After rapid decreases in the burden of disease in the developing world since 2000, funding for global health treatment and research has plateaued or is in decline. Meanwhile, the World Health Organization estimates that $150 billion is required to restore the pipeline of drugs for neglected tropical disease (NTDs) and Tuberculosis to the necessary levels. Recent research from West, Villasenor and Schneider finds that only $5.6 billion is currently spent on overall global health research and development (R&D) annually. Even if R&D funding for neglected diseases increased sharply today, given the average eight-year timeline from pre-clinical testing to approval, drug development for NTDs will be inadequate for the foreseeable future compared to disease burden.
In this report, Jeremy Barofsky and Jake Schneider explore the current drug and vaccine development environment for NTDs and investigate ways to stimulate more investment. This is the fourth in a series of reports in the Brookings Private Sector Global Health R&D Project on ways to strengthen private investment to expand available drugs and vaccines against NTDs. Earlier reports examined health R&D spending levels, the literature on barriers to investment, and health governance. This analysis focuses on specific examples of successful or promising NTD drug and vaccine development, tells the story of how novel compounds are being turned into viable products, and describes the private sector’s role.
Case studies conducted by the authors reveal a challenging landscape for private sector involvement in NTD drug and vaccine development, due to the size of investments needed and the average length of development timelines. Based on their analysis, Barofsky and Schneider make several recommendations for future action:
- Alignment of public funding with social return. To increase the range of activities that receive private funding, the authors propose public funding that is explicitly tied to health gain (disability adjusted life years averted).
- Private sector late-stage investment and risk sharing. The most important drivers of private sector development cost are long development timelines and failure risk. Therefore, the authors propose additional private sector investment focused on phase III clinical trials to minimize risk-adjusted, capitalized private sector costs. In addition, to further minimize risk, private sector biopharmaceutical firms could enter into investment agreements that would spread the risk and benefits of these trials.
- Public funding coordination and stewardship. Greater stewardship from governments to determine priority areas for NTD investment as well as coordinating joint funding of early stage R&D with nonprofit actors would both increase the likelihood of private sector involvement in late stage R&D and increase the likelihood that innovation maximizes public health.
- Advanced market commitment for hookworm and schistosomiasis. The creation of an advanced market commitment ensuring a set price for certain number of treatments purchased would increase the likelihood of private involvement in vaccine development.
- Tiered PRV based on social return and clinical stage. One specific policy change that may be more feasible in the near term to align financial incentives and health impact includes an adjustment to the priority review voucher (PRV) such that the PRV varies based on the level of innovation produced compared to current clinical practice. (The PRV program awards firms that develop an eligible drug with expedited FDA review for another drug candidate.)
- Targeted domestic resource mobilization. Although there are limited resources available for NTD R&D in the developing world, Barofsky and Schneider recommend a targeted strategy of domestic resource mobilization mediated through and conditioned by low-interest loans from multilateral institutions like the World Bank or the African Union.
Report Produced by Center for Technology Innovation