Demonstration Financing: Considerations for a Pilot Pooled International Fund for R&D

A new paper recently commissioned by DNDi to examine the possibilities of creating a pooled international R&D fund for the Demonstration Projects that were selected as part of the process following on the report of the WHO Consultative Expert Working Group on Research and Development (CEWG): “Demonstration Financing: Considerations for a Pilot Pooled International Fund for R&D.” Authored by Suerie Moon of the Harvard School of Public Health, the paper explores the:

  • Potential Limitations and Opportunities;
  • Functions;
  • Principles and Policies; and
  • Governance Arrangements

of a Pilot Pooled International Fund (pPIF) for the four Demonstration Projects.

The paper is available here.
Background:

The CEWG report launched the most recent chapter of a process that stretches back at least several decades – that is, the search for a sustainable and equitable way to ensure innovation and access to technologies to meet health needs in developing countries. The CEWG outlined a global framework for building such a system, including mandatory financial contributions from all Member States, the establishment of a Global Health R&D Observatory to track pipelines and resource flows in order to identify needs and gaps, a body to coordinate actors and set priorities based on identified gaps, and the use of innovative approaches to accelerate the R&D process and ensure the affordability of end products. (In this paper the general phrase “open knowledge innovation” is used to refer to the set of policies recommended by the CEWG, including grants, prizes, equitable licensing, patent pools, pre-competitive platforms, open source and open access approaches to knowledge-sharing, and other measures to de-link the cost of R&D from the price of products.)

The CEWG recommended a doubling of existing R&D for the health needs of developing countries from about $3 billion to $6 billion per year, a significant part of which should be pooled internationally, and called for increased contributions from Member States, including middle-income countries not currently financing R&D on a large scale. The CEWG report recommended this framework be implemented through an R&D convention, analogous to the 2005 WHO Framework Convention on Tobacco Control. Before considering a convention, Member States decided in 2012 to implement a trial period until 2016 which included a set of demonstration projects and during which certain CEWG principles and approaches would be pilot-tested.

At the 2013 World Health Assembly, Member States recognized in Resolution 66.22[i] “the importance of securing sustainable financing mechanisms” for R&D to meet health needs in developing countries.  The resolution further called on all Member States to “secure resource needs for implementation” of the demonstration projects, “to contribute to coordinated and sustainable financing mechanisms for health research and development, through voluntary contributions”, and called upon all stakeholders also “to contribute to the financing mechanisms.” It also asked the WHO to “develop a proposal for effective mechanisms, including pooling resources and voluntary contributions, as well as a plan to monitor their effectiveness independently.” Since the 2013 WHA, Member States engaged in regional consultations to select candidate Demonstration Projects, eight of which were chosen by an expert committee in December 2013.  These eight were then narrowed down to the four projects that most closely reflected the CEWG principles at a follow-up meeting in March 2014.

Now that four Demonstration Projects have been selected, the key questions of how these projects should be financed and what such financing arrangements should “demonstrate” are now squarely on the table. Since Member States will be meeting in late 2015 for a second open-ended meeting to assess progress and begin to draw conclusions from the projects, it seems essential also to use this opportunity to explore what can be demonstrated regarding a potential future pooled international fund for R&D. This paper focuses on these questions.

[i] 66th World Health Assembly Resolution 66.22 (2013), available: http://www.who.int/phi/resolution_WHA-66.22.pdf and http://www.ip-watch.org/weblog/wp-content/uploads/2013/05/CEWG-decision-point-May-2013.pdf