Tania Cernuschi AMC Secretariat GAVI Alliance The Advance Market Commitment Innovative Finance for...
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Transcript of Tania Cernuschi AMC Secretariat GAVI Alliance The Advance Market Commitment Innovative Finance for...
Tania CernuschiAMC Secretariat
GAVI Alliance
The Advance Market CommitmentInnovative Finance for DevelopmentThe Advance Market CommitmentInnovative Finance for Development
A financial commitment by donors to subsidise vaccine purchase at a set price, if & when:
they are developed meet minimum specified criteria demanded by GAVI-eligible countries
What is an AMC?What is an AMC?
An AMC is a pull funding mechanism, additional to current package of solutions, e.g. push funding, support for purchase of
current products, system strengthening.
An AMC is a pull funding mechanism, additional to current package of solutions, e.g. push funding, support for purchase of
current products, system strengthening.
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Source: GAVI
Price
Quantity(& time)9 10 11
AMC Funds
AMC price
Low tail price
The basic conceptThe basic concept
The AMC is designed to get life-saving vaccines to developing countries faster and at a sustainable price
The AMC is designed to get life-saving vaccines to developing countries faster and at a sustainable price
15~20 yrs
Guaranteedfirst stage price (AMC price)Guaranteedfirst stage price (AMC price)
In return, firms obliged to sell at lower long run price (tail price)In return, firms obliged to sell at lower long run price (tail price)
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1. Accelerate and influence vaccine development
2. Ensure availability
3. Enhance uptake
Challenges to introduction of vaccines in developing
countries:
Challenges to introduction of vaccines in developing
countries:
Vaccine formulations and presentation for developing countries
Vaccines may not be available in sufficient quantity at the time of demand
Sustainable, affordable pricing
AMC Objectives:
Which challenges are we targeting?Which challenges are we targeting?
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The AMC incentivises:
COUNTRIES – Guarantee of future financing before funds needed to purchase doses; predictability of long term tail price
INDUSTRY – Assurances of future price as incentive for more timely investment by industry; new “market” can bring in additional firms
How does an AMC help?How does an AMC help?
The AMC only provides funds if vaccines are developed and are requested by developing countries
The AMC only provides funds if vaccines are developed and are requested by developing countries
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G7: Launch of consultation process
on pilot AMC2005
Legal AgreementsSignature of Final
T&C, Donors, Stakeholders' & Offer
AgreementsJuly 2008
Disease Expert Committee:
Recommendation on Pilot
Feb. 2006
Publication of Economic Expert
Group Final Report1 April 2008
2008
Launch of the Pilot AMC: 1.5 billion
US$Feb. 2007
Donors, GAVI and World Bank preparing AMC Pilot
implementation
Role of different organizations defined IAC members selected by panel of public
health leaders TPP approved by DG of WHO – Dec. 2007Consultations with different stakeholders M&E StudyLegal Agreements
Implementation details defined
May 2008
AMC timelineAMC timeline
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Publication of ‘Making Market for
Vaccines’2005
2005
T&C, Offer, Stakeholders’
AgreementSigned2008
Guarantee terms setContract binding on sponsors
Product specifications set through TPP
Supply AgreementPrice guarantee
Manufacturing capacityCompanies sign on Vaccines delivered
FirstVaccine
Approved(2009)
SecondVaccine
Approved(2012)
ThirdVaccine
Approved(2016)
AMC timeline (cont’d.)AMC timeline (cont’d.)
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2030
GAVI eligible countries can apply for AMC approved vaccines through regular application procedures
2008
Center for Global DevelopmentCenter for Global Development
http://www.cgdev.org/section/initiatives/_archive/vaccinedevelopment
Ruth LevineVice President for Programs and Operations and Senior Fellow
Michael KremerGates Professor of Developing Societies, Harvard University Department of Economics
Alice AlbrightCFO, GAVI Fund
Back
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Disease considered: HIV, HPV, Malaria, Rotavirus, Disease considered: HIV, HPV, Malaria, Rotavirus, Tuberculosis, PneumococcusTuberculosis, Pneumococcus
Disease considered: HIV, HPV, Malaria, Rotavirus, Disease considered: HIV, HPV, Malaria, Rotavirus, Tuberculosis, PneumococcusTuberculosis, Pneumococcus
Disease Expert GroupDisease Expert Group
Decision: PneumococcusDecision: PneumococcusDecision: PneumococcusDecision: Pneumococcus
MembershipMembership
Composed of a range of experts in public health, developing country health systems, legal affairs
and immunization
Chair: Dr. Ntaba, former Minister of Health, Malawi
Mission: Recommend most suitable disease for pilot AMC
Timeline: Paris, February 2006
MembershipMembership
Composed of a range of experts in public health, developing country health systems, legal affairs
and immunization
Chair: Dr. Ntaba, former Minister of Health, Malawi
Mission: Recommend most suitable disease for pilot AMC
Timeline: Paris, February 2006
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Why pneumococcal diseases?Why pneumococcal diseases?There is a high disease burden: Potential to prevent 5.8 million deaths by 2030
Quick measure of effectiveness of AMC concept:
o Science and technology for effective pneumococcal vaccine are well understood
o There is robust pipeline that includes several efficacious vaccines for target countries
Importance of accelerating the development, capacity scale-up and reducing manufacturing costs
Cost-effective intervention: Pneumo vaccines are likely to fit into existing delivery systems; concerns about growing antibiotic resistance
Back
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Attribute Minimally Acceptable Profile
Vaccines sereotypes• Must cover at least 60% of invasive disease isolates in target region• Must include 1,5,14
Immunogenicity In accordance with WHO criteria: non inferiority to a licensed pneumo vaccine
Target population Prevent disease among children < 5, in particular < 2
Safety, reactogenicity Similar to currently licensed vaccine
Dosage and schedule Compatible with national infant immunization programmes and no more than 3 doses in first year of life
Interference No significant interaction or interference with currently administered vaccines
Routes of administration Intramuscolar or subcutaneous
Product presentation Mono-dose or low multi-dose
Product Formulation Liquid formulation
Storage and cold chain Stable at 2-8 °C with shelf life of at least 24 months
Packaging and labelling In accordance with WHO recommendations
Product registration and pre-qualification WHO pre-qualified
Post marketing surveillance In accordance with national regulatory authorities and WHO prequalification requirementsBack
Target Product ProfileTarget Product Profile
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ECONOMIC EXPERT GROUPECONOMIC EXPERT GROUP
Lead world experts in development economics, health economics, contract law, vaccine delivery
systems, vaccine business development, public health
Mission: Recommend financial terms of AMC
Timeline: Summer 2007- April 2008
ECONOMIC EXPERT GROUPECONOMIC EXPERT GROUP
Lead world experts in development economics, health economics, contract law, vaccine delivery
systems, vaccine business development, public health
Mission: Recommend financial terms of AMC
Timeline: Summer 2007- April 2008
AMC Donor Committee: AMC Donor Committee: Analyses report and makes a decisionAnalyses report and makes a decision
AMC Donor Committee: AMC Donor Committee: Analyses report and makes a decisionAnalyses report and makes a decision
1 April 2008: Final Report1 April 2008: Final Report1 April 2008: Final Report1 April 2008: Final Report
Consultations with stakeholders Consultations with stakeholders andand empirical analysis/scenariosempirical analysis/scenarios
Consultations with stakeholders Consultations with stakeholders andand empirical analysis/scenariosempirical analysis/scenarios
Optimising the AMC designOptimising the AMC design
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Economic Expert Group (EEG): Overview of findingsEconomic Expert Group (EEG): Overview of findings
1.
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SPECIAL NATURE OF PNEUMO
Key issue is to incentivize manufacturing capacity Demand risk A lucrative market exists in high- and middle-income countries There is relatively little competition likely at least in early years
2.
Modify the basic AMC structure to increase efficiency and efficacy of AMC. In Modify the basic AMC structure to increase efficiency and efficacy of AMC. In particular, need to ensure building of sufficient capacity to meet particular, need to ensure building of sufficient capacity to meet GAVI demandGAVI demand
0
25
50
75
100
125
150
175
200
225
Dos
es (M
illio
ns)
Updated, December 2007. Source: Pneumo ADIP
Strategic demand forecast for GAVI countries – Accelerated Introduction Plan – Vaccine Demand Routine Immunizations
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Companies should commit to supply portion of forecast developing country demand. In return, companies would be apportioned access to share of AMC’s $1.5bn resources.
For example, if a company guarantees to supply 30% of forecast demand, then 30% of available AMC funds would be allocated to subsidise purchase of its vaccine.
After these funds are used up, the company would be obligated to supply a proportional amount vaccines at AMC tail price.
How to modify the AMC A. Supply commitmentsHow to modify the AMC A. Supply commitments
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If demand substantially less than anticipated, frontloading reduces firms’ financial exposure.
Firms value earlier revenues. Frontloading would not increase overall amount of AMC subsidy that any one
company receives. It only means that each company receives its portion of an AMC faster – but would also transition faster to supplying at low tail price.
Framework Design Frontloading 1
Tail Price Tail PriceThe Donor Committee agreed to mitigate industry’s risk with frontloading of price.
B. Mitigate risk by frontloading priceB. Mitigate risk by frontloading price
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The AMC funds will most likely be divided and allocated within sequential offers. The first offer would be available from start of the AMC and accessible for all companies that produce vaccines in the early years. The remaining funds would be made available under future offers, during later years of the AMC period.
WHY?
Uncertainty about demand will be resolved through first round of tender/deliveryPermits market to be split among additional entrants (potentially including emerging)Increases responsiveness to country choice
C. Sequential tenderingC. Sequential tendering
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Price
Quantity(& time)
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The AMC ensures the long term price is sustainable in the long term
AMC price
Low tail price
D. Ensure there is low and hard cap on tail priceD. Ensure there is low and hard cap on tail price
AMC Funds
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Correct formulation and presentation of vaccines will be developed
They will become available faster and in the right quantities to cover demand
The price for developing countries will be known years before procurement starts
Availability of support funding is known years in advance GAVI countries are empowered to chose the vaccine they
want
What does it mean for GAVI-eligible countries?What does it mean for GAVI-eligible countries?
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We believe the AMC can be an effective ‘incentive mechanism to addressing the
linkage between the cost of research and development and the price of vaccines’
World Health Assembly Resolution 60.30World Health Assembly Resolution 60.30
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Thank you for your attentionThank you for your attention
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