Calculating the Costs and Benefits of Advance Preparations for Future Pandemics

While Covid-19 vaccines were developed and deployed with unprecedented speed, their widespread introduction could have been accelerated—saving millions of lives and trillions of dollars—had more vaccine capacity been available prior to the pandemic. Combining estimates of the frequency and intensity of pandemics with estimates of mortality, economic-output, and human-capital losses from pandemics of varying severities, we calculate that the present value of global social losses from the stream of future pandemics can be expected to be nearly $18 trillion—over $700 billion each year going forward. According to our model, a program spending $60 billion up front to expand production capacity and supply-chain inputs for vaccines and $5 billion annually thereafter would be sufficient to ensure production capacity to vaccinate 70% of the global population against a new virus within six months. The program would generate an expected net present value (NPV) gain of more than $500 billion over the status quo of delaying investment until a pandemic arrives. A program undertaken by the United States alone would generate an expected NPV gain of over $60 billion.