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21 July 2006

G8 Nations Will Push Plans To Fund Medicines for Poor Countries
Experts say lack of consensus regrettable, but will not stop pilot programs

By Elizabeth Kelleher
Washington File Staff Writer

Washington – In reviewing what she called the Group of Eight (G8) nations’ recent “intense meeting on global health,” Josette Shiner, U.S. under secretary of state for economic, business and agricultural affairs, pointed out an omission in the official document resulting from the summit: endorsement of finance mechanisms to pay for vaccines and medicines needed by poor countries.

Shiner said that, even though there is support among donor countries for finding ways to get better results from their financial assistance to less developed nations, officials from the United States, Japan, Germany, Italy, France, the United Kingdom, Russia and the European Union could not reach consensus on proposals put forward in St. Petersburg, Russia. She spoke July 20 at the Center for Strategic and International Studies (CSIS) in Washington.

The G8 communiqué, “Fight Against Infectious Diseases,” adopted July 16, encourages greater investment in research, development and production of drugs and vaccines to address global diseases impeding development and calls for innovation in strategies to promote those goals. “The limited capacity of health systems is a major barrier to coming as close as possible to universal access to treatment for those who need it by 2010,” the communiqué says. (See related article.)

Citing evidence in a July article in the medical journal The Lancet, another participant at the CSIS discussion, Jennifer Kates of the Kaiser Family Foundation, said global health funding is increasing, but not fast enough to meet the needs of the world’s poor. The journal reports that an additional $22 billion a year will be needed by 2007 and an additional $31 billion a year by 2015.

Several proposed financing mechanisms, meant to better utilize money that developed countries donate to improve global health, were discussed at the G8 summit. But in the end, no endorsement of any of the mechanisms was made. “Everyone wanted their thing mentioned in the final document,” said Kates. In the end, countries stated their support for various proposals in an annex to the main document.

The United States favors a system whereby donor nations would make commitments to buy vaccines that pharmaceutical companies might develop in the future. These advance market commitments (AMCs) would encourage manufacturers to develop vaccines against diseases epidemic in poor countries. According to supporters – which include Italy, Canada and Russia – AMCs would assure manufacturers of profit at the end of development.

In current market conditions, the inability of poor countries to buy large amounts of vaccines and medicines for diseases that affect their populations is a disincentive for pharmaceutical companies to invest in the research and development of these drugs. The United States supports work toward a successful launch of an AMC pilot project for vaccines by the end of 2006, according to the U.S. annex to the G8 communiqué.

“Some of us wanted a good, strong looking-ahead at the AMCs,” Shiner said, “but there was no consensus.”

Another system, championed by the British, would issue bonds to pay for existing vaccines that could help developing countries now. The goal is to get donors to commit to 15 years’ worth of budget allocations to the bond program, allowing poor countries to ramp up large-scale health campaigns without worrying that funding would not be renewed year to year.

A third financing mechanism, favored by France, would tax airline tickets and use the money to pay for medicines for people with HIV/AIDS, tuberculosis or malaria. France implemented such a tax in its own country on July 1 and enjoys support for the idea from other countries.

Kates said that because the G8 countries did not agree on which mechanism to endorse in its main document, the press portrayed them as oppositional, when in fact each system can operate in complement to the others.

“It’s always nice to have G8 pronouncements to say these things are great,” said Owen Barder, of the Center for Global Development, a think-tank focused on poverty eradication. “But, in fact, the G8 has no budget, no bureaucracy, no process. So individual members can take things forward with or without the G8.”

The center expects several countries will launch a pilot AMC program by the end of 2006 to support the development of a vaccine to prevent pneumococcal infections. There is a version of a vaccine used in the United States, Barder said, that needs to be adapted to help children in African countries who often die or are left disabled after upper-respiratory infections.

Barder said that he expects such a pilot to be supported by Italy, Canada, the United Kingdom, the United States, Russia and “possibly France.” He said there will be outreach to donors not in the G8 – Australia, Sweden, Norway, Denmark, Holland, Ireland and Switzerland – and to big foundations. His expectation was echoed by Lisa Carty of the Bill and Melinda Gates Foundation, who also spoke at the CSIS panel.

Those expectations are based on a communiqué, resulting from an April meeting in Washington, in which the G7 finance ministers endorsed the concept of a pilot AMC for vaccines. The document calls for “the additional work necessary to make its launch possible in 2006.”

For additional information, see Health and G8 Summit 2006, St. Petersburg, Russia.

(The Washington File is a product of the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)