulb portion of the virus, which mutates from year to year, but Fauci says the stem contains proteins that don't change much from virus to virus.

The problem is that when the flu virus is presented to the body, these stem proteins are structurally hidden from the immune system. A genetically engineered vaccine could overcome that by only presenting these stem proteins to the immune system.

Phase 1 studies have already begun in people, testing for safety and whether the vaccine can prod the immune system into making an appropriate response.

Robinson said the science has reached a stage where BARDA is getting involved.

Both HHS and NIH are working with a team led by Peter Palese from the Mount Sinai School of Medicine in New York. Robinson said BARDA will be handling the manufacturing of the vaccine along with colleagues at Novartis, and the clinical trial will be done by NIH.

"It's a good hypothesis that we can test and hopefully it will work. We're keeping our fingers crossed," Robinson said.

(Writing and reporting by Julie Steenhuysen with additional reporting by Bill Berkrot in New York; Editing by Jilian Mincer and Prudence Crowther)

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