The 2020 OHE Annual Lecture Explores the Question: How Should the World Pay for a COVID-19 Vaccine?

This year’s OHE lecture addresses the question: how should the world pay for a COVID-19 vaccine? Adrian Towse, Emeritus Director of OHE and Senior Research Fellow presents the challenges that we face in developing a COVID-19 vaccine, and suggests a mechanism for buying the vaccine on a global scale.

This year’s OHE lecture addresses the question: how should the world pay for a COVID-19 vaccine? Adrian Towse, Emeritus Director of OHE and Senior Research Fellow presents the challenges that we face in developing a COVID-19 vaccine, and suggests a mechanism for buying the vaccine on a global scale.

The COVID-19 pandemic has caused health and economic disaster across the world since the outbreak began. In response to this crisis, governments, companies and the global health community have sprung into action to develop an effective vaccine. Thanks to this incredible effort, only weeks after the COVID-19 genome was shared, there were vaccine candidates in the pipeline, and by March 2020 the first of them had entered clinical trials.

The Global health community is now realising that while it is a challenge to get leading vaccine candidates through clinical trials, there are two further major challenges – manufacturing and delivering COVID-19  vaccines, and ensuring that more candidates are able to enter clinical development in case the lead candidates fail, or do not provide the levels of protection required for all of the world’s population. World leaders and international organisations are now trying to understand (i) how to tackle these development and manufacturing issues, and, given the billions of doses that will be needed, (ii) decide who should get vaccines first, and (iii) raise enough money even to get to that stage. Meanwhile several companies engaged in the vaccine race are offering to sell the vaccine close to the cost price. This is not business as usual.

During the 2020 OHE Annual Lecture, Adrian will discuss these challenges and the schemes underway to address them. He will then suggest that to have the best chances of securing safe and effective vaccines we need a payment mechanism using an Advance Market Commitment (AMC). He proposes a Benefit Based Advance Market Commitment (BBAMC). Crucially, this advanced commitment should be based on paying for value instead of cost, to incentivise the development of vaccines that provide high levels of protection, and are not just the first to cross the finish line. This isn’t cheap. To create the right incentives, we need enough money to be set aside to buy the vaccine. This should include commitments from high income countries to help pay for vaccines for the nearly 50% of the world’s population who live in the world’s poorest countries.

The slides from the lecture and a link to the final paper outlining in more detail the challenges and the proposal have also been shared on the OHE website. Comments and feedback are welcome. Further information on the BBAMC is here. It is based on an earlier Center for Global Development and Office of Health Economics proposal for an AMC to incentivise the development of new TB drugs.

Citation

Towse, A. Firth, I. (2020) How should the world pay for a COVID-19 vaccine? Draft paper to accompany the 2020 OHE Annual Lecture. Office of Health Economics. Available: https://www.ohe.org/publications/how-should-world-pay-covid-19-vaccine

Related research

Chalkidou K, Towse A, Silverman R, et al. (2020). Leave No One Behind: Using a Benefit-Based Advance Market Commitment to Incentivise Development and Global Supply of COVID-19 Vaccines. Center for Global Development and the Office of Health Economics. Available: https://www.cgdev.org/publication/leave-no-one-behind-using-benefit-based-advance-market-commitment-covid-vaccine

Chalkidou K, Towse A, Silverman R, et al. (2020). The Race for a COVID-19 Vaccine: An Overview of Current Proposals and Our Contribution in Bringing in the Missing Middle. Center for Global Development and the Office of Health Economics. Available: https://www.cgdev.org/blog/race-covid-19-vaccine-overview-current-proposals-and-our-contribution-bringing-missing-middle

Chalkidou K, Towse A, Silverman R, et al. (2020). In the Race to Develop A Vaccine For COVID-19, Is A Pull For R&D Essential Or Optional? Center for Global Development and the Office of Health Economics. Available: https://www.cgdev.org/blog/race-develop-vaccine-covid-19-pull-rd-essential-or-optional

Chalkidou K, Garau M, Silverman, R M, et al. (2020) Blueprint for a Market-Driven value-based advance commitment (MVAC) for tuberculosis. Center for Global Development and the Office of Health Economics. Available: https://www.cgdev.org/publication/blueprintmarket-driven-value-based-advance-commitment-tuberculosis

Chalkidou K, Towse A, Silverman R, et al. (2020). Market-driven, value-based, advance commitment (MVAC): accelerating the development of a pathbreaking universal drug regimen to end TB. BMJ Global Health 2020;5:e002061. Available:  https://gh.bmj.com/content/5/4/e002061