Combining health and social protection measures to reach the ultra ...

InnovationFinancing of vaccine R&D– gaps and opportunitiesfor innovationArticle by Paul A Wilson (left) and Robert Hecht (right)The purpose of this paper is to identify gaps anddeficiencies in existing funding for vaccine research anddevelopment (R&D) and explore ways that innovativefinancing mechanisms could fill these gaps. Our focus is onAIDS vaccines, but new funding mechanisms could alsosupport development of vaccines for other diseases thatprimarily affect the developing world, such as malaria andtuberculosis. We begin to construct an analytical frameworkand use it to characterize and evaluate funding mechanismsfor vaccine R&D.There has been considerable innovation in global healthfinancing in recent years, including the establishment of theGlobal Fund for AIDS, Tuberculosis and Malaria (the “GlobalFund”) and the GAVI Alliance (formerly the Global Alliance forVaccines and Immunization) 1 . GAVI itself is now funded inpart by an innovative mechanism, the International FinanceFacility for Immunization (IFFIm), which raises resourcesthrough the sale of bonds backed by future donorcommitments 2 . In the R&D area, public-private productdevelopment partnerships (PDPs), which first appeared in themid-1990s and are supported primarily by grants fromgovernments and foundations, are another important newfunding mechanism 3 . A pilot Advance Market Commitment(AMC) for pneumococcal vaccines, intended to spur privatesector investment in development and manufacture ofvaccines for developing world markets by creating asubstantial subsidized market for these products, wasannounced earlier this year 4 .Despite this dynamism, funding of global health R&Dremains inadequate. Innovative financing mechanisms couldaccelerate R&D by increasing the total volume of funding andby improving its focus, flexibility, and predictability and thuseasing some of the inefficiencies that currently hamperprogress. Innovative financing could also help to mitigate thescientific and commercial risk associated with drugs andvaccines for diseases of the developing world and in this wayallow the private sector to contribute more to the developmentof these new technologies.Current investments in AIDS vaccine R&DFunding for AIDS vaccine R&D has grown substantially inrecent years. Between 2000 and 2006, funding from thepublic and the philanthropic sectors rose from US$ 327million to US$ 854 million, as existing funders increasedtheir contributions and were joined by new donors 5 . If privatecommercial funding is included, total spending on AIDSvaccines reached $933 million last year (Figure 1). Publicsector funders continue to provide the large majority (83%) ofresources for preventive HIV vaccine R&D, while in 2006 thephilanthropic sector provided 8.4% and the commercialsector accounted for the remaining 8.4%.Where are the gaps in vaccine R&D financing? How couldinnovative financing make a difference?While financial resources devoted to AIDS vaccine R&D haveincreased substantially, there are a number of deficienciesthat must be addressed:✜ Insufficient volume of funding. The Global HIV VaccineEnterprise estimated in 2005 that US$ 1.2 billion isneeded annually to speed the search for an HIV vaccine.Current spending is thus about US$ 270 million lessthan what is required. Moreover, sustained support ateven current levels is by no means assured: in recentyears, the overall NIH budget has levelled off, and onetimegrants from foundations cause funding from thissector to fluctuate from year to year. There are strongarguments for expanded government funding of vaccineR&D: vaccines are in important respects “public goods”,in that by interrupting disease transmission theyindirectly benefit people who are not themselvesvaccinated. Moreover, many people who need thesehealth tools are very poor, which further weakens thepower of market forces alone to drive their development.Short political cycles and immediate pressures to spendon today’s health care services can make it difficult forgovernments to devote adequate resources to longer-terminvestments in new drugs and vaccines.✜ Allocative inefficiencies. Certain activities areinadequately resourced, leaving gaps in critical parts ofthe R&D continuum. Under-funded areas include appliedresearch to address key scientific constraints, such as thechallenge of finding a vaccine capable of eliciting broadlyneutralizing antibodies; translational research and designof novel vaccine concepts; and trial capacity sufficient toconduct several proof-of-concept efficacy trials in parallel 7 .These gaps mean that scientific knowledge is not being088 ✜ Global Forum Update on Research for Health Volume 4