Novel financing mechanisms for global health
Comments (1)Last week’s Economist magazine takes a look at innovation in global health financing with a feature article on UNITAID and the Massive Good movement of the Millennium Foundation, among other novel mechanisms designed to leverage the wealth of populations to fund medical care for TB, AIDS, and malaria.
In the 1990s, more than two-thirds of the $5.6 billion spent on global health assistance came from governments. In 2007, the Gates Foundation and other major philanthropies accounted for the bulk of total funding for health. While those models relied on a small number of large donations, UNITAID is targeting entire populations by introducing so-called “solidarity tax” on purchases of airline tickets.
Founded by France and Brazil in 2006, UNITAID is hosted by the WHO and has raised more than $1.5 billion over the past four years. The organization’s primary goal is to ensure access to drugs against the most deadly global diseases by negotiating low prices for the bulk purchase of medications and to incite the development and mass production of special drugs (such as pediatric treatment for HIV/AIDS-infected children).
In January, a private foundation linked to UNITAID called MassiveGood, started raising money from the public directly with the help of the Tourism and Travel industry. In his new book, “Power in Numbers: UNITAID, Innovative Financing, and the Quest for Massive Good”, UNITAID president Phillippe Douste-Blazy argues that “building solidarity” will be essential to any effort to combat disease.
The article goes on to describe other new approaches, including the GAVI alliance’s strategy of issuing bonds backed by sovereign pledges of aid money in future years; the Global Fund’s exchange-traded fund aimed at both traditional investors and “socially responsible” ones; and the WHO’s effort’s to pressure the drug industry to relax patent protection and for large drug makers to share patents with more modest institutions. By pooling patents, the cost of development can be lowered and the pace accelerated. GlaxoSmithKline and Pfizer have announced they would combine their patents for HIV into a joint research effort called ViiV.
Also profiled is the Affordable Medicines Facility-Malaria (AMFm) to be rolled out by the Global Fund by mid-2010. Spending $216 million over two years to subsidise the cost of ACT to wholesale buyers, the Global Fund intends to reduce the retail price to between 20 and 50 cents, although 50 cents may still be too expensive.
“The flurry of innovative schemes should help,” write the authors, “but the developing world will have to mobilise its own money and willpower to tackle humanity’s great scourges.”
