Considerations for a Regional Health Security Fund for the Asia Pacific Region

Considerations for a Regional Health Security Fund for the Asia Pacific Region Copyright © 2017 UCSF Global Health Group. All rights reserved.

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Recommended Citation Malaria Elimination Initiative. (2017). Considerations for a Regional Health Security Fund for the Asia Pacific Region. San Francisco: The Global Health Group, University of California, San Francisco.

Cover Photo: World Malaria Day, Thai-Cambodia Border, 2014. USAID joins celebrations on World Malaria Day in Chanthaburi, Thailand. Officials from Thailand and Cambodia participated for the fourth year. Photo: Montakan T, USAID

Acknowledgements This report was written by Roberto Garcia and Corinne Eisma with input from Jim Tulloch and Rima Shretta of the Malaria Elimination Initiative at the University of California, San Francisco (UCSF) Global Health Group. The authors thank Salina Abigail, Melissa Melgar, Katie Fox, and Brittany Zelman of the UCSF Global Health Group for editorial assistance. The authors also thank the list of informants in Annex 4 who provided valuable time for interviews to inform this report. This work was co- funded by the Asian Development Bank and the Bill & Melinda Gates Foundation

Disclaimer The study is not meant to be an exhaustive analysis of the options for a regional health security fund. Any omissions are those of the authors.

The Malaria Elimination Initiative (MEI) at the University of California, San Francisco (UCSF) Global Health Group believes a malaria-free world is possible within a generation. As a forward-thinking partner to malaria-eliminating countries and regions, the MEI generates evidence, develops new tools and approaches, documents and disseminates elimination experiences, and builds consensus to shrink the malaria map. With support from the MEI’s highly-skilled team, countries around the world are actively working to eliminate malaria—a goal that nearly 30 countries will achieve by 2020. www.shrinkingthemalariamap.org REPORT

Contents 1. Introduction ...... 2 2. The Response to Malaria in the Asia Pacific Region...... 3 2.1. Current Malaria Control and Elimination Strategies and Guidance ...... 3 2.2. Regional Coordination and Governance Mechanisms for Malaria...... 3 3. The Current Context and Sources of Financing for Malaria Elimination...... 5 3.1. Strong Programmatic Leadership and Coordination...... 5 3.2. Estimated Costs and Benefits of Malaria Elimination...... 5 3.3. Asia Pacific Economic Outlook...... 5 3.4. Current and Potential Conventional Sources of Malaria Financing...... 6 3.5. Trends and Gaps in Malaria Financing...... 10 3.6 Why Sustained Donor Funding is Needed for Malaria Elimination?...... 11 4. Beyond Malaria Elimination: Broader Health Security...... 12 4.1. What is Global Health Security ...... 12 4.2. Health Security Initiatives ...... 12 5. Future Financing Options for a Regional Health Fund...... 14 5.1. Introduction ...... 14 5.2. Innovative Financing Mechanisms...... 14 5.2.1. Obligatory Charges...... 15 5.2.2. Voluntary Contributions...... 15 5.2.3. Establishment of International and Regional Funds...... 15 5.2.4. Social Impact Bonds...... 16 5.2.5. Blended Financing...... 16

6. Structuring a Regional Health Fund (referred to below as “the Fund”)...... 17 6.1. Determining the Nature of the Fund...... 17 6.2. Management Components...... 17 6.2.1. The Governance Body...... 17 6.2.2. The Implementing Entity...... 18 6.2.3. The Trustee...... 18 7. An Evolving Fund: From Malaria Elimination to Health Security...... 19 7.1. Creating a Fund for Malaria Elimination and Health Security...... 19 7.1.1. Why Start with Malaria?...... 19 7.1.2. Why Transition to Broader Health Security?...... 19 7.2. Evolution of the Fund’s Structure, Function and Financing...... 21 7.2.1. Pragmatic First Steps...... 21 7.2.2. Transition in Functions...... 21 7.2.3. Transition of the Funding Model...... 21 7.2.4. Timeframe for Transition...... 22

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Contents (continued) 8. Issues and Conclusions...... 23 8.1. Issue 1: The Need for Formal Consultation with Member States...... 23 8.2. Issue 2: The Acute Need to Address Future Funding for Malaria Elimination...... 23 8.3. Issue 3: Broader Health Security May Be a Higher Priority than Malaria Elimination for Most Countries...... 23 8.4. Issue 4: A Regional Fund is Unlikely to be Advanced Without Dedicated High-level Attention..... 23 8.5. Issue 5: Consensus on the Need to Build on Existing Structures and Mechanisms...... 23 8.6. Issue 6: The Need to “Walk to Talk” and Take Risks on Innovative Financing...... 24 References...... 25

Annex 1: Global Fund Funding Conditions for Income Classes...... 27 Annex 2: Innovative Financing Mechanisms and Their Applicability to Malaria Elimination...... 28 Annex 3: Additional Documents Consulted...... 31 Annex 4: List of Informants...... 33

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Acronyms and Abbreviations

AAAA Addis Ababa Action Agenda HIV Human immunodeficiency virus ADB Asian Development Bank ADF Asian Development Fund IFFIm International Finance Facility for Immunisation AIM Action and Investment to defeat Malaria 2016-2030 IHR International Health Regulations APLMA Asia Pacific Leaders Malaria Alliance IMF International Monetary Fund APMEN Asia Pacific Malaria Elimination Network Lao PDR Lao People’s Democratic Republic APSED Asia Pacific Strategy for Emerging MDR Multidrug-resistant Diseases MEI Malaria Elimination Initiative ASEAN Association of Southeast Asian Nations NFM New funding model AUD Australian Dollar NGO Non-governmental organization BMGF Bill and Melinda Gates Foundation NSP National strategic plan CDC U.S. Centers for Disease Control and ODA Official development assistance Prevention OECD Organisation for Economic Co-operation CSO Civil society organization and Development CSR Corporate social responsibility OIE World Organisation for Animal Health DFAT Australia’s Department of Foreign Affairs PEF Pandemic Emergency Financing Facility and Trade PMI United States President’s Malaria Initiative DFID United Kingdom’s Department for International Development RAI Regional Artemisinin-resistance Initiative E8 Elimination Eight Regional Initiative RAI2E Regional Artemisinin Initiative 2 Elimination EID Emerging infectious disease RMTF Regional Malaria and Other Communicable Disease Threats Trust Fund EMMIE Elimination of Malaria in Mesoamerica and Hispaniola RSC Regional Steering Committee EPT Emerging pandemic threats SARS Severe acute respiratory syndrome EUR Euro SDGs Sustainable Development Goals FAO Food and Agricultural Organization SEARO World Health Organization Regional Office of the United Nations for South-East Asia GCC Gulf Cooperation Council SIB Social impact bond GDP Gross domestic product UCSF University of California, San Francisco Global Fund The Global Fund to Fight AIDS, UHC Universal health coverage Tuberculosis and Malaria UNOPS United Nations Office for Project Services GHSA Global Health Security Agenda USAID U.S. Agency for International Development GMS Greater Mekong Subregion WHO World Health Organization GTS Global Technical Strategy 2016 – 2030 WPRO World Health Organization Western HxNx Various strains of the influenza virus Pacific Region Office

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1. Introduction tuberculosis is also prevalent in the region and resistance of other pathogenic organisms to multiple anti-microbials Countries in the Asia Pacific region have made significant are an urgent concern. progress in combatting malaria, reducing morbidity by 48.5% and mortality by 85% since 2007.1 These gains This report considers the possibility of establishing a have been achieved in part because of increased regional health fund for addressing the health security political and financial commitment allowing the scale-up threat from infectious diseases. For most health of effective tools for preventing, diagnosing, and treating interventions the appropriate place for raising and man- malaria. aging financing is at the national level, mostly within the domestic government health budget. There are two Despite this remarkable achievement, an estimated exceptions where supplementing domestic health funding 50,000 people die from malaria in the Asia Pacific region with regional funds may be appropriate and necessary. every year and about half of the total population lives in The first is where there is an effort to definitively eliminate areas where they are still at risk of malaria. Moreover, the or eradicate an endemic disease, the achievement of emergence in the Greater Mekong Subregion (GMS) of which would benefit all countries in the region. The Plasmodium falciparum (P. falciparum) parasites resistant second is during a collective effort to prepare for and to the primary available treatment used worldwide respond to an emerging or re-emerging health threat threatens to reverse the gains made in malaria control that endangers the health security of the region. In both and elimination globally. cases, supplemental funding from outside of the region may be appropriate as successful efforts would benefit In response to these challenges, the Asia Pacific all countries, directly or indirectly. This document explores Leaders Malaria Alliance (APLMA) was created and at the need and provision for the creation of a potential fund the East Asia Summit, in November 2014, national that could address malaria elimination, a goal already leaders committed to a goal of eliminating malaria from declared by Asia Pacific leaders, and strengthen capacity the Asia Pacific region by 2030. APLMA has developed to respond to other potential health threats. a roadmap to attain this goal; presenting six essential priorities that outline key ways to establish a robust and This report examines the current financial landscape coherent approach to malaria elimination and to build for malaria and malaria elimination in the region and sustained and effective financing and delivery. Malaria discusses opportunities for resource mobilization prevention and treatment are among the most cost- including an innovative regional health fund, which effective public health interventions available; the benefits would go beyond just malaria. This fund could finance are not only to the health of populations affected but priority strategic regional activities, provide support to also alleviate poverty in the developing world.2 countries in the region with the highest malaria burden and the least capacity to increase domestic funding, Malaria is one of the many infectious diseases of concern and scale up investments in national programs for in the Asia Pacific region and political leaders and malaria control and eventually elimination. Such a fund public health experts are increasingly aware of the threat could be expanded to support regional responses to to health security posed by drug resistance and emerging other communicable diseases. This report is an update disease threats. In the last two decades the region has of the pre-feasibility report commissioned during the borne the brunt of severe acute respiratory syndrome first half of 2015 by APLMA through the Health Resource (SARS) and avian influenza epidemics, both of which Facility supported by Australia’s Department of Foreign led to devastating economic impacts in addition to Affairs and Trade (DFAT).3 human suffering and deaths. Multidrug-resistant (MDR)

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2. The Response to Malaria in the the Asia Pacific region identified four main multi-lateral entities with governance, coordination, and/or technical Asia Pacific Region functions that cover a number of countries or a defined region. These have their own complementary but specific 2.1. Current Malaria Control and Elimination mandates and degrees of intervention. They are briefly Strategies and Guidance described below. Since 2000, there has been an unprecedented World Health Organization (WHO): Through its Global political effort to catalyze responses to the global Malaria Program, its regional offices in South-East Asia burden of malaria. Spurred by the success of these (SEARO) and the Western Pacific (WPRO), and the GMS efforts, stakeholders have set their sights on national Malaria Elimination hub (formerly the Emergency Response and regional malaria elimination. to Artemisinin Resistance hub) WHO provides overall policy and technical guidance as well as technical support In 2015, new global goals for malaria control and to countries. It is the organization mandated to coordinate elimination were endorsed in three documents: international initiatives, set norms and guidelines, and - The World Health Organization’s Global Technical serve as the main conduit for channelling national data Strategy for Malaria 2016- 2030 (GTS) into global reports. Its regional governing bodies are the - Roll Back Malaria Partnership’s Action and Investment Regional Committees of SEARO and WPRO. to Defeat Malaria 2016-2030 (AIM) - Multi-partner From Aspiration to Action: What Will It APLMA: This alliance, formed in 2012, serves the leaders Take to End Malaria? of Asia Pacific countries and promotes their roadmap to malaria elimination by 2030. It brings political engagement In addition to these important direction-setting and advocacy to the malaria control and elimination effort documents, in 2016 the WHO produced a report entitled covering the Asia Pacific region. The governance board “Eliminating malaria” and in 2017 it produced a separate of APLMA now also oversees the Asia Pacific Malaria report entitled “A framework for malaria elimination” Elimination Network (APMEN), which was established in which reaffirms the WHO GTS target of malaria elimination 2009 as a network of national malaria control programs in at least 35 countries by 2030. The latter report spells and multiple institutional partners to share lessons and out the key interventions required to achieve elimination: provide support to malaria elimination in Asia Pacific, with enhancing and optimizing vector control and case a particular focus on Plasmodium vivax. management; increasing the sensitivity and specificity of surveillance; accelerating transmission reduction; The Global Fund to Fight against AIDS, Tuberculosis and investigating and clearing individual cases. The and Malaria (Global Fund): Since the inception of recently endorsed Sustainable Development Goals the Global Fund in 2002, external funding for malaria (SDGs) also include ending malaria, among other in the Asia Pacific region has increased to its present diseases, as part of its 169 targets unprecedented levels. As the largest external financier, it is also one of the most important influencers of malaria In the Asia Pacific region, the WHO has coordinated the elimination in the region. It is managed by a secretariat development of regional malaria elimination strategies in Geneva and funds are channelled through Principal for each of its two concerned regions (Southeast Asia Recipients and overseen by Country Coordinating and the Western Pacific) and worked with countries to Mechanisms (CCMs) in each country. Importantly, the develop their national strategies for malaria elimination. Global Fund provides a sub-regional grant for malaria The APLMA Malaria Elimination Roadmap provides further elimination in the GMS known as the Regional Artemisinin guidance towards the goal of an Asia Pacific region free Initiative (RAI), which is overseen by the RAI Regional 4 of malaria by 2030. Steering Committee (RSC), a multi-partner/multi- disciplinary governance platform including representation 2.2. Regional Coordination and Governance from national governments, the Asian Development Bank Mechanisms for Malaria (ADB), the Association of Southeast Asian Nations (ASEAN), donors, WHO and other partners dedicated There are a number of entities involved in malaria control to malaria elimination in the GMS. The second phase and elimination in the Asia Pacific region at different levels of the RAI - renamed the Regional Artemisinin Initiative and with different geographical coverage. Earlier work 2 Elimination (RAI2E) - has been approved by the Global on governance and coordination of malaria elimination in Fund for an additional 3 years (2018-2020).

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The ADB Regional Malaria and Other Communicable to support malaria elimination through broader health Disease Threats Trust Fund (RMTF): This mechanism, systems strengthening and technical assistance. The ADB set up in 2013 with support from DFID and DFAT to assist works closely with ministries of finance, which will be key countries to develop regional, multi-country, cross-bor- partners in securing domestic financing for malaria elimi- der, and multi-sector responses to drug–resistant malaria nation and other disease control programs. This fund will and other communicable disease issues, including efforts be ending in June 2018.

Figure 1: Complementarity of Multilateral Governance and Coordination Mechanisms in the Asia Pacific Region

APLMA/APMEN - Political, advocacy, and technical support - Resource mobilization (21 countries)

Global Fund - Main external funding for NSP WHO/SEARO/WPRO/MME implementation to most endemic Asia Pacific Policy guidance and country countries Endemic Countries support technical expertise - RSC/RAI2E governance platform (22 countries) (GMS countries)

ADB/RMTF Regionally focused support to malaria elimination and other communicable diseases (GMS focus)

A number of development partners have also supported regional and country levels. Significant progress has malaria programs in the Asia Pacific region and more been made with APLMA and APMEN complementing specifically the GMS over the past two decades, helping the WHO role. The establishment of an annual regional countries shape their strategies and supporting their malaria week initiated by APLMA to bring together a activities. While their support may cover more than one number of regional meetings on malaria has also helped country they do not serve as multi-country coordination with regional coordination and collaboration. The RAI mechanisms. These entities are listed in the following RSC, although restricted to the GMS countries, has section. provided another example of open, multi-stakeholder governance and coordination, bringing together There is a general consensus among stakeholders that governmental and non-governmental groups including to eliminate malaria, governance and coordination across research institutions and the private sector. the region are essential, and can be improved at both the

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3. The Current Context and between USD 3.2 and USD 3.9 billion over the 15-year period. This corresponds to an average of USD 1.8–2.2 Sources of Financing for Malaria per capita per year for the population at risk of malaria Elimination per year. More recently, a study conducted by the Malaria Elimination Initiative (MEI) at the University of California, 3.1. Strong Programmatic Leadership and San Francisco (UCSF) Global Health Group estimates that Coordination USD 2.5 billion will be needed for the GMS region. These costs should be weighed against the epidemiological and While this report focuses on a regional fund for malaria economic costs of inaction. In the same study, investing in elimination, it is important to note that funding will need malaria elimination would save over 91,000 lives and avert to be coupled with dedicated leadership and coordination. 23.5 million cases with 5:1 return on investment and over Although this has greatly improved in recent years through USD 9 billion economic benefits.7 the establishment of APLMA and APMEN complementing the on-going role of the WHO and the CCM and The cost of malaria elimination in Asia Pacific has been RSC/RAI2E models of the Global Fund, better overall estimated by APLMA at USD 1 billion per year in the coordination for the entire region and leadership towards first five years of the implementation of its Roadmap and the shared goal of malaria elimination will be crucial for just under USD 2 billion per year in subsequent phases, success. amounting to a total of USD 33 billion over 15 years. Recent analysis by the University of California estimate In a commentary published in the Malaria Journal5 seven that elimination will cost about USD 29.02 billion between critical actions for rapid elimination of P. falciparum in 2017-2030.8 The returns are substantial. In the Asia the GMS were identified. The first critical action listed Pacific region, APLMA estimates that elimination could was the need for the establishment of a command- lead to over 200 million preventable malaria cases by and-control structure. The authors propose that “to 2030 and an additional 1.3 million deaths with economic achieve the levels of coordinated action required to savings of over 300 billion (APLMA Roadmap). confront MDR malaria and P. falciparum, there should be a single regional coordinator, elected and empowered This is particularly significant for economies that depend by a multi-stakeholder governing body that includes heavily on agriculture, where malaria elimination would representation of the GMS National Malaria Control increase production, in turn contributing to national food 9 Program directors, with a broad managerial and financial security and greater rural prosperity. Malaria strains mandate. Responsible and accountable focal points and drains public health systems; it can sometimes must then be identified at country and provincial levels. represent 40% of public health spending in high- 10 The overall role and mandate of this structure should transmission areas. Malaria elimination could result be clearly defined, and fully supported by existing regional in major cost savings. The financial and health staff structures, including WHO, the and APMEN, but there resources consumed by malaria could be reallocated must be a single locus of coordination for a well- to other public health interventions or emerging health organized, flexible and comprehensive response.” security threats. In addition, the systems and capacity in surveillance and response, laboratories and monitoring 3.2. Estimated Costs and Benefits of Malaria and evaluation developed for malaria elimination could be a valuable contribution to tackling other epidemics or Elimination health issues. It is also widely acknowledged that malaria The GTS has calculated that achievement of its 2030 elimination is also the only solution to the emerging threat global targets would require USD 101.8 billion, with an of artemisin in resistance in the region.11 12 annual USD 673 million to fund malaria research and de- velopment.6 The 2015 “From Aspiration to Action Report” 3.3. Asia Pacific Economic Outlook estimates that the cost to eradicate malaria between 2015 Economies in the Asia Pacific region have been growing and 2040 could be between USD 90–120 billion. by approximately 6% annually since the year 2000, Using the assumptions included in the study scenarios, and although the International Monetary Fund (IMF) WHO estimated that the total cost of eliminating expects the region’s growth to decelerate to 5.3% in P. falciparum malaria in the GMS was estimated to range 2016-17, it is still the world’s fastest growing region (IMF, 2016). The growth in wealth is, however, unequally

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distributed both between and within countries. Neverthe- there has been a steady decline in external financing for less, it has increased countries’ fiscal space to invest in malaria, particularly in low-burden, pre-elimination, and socio-economic development. Asian economies spend elimination countries. These countries are also middle- just over USD 730 per person per year on health, as income countries and considered a lesser priority for opposed to countries in the Organisation for Economic international funding. While in some countries this decline Co-operation and Development (OECD), which spend has been partially compensated by a rise in domestic USD 3,510. This amount to just over 4.6% of GDP, on financing, the needs for malaria control and elimination average, in the Asian region, compared to over 9.3% far exceed the available resources. At the same time, the in OECD countries.13 In addition, the share of public region as a whole has experienced unprecedented eco- spending in total health spending is much lower in nomic growth providing unparalleled opportunities to reach Asia compared to OECD countries: 48.1% vs 72.7% and sustain its own resources for malaria elimination. respectively.14 However, while it can be expected that as countries get richer, health expenditures also The following paragraphs briefly describe some of the increase, this is not a linear relationship.15 As countries current and potential sources of financing for malaria in the region see positive economic growth, there needs control and elimination in the Asia Pacific region. to be an active effort to increase domestic financing levels for health, and specifically for malaria, in order to reduce Governments reliance on donor funding. It is worth noting, however, Government financing and external grants are the that the allocation of national budgets can vary greatly major sources of funding for malaria programs, with depending on the underlying politics and perceived loans and the private sector contributing smaller priorities, with dramatic effects on the continuity of amounts. While in the last decade external resources program activities. have been exceeding domestic resources, in many cases there is now a reversing trend. For the period 3.4. Current and Potential Conventional 2018-2020, it is estimated that government contributions Sources of Malaria Financing will be approximately 2.5 greater than external resources. The majority of the domestic funding comes from tax The Asia Pacific region attracted between 12% and 21% revenue; the use of innovative financing instruments by 16 of global malaria funding from 2006-2010. However, countries in the region for malaria program financing is very limited. Figure 1 illustrates the projected financing for malaria by source for 2017.

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Figure 1. Projected financing for malaria in Asia Pacific countries (in millions USD), 2017

100,000,000

Domestic

80,000,000 Other External Global Fund

60,000,000 (Millions USD)

40,000,000

20,000,000

0

India China Nepal Bhutan Vanuatu Malaysia Pakistan Thailand Viet Nam Indonesia Myanmar Sri Lanka Cambodia Philippines AfghanistanBangladesh Timor-Leste

Solomon Islands Republic of Korea Papua New Guinea

Lao Peoples Democratic Republic

Democratic Peoples Republic of Korea

The ADB Regional Malaria and Other Communicable Global Fund Country Allocations Disease Threats Trust Fund By the end of 2017, the Global Fund will have allocated The ADB RMTF was established with initial contributions a total of almost USD 10 billion to malaria control and from Australia DFAT and UK DFID of USD 16.3 million and elimination. In the period 2012 to 2017 the allocation for USD 19.4 million, respectively. Additional contributions malaria varies between USD 800 million to USD 1.2 have been sought from other development agencies, the billion per year, of which approximately 10 to 15% was private sector and foundations. Contributions from other dedicated to Asia Pacific countries (Figure 2). These entities include technical expertise, such as that provided countries were Bangladesh, Bhutan, Cambodia, India, by the Clinton Health Access Initiative, the Asia E-Health Indonesia, Democratic People’s Republic of Korea Network, the MEI and various other academic and (DPR Korea), Lao, Myanmar, Nepal, Pakistan, Papua government bodies. New Guinea, Philippines, Solomon Islands, Sri Lanka,

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Thailand, Timor-Leste and Viet Nam. For the period created with a USD 100 million grant from the Global 2018-2020 the current Global Fund allocation to Fund for five countries of the GMS, in addition to their these countries is estimated at USD 379.1 million. other Global Fund allocations for malaria. The original allocation covers the period 2014-2017, and additional Global Fund Regional Artemisinin Initiative 2nd funding of USD 243 million has been set-aside for the phase Elimination (RSC-RAI2E) period 2018-2020. The regional principal recipient/ The first phase of the Regional Artemisinin Initiative was manager of the funds is the United Nations Office for Project Services (UNOPS). It is overseen by the RSC.

Figure 2. Global Fund Financial Allocations, 2012-2017

1,500,000,000 Asia Pacific All Countries

1,200,000,000

900,000,000

600,000,000

300,000,000

0 2012 2013 2014 2015 2016 2017 Source Global Fund data

USAID/President’s Malaria Initiative (PMI) The World Bank PMI is led by USAID and implemented by the US Centre Between 1989 and 2011, there were 73 World Bank- for Disease Control (CDC) and other partners. PMI covers financed health projects with malaria control activities, a wide range of programs, mostly in Africa, including the of which 42 were based in Africa. Under the Malaria Control and Prevention of Malaria (CAP-Malaria) initiative Control Booster Program (2005-2010), the World Bank in the Mekong. PMI has allocated US$ 50 million to Asian committed nearly USD 1 billion for malaria control activi- Pacific countries (Cambodia, Myanmar, Thailand), since ties in Africa and India.18 The OECD Creditor Reporting 2015 and is planning to allocate a further US$ 43 million System data shows that from 2013 to 2015 the World to Myanmar and Cambodia for the period 2018-2020. Bank invested USD 136 million in malaria programs, of which 5% was directed to India, Lao PDR, and Viet Nam Bill & Melinda Gates Foundation (BMGF) and the remainder for Africa. Malaria control is also an BMGF, a private foundation, has funded a wide number integral part of the World Bank’s financing for essential of health initiatives, innovations, and research efforts. health services in the context of universal health coverage Since 1997, it has committed nearly USD 2 billion in (UHC), aiming to scale up effective interventions and to grants to combat malaria, and in addition, more than strengthen systems such as supply chain, human USD 1.6 billion to the Global Fund. BMGF has been the resources, and monitoring and evaluation.18 world’s largest donor for malaria drug research. Its main priorities within malaria are to demonstrate an accelerated Australia path to elimination, to invest in new interventions, and to In 2015 – 2016 the health budget was 14.3% of mobilize support through political agendas. The BMGF Australia’s official development assistance (ODA)19, has provided USD 74 million in malaria funding to the down from 16.3% in 2014-15.20 In line with overall aid GMS of which approximately two thirds has been policy, the main geographic focus of the Health for invested from 2014 to 2017. Development Strategy 2015-2020 is Southeast Asia

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and the Pacific with Papua New Guinea, Indonesia, sharing its expertise with other countries in the region. In the Solomon Islands, and Cambodia accounting for addition, in 2016, China, Australia and Papua New Guinea the majority of their ODA targeted towards health. have launched a trilateral project to combat malaria in Australia finances various regional and global malaria Papua New Guinea. The project focuses on working with initiatives: AUD 12 million from 2013 – 2019 to directly the National Department of Health, the Central Public support the work of APLMA; AUD 220 million to the Health Laboratory and the Institute of Medical Research Global Fund for 2017 – 2019 (up 10% on its previous to improve malaria diagnosis by strengthening laboratory contribution); AUD 10 million over 2014 – 2017 to the services and research. Medicines for Malaria Venture; and AUD 18 million to ADB’s RMTF.21 The Republic of Korea

th Japan The world’s 12 largest economy in the world aims to increase its ODA from 0.14% to 0.2% of their gross Health has been given a greater priority in recent years national income by 2020.2 Global public health has been in Japan’s foreign aid through the Japan International one of the three largest outreach areas of the Republic of Cooperation Agency (JICA), which is shown by the 68% Korea’s foreign aid programs. A 2015 analysis shows that 22 growth in ODA for health from 2006 to 2015. Japan has it concentrated its foreign aid on Asia and Africa (45% in also exerted increasing global development leadership Asia and 36% in Africa), and that a large share of its aid and influence in the health arena in recent years. As was focused on health care services and maternal and hosts of both the G8 Experts’ Meeting on Global Health child health in Asia and water, sanitation, hygiene, and Issues in Tokyo in April 2000 and the 26th G8 Summit in infectious diseases in Africa.26 Kyushu-Okinawa in July 2000, Japan was able to play a key role in the creation of the Global Fund. During its Asian Infrastructure Investment Bank first decade of operation, Japan was the third biggest contributor to the Global Fund. At the 42nd G7 Summit The Asian Infrastructure Investment Bank was established in Ise-Shima in May 2016, health was one of the priority in January 2016 and is a regional investment bank areas with its Vision for Global Health focusing on headquartered in Beijing serving Asia and Oceania. public health emergency response, the promotion of Proposed as an initiative by the government of China, UHC, and reducing anti-microbial resistance.23 In 2016 the bank aims to support infrastructure in the Asia Japan pledged USD 800 million to the Global Fund for Pacific region. The bank has a capital of USD 100 billion, 2017-2019 - an increase of 46% on its previous pledge.24 which represents an estimated two-thirds ADB’s capital 27 While the magnitude of Japan’s support for malaria in the and about half of the World Bank’s capital. While not region is modest, it has in past years supported malaria currently lending for health, the AIIB is likely to be control in Myanmar and the Solomon Islands. interested in regional health security to safeguard their financial investments. China One of the key priorities of China’s foreign aid agenda Non-governmental Organizations (NGO), Academic released in 2014, was to improve health services with a Institutions, and Private Sector Initiatives priority in strengthening infrastructure, human resources While NGO and academic institutions are not, in general, development, and the provision of equipment and drugs.25 primary sources of funding, they make an invaluable China also contributes to and cooperates with regional contribution to malaria control and elimination, in some financial institutions; for example, by the end of 2012, it cases using their own financing, and in some cases as had contributed a total of USD 110 million to the Asian contracted implementers, such as with Global Fund Development Fund (ADF) of the ADB. In 2016, China support. The monetary value of their contribution is pledged USD 18 million to the Global Fund representing however, complex to estimate. There are a number of a 20% increase on their commitment for the previous NGOs operating in Asia Pacific, such as the Clinton replenishment period. In addition to being an important Health Access Initiative, Population Services International, global health donor to Africa, engagement with the Pacific PATH, the Malaria Consortium, as well as a range of region is growing.1 China has executed a very successful research institutions carrying out a variety of activities in malaria elimination program and has shown interest in the malaria field.

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3.5. Trends and Gaps in Malaria Financing until 2021. However, Global Fund support beyond 2021 is largely unpredictable. Continuation of strong support for The strong economic growth in the Asia Pacific region malaria control and elimination will be contingent on the has led to changes in the way economies are classified priorities set by and the convictions of the Global Fund’s by the World Bank. In 2001, the World Bank classified donors. fourteen countries in the region as low-income countries (LICs), and thirteen as lower-middle-income countries The Global Fund’s new Sustainability, Transition and (LMICs), and only three as upper-middle-income countries Co-financing (STC) Policy requires countries with (UMICs). In 2016, only three countries were classified as improving domestic economies to assume greater LIC, 21 as LMIC, and eight as UMIC. responsibility for their disease control programs. In this context, the funding from external resources, Access to funding will become more difficult particularly including the Global Fund and bilateral donors such for upper middle-income countries and lower middle- as Australia and the UK may scale down significantly. income countries with moderate disease burden. In In the coming years, external donors will increasingly the region, this is likely to affect Thailand, Malaysia, focus on urging governments to increase their domestic Philippines, Sri Lanka, Solomon Islands, Timor-Leste and funding for malaria elimination in order to increase Vanuatu. As part of the STC policy, the Global Fund will financial sustainability. support transition readiness assessments and introduce higher co-financing incentives for certain countries. Global Fund Financing Funding Need and Gap As the Global Fund has become the largest external financier in the region for malaria, any downward trend The total cost to achieve malaria elimination in Asia Pacific in its funding is likely to create a significant funding gap. between 2017-2030 is estimated to be USD 29.023 billion In the GMS, the epicenter of MDR malaria, for example, (range: USD 23.65-36.2 million) by the USCF/MEI. The the Global Fund represented more than two thirds of median cost in 2017 for the elimination scenarios is about total external funding as of 2016. With the 2016 USD 1.5 billion. Costs peak in 2020 at USD 4.29 billion, replenishment of Global Fund financing, most endemic then decrease to less than USD 1 billion in 2027 and less countries in the Asia Pacific region have secured than USD 450 million in 2030. continued support for their national malaria programs

Figure 3. Modeled costs of the elimination scenario 2016-20308

5,000,000,000

4,000,000,000

3,000,000,000 Millions USD

2,000,000,000

75% Cost Median 1,000,000,000 25% Reduced PAR 0

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Source: Shretta et al., 20178

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A median resource envelope of about USD 3 billion is countries fall into these categories, there is a clear op- needed annually to achieve elimination between 2018- portunity for ODA financing for malaria to be scaled up. 2020. Total financing for the region was 97.2 million in This trend, however, also poses three distinct risks for low 2017 and is projected to be USD 1.4 billion annually for burden and eliminating countries: 2018-20. The anticipated gap is expected to be about 50% of the need. 1. Donor metrics of need are very specific. Thus, when a country moves out of a defined group (e.g., low While investment from governments will inevitably need to income, high poverty, fragile) there is a risk that increase as they approach the malaria elimination phase, funding could be shifted elsewhere. There are a external funders should remain mobilized to support the considerable number of malaria-affected countries common long-term objective. Elimination of malaria in the that at present receive ODA, but which may not in Asian Pacific region is a regional public good – and since the future be defined as having the greatest need. addressing drug resistance is one driver and potential outcome of the elimination program, it can also be seen 2. Donor decisions tend to be based on aggregate as a global public good; as such, it requires continued national data across all issues. This could cause support from both international partners, and emerging problems for countries that are improving regional development partners as well as governments. economically, but still struggling against malaria or for those that have high malaria burdens in specific 3.6. Why Sustained Donor Funding is Needed regions. for Malaria Elimination 3. Malaria eliminating countries face a lower burden of Stability of funding is especially important for countries disease and therefore less of a priority for donors seeking to eliminate malaria. There have been historical focusing on high burden countries. For example, cases where regional incidence has been reduced by the Global Fund New Funding Model implemented 90% through targeted programs, but where subsequent in 2014 estimates country allocations based on funding cuts have resulted in a rapid reversal of those disease burden and ability to pay as characterized gains. For example, in Sri Lanka in the 1960’s when by the Gross National Index. As a result of this malaria cases were reduced, funding was redistributed revised strategy, eliminating countries faced a 30% to other health priorities resulting in a rapid resurgence reduction in available financing from the Global 16 of cases and deaths. To mitigate these risks, there is a Fund. strong case for donors to increase allocations according A regional fund has the potential to play a coordination to the need around specific global challenges. In the case and catalytic role to ensure that support for malaria of malaria, this could mean substantially scaling up aid elimination as a regional public good continues to receive directed towards the Global Fund. priority. Given that malaria cases are declining, the case Donors currently use varying metrics to define greatest for a regional fund that addresses health security need, but are increasingly focusing on the least devel- becomes stronger. oped and fragile states.28 As the majority of high burden

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4. Beyond Malaria Elimination: health security frameworks. This partnership is led and supported by a steering group composed of member Broader Health Security nations.

4.1. What is Global Health Security The Global Health Security Initiative (GHSI), not to be The WHO defines global health security as the activities confused with the Global Health Security Agenda, is a “…required, both proactive and reactive, to minimize partnership led by Canada, launched in November 2001 vulnerability to acute public health events that endanger and includes the European Union, France, Germany, Italy, the collective health of populations living across Japan, Mexico, the UK and USA. The WHO serves as an geographical regions and international boundaries.”29 expert advisor. The main difference between the GHSI The international community collaborates through and the GHSA is that the latter has more of an emphasis various initiatives and mechanisms aiming to improve on multi-sectoral engagement. the detection and reporting of potential public health emergencies worldwide. The emergence of new In May 2016, the World Bank Group launched the diseases and the need for these collaborations has Pandemic Emergency Financing Facility (PEF). The PEF increased in the past decades due to, for instance, is an innovative, insurance-based mechanism for the growing populations and international travel, intensive poorest countries to help prevent disease outbreaks farming practices, environmental degradation, and the from becoming a pandemic. The PEF funding, under spread of resistance to antimicrobials. Drug resistance the insurance window, is provided by resources from is increasing across many disease groups including the reinsurance market and the proceeds of catastrophe diarrhoeal diseases, hospital-acquired infections, bonds issued by the International Bank for Reconstruction malaria, meningitis, respiratory tract infections and and Development. The PEF also includes a cash window sexually transmitted diseases. The risk of a disease to complement the insurance window. The PEF is spreading across borders is especially high for low and designed as an emergency response mechanism, middle-income countries with less developed systems and as such it will not be used to directly finance to prevent, detect, and rapidly respond to emerging pandemic preparedness measures. Japan committed and re-emerging public health threats. Health security their first USD 50 million in 201730. The PEF currently ties into health systems strengthening, as building a covers outbreaks of infectious diseases most likely to resilient population requires a resilient and sustainable cause major epidemics, including Orthomyxoviridae, health system. In turn, a strong health system enables Coronaviridae (SARS, Middle East respiratory syndrome), UHC. Many health security initiatives connect their Filoviridae (Ebola and Marburg viruses) and other programs to health systems strengthening or UHC zoonotic diseases. The PEF also includes a replenishable efforts, which may in turn increase the eligibility to tap cash window, which could be enabled for payments for into the financial resources in those fields. diseases not covered by the insurance window. It is not clear whether this could include malaria outbreaks or The WHO’s Asia Pacific Strategy for Emerging Diseases drug-resistant malaria.31 This mechanism, however, is not (APSED - see next paragraph for a description) progress focused on strengthening the national capacities to reports all state that steady progress has been made in prevent, detect, and respond to disease outbreaks. developing and strengthening the International Health Regulations (IHR) core capacities. Since 2016, ADB has been piloting a regional health security grants to promote health security related region- 4.2. Health Security Initiatives al public goods. The grants support poorer loan-eligible The Global Health Security Agenda (GHSA) was launched countries to: in February 2014 and is a partnership of nearly 50 nations, international organizations, and - Meet international standards for health security non-governmental stakeholders, which facilitates - Secure broader regional cooperation collaborative capacity-building efforts to achieve specific - Strengthen health systems for better preparedness and measurable targets around biological threats. It for pandemics (including by strengthening rapid also works towards increasing capacity for the IHR, the alert systems and communication on public health World Organization of Animal Health’s Performance of threats) Veterinary Services Pathway, and other relevant global - Respond to outbreaks with assistance of an emergency facility

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This will also enable the use of innovative financing premise that the normal response to malaria and other approaches to create incentives for the countries to communicable disease threats is bound to fail, and prog- use ADB investments to strengthen their own health ress demands innovative approaches. sector budgets and sustain programs on vaccine preventable diseases, malaria, tuberculosis, and HIV/ The WHO’s APSED is a common strategic framework AIDS. Contributions from other countries and sources for countries and areas of the region to strengthen their are now being sought.32 capacity to manage and respond to emerging disease threats. The framework was developed in 2005, revised in In addition, ADB funds the GMS Health Security Project, 2010 and in 2016 (APSED III) and aims to further support which is composed of four loans to Cambodia, Lao PDR, progress towards meeting the obligations under the IHR. Myanmar, and Viet Nam, as well as a grant to Lao PDR. The project was launched in 2016 and aims to enhance One Health is an international movement that seeks to responses to emerging infectious diseases and the man- promote, improve, and defend the health and well-being agement of other major public health threats. The proj- of all species by enhancing cooperation and collaboration ect’s total cost is USD 132.2 million, with the four coun- between health and environmental professionals as well tries contributing a total of USD 7.2 million. The estimated as by promoting strengths in leadership and management project completion date is the first quarter of 2022. The to achieve these goals.34 From this, the One Health project has three outputs: Approach to disease control has evolved, which encom- passes both human and animal health benefits at - Regional cooperation and communicable disease a societal level.35 control in border areas improved - National disease surveillance and outbreak response These initiatives are supported by funding from different systems strengthened sources; however, there is very limited international - Laboratory services and hospital infection prevention funding from which countries can draw in the event of and control improved33 a public health security threat and there is not a significant fund dedicated to preventive and preparative ADB also manages the Regional Malaria and Other health system strengthening activities. It falls largely to Communicable Disease Threats Trust Fund (RMTF) that governments to finance capacity building for health takes malaria elimination as the entry point to health emergency preparedness from their health sector systems strengthening for regional health security. It was budgets. It is then likely that other, more pressing set up in 2013 and will expire in 2018. It aims to support short-term priorities will overshadow the long-term developing member countries to develop multi-country, investment in being prepared for a possible health cross-border, and multisector responses to urgent malaria emergency. As World Bank President Jim Yong Kim and other communicable disease issues. The RMTF is put it: “what happens every time in the face of 36 supported by Australia, Canada, and the UK on the pandemics is a cycle of panic, neglect, panic, neglect.”

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5. Future Financing Options for a 5.2. Innovative financing mechanisms Regional Health Fund A recent survey conducted by the MEI27 describes various innovative financing instruments and mechanisms that 5.1. Introduction have previously been discussed and deployed. It presents examples of their application to global public health and Despite the highest political commitment of leaders in the welfare initiatives and analyzes their salient features to as- region for malaria elimination, the domestic and regional sess their feasibility and utility for malaria elimination. The investment has not yet followed and so far no system survey classified the approaches into the six categories exists to secure the funding needed to achieve the shown in Figure 4. While the first five categories concern regional goal of malaria elimination by 2030. To address instruments predominantly for resource generation and the uncertainty of future dedicated financing, there is a pooling, the last refers to mechanisms for deployment growing consensus that a regional fund should be of the funds (Note: Many examples share the features of considered to secure appropriate resources to achieve resource generation and pooling as well as deployment). malaria elimination by 2030 with the potential to expand it to address broader infectious disease health security The study examined the extent to which these mecha- concerns. nisms are likely to be applicable to malaria elimination The main potential financing sources for such a fund are: (see Annex 1, for further details). The following text draws on the MEI study and briefly explores: obligatory charges, - Governments’ domestic funding voluntary contributions, and establishment of funds. In ad- - Traditional bilateral donor funding dition, it addresses two mechanisms for capitalizing such funds: social impact bonds and blended financing. - Non-traditional bilateral donor funding

- Lending by regional/multilateral development banks Figure 4. Innovative financing instruments and - Global Fund financing mechanisms - Private sector and philanthropic funding - Innovative financing mechanisms State A reduction of ODA allocations beyond 2020 (including Guarantees, from the major malaria contributor, the Global Fund) Securities and Obligatory will result in a funding gap. There is a pressing need to Market-Based Charges identify other potential financing options to progress the Mechanisms malaria elimination agenda. This is all the more critical because of the competition for funding of health priori- Innovative ties in the region and the additional demands for funding Public Financing Voluntary created by commitments to address the broad agenda of Private Instruments Solidarity the SDGs. Traditional bilateral financiers, a large majority Partnerships and Contributions of which are also donors of the Global Fund, may have Mechanisms limited appetite or scope to engage in an agenda more in line with the past health Millennium Development Goals, which focused more specifically on HIV/AIDS, tubercu- Results and losis, and malaria. However, the prospect of a regional Establishment Performance funding mechanism than could grow into a larger fund for of Funds -Based health security could trigger interest. Nevertheless, it is Mechanisms highly likely that the majority of funding for a regional fund would need to come from domestic government budgets in the region and new, innovative sources. The following section focuses on the potential of innovative financing Instruments for Resource Generation and Pooling mechanisms. Innovative Deployment Methods

Source: UCSF/MEI

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5.2.1. Obligatory Charges total value of their purchase at the point of sale have been Obligatory charges in the form of taxes or levies are shown to be successful fundraising tools for a variety of important fiscal policy instruments to generate additional causes and organizations. Collaborations with private revenue. Several obligatory taxes have been introduced corporations, such as product manufacturers or credit at the national and international levels to generate funding card companies may improve donation collection efforts. for international development. Taxes on pollution or Such partnerships can be established by public or private emissions and “sin” taxes on tobacco and alcohol organizations, which can lead to greater publicity and products are classic examples of such initiatives. awareness for a given cause, organization, or campaign. Sin taxes in Asia Pacific already exist, however a large portion are not used or prioritized for malaria or Beyond retail or consumer-driven donations, private communicable diseases. sector corporations are an important source of financing for health and development. Increasingly, companies Taxes on financial transactions in the international market are implementing corporate social responsibility (CSR) have also been proposed with a great potential for programs and allocating a fraction of their profits for revenue generation. Taxation of foreign exchange has selected initiatives. Effective engagement with private also been found to be technically feasible at the global corporations could bring attention to causes that they level. The large revenue base and the long-term nature have not yet considered. of taxes make these instruments a reliable and sustainable source of funding. The potential for revenue Voluntary contributions can also take the form of generation from the private sector once the tax system endowment funds. Established by individuals or is instigated can ensure a predictable and sustainable institutions (including foundations), endowment funds source of revenue. are a type of investment fund in which capital is invested in the financial market. The fund’s principal In addition, there is a low transaction cost associated as remains intact while returns from the capital investment observed, for example, in the airline levy model which are used to finance projects, including health and is used as a financing mechanism for UNITAID. It is development initiatives. However, the capital required estimated by the International Air Transport Association for an endowment must be large enough to generate that there were over 1 billion passengers traveling into and revenues that can support its beneficiaries. through Asia in 2016. Even a modest levy of USD 1 would provide an annual recurrent income of approximately USD 5.2.3. Establishment of International and Regional 1 billion. In this proposed approach, governments would Funds not need to pledge future health budgets but would have Typically development institutions, in collaboration with an opportunity to utilize additional funds raised from the other private or public institutions, establish funds to airline ticket levy, thereby increasing the overall domestic support specific causes. Such funds are established to spending on health. Given its direct link to travel, a major generate and mobilize resources from various sources factor in infectious disease transmission, this option has including direct contributions from countries, private particular potential to raise resources from donors, re- foundations, private corporations and individuals. The gional governments, and the private sector concerned by pooled resources may be then used to finance various health issues having an affect across borders. projects serving the common goal. Establishment of international funds reflects international commitment to One of the challenges of such an initiative is that it needs fight specific problems at a local, regional, or global level. strong political support and could take a very long time An example is the Gulf Cooperation Council established to establish due to required changes in legislation and a malaria control fund created in 2006 by the ministries policies in numerous countries if it were to have a of health in the Gulf countries to prevent the reintroduc- regional scope. tion of malaria in malaria-free countries and to support elimination in the region. It received financial contributions 5.2.2. Voluntary Contributions from the governments of Kuwait, Oman, Qatar, Saudi Voluntary contributions, either from individuals or private Arabia, and technical assistance from the WHO. organizations, are important sources of funding, partic- ularly for social causes. At the individual level, initiatives The Global Fund also finances regional initiatives but that allow consumers to donate a small percentage of the these are not regional funds in the traditional sense,

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although they do have a regional governance mechanism. SIBs are intended to finance interventions for well-defined In addition to the RAI2E previously described, the Global problems affecting known populations when costs and Fund finances the Malaria Elimination Initiative for Central benefits can be measured accurately. In the case of ma- America and Hispaniola and, more recently, the USD laria elimination the costs are well-defined and therefore 17.8 million grant to the Elimination 8 (E8) Initiative likely to attract investors. Alternatively, the fund could be supporting malaria elimination efforts in Southern Africa. initially capitalized through debt-financing or guarantees Such regional grants complement in-country grants to from one of the multilateral banks. focus on regional level interventions that would accelerate progress towards elimination by tackling issues such as 5.2.5. Blended Financing malaria importation. Blended financing can take many forms; one definition, used by the Global Fund, is a mechanism through which 5.2.4. Social Impact Bonds Global Fund grant resources are combined with a loan A possible mechanism for the initial capitalization of from a lender to result in a highly concessional financing a regional fund could be social impact bonds (SIB). package (loan) with favourable repayment terms such Social impact bonds are financial mechanisms by which as a reduced or zero interest rate or a reduced payable governments – or donor agencies or development banks principal. Blended options could be a particularly helpful set out desired social outcomes and private investors tool to contribute to smoother transitions, address provide funding for a set of interventions aimed to significant gaps for priorities identified, help countries achieve them. If the social outcome is achieved, address key drivers of epidemics that they currently according to agreed performance indicators, the cannot fund through their own budgets, and increase government (or donor agency) repays the investor for dialogue with ministries of finance. Both ADB and the its initial investment, plus a return for the financial risk World Bank practice a form of blended financing by they incurred; if the social outcome is not achieved, combining loans with technical assistance to facilitate the investors stand to lose their money. their use. Negotiations are underway between the Global Fund and ADB to implement similar blended To date, two social impact bonds specifically related to mechanisms in Asia. malaria have been developed: - The Mozambique Malaria Performance Bond, launched in 2013 with an estimated total value of USD 25 million over three years. - Nigeria’s Innovative Financing for Malaria Prevention and Treatment/Control Project, which is currently in the planning phase. Its target is to mobilize USD 300 million from investors to fund distribution of bed nets treated with insecticide for the country’s malaria control program.

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6. Structuring a regional health fund - A governance body or board that decides on and is accountable for the priorities and strategies for raising (referred to below as “the Fund”) and investing resources. The financiers of the fund could be part of this body but not dominate its 6.1. Determining the Nature of the Fund decision-making. This entity would also be in charge An important consideration is the nature of the Fund, that of mobilizing resources. is, whether it will hold and disburse funds with periodic – An overall implementing entity or operator that puts replenishment from donors or, whether it would be struc- into action the decisions of, and is accountable to, tured to generate revenue. There are obvious advantages the governance body by developing the programs in having a fund that generates its own income. In order and processes, interfacing with the beneficiaries, and for it to generate sufficient funds to meet significant ongo- monitoring and overseeing the grants. ing needs, however, the capital invested needs to be con- – A fund trustee that is responsible for receiving and siderable. This may be possible if the capitalization of the disbursing the resources and providing financial Fund is itself from a mechanism that produces revenue accounting. on a continuous basis, such as the obligatory charges category outlined in Section 4.2.1. Even then, the incom- The desired institutional characteristics of the bodies to ing revenue would need to be significantly greater than be selected for these roles would depend on the nature the ongoing expenditure to establish a significant invested of the Fund and the activities to be supported through it. capital. Another limitation is that private philanthropists or The Fund should also be envisioned to exist until the corporations may be more willing to add their contribution region is declared malaria free by the WHO, and beyond to a fund that is already healthily capitalized. Traditional if it were to gradually take on a broader role in health donor agencies generally have the constraint that their security. funding is for use within a specified period, given polit- ical needs to show impact and government accounting 6.2.1. The Governance Body procedures. They are unlikely to contribute to a fund for investment. Governments have, however, contributed to The governance body of the Fund should ideally be some of the innovative financing mechanisms mentioned independent from institutions playing the role of in the previous section. implementing entity and fund trustee. In addition, this body should be independent from the beneficiaries It seems likely that a regional health fund, for whatever to which the funds will be disbursed. Nevertheless, purpose, would initially need to count on sizeable con- it should ensure strong country ownership, as national tributions from high- and middle-income countries in the governments are key to the success of the elimination region (e.g., Australia, Japan, Republic of Korea, and effort. The best option for avoiding bias in decision- Singapore) while exploring the possibility of contributions making is to have a mechanism with balanced from other large regional economies such as China and representation of a broad range of stakeholders. India. In addition, countries that would seek to draw on This does not mean that every stakeholder should be the funds could be required to make a contribution directly part of the mechanism. As in the Global Fund (calculated, for example, based on their total or per model, constituencies representing, for example, civil capita gross national income). These government sourc- society organizations, private sector, academia, and es of funding could be complemented by private sector the military, could be asked to agree on a regional contributions, including from industries with the greatest representative to participate in meetings. The Fund exposure to the risk of disease spread and epidemics. should be constructed in a way that it is likely to attract the most partners. 6.2. Management Components One major responsibility of the governance body would There is currently no single regional fund to finance be to identify the financing gaps and develop and malaria elimination for the Asia Pacific region. In manage a resource mobilization strategy. It should discussions held to date, partners are generally of the also be empowered in its decision-making authority to view that if such a mechanism were to be created it allocate and re-allocate funds according to priorities should build on existing structures. There is also some based on appropriate and up-to-date information, be agreement that the management of the Fund would re- able to challenge it and, if needed, verify the information quire three components: provided to it. This suggests a dedicated independent monitoring group of experts that can provide an

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objective assessment of how malaria elimination activities 6.2.2. The Implementing Entity are progressing across the region. Depending on Currently, the main implementers of malaria programs the decision about its exact mandate it will need a are national government programs complemented by well thought out robust governance mechanism as NGOs that receive external funding. The most important decisions will need to be made covering a large example of an entity playing a role as a regional number of countries, a broad range of topics, possibly implementer is UNOPs, which is the principal recipient a significant amount of funding, and also an interest of Global Fund financing for the RAI2E grant in the GMS in health security issues. countries. UNOPS or a similar entity could be considered There is currently no obvious existing entity that would as an option as the regional implementing entity for the meet the needs as the governance body of the Fund. Fund. Choice of an existing institution to play the role of However, the governance bodies of APLMA or the RSC implementing entity should take into account whether the could be considered to fill this role. Both have or could choice is likely to impose undue restrictions on the have the range of stakeholders needed to carry out the composition, independence, or authority of the governance function. Both entities would, however, need governance body. Another option would be to establish to expand their roles, the membership of their governing a completely new mechanism as the implementing entity. bodies and the capacity of their secretariats. This would likely be time-consuming and add to the complexity of the regional architecture. It would be a APLMA has the structure to operate a resource reasonable option only in the presence of very strong mobilization strategy at the political level and to potentially and broad political support, and probably a long-term oversee the use of the resources generated. It has a sponsor. legitimacy associated with its high level political participation that resulted in a declaration by regional 6.2.3. The Trustee leaders at the East Asia Summit in support of the The trustee of the regional health fund could be a regional elimination of malaria by 2030 and has a specific mandate body such as ADB, or alternatively this role could lie to oversee progress towards malaria elimination based on with the World Bank, which currently plays this role for the road map they generated. APLMA, however, is a body the Global Fund. However, the procurement and mainly composed of governmental representatives and disbursement mechanisms of ADB and the World Bank it would need to be empowered by the leaders to open may not allow for financing to be managed by a third its membership to non-government representatives and party if the implementing agency were not ADB or the to take on a larger governance role. While APLMA has World Bank itself. These institutions would be questioning so far shown a great capacity to play its advocacy role, what the costs of capital are for them, what their financial the board would need to seek guidance on technical and return is (particularly the ADB), and what their incentives programmatic issues. are to put grant funding into an external fund. Any trust The RAI2E RSC currently includes representation of fund held by ADB or the World Bank would need to follow most of the main partners and constituencies involved their disbursement processes. in malaria elimination. It is, however, concerned only with the GMS and particularly with addressing MDR P. falciparum through malaria elimination. The RSC meets every six months (the frequency may increase to three times a year) and has become a coherent group. It has the authority, mandate, and experience to make decisions on the allocation of resources. The RSC is a flexible mechanism that would only require the agreement of the Global Fund and its current members to expand its geographical remit and to include new constituents if this is considered necessary.

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7. An Evolving Fund: From Malaria together Asia Pacific countries with malaria and has a role in advocacy and resource mobilization. Elimination to Health Security - A clear declaration from the leaders at the East Asia 7.1. Creating a fund for malaria elimination Summit of their support for malaria elimination. and health security - An established mechanism for results-based financing in the form of the Global Fund RAI malaria grant and In the face of growing resistance to anti-malarial drugs, its associated structures that could function as the one option for addressing acceleration of malaria delivery mechanism (or the model for such) for elimination in the region, while at the same time funding available at regional level; addressing health security more broadly, is to start with malaria elimination and transition over an agreed pe- - An objective that is circumscribed and relatively well riod to financing of activities covering a wider range understood with financing needs that are reasonably of regional health threats. predictable. By contrast, health security potentially covers a broad variety of diseases and other threats The evolution of the financing mechanism could start with to health; emerging diseases and epidemics are by countries where financing malaria elimination is a priority nature unpredictable, as are the financial needs. and expand to include all countries in the Asia Pacific region. Initially, funding of such a mechanism may struggle 7.1.2. Why Transition to Broader Health Security? to keep pace with the ongoing demands of accelerating While the above points are reasonable arguments to start malaria elimination so tackling a broader agenda may with malaria elimination, there are equally strong argu- not be feasible. In the longer term, a proven mechanism ments to plan for and progressively implement expan- may be able to accumulate sufficient financing to function sion of the financing mechanism to include other health as a revolving fund on which countries could draw from threats. These include: to respond rapidly to a variety of acute health security challenges. In both cases, the Fund would give highest - Malaria is only one of many health threats that disrupt priority to financing the elements of response that require health security and in many countries makes only a all concerned countries to take certain actions in concert modest contribution to overall disease burden. to achieve the regional aim. Strengthening of underlying - As malaria incidence becomes very low, continued health systems would still need to be financed by political support and financing will depend on countries’ domestic health budgets or other international demonstrating integration with and a positive spill- development financing mechanisms. over effect of ongoing malaria elimination activities to other disease control efforts. 7.1.1. Why Start With Malaria? - Malaria elimination is not equally relevant to all There are a number of reasons why it makes sense to countries in the region, and sufficient priority should initially focus on malaria elimination rather than aiming be placed on preparing for an effective response to from the outset to establish a financing mechanism with a emerging diseases and other health crises. broader mandate. These include: - The urgency of eliminating P. falciparum malaria and, The general operational links between eliminating malaria with it, centers of MDR strains from the Asia Pacific and achieving regional health security are generally: region, while available tools are still largely effective. - Cross border cooperation around malaria and other Arguably, MDR P. falciparum is as threatening to health threats are the same. Malaria elimination efforts international public health as new emerging help build and stress-test health security systems. infections, like the Zika virus, and needs to be funded, approached, and managed as an emergency. - To reach and sustain malaria elimination, health systems need to build strong surveillance, laboratory, - Established regional and national malaria elimination and response systems for malaria outbreaks. strategies exist based on cost-effective interventions Strengthening these systems also builds the and with defined measurable targets. capacities required for tracking other infectious - An established dedicated mechanism for malaria disease outbreaks and health security threats, elimination in APLMA and APMEN that brings such as dengue and epidemic influenza.

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- Over time, reducing the need to respond to malaria - Elimination of drug-resistant malaria will require cases and outbreaks frees disease surveillance, systems that address the drivers of drug resistance response, clinical staff, and facilities to be able to – not only for malaria treatment, but other anti- deal with other infectious diseases and epidemics. microbial agents, which presents a serious health It is an investment with short-term gains and a security threat. long-term legacy.

Figure 5. Malaria elimination and regional health security

Source: ADB/RMTF, 2017

The ADB and APLMA consider that malaria elimination promote broader regional collaboration, for example, on has the potential to be the entry point for not only national a regional health GIS system; pharmaceutical regulatory health security, but also for addressing health security as convergence and increasing health financing would also a regional issue as well as for strengthening the health have regional benefits. For these and other reasons, this systems in general. They suggest that improving the report recommends that a fund, if established, start with regulation of pharmaceuticals, eHealth, and surveillance malaria elimination to show focused, measurable impact systems for malaria would inevitably lead to a more and evolve rapidly to incorporate a more regional health effective health information system and health sector security focus as more countries approach elimination to management. Regional action on surveillance would maintain the interest of countries and donors.

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7.2. Evolution of the Fund’s Structure, Activities associated with malaria elimination are well Function and Financing defined and included in national and regional strategies that take into account cost effectiveness of proven 7.2.1. Pragmatic First Steps interventions. The Fund should, however, also support innovation and experiment with interventions for which Given the recommendation for an initial focus on malaria the cost effectiveness has not yet been established. elimination and the consensus that, where possible, existing structures should be used, there is a strong In the area of broader health security the diversity of argument for exploring the use of a mechanism that activities that could reasonably be supported expands already allocates and oversees the use of external greatly. This would require the definition of guiding funding for malaria elimination. The most obvious principles for the selection of activities. Given the regional candidate is the Global Fund. nature of the Fund it might be reasonable to give highest priority to activities that have positive externalities for one Although a regional mechanism would divert from the of more other countries or lead to regional public goods. Global Fund’s usual practice, there is no reason why With infectious disease spread being one of the main this should not be explored. The Global Fund should, in concerns, this criterion would likely not be difficult to fact, explore new models as it moves towards ending meet. these epidemics in a time of uncertain future funding. The trustee of the regional malaria elimination fund could be a Activities that could be supported include helping regional body such as ADB, or alternatively this role could countries meet the minimum standards required to meet remain with the World Bank (as under the current Global the IHR. Another area for possible support would be an Fund set up). Governance could be organized through emergency fund to allow rapid response to health security the existing Global Fund structures, or a multi-stake- crises against future complete or partial reimbursement holder regional governance body could be created. If the to ensure that action is not delayed because of a lack of Global Fund were not able to incorporate financing from cash availability or authorization of spending. In addition a regional fund into its normal operations, it may be able to preparedness for and response to emergencies, the to take on this role for a fee. Would this option be consid- Fund could also support longer term collaborative ered, the Global Fund funding allocation criteria should be programs such as addressing antimicrobial resistance revised to respond to a different set of priorities. Alterna- and the factors that cause it. tively, a regional body with a similar structure to the Global Fund could be set up. Once there is agreement on the nature of the Fund’s priorities it will be important to reach agreement on the The advantage of such an approach is that countries are criteria for project selection, eligibility for funding, project by now very familiar with the way the Global Fund works management modalities for different types of action and it is already channelling the largest proportion of (including streamlined procedures for emergencies), external funding for malaria to the region. It has well- evaluation criteria, and risk mitigation. established procedures for allocation of resources, planning and budgeting, measuring progress towards 7.2.3. Transition of the Funding Model targets, risk management, and efficient procurement of Where currently the global donors play a major approved commodities. Use of the Global Fund or a country-level role, the Fund will need to source funds similar set-up to deliver funding for malaria elimination from a regional level. In view of expanding the scope would appear to be a pragmatic and efficient option. from fighting malaria to building health security capacities, the Fund’s model will need to include resources that aim 7.2.2. Transition in Functions at more than just malaria to include a wide range of health As described in the previous section, the activities to security priorities. Ideally the Fund would be a revolving build the capacity of a nation to prevent, detect, and fund to which all countries in the region would contribute respond to malaria epidemics, and eradicate the disease according to capacity, and to which all countries could altogether, overlap with building the capacity for health draw on to address health security emergencies of security. The Fund could therefore initially focus on regional significance. malaria elimination and gradually enlarge the focus to health security once it has proven its effect.

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7.2.4. Timeframe for Transition has been achieved. This period would be driven by a largely regional entity with a regional governance The timeframe for the proposed transition could be structure, whereby a substantial proportion of funding divided into three distinct periods: would come from regional sources. From 2018 to 2021: From 2027 to 2030: Malaria elimination focus. The priority here is to establish Clear focus on broad health security as the last few a regionally oriented structure that is semi-autonomous countries move to malaria elimination. This would entail from a global financing institution. a fully regional financing mechanism. From 2022 to 2026: Integration of malaria elimination with other related health security activities. This would entail the transition to new priorities in countries where malaria elimination

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8. Issues and Conclusions Conclusion: There is an urgent need to put in place a process now that actively addresses the likely gaps in 8.1. Issue 1: The Need for Formal funding for malaria elimination post 2020. One part of Consultation with Member States. that process would be to decide whether there is support for a regional fund for malaria elimination. This report was preceded in June 2015 by a report commissioned by APLMA entitled “Landscape analysis 8.3. Issue 3: Broader Health Security May Be and options review to inform the design of the business a Higher Priority than Malaria Elimination for case for a regional health security financing mechanism.” The analysis concluded that in order to meaningfully take Most Countries forward the exploration of a malaria and/or health secu- The need to address funding gaps for malaria elimination, rity fund for the Asia Pacific region several key questions so that momentum and previous investments are not lost needed to be answered. The nature of the questions was and so that capacity for health security can be built, could such that they could only be meaningfully approached be addressed through a single approach. This would start through a formal approach to representatives of govern- with malaria elimination needs but evolve over an agreed ments with sufficient official status to offer an authoritative period of time to address other disease threats. opinion. The authors of the 2015 report recommended that the APLMA senior officials meeting in 2015 be used Conclusion: This proposal should be a key component as an initial opportunity to present the key issues and op- of consultation with member states. Preparation for this tions, with the expectation that there would be a follow-up aspect of consultation could be through the development process. The authors concluded their report by stating: of a short paper building on the ideas presented in “Until there is a consensus on these issues, it will be Section 6.3 of this report. challenging to further develop the regional health security financing mechanism.” 8.4. Issue 4: A Regional Fund is Unlikely to Be Advanced Without Dedicated High-level The current report is to a large extent a reframing of the Attention findings, issues, and options outlined in the earlier re- port. However, no mechanism has yet been put in place This report highlights, once again, that there are many to discuss in depth the issues with government officials dimensions that need to be taken into account in setting and to obtain their formal opinion. As was agreed at the up a regional fund, especially if this is to engage all or onset of this work, such consultation can only be done by most of the countries across the region as is necessary a regional body such as ADB or the WHO and not by an for any regional disease control or elimination goal. It is independent consultant. implausible that an undertaking as complex as setting up a regional health fund can be taken forward without the Conclusion: There is still a need for formal consultation support of a full-time, appropriately qualified, and em- with countries on key questions surrounding a regional powered team of experts to drive the process, along with health fund and for some level of consensus before further backing from a regional institution and some high-level productive work can be undertaken on such a fund. As champions in at least several countries. a first step, it might be important to formally assess the intentions or levels of interest of some countries that Conclusion: If there is sufficient interest in the notion of could potentially assist in initial capitalization of a fund a regional health fund, a skilled team should be put in (e.g., Australia, China, Japan, Republic of Korea). place, in an appropriate regional institution, and a work plan generated and funded with an expectation that the 8.2. Issue 2: The Acute Need to Address process would take at least 2-3 years. Future Funding for Malaria Elimination 8.5. Issue 5: Consensus on the Need to Build While progress has been made on malaria elimination, on Existing Structures and Mechanisms protection of the gains and further advances are high- ly dependent on future funding at a time when external There is a strong consensus among those consulted development assistance to the region, including from the that any new regional health financing mechanism should main financier of malaria elimination, is predicted to de- build on existing structures and processes. For malaria cline within a few years. elimination financing this would argue for using the Global

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Fund, which is already effectively distributing hundreds 8.6. Issue 6: The Need to “Walk to Talk” and of millions of dollars through a mechanism with which Take Risks on Innovative Financing countries are familiar. Management of a regional fund would be new for the Global Fund and would require This report, given the limited scope of its remit, has added the acceptance of its board. Managing a regional fund to the many documents that list possible options for inno- for health security would be a greater deviation from the vative financing but without being in a position to explore Global Fund’s mandate but this does not preclude one or a few of them in detail. There is little more to be exploration of the concept. Alternatively, a similar gained from exercises exploring the theoretical potential mechanism could be created within an existing regional of innovative financing. It is perhaps time to select one body building on the positive aspects of the Global Fund or two options and aggressively pursue them. As with model. A formal Global Fund-ADB alliance would issue 4 described above, it must be recognized that this potentially allow for experimentation with blended funding. would be a serious undertaking that would require heavy resources. Creation of a Unitaid-like mechanism such as Conclusion: Formal exploration of the possibility of the a tax on air travel, for example, would require a team with Global Fund managing a regional fund for malaria elimina- diverse skills and knowledge. tion could be explored to either exclude it or to keep it on a list of possible options. Conclusion: It may be time to select one or two innovative financing options and aggressively seek to develop them for the funding of malaria elimination through an appropri- ately staffed and adequately financed initiative.

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References 15. Shretta R, Zelman B, Birger ML, Haakenstad A, Singh L, Liu Y, et al. Tracking development assistance and government 1. World Malaria Report. Geneva: World Health Organization; health expenditures for 35 malaria-eliminating countries: 2016. 1990–2017. Malaria Journal. 2017; 16(1): 251. 2. Purdy M, Robinson M, Wei K, Rublin D. The economic case 16. Zelman B, Melgar M, Larson E, Phillips A, Shretta R. Global for combating malaria. The American journal of tropical fund financing to the 34 malaria-eliminating countries under medicine and hygiene. 2013; 89(5): 819-23. the new funding model 2014–2017: an analysis of national 3. Huszar A PM, Pepperall J,Tulloch J. Landscape Analysis and allocations and regional grants. Malaria Journal. 2016; 15(1): Options Review to inform the design of the Business Case 118. for a Regional Health Security Financing Mechanism: Health 17. Advocacy and Resource Mobilization Partner Committee Resource Facility for Australia’s Aid Program; 2015. Analysis. Unpublished: Roll Back Malaria; 2017. 4. APLMA. Malaria elimination roadmap. Philippines: Asia 18. Brief: Malaria: The World Bank; 2015. Pacific Leaders Malaria Alliance; 2015. http://www.aplma. 19. 2015-16 Development Assistance Budget Summary org/upload/resource/Roadmap/APLMA_Roadmap_final_ Mid-Year Economic and Fiscal Outlook Update Australian EAS_2015.pdf. Accessed 9 Sept 2016. Government Department of Foreign Affairs and Trade; 2016. 5. Lover AA, Gosling R, Feachem R, Tulloch J. Eliminate now: 20. Performance of Australian Aid report 2014-15: Australian seven critical actions required to accelerate elimination of Government Department of Foreign Affairs and Trade; 2016. Plasmodium falciparum malaria in the Greater Mekong Subregion. Malaria Journal. 2016; 15(1): 518. 21. Regional Health initiatives: Australian Government Department of Foreign Affairs and Trade 2017. 6. Global Technical Strategy for Malaria 2016–2030: World Health Organization; 2015. 22. Creditor Reporting System data: Organisation for Economic Co-operation and Development 7. Shretta R, et al. . Investment Case for Malaria Elimination in the GMS. Forthcoming. 2017. 23. Japan Donor Profile. 2017 [cited; Available from: http://donortracker.org/country/japan 8. Shretta R, Silal, S. Avanceña, A.L.V., Zelman, B., Fox, K., Baral, R., White, L. . The costs and investment case for 24. Japan Secures US$313 million Contribution to the Global eliminating malaria in the Asia Pacific Region. San Francisco: Fund. 2017 [cited; Available from: https://www.theglobal- The Global Health Group, University of California, fund.org/en/news/2017-03-27-japan-secures-us313-million- San Francisco.; 2017. contribution-to-the-global-fund/ 9. Girardin O, Dao D, Koudou BG, Essé C, Cissé G, Yao T, et 25. Grépin KA, Fan VY, Shen GC, Chen L. China’s role as a al. Opportunities and limiting factors of intensive vegetable global health donor in Africa: what can we learn from farming in malaria endemic Côte d’Ivoire. Acta Tropica. studying under reported resource flows? Globalization 2004; 89(2): 109-23. and health. 2014; 10(1): 84. 10. Narasimhan V, Attaran A. Roll back malaria? The scarcity of 26. Kim Em, Ha Eh, Kwon Mj. South Korea’s Global Health international aid for malaria control. Malaria Journal. 2003; Outreach through Official Development Assistance: 2(1): 8. Analysis of Aid Activities of South Korea’s Leading Aid Agencies, 2008–2012. Asia & the Pacific Policy Studies. 11. Strategy for Malaria Elimination in the Greater Mekong 2015; 2(2): 338-46. Subregion (2015–2030). Geneva, Switzerland: World Health Organization; 2015. 27. A Survey of Innovative Financing Mechanisms and Instruments: Opportunities for Malaria Elimination 12. Gueye CS, Newby G, Hwang J, Phillips AA, Whittaker M, Financing: UCSF Global Health Group; 2017. MacArthur JR, et al. The challenge of artemisinin resistance can only be met by eliminating Plasmodium falciparum 28. DAC High Level Meeting: HLM policy Brief. 2016 [cited; malaria across the Greater Mekong subregion. Malaria Available from: http://www.oecd.org/dac/financing-sustain- Journal. 2014; 13(1): 286. able-development/DAC-HLM-2016-PROGRESS-AMONG- DAC-MEMBERS-TOWARDS-IMPROVED-TARGETING-OF- 13. OECD Economic Outlook for Southeast Asia, China and ODA.pdf India 2016: Enhancing Regional Ties. 2016 [cited; Available from: 29. WHO. The World Health Report 2007. The world health report 2007: a safer future: global public health security in 14. OECD. Most Asia/Pacific countries need to improve the 21st century. 2007. World Health Organization, Geneva. affordable access to healthcare, says OECD. 2015 [cited; Available from: http://www.oecd.org/newsroom/asia-pacific- countries-need-to-improve-affordable-access-to-healthcare. htm

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30. World Bank Group Launches Groundbreaking Financing 33. ADB $125 Million Loan and Grant to Strengthen Health Facility to Protect Poorest Countries against Pandemics. Security in GMS. 2016 [cited 14 April 2017]; Available 2016 [cited; Available from: http://www.worldbank.org/ from: https://www.adb.org/news/adb-125-million-loan- en/news/press-release/2016/05/21/world-bank-group- and-grant-strengthen-health-security-gms launches-groundbreaking-financing-facility-to-protect- 34. 2017 [cited 15 April 2017]; Available from: poorest-countries-against-pandemics http://www.onehealthinitiative.com/mission.php 31. Pandemic Emergency Financing Facility: Frequently Asked 35. Pandemic Risk and One Health. 2013 [cited 15 April 2017]; Questions. 2017 [cited 14 April 2017]; Available from: http:// Available from: http://www.worldbank.org/en/topic/health/ www.worldbank.org/en/topic/pandemics/brief/ brief/pandemic-risk-one-health pandemic-emergency-facility-frequently-asked-questions 36. Edwards S. Pandemic response a cycle of ‘panic and 32. Strengthened ADB Support for Regional Health Security. neglect,’ says World Bank president. 2017 [cited; Kathmandu, Nepal: Asian Development Bank; 2016. Available from: https://www.devex.com/news/pandemic- response-a-cycle-of-panic-and-neglect-says-world-bank- president-89995

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Annex 1: Global Fund Funding Conditions for Income Classes

Sustainability and Transition – Increasing alignment and predictability

LIC/LMIC L-LMIC/U-LMIC U-LMIC/UMI

• Support National Strategic • Transition Readiness Plan to ensure sustainability Assessment of HIV, TB, and malaria • Once country- programs component becomes • Transition Work Plan ineligible, may Transition receive 3 years of • Support development of Transiition Funding Health Financing Strategies • Transition Work Plan basis for in countries with high burden funding request (funding of diseaseand/or low comes from country revenue captures allocation)

Working towards sustaining programs and eventual transition

All countries subject to Co-Financing Requirements

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Annex 2: Innovative Financing Mechanisms and Their Applicability to Malaria Elimination

Criteria Financing Opportunities (+), Challenges (-), and Mechanisms and Assessment of Applicability in Malaria Instruments Scale Predictability Sustainability Additionality Acceptability Transaction cost Equity Adverse effects State Guar- ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ (+) Generate immediate revenues from expected antees and future commitments Market Based (+) Produces a stable source of resource Mechanisms (+) Identify new sources of private sector funding (-) Entails a heavy set up and transaction cost (-) Does not necessarily generate new revenue (-) Heavy discounting-ultimate burden of payment is handed off to the future generation Limited applicability Obligatory ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ (+) Large potential for revenue generation from Charges/Taxes private sector (+) Once the tax system is instigated, it ensures a stable, predicable and sustainable source of revenue (+) Low transaction cost (-) May suffer restrain from the political forces and individuals (-) May take a long time to implement due to need for changes in legislation and policies Applicable

Voluntary ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ (+) Increased level of social awareness among Contributions individuals and private sector organizations (Involving Private (+) Pooling the resources from various private Sector) sectors could (-) Advocating for malaria elimination among private sector industries and individuals itself might be costly (-) May not be a stable source of resource Applicable

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Annex 2: Innovative Financing Mechanisms and Their Applicability to Malaria Elimination (continued)

Criteria Financing Opportunities (+), Challenges (-), and Mechanisms and Assessment of Applicability in Malaria Instruments Scale Predictability Sustainability Additionality Acceptability Transaction cost Equity Adverse effects Debt Swap and ∆ ∆ ∆ ∆ ∆ ∆ ∆ (+) Helps reallocate resources from debt repayment Debt Conversion to social development Mechanisms (+) Fund is predictable as it is predetermined (+/-) Low debt in malaria eliminating countries (-) Depends on creditor’s willingness to cancel the stock of debt (-) Reallocation of fund from debt relief may be difficult to earmark Limited Applicability Diaspora Bonds ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ (+) Generates revenues from private funds (+) Frontloads funds for development (+) Potential for funding depends on the size of diaspora (-) High transaction cost (-) Success depend on interest rates in the capital market (-) Difficult to implement in countries with conflict and poor governance (-) Earmarking funds for malaria specific projects might be difficult and costly to campaign Limited applicability Establishment ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ (+) Provides sustainable funding as the endowed of Funds: fund is invested and only the returns are used to Endowment fund programs Funds (+) Suitable for more risk averse investors (-) Large scale funding required in the beginning to yield returns that could sustain programs (-) Difficult to find donors to provide endowment Applicable

Establishments ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ ∆ (+) Potential to raise resources from donors, and of Funds: regional governments and private sector interested Regional Funds in development issues affecting cross borders (+) Opportunity to fund cross border activities (-) Developing proper incentive mechanisms to avoid free riding problems inherent in public goods might be difficult Applicable

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The strengths and weaknesses of each innovative negative attributes). The numbers of triangles (1 to 3) financing approach were used to apply a score against reflects the relative strength of criteria. In instances where each criterion listed in table below. The applicability of not enough information is available to support our the approaches is illustrated using a triangle (reflecting judgment or when specific criterion is not applicable, positive attributes) and inverted triangle (reflecting the cells are left blank.

Characteristics Description

Scale/Sufficiency Extent to which an instrument or mechanism raises resources to meet the intended purpose

Predictability/Reliability Certainty with which the revenue stream from a given instrument or mechanism is generated

Sustainability Extent to which the instrument produces sustainable stream of resources

Additionality Extent to which an instrument raises additional resources after offsetting all associated costs

Acceptability Extent to which the instrument is acceptable to relevant stakeholders

Transaction Costs Extent of costs associated with establishing and maintaining the instrument

Equity Extent to which both the costs and benefits of the mechanisms are distributed to a given population Adverse Effects Extent of adverse effects due to the instrument

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Annex 3: Additional Documents 17. Smith R, Woodward D, Acharya A, Beaglehole R, Drager N. Communicable disease control: a ‘Global Public Good’ Consulted perspective. Health policy and planning 2004; 19(5): 271-8. 1. Asia Pacific Leaders Malaria Alliance. Malaria and health 18. The ASEAN Secretariat. ASEAN 2025: Forging ahead security in Asia Pacific. In: Dr Benjamin Rolfe, editor. together. Jakarta; 2015. Singapore; 2015. 19. The Guardian. World Bank launches $500m insurance to 2. Asian Development Bank. Assessing the impact and cost fight pandemics. 2016. of SARS in Developing Asia. In: Asian Development Outlook 20. Walker PG, White MT, Griffin JT, Reynolds A, Ferguson NM, 2003. Manila, Philippines; 2003. Ghani AC. Malaria morbidity and mortality in Ebola-affected 3. Asian Development Bank. Malaria Elimination. An entry point countries caused by decreased health-care capacity, and the for strengthening health systems and regional health security potential effect of mitigation strategies: a modeling analysis. and a public health best-buy. Manila, Philippines; 2015. The Lancet Infectious diseases 2015; 15(7): 825-32. 4. Asian Development Bank. Strengthened ADB Support for 21. World Bank. People, Pathogens and Our Planet : The Regional Health Security. In: Asian Development Fund, Economics of One Health. Washington, D.C.: World Bank; editor. Nepal; 2015. 2012. 5. Asian Development Bank. ADB $125 Million Loan and Grant 22. World Bank Group. Pandemic Emergency Financing Facility: to Strengthen Health Security in GMS. 2016. Frequently Asked Questions. 2017. http://www.worldbank. org/en/topic/pandemics/brief/pandemic-emergency- 6. Asian Development Bank. Regional Malaria and Other facility-frequently-asked-questions. Communicable Disease Threats Trust Fund (RMTF). 2017. 23. World Health Assembly. Implementation of the International 7. Azemati H et al. (2013), Social Impact Bonds: Lessons Health Regulations (2005). Report of the Review Committee Learned So Far, in Jonathan Greenblatt and Annie Donovan, on Second Extensions for Establishing National Public Health The Promise of Pay for Success, CMTY. DEV. INV. REVIEW, Capacities and on IHR Implementation. Geneva, Switzerland; FED. RESERVE BANK OF SAN FRANCISCO 18, 20, available 2015. at http://www.nj.gov/state/programs/pdf/faith-based- investment- success-financing.pdf (issue hereinafter 24. World Health Organization. Frequently asked questions “COMMUNITY DEVELOPMENT REVIEW”) at 25–26. about the International Health Regulations (2005). Geneva, Switzerland; 2005. 8. Centers for Disease Control and Prevention. Global health protection and security. Global health security. Atlanta, 25. World Health Organization. International Health Regulations Georgia; 2017. (2005). Areas of work for implementation June 2007. Geneva, Switzerland; 2007. 9. Coker RJ, Hunter BM, Rudge JW, Liverani M, P H. Emerging infectious diseases in southeast Asia: regional challenges to 26. World Health Organization. International Health Regulations control. Lancet 2011; 12(377): 599-609. (2005). Second edition. Geneva, Switzerland; 2008. 10. Garrett L. WHO’s Fairy Dust Financing. Foreign Policy, 27 27. World Health Organization. The FAO-OIE-WHO Collaboration May 2016, 2016. http://foreignpolicy.com/2016/05/27/ Tripartite Concept Note. Sharing responsibilities and whos-fairy-dust-financing-world-health-organization- coordinating global activities to address health risks at the zika-budget/ (accessed. animal-human-ecosystems interfaces. Geneva, Switzerland; 2010. 11. Global Health Security Agenda. About. 2017. https://www.ghsagenda.org/about. 28. World Health Organization. Asia Pacific Strategy for Emerging Diseases (APSED, 2010). Geneva, Switzerland; 12. Hammel MJ. Ebola; the hidden toll. The Lancet Infectious 2010. Diseases 2015; 5(7): 756-7. 29. World Health Organization. IHR core capacity monitoring 13. Korea’s second mid-term ODA policy (2016-2020). framework. Checklist and indicators for monitoring progress 14. Lowy Institute (2015). https://www.lowyinstitute.org/ in the development of IHR core capacities in States Parties. publications/chinese-aid-pacific Geneva, Switzerland; 2011. 15. PwC. Connectivity and growth. Directions of travel for 30. World Health Organization. Summary of states parties 2012 airport investments; 2014. report on IHR core capacity implementation. Report For 16. Rushn J, Viscarra R, Bleich EG, McLeod A. Impact of avian National IHR Focal Points. 2012. influenza outbreaks in the poultry sectors of five South East 31. World Health Organization. Asian Pacific Strategy for Asian countries (Cambodia, Indonesia, Lao PDR, Thailand, Emerging Diseases. Progress report 2014. Securing Viet Nam) outbreak costs, responses and potential long term Regional Health. Geneva, Switzerland; 2014. control. Proceedings of the Nutrition Society 2005; 61: 491-541.

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32. World Health Organization. Summary of states parties 2013 41. World Health Organization. A Strategic Framework for report on IHR core capacity implementation. Regional Emergency Preparedness. Geneva, Switzerland; 2017. Profiles. Geneva, Switzerland; 2014. 42. World Health Organization. Joint External Evaluation of IHR 33. World Health Organization. International Health Regulations Core Capacities. The Kingdom of Cambodia. Mission report. Support to global outbreak alert and response, and building Geneva, Switzerland; 2017. and maintaining national capacities. Department of global 43. World Health Organization, World Organisation for Animal capacities, alert and response. Geneva, Switzerland; 2014. Health (OIE). WHO-OI operational framework for Good gov- 34. World Health Organization. Malaria: draft global technical ernance at the human-animal interface. Bridging WHO and strategy: post 2015. Geneva, Switzerland; 2015. OIE tools for the assessment of national capacities. Geneva, 35. World Health Organization. Asia Pacific strategy for Switzerland; 2014. emerging diseases progress report 2015: securing regional 44. Zacharowski K, Brodt HR, Wolf T. Medical treatment of an health. Geneva, Switzerland; 2015. Ebola-infected doctor--ethics over costs? Lancet 2015; 36. World Health Organization. Asia Pacific Strategy for 385(9969): 685. Emerging Diseases and Public Health Emergencies 45. World Health Organization. Asia Pacific strategy for emerging Advancing Implementation of the International Health diseases progress report 2015 : securing regional health. Regulations beyond 2016. Geneva, Switzerland; 2016. WHO, Geneva 37. World Health Organization. Joint external evaluation tool: 46. World Health Organization. Checklist and indicators for International Health Regulations. Geneva, monitoring progress in the development of IHR core Switzerland; 2016. capacities in States Parties. April 2013. WHO, Geneva 38. World Health Organization. Advancing Global Health 47. Global Health Security Agenda. https://www. Security: From Commitments to Actions. Concept Note. ghsagenda.org/about. Accessed on 14 April 2017 Bali, Indonesia; 2016. 48. World Bank Group. http://www.worldbank.org/ 39. World Health Organization. Update. WHO Health. en/topic/pandemics/brief/pandemic-emergency- Emergencies Programme: progress and priorities Financing facility-frequently-asked-questions Accessed on 14 Dialogue. Geneva, Switzerland; 2016. April 2017 40. World Health Organization. High-level Conference on Global 49. Asian Development Bank. Regional Malaria and Other Health Security. Solutions for strengthening the States’ Communicable Disease Threats Trust Fund (RMTF). capacities under IHR (2005). Conference summary report. https://www.adb.org/site/funds/funds/rmtf Accessed Lyon, France; 2016. on 16 April 2017

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Annex 4: List of Informants

Name Organizations Name Organizations

Eduardo P. Banzon ADB Renee Deschamps DFAT

Patricia Moser ADB Bronwyn Duce DFAT

Randy N. Dacanay ADB Sarah Boulton DFID

Susann Roth ADB Annemarie Meyer Malaria No More UK

Li Ailan WHO Sonia Klabnikova Gavi, the Vaccine Alliance

Bruce Aylward Outbreaks and Health Hind Othman Gavi, the Vaccine Alliance Emergencies, WHO Ferdinal M. Fernando ASEAN Secretariat George Jagoe Medicines for Malaria Venture Nafsiah Mboi APLMA Victoria Fan University of Hawaii

Ben Rolfe APLMA Amanda Glassman Center for Global Development Paul Lalvani APLMA consultant Mead Over Center for Global Development Lisa Goldman–Van Nostrand Sumitomo Chemical Ferdinando Regalia Inter-American Development Bank Ray Nishimoto Sumitomo Chemical John McArthur Brookings Institute

Erin M. Stuckey BMGF Sanne Fournier-Wendess Unitaid

Chris White BMGF Michael Borowitz Global Fund

Bruno Moonen BMGF Urban Weber Global Fund

Kieran Daly BMGF Patrick Silborn Global Fund

Rodrigo Salvado BMGF Sanjay Mathur UNOPS

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