Innovative Financing for Health in the Asia-Pacific

1. Innovative Financing for Health in the Asia-Pacific APLMA Regional Financing for Malaria Task Force May 12, 2014 Jenny Liu, PhD Malaria Elimination Initiative The Global Health Group University of California, San Francisco Contributors: Cambridge Economic and Policy Associates Clinton Health Access Initiative

2. Donor funding for malaria has declined since 2009 • Donor funding for Asia-Pacific countries was 12-21% of the total global malaria financing from 2006 to 2010, but was only 6% in 2011. Change in USD/year in malaria development assistance (2006-2011) Malaria development assistance across regions • Source: IHME Financing Global Health Database, released 4/2014

3. Malaria programs in the Asia-Pacific are heavily dependent on donor funding • The Global Fund has provided 30% of all country malaria program funding in the Asia-Pacific from 2006-2010 • Other external donors (mulit- and bilateral) accounted for 32% of all financing • Mainly from the US, UK, Australia, and Japan Sources of malaria program financing for Asia Pacific countries (2006-2010) $304m $429m $264m • Domestic governments contributed 38% • 31% among malaria control countries • 47% among malaria-eliminating countries $409m $497m $379m Source: UCSF GHG calculations of data from Pigott et al. (2012)

4. Substantial gaps in funding exist • At least 35% of the total need is projected to be unfunded through 2015, and likely more given GF NFM allocations Estimated malaria program costs through 2030 in the Asia-Pacific 1Notes: 2008 GMAP estimate from Malaria 2012 Background paper #2. Cumulate estimates for malaria-eliminating countries are taken from Zelman et al. 2014. Model assumptions differ; please see source documents for model specifications.

5. Potential impact of the Global Fund NFMExample from the Asia-Pacific malaria-eliminating countries

6. The APLMA Regional Trust Fund is vital to sustaining efforts Warning! • Malaria program disruptions have led to malaria resurgences • Cannot afford to reduce efforts, particularly with the risk of spreading artemisinin resistance Source: Cohen et al. 2012 Malaria Journal

7. Malaria elimination is the universal goal • Artemisinin resistance now in 6 areas of the Mekong, and spreading • Delayed parasite clearance reported in Suriname, Nigeria, and Kenya • Evidence resistance in Angola • Within the Mekong, eliminatingP. falciparumis the answer to artemisinin resistance • Elimination is the collective goal of countries outside the Mekong • Two vanguards in this effort:

8. Asia Pacific Malaria Elimination Network • 15 countries with a goal of national or sub-national elimination • 30 partner institutions relevant to elimination • Country-led, country-driven – direction & annual work plans • Objectives: Information-sharing, capacity building, building the evidence base for elimination, and advocacy

9. Role for the Regional Trust Fund • Support countries unable to fund their own programs • Especially important for countries whose GF support will decline • Incentivize countries nearing elimination to maintain/accelerate efforts • E.g. reducing cross-border risk, technical assistance, eliminating Pf in resistance countries • Finance activities that produce regional public goods • Diagnostic tools, surveillance, data of decision making, collaboration across sectors and countries, quality of pharmaceuticals, HR capacity building, operational research • Fund assessment of health impacts and risk mitigation • Need to measure progress • Generate evidence to demonstrate ROI

10. Sustainability is key to the Trust Fund Fundraising instruments Sources of finance • Market financing / debt raising mechanisms: • IFFIm • Social impact or pay for performance bonds – e.g. proposed malaria bond in Mozambique • Debt / credit conversion mechanisms: • Debt2Health • Performance-based credit buy-down • Endowment Funds: Gates Foundation, Rockefeller endowments • International earmarked taxes and levies: UNITAID • Regional funds: • Malaria Control Fund of the Gulf Cooperation Council Central Asian Countries Initiative for Land Management • Private sector resources: • Corporate social responsibility • Profit-sharing mechanisms: Product RED campaign • Public-Private Partnerships – global funding mechanisms such as the Emerging Africa Infrastructure Fund • Major foundations and other philanthropic funding: Gates Foundation, Rockefeller, Rotary • Emerging government donors: BRICs, East Asian countries including South Korea, Brunei and Malaysia. • Voluntary contributions: lotteries, mobile phone solidarity contributions

11. Applicability of mechanisms to malaria elimination

12. Structural considerations • Funding mechanism features • All countries should be able to access the fund, not just high burden countries • Align timing with national budget cycle • Government, CSO, and private sector should be eligible to be recipients • Accountability features • Results-based • Independent M&E system • Leverage ADB’s capacity and credibility, particularly for countries with less domestic capacity to manage funds

13. Cash-on-delivery (COD) is well-suited for accelerating Pf elimination in the Mekong and regionally • Key Features of COD • Improved Outcomes: Countries are incentivized to maximize results – optimizing impact, rather than input • Increased Efficiency: COD rewards depend only upon independently verified outcomes, eliminating the transaction costs of interim reporting • Country Ownership: COD funding is unrestricted and a country must decide how to spent it, increasing programmatic ownership • Low Donor Risk: Payment is only made upon performance, maximizing value-for-money • A COD contract is an agreement between a donor and a recipient country where the country will receive a financial award for achievement of a pre-agreed indicator of progress. • Currently being piloted by Global Fund in health and DFID in education • Could eliminate complex grant indicators and intensely focus on impact towards elimination

14. The Global Fund has designed its first COD grant in Central America for malaria elimination The Grant - $10M for Malaria Indicator • “Eliminacion de la Malaria en Mesoamerica y la Hispaniola” • Panama, Costa Rica, Nicaragua, Honduras, El Salvador, Guatemala, Belize, Haiti & Dom. Republic • Local Cases of Malaria • Singular indicator in WHO definition of elimination • Uses country systems • Unites region around common goal The Model • In Year 1, all countries receive start-up money to improve surveillance systems • In Year 2 and 3, successful countries receive $600k reimbursement for any government malaria expense from previous year Reward Payout • $600,000 • Per country, per year • Calculated by dividing funds across two years for all countries Quality Assurance • The PR’s main role is to verify results (annually) • Analyzes accuracy of data, and potential for fraud/misrepresentation

15. Measuring progress in the Asia Pacific Within 1 day All suspected fever cases laboratory/ clinically diagnosed and reported China’s 1-3-7 strategy for surveillance and response • Choose simple indicators: • Many countries already use cases as a metric to measure program performance • Others could be considered for different phases (e.g. China’s 1-3-7) • COD grants could use existing measurement systems, but would require an external verification • In a regional scheme, these data could be shared to help border states better react to outbreaks in neighboring countries Within 3 days Conduct case investigation, confirm case by double microscopy & PCR, classify as imported vs. local Within 7 days Conduct focus investigation, reactive case detection, IRS, health education Source: Cao et al. 2015 PlosMed

16. Priority considerations • Clear focus for immediate future: malaria elimination is necessary for combatting artemisinin resistance • Expanding the resource pool: need convincing business case for why the trust fund is interesting for (1) traditional donors, (2) emerging donors, and (3) private sector businesses and foundations • Prioritizing disbursements: Stop-gap funding for “crisis” countries to sustain program efforts • Clear messaging and speed: to instill confidence and buy-in from member countries