It's probably not much of a surprise that the U.S. Food and Drug Administration came around at last and agreed with its U.K. counterpart that the flu vaccine produced by Chiron (NASDAQ:CHIR) was no good. There might even have been some face-saving going on when it said it would have caught the contaminated doses had they been shipped because they would have been tested before being administered. Yet it confirms that the U.S. will only have available half its regular vaccine supply -- the half produced by Aventis (NYSE:AVE).

We've had our share of vaccine production problems before. In 2000, Parkdale Pharmaceuticals, a subsidiary of King Pharmaceuticals (NYSE:KG), had its vaccine facilities shut down for quality control problems and they never reopened. Wyeth (NYSE:WYE) had similar problems and eventually left the business altogether. It explains how the U.S. became reliant on just two manufacturers for virtually all of its flu vaccine. Parkdale had produced about 12% of the nation's supply and Wyeth about one-third.

The flu vaccine is produced by growing the flu virus in fertile eggs. Millions of them. It's then extracted from the egg and killed. The virus is purified and from the debris, a serum is produced that when injected, causes the body to produce antibodies that protect it from the virus.

The technology to produce the vaccine has remained virtually unchanged since the 1950s, and Chiron needs approximately 100,000 eggs a day to make all of its doses. The company gets its eggs from one supplier in the U.K. and, as eggs don't ship overseas well, U.S. egg producers like publicly traded Cal-Maine (NASDAQ:CALM) and privately held firms like Michael Foods, Moark, or Rose Acre Farms, are not affected.

But Chiron's egg program may soon be fried anyway. Scientists are busily at work trying to create a lab-developed virus derived from humans, monkeys, and dogs. It's thought that this approach would allow companies to develop vaccines in a timelier fashion -- egg-based vaccines take anywhere from six months to a year to produce -- and in a less laborious manner. Working with eggs is tedious. Companies need to crack open the eggs, inject the flu virus into the fluid around the yolk, and reseal the egg. What the eggs have going for them is cost. It's a relatively cheap way to produce the vaccine and it is why it has remained virtually unchanged for over 50 years. The egg-based vaccines also work quite well.

A lab-based process would also allow companies to respond more quickly in an emergency. As has become evident with the latest crisis, there is no chance of additional vaccines being made available this year. If the flu should become pandemic, with outbreaks occurring worldwide, cell-based vaccines could be churned out quickly in greater numbers. Companies would be able to freeze cells and remove them at need. That's not possible with eggs.

One such company developing these new vaccines is Crucell (NASDAQ:CRXL), a Dutch biotech using human cells that has partnered with Aventis. Baxter International (NYSE:BAX) is another that is working with monkey cells, which it has used to replenish the U.S.'s smallpox vaccine supply.

Undoubtedly it will not be an "either/or" proposition, just eggs or just cell-based vaccines. It will surely be a combination of the two methods that eventually provides the safety and precaution necessary against a surprisingly deadly virus.

Fool contributor Rich Duprey once faced the crisis of an empty Coors Light keg. He does not own any of the stocks mentioned in this article.