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Financing Vaccines for Global Health Security

Author

Listed:
  • Jonathan T. Vu
  • Benjamin K. Kaplan
  • Shomesh Chaudhuri
  • Monique K. Mansoura
  • Andrew W. Lo

Abstract

Recent outbreaks of infectious pathogens such as Zika, Ebola, and COVID-19 have underscored the need for the dependable availability of vaccines against emerging infectious diseases (EIDs). The cost and risk of R&D programs and uniquely unpredictable demand for EID vaccines have discouraged vaccine developers, and government and nonprofit agencies have been unable to provide timely or sufficient incentives for their development and sustained supply. We analyze the economic returns of a portfolio of EID vaccine assets, and find that under realistic financing assumptions, the expected returns are significantly negative, implying that the private sector is unlikely to address this need without public-sector intervention. We have sized the financing deficit for this portfolio and analyze several potential solutions, including price increases, enhanced public-private partnerships, and subscription models through which individuals would pay annual fees to obtain access to a portfolio of vaccines in the event of an outbreak.

Suggested Citation

  • Jonathan T. Vu & Benjamin K. Kaplan & Shomesh Chaudhuri & Monique K. Mansoura & Andrew W. Lo, 2020. "Financing Vaccines for Global Health Security," NBER Working Papers 27212, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:27212
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    References listed on IDEAS

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    1. Victoria Y. Fan & Dean T. Jamison & Lawrence H. Summers, 2016. "The Inclusive Cost of Pandemic Influenza Risk," NBER Working Papers 22137, National Bureau of Economic Research, Inc.
    2. Neil M. Ferguson & Derek A. T. Cummings & Christophe Fraser & James C. Cajka & Philip C. Cooley & Donald S. Burke, 2006. "Strategies for mitigating an influenza pandemic," Nature, Nature, vol. 442(7101), pages 448-452, July.
    3. Vittoria Colizza & Alain Barrat & Marc Barthelemy & Alain-Jacques Valleron & Alessandro Vespignani, 2007. "Modeling the Worldwide Spread of Pandemic Influenza: Baseline Case and Containment Interventions," PLOS Medicine, Public Library of Science, vol. 4(1), pages 1-16, January.
    4. Kevin Outterson & Unni Gopinathan & Charles Clift & Anthony D So & Chantal M Morel & John-Arne Røttingen, 2016. "Delinking Investment in Antibiotic Research and Development from Sales Revenues: The Challenges of Transforming a Promising Idea into Reality," PLOS Medicine, Public Library of Science, vol. 13(6), pages 1-7, June.
    Full references (including those not matched with items on IDEAS)

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    RePEc Biblio mentions

    As found on the RePEc Biblio, the curated bibliography for Economics:
    1. > Economics of Welfare > Health Economics > Economics of Pandemics > Specific pandemics > Covid-19 > Health > Immunization

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    Cited by:

    1. Zhang, Ying & Andrew, Jane, 2022. "Financialisation and the Conceptual Framework: An update," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 88(C).
    2. Postigo, Antonio, 2023. "The Economics and Actors in Vaccine Research and Development," EconStor Open Access Book Chapters, in: From Lab to Jab: Improving Asia and the Pacific’s Readiness to Produce and Deliver Vaccines, pages 17-42, ZBW - Leibniz Information Centre for Economics.

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    More about this item

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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