Intensified vaccination campaigns brought down global measles deaths by 74 percent.
Polio is close to being eradicated and is today endemic in only four countries—down from 125 in 1988.
Vaccine development has been booming, producing new life-saving vaccines, with more on the way.
Developing countries have become vaccine-manufacturers, helping to keep traditional vaccines affordable.
The last 10 years have seen “remarkable progress” in immunization and vaccine development.
Innovative financing mechanisms such as immunization bonds are aiding the fight against infectious diseases.
Rising costs of new vaccines, hard-to-reach children, pose concerns for the future.
January 4, 2010—More children than ever before are being immunized against infectious diseases, thanks to a big push this decade to manufacture, distribute and pay for vaccines and immunization in developing countries.
In the last 10 years, intensified vaccination campaigns resulted in “remarkable progress” in conquering diseases like measles and polio.
Immunization, along with clean water and better sanitation, reduced the number of children under 5 dying every year from 17 million in 1970, to 10.5 million in 2000, and 9.2 million in 2007.
The report credits much of the progress in 72 of the poorest developing countries to the GAVI Alliance, a public-private vaccine-financing partnership whose members include UNICEF, WHO, the World Bank and the Bill & Melinda Gates Foundation, as well as donor and developing country governments, private industry and civil society organizations.
GAVI’s efforts, combined with innovative financing mechanisms, enabled vaccines to reach 200 million children and avert an estimated 3.4 million premature deaths since 2000.
“It’s an amazing success story for public health,” says Amie Batson, assistant to World Bank Managing Director Graeme Wheeler and the World Bank’s original representative in the GAVI Alliance.
Outcomes Defy Trends of the ‘90s
And one that wasn’t assured when GAVI was formed in 2000 to reinvigorate immunization as a key weapon against childhood illness and mortality.
In the late 1990s, immunization programs in low-income countries faced an uncertain future. The supply of cheap vaccines for such diseases as diphtheria, measles and polio was drying up as producers shifted to more expensive combination vaccines targeted at industrialized countries, according to the vaccine report. New vaccines available in rich countries weren’t being introduced to poorer ones. Vaccine research and development had fallen to low levels.
“At the time, there was great concern that immunization was one of the most important tools in the public health arsenal, and yet it seemed to have stalled,” says Batson.
In response, the partners created GAVI to help correct the inequities through funding introduction of new and underused vaccines in developing countries.
Lacking the capacity to monitor inputs into the immunization process itself, GAVI instead focused on results, reimbursing countries a certain amount for each additional child immunized, with WHO monitoring the outcomes. It was an innovative system that produced results, says Batson.
Financing Ideas Take Shape
At the same time, special financing task forces at GAVI and the World Bank looked at various financing options for the immunization program, eventually adopting an idea for a new international finance facility first floated by then UK Chancellor of the Exchequer Gordon Brown as a way of financing the Millennium Development Goals.
The International Finance Facility for Immunisation (IFFIm) was launched in 2006 to make funding for immunization programs available more quickly and predictably to 70 of the world’s poorest countries supported by the GAVI Alliance.
IFFIm was established as a supranational institution and its bonds are rated triple-A. The World Bank acts as IFFIm’s financial advisor and treasury manager.
“It’s a way to generate predictable financing for countries and to frontload donor commitments. They make long-term commitments – up to 20 year grants – but the money is delivered within eight years, so the countries get the money sooner,” says Logan Brenzel, a senior health specialist with the World Bank’s Human Development Network, and a contributor to the The State of the World’s Vaccines and Immunizations chapter on investing in immunization.
The United Kingdom, France, Italy, Spain, Sweden, Norway and South Africa have committed a total of $5.3 billion over a 20-year period, worth $3.2 billion in net present value terms. IFFIm uses these commitments to issue bonds on the international capital markets. Bond proceeds are used to fund GAVI programs.
As of late 2009, IFFIm had issued $2.3 billion in immunization bonds, and disbursed $1.5 billion to the GAVI Fund Affiliate for use by GAVI in poor countries.
The Netherlands has also committed to contribute €80 million to IFFIm, and in September, the UK, Norway and Australia pledged an additional $1 billion to IFFIm for health system strengthening, says Brenzel.
Advance Market Commitment Provides Incentives for Vaccine Development
In 2005, the Center for Global Development conceived a new mechanism—the Advance Market Commitment (AMC)—to stimulate the development and manufacture of vaccines specially suited to developing countries. The idea has been carried forward by interested donors, the Bill & Melinda Gates Foundation, GAVI, and the World Bank.
The vaccine industry has almost tripled since 2000—reaching over $17 billion in global revenue by mid-2009—but most of the expansion has come from sales in industrialized countries of newer, more costly vaccines, says the vaccine report.
The AMC will help correct this market failure by subsidizing the purchase of a certain number of doses of a new vaccine needed in poor countries, in exchange for manufacturer commitments to supply the vaccine at a low price over a long period, says Brenzel.
The governments of Italy, the United Kingdom, Canada, the Russian Federation, and Norway, together with the Gates Foundation, have committed $1.5 billion to pilot an AMC targeting vaccines for pneumococcal disease, which if made widely available in developing countries, could save over 7 million lives by 2030, says the report.
Pneumococcal vaccines were selected as the focus of the first pilot on the recommendation of an independent expert committee. Pneumonia kills more kids than any other infectious disease. The pneumococcal vaccine AMC pilot was formally launched last June.
The World Bank is the AMC’s financial manager, and has taken the unusual step of putting its balance sheet behind donor commitments to this compelling pilot initiative, says Susan McAdams, who, as Director of the World Bank’s Concessional Finance and Global Partnerships, is responsible for the Bank’s engagements for IFFIm and the pilot AMC.
“It’s not realistic to tell firms to invest hundreds of millions in developing a new vaccine and once that’s done, expect them to give the vaccine away for free,” says Batson.
“But at the same time, to have a life-saving vaccine that is simply beyond the reach of the world’s poorest, who are the ones who most need it, is not acceptable either. So these innovative financing mechanisms are a way of recognizing the economic realities – they provide a realistic market-based solution that achieves the public health aim.”
“These innovative financing initiatives – the AMC and IFFIm – provide well-designed funding that is accelerating achievement of the world’s immunization goals,” says Axel van Trotsenburg, World Bank Vice President for Concessional Finance and Global Partnerships.
Adds World Bank Managing Director Graeme Wheeler: "These innovations save lives and show what tremendous outcomes are possible when organizations fully combine their creativity and expertise.”
Rising Costs a Concern
While immunization is one of the most cost-effective health interventions, costs have been rising in developing countries – from $3.50-$5 per child in the 1980s, to $6 in 2000. By 2010, the average cost of immunizing a child is projected to rise to about $18.
Scaling up immunizations to protect children against 14 diseases—the goal of the Global Immunization Vision and Strategy—is likely to cost more than $30 per child, in order to save an additional 2 million lives per year, says the report. Rising costs are due to reaching children in more remote areas, and immunizing against more diseases.
Another challenge is reaching the 24 million babies each year that are inadequately immunized or not immunized at all. The report estimates it will cost an additional $1 billion per year to ensure that new and existing vaccines will be delivered to all children in the 72 poorest countries.
New vaccines are also urgently needed to reduce illness and deaths from high-burden diseases such as malaria, tuberculosis, and AIDS.
While the costs seem steep, the report points out that immunization costs can be drastically lower than treatment costs. Eradicating smallpox, for instance, cost $100 million over a 10-year period up to 1977, but that investment, according to one estimate, has since been saving the world about $1.3 billion a year in treatment and prevention costs.
“Costs are indeed rising, but immunization remains one of the most cost-effective health interventions available,” says Julian Schweitzer, Acting Vice President of the World Bank’s Human Development Network and Director, Health, Nutrition and Population.
“The new, more expensive vaccines are protecting against more diseases. The key will be strengthening health systems to deliver them efficiently and effectively, and finding the right strategies to ensure hard-to-reach children are also immunized.”
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