Economist examines innovative mechanisms for funding global health programs

Jan 9 2010

The Economist examines the "dramatic" change in funding for projects aimed at fighting diseases in the developing world. "In 1990 more than two-thirds of the $5.6 billion spent on global health assistance came from governments. … By 2007, when total funding for health reached nearly $22 billion, government spending still made up the lion's share," the magazine writes. "Look closer, though, and it emerges that the yeast which leavened this bread was 'non-traditional' financing. In 2007 private money from firms and charities like the [Bill & Melinda] Gates Foundation eclipsed the total from all sources spent in 1990."

As an example of ongoing creative financing efforts, the magazine points to UNITAID, "an agency founded by France, Brazil and three other countries, which is hosted by the World Health Organisation in Geneva and calls itself a 'facility' for the purchase of drugs to fight important diseases. UNITAID's main income comes from a charge on air tickets, levied by a dozen states; combined with cash contributions from other countries, this has raised $1.5 billion in the past four years," and later this month a private foundation linked with UNITAID will begin raising money directly from the public, the magazine notes.

The article highlights additional innovative ways agencies are raising money through public-private partnerships, bond issues, aggregating drug demand, patent pools and subsidizing the cost of medicines and vaccines. Also addressed in the article is the challenge of efficient spending and improving the transparency and evaluation of the agencies.

The magazine concludes: "For all the new ideas, the problems of funding global health remain grave. The flurry of innovative schemes should help, both by persuading official donors that money is being spent wisely and by attracting funds from the vastly bigger pool of global private capital. But perhaps change will come only when poor countries themselves demand better ways to test the results of health spending. External funding can be a catalyst, but the developing world will have to mobilise its own money and willpower to tackle humanity's great scourges" (1/7).