Improving Health R&D Financing For Developing Countries: A Menu Of Innovative Policy Options

Abstract

New drugs, vaccines, and diagnostics for the diseases of the developing world could save millions of lives and prevent enormous suffering and economic loss. Despite substantial new funding from the Gates Foundation and other donors, financing for the development of these new health technologies remains inadequate. New approaches are needed to generate more resources, make funding more stable and flexible, and further engage the expertise of the pharmaceutical industry. Several new financing mechanisms have been launched recently, and others are being proposed. This paper summarizes some of the most promising new ideas and offers a framework for evaluating them. [Health Affairs 28, no. 4 (2007): 974-985; 10.1377/hlthaff.28.4.974] D e s pi t e p r o g r e s s i n r e c e n t y e a r s , the world still urgently needs new and improved health technologies-drugs, vaccines, and diagnostic tests-to prevent and treat the diseases that take a heavy toll on people in the developing world. These new technologies could save millions of lives annually and promote faster economic and social progress.n Need for vaccines. New vaccines are required to lower the burden of infectious diseases, including AIDS, TB, malaria, and other tropical illnesses. The potential of these vaccines is enormous. For each million people in malaria-endemic countries of Africa, a partially effective malaria vaccine could avert 10,000 deaths and 16,000 severe cases of malaria over a twenty-year period.1 A vaccine to prevent dengue fever, a mosquito-borne viral disease that causes tens of millions of cases of illness and thousands of deaths annually in all regions of the tropics, could reduce the 9 7 4 J u l y /A u g u s t 2 0 0 9

Assessing 15 Proposals for Promoting Innovation and Access to Medicines Globally

“…12 Financial reform proposals help address the need for greater cooperation between the public and private sector. PDPs, tax breaks and grants, and GIPs are three avenues to address sustainable funding of R&D for medicines.…”

“…[8][9][10] Cumulatively, these circumstances have contributed to what many have called the "10/90 gap" in R&D financing and coordination for NTDs, where only 10% of financial investment in R&D is spent to treat 90% of the global disease burden. [12][13][14] To effectively address this current access gap, new strategies to manage intellectual property are needed to increase the affordability of pharmaceutical products and incentivize research into diseases that predominantly affect poorer populations.…”

Access to medical products, vaccines, and medical technologies

“…A number of alternative "push" (prior) and "pull" (ad-hoc and post-hoc) incentive mechanisms have been proposed to address the R&D gaps inherent in the market-based innovation paradigm (Hecht, Wilson and Palriwala, 2009). "Pull" mechanisms-such as advance market commitments (e.g., donor commitments to provide incentives to vaccine makers to produce vaccines for developing countries), prize funds, and expedited regulatory review (e.g., the FDA's Priority Review Vouchers, Accelerated Approval, and Fast-Track regulatory review)-reward R&D outcomes by facilitating commercialization of valuable but less profitable health products (Towse and Kettler, 2005;Love and Hubbard, 2007;Robertson, et al, 2012).…”

Current progress in the management of rare diseases and orphan drugs in China

“…For incentive strategies for global health research and development, funders and advocates have considered solutions of two types: "push" mechanisms and "pull" mechanisms (2). "Push" mechanisms aim to reduce the developer's risks and initial costs, thereby lowering barriers to entry and increasing investment in research at the start of the innovation pathway.…”

“…Pull incentive measures include market guarantees, purchase funds, prizes for successful research, improved market information, tax credits on sales, intellectual property incentives, and patent buyouts. For example, advance purchase commitment to buy a new drug, extension of patent term or market exclusivity on a new drug, or transferable patent extension of an alternative drug (2,3).…”