Select Committee on International Development Minutes of Evidence

Attachment 2

Accelerating an AIDS Vaccine for Developing Countries


  1.  Considering the impact of AIDS in developing countries both on human and economic development a Task Force was established at the World Bank to provide an analysis of comparatively advantageous activities in 1998. In their recommendations the Task Force now has identified a number of activities for the World Bank and related agencies/bodies how they may contribute to the development of an accessible, affordable and appropriate HIV preventive vaccine for developing countries.

  2.  The Task Force acknowledges the activities of the International AIDS Vaccine Initiative (IAVI) to focus subsidies on vaccine candidates for developing countries and the substantial public investments in basic research. However, overall HIV preventive vaccine development activities and investments in this sector are considered to be low due to the market failures inherent in the development of a vaccine as a public good, the apparent lack of individual and public willingness to pay in developing countries and a low probability of return on investment for private companies.

  3.  The Task Force acknowledges that the World Bank is only one of a number of international agencies that can help to accelerate vaccine development. The European Union governments of industrialised countries for instance are seen to be in unique positions to offer tax breaks to industry for certain types of research and development or to negotiate patent law, both of which affect incentives to invest in research and development.

  4.  The Task Force proposes three major areas of activities where the World Bank has an advantage over other actors in accelerating development of a vaccine for developing countries.

  5.  Policy dialogue—The World Bank's credibility and access to treasury and finance officials, as well as development/health leaders are identified to put it in a strong position to engage all actors in the policy dialogue surrounding the development impact of AIDS and the key responsibility of government to prevent the epidemic. Building on this dialogue on HIV/AIDS, the World Bank could raise the level of political commitment to support HIV/AIDS vaccine research and development and help to forge partnerships between developing countries, industry and international donors.

  6.  Push mechanisms. The World Bank could undertake activities to directly reduce the costs and risks of AIDS vaccine research and development. Main activities for the World Bank's involvement in "push" intervention are through contributions to the International AIDS Vaccine Initiative and lending to developing country governments for key inputs for vaccine development or clinical trials.

  7.  Pull mechanisms. "Pull" interventions are seen to raise the expectations of a future return for a safe, affordable, and low-cost vaccine that is effective in developing countries. Such mechanisms are an expansion of lending for existing vaccines and immunisation infrastructure, the establishment of a vaccine purchase fund to be capitalised now or in the future, contingent loans and guarantees (in which countries contract now to purchase vaccine in the future), and the generation of a knowledge base on the potential demand and the strategic use of an HIV preventive vaccine.

  8.  The Task Force proposes that a successful strategy is likely to incorporate intense policy dialogue accompanied by both "push" and "pull" mechanisms, and the simultaneous involvement of numerous international actors. Regulatory policies on patents and liability in industrialised countries may also have an important effect, but they are seen to not easily be influenced by the World Bank.

  9.  The strategy proposed by the Task Force includes both "push" and "pull" interventions that build on the comparative advantages of the World Bank. The proposed strategy uses existing instruments (such as lending, policy dialogue and analytic capacity) to enable developing countries to be better partners in AIDS vaccine development. The strategy includes an increased coverage of childhood immunisation programmes with existing cost-effective vaccines and the generation of knowledge on the potential benefits, strategic use of, and public and private demand for an AIDS vaccine in developing countries.

  10.  In addition, to ensure the effectiveness of these efforts, the Task Force proposes that management launched a broad discussion with the IDA community concerning new IDA-based mechanisms that would assure adequate finance for a vaccine when it becomes available, serve as a large, visible, and highly credible commitment to the market for an AIDS vaccine for developing countries. In the short run such new mechanisms may also serve to finance key activities to accelerate the process.

  11.  One innovative approach the Task Force considers to be appropriate is a "revolving fund" of U$ 1 billion within the IDA. The fund would be "topped off" as necessary at the time of each IDA replenishment, thereby providing continuing financial commitment. Until a cost-effective vaccine for the poorest countries becomes available the fund could be used to lend for other "push" and "pull" mechanisms, including finance of existing vaccines, AIDS prevention, and developing country participation in vaccine trials. Part of this fund could also serve to finance global partnerships or initiatives to address the needs of poor countries. Simultaneous initiatives or matching grant funds by other donors and private foundations would—in the opinion of the Task Force—multiply the impact of World Bank action.

  12.  Considering the urgency of the problem and the inadequacy of existing mechanisms for ensuring rapid development of the technology for an AIDS vaccine, the Task Force looks to the meeting of IDA deputies in Lisbon in June 2000 to discuss its proposals. A formal presentation of the recommendations to the Board of the World Bank should be scheduled in Spring 2000.

  13.  Resource requirements for implementation of the proposed programme are calculated to include U$ 1 million in staff time for the next three to five years and an additional U$ 2 million of DGF funding for global partnerships to support development of an AIDS vaccine.

Summarised by Matthias Weinold, WDP, Hanover

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