## Working Paper ## Source details **Canonical URL:** [Working Paper](https://www.imf.org/-/media/files/topics/covid/pandemic/working-paper.pdf) ## Other formats - [Markdown version](/-/media/files/topics/covid/pandemic/working-paper.pdf.md) - [Structured JSON version](/-/media/files/topics/covid/pandemic/working-paper.pdf.json) --- ### 1. Support countries to develop a comprehensive toolkit: While vaccines remain a critical tool, we need to move beyond an approach that is overly dependent on vaccines to one that includes testing, genomic surveillance, and therapeutics - Rationale and strategic priorities - Vaccines are critical but insufficient alone; comprehensive strategies must include testing, genomic surveillance, therapeutics, and strengthened health systems. - Strengthening health systems reduces the risk of mutations, prevents excess mortality when infections overwhelm health systems, and prepares for future pandemics. - Many multi-country infectious disease outbreaks have originated and had the greatest impact in countries with weak public health systems and limited capacity to detect and suppress outbreaks. - Financing and the ACT Accelerator - The refreshed ACT Accelerator budget is $23.4 billion (with about $15 billion in grants). - The ACT Accelerator budget should be treated as a dynamic tool that can be updated depending on the evolution of the virus. - Financing the strengthening of health systems is likely to become more important over time. - Antivirals: effectiveness, supply constraints, and access gaps - Paxlovid has been shown to be 89 percent effective in preventing hospitalization, albeit on a small sample. - Global production constraints in 2022: - Only 120 million courses are expected to be available in 2022. - Of those, 30 million are expected in the first half of the year. - Generics are not expected until 2023. - Access implications for developing countries: - It seems likely that only a limited volume would be available to developing countries. - If 10 million courses were secured for developing countries, about $2 billion would be required to procure and deploy this volume (with adequate testing), which is currently not available. - Operational and policy actions needed - Substantial support is required to expand production of antivirals and create pathways for equitable access. - Implement comprehensive “test and treat” pathways that ensure: - Timely diagnosis, - Prioritization, - Treatment with antivirals within the time frame required to maximize benefits. - Many low-income countries will need to scale up testing significantly to enable effective test-and-treat strategies. - Global coordination is needed to ensure antivirals are not used as monotherapies to minimize the risk of drug resistance. - Contingency relevance - These actions will be particularly helpful if Scenarios B or D materialize, i.e., if future variants cause severe disease. ### 3. Invest in R&D and genomic surveillance - R&D priorities and genomic surveillance - The global scientific response to COVID-19 developed vaccines, tests, and treatments at unprecedented speed, saving many lives (Agarwal and Gaule 2022). - Continued R&D investment is needed to handle new SARS-CoV-2 variants, novel coronaviruses, and other threats, including: - developing a universal vaccine against coronaviruses; and - improved antiviral drugs. - Enhanced genomic surveillance capabilities are especially needed in developing economies. - The rapid detection and sequencing of the Omicron variant by scientific teams in Botswana and South Africa demonstrated the value of surveillance and the critical need to expand these capabilities. - These actions are particularly valuable if Scenarios B or D materialize (i.e., if highly virulent future variants emerge). - Barriers to meeting global COVID-19 tool targets - Lack of financing: - The global response has raised only about $18.7 billion in grant form for the ACT Accelerator. - The IMF Pandemic Proposal identified a grant need of $35 billion, leaving a gap of about $15 billion. - In-country delivery barriers: - COVAX offers free vaccines to 91 Advance Market Commitment (AMC) countries toward the 70 percent goal. - Over half of the countries have deferred or refused delivery of free vaccines despite low vaccine coverage, typically due to absorptive capacity or lack of demand. - COVAX Round 14 offered 420 million doses to AMC countries, but only 100 million doses were accepted. - Overcoming barriers requires more reliable long-term supply forecasts and flexible financing to support in-country efforts and strengthen health systems. - Unpredictable supplies and regulatory inefficiencies: - Episodic and unpredictable vaccine supply has disincentivized planning mass vaccination programs. - Regulatory authorities have struggled to provide timely and clear guidance for rapid use of tools. - Unbalanced response: - Tests, therapeutics, and supportive care (including medical oxygen) remain vastly under-resourced in many regions. - Funding for diagnostics through the ACT Accelerator has been only a fraction of what would be required. - Policy implications and a unified global approach - If the “mild endemic scenario” (Scenario A) materializes worldwide, global targets are less likely to be a useful guide; if more severe scenarios occur, full access to countermeasures remains critical. - Vaccination focus should primarily be on fully vaccinating the most clinically vulnerable populations in accordance with WHO’s Prioritization roadmap (WHO 2022a). - Over time, shift from a supply-driven global response to a demand-driven and balanced response guided by national health priorities. - Four areas needing a refreshed approach: 1. Donor financing should be treated as addressing a systemic risk to the international economy—not only development aid—and go beyond official development assistance. 2. Acting early matters: taking resources even one week earlier can save lives; a systemic risk approach can avoid delays from perfectionism and poor coordination. 3. Emphasize complementarities between disease-specific investments and systems that address broader health threats; prioritize multi-pathogen systems, platforms, and capacities. 4. Strengthen global collaboration and systems for faster response, including: - (1) stronger multilateral institutions with high-level political support to coordinate global responses to health shocks; - (2) rapid and adequate financing windows for global public goods activated at pandemic onset; - (3) diversified regional manufacturing capacity for vaccines, tests, and drugs with arrangements to share technology and know-how; - (4) increased investment in disease surveillance at global, regional, and national levels, resilience and sustainability of national public health systems, and R&D to enable more rapid delivery of countermeasures (for example, the goal of making safe and effective vaccines against any virus in 100 days); and - (5) improved regulatory frameworks to allow speedy delivery of existing and novel tools worldwide. - Investments should also address environmental drivers of pathogens, reflecting One Health interlinkages. - Financing: gaps, proposals, and roles - ACT Accelerator consolidated financing framework (released February 2022) identified: - an urgent grant financing need of $16.8 billion to meet global COVID-19 targets; and - $6.8 billion as part of a larger investment to support countries’ local delivery of COVID-19 tools. - As of mid-March 2022, the grant financing gap stood at about $15 billion. - Estimates for future pandemic preparedness and response (PPR): - WB-WHO report estimates total annual financing need for a future PPR system to be $31 billion. - Considering current and expected financing, the additional international financing required is estimated at about $10 billion annually. - Suggested international financing actions: - Make an additional $15 billion in grant financing available in 2022 (primarily geared toward fighting COVID-19 in line with the ACT Accelerator framework). - Make $10 billion annually going forward to support PPR activities. - These funds are argued to be best provided as grant financing to treat timely pandemic control as a global public good and to avoid burdening developing economies with large debt. - Additional domestic financing needs should be supported by concessional financing from multilateral development banks. - World Bank COVID health operations have provided about $15 billion in financing for COVID-19 tools, of which about $6.5 billion is in IDA financing, of which a third is on grant terms. - Coordination and efficiency: - Maximize synergies between investments for preparedness and investments to fight existing diseases to optimize impact. - Strengthen procurement capabilities, streamline regulatory approvals, and improve coordination at national, regional, and global levels. - IMF roles: - Support countries in opening fiscal space and potentially act as a third-resort line of finance. - A historic Special Drawing Right (SDR) allocation of $650 billion was approved by the IMF’s Executive Board in 2021. - The IMF is exploring options to channel SDRs to support global public policy goals through a Resilience and Sustainability Trust (RST) aimed at affordable long-term financing for structural challenges, including pandemic preparedness. - Long-term impacts and closing observations - The pandemic has exacerbated within-country inequality, especially in emerging market and developing economies. - About 65–75 million additional people are estimated to be in extreme poverty in 2021 compared with pre-pandemic projections (IMF, 2021). - Employment and labor market participation remain below pre-pandemic levels, with emerging market and developing economies hit harder on average. - Education impacts: - Nearly one in four people in the world are school age, and schools were closed for millions worldwide. - School closures have been twice as long in developing economies as in advanced economies. - Emerging health crisis beyond COVID-19: - In rich countries, waiting lists for medical procedures and delayed diagnosis (for example, cancer) have increased. - In poorer countries, knock-on impacts on other infectious diseases have reversed years of progress and led to hundreds of thousands of additional deaths. - Long-term economic and welfare consequences: - Learning losses, productivity and employment impacts, and longer-lasting divergence across countries in health and well-being outcomes may persist for decades. - There are large welfare gains from avoiding a pandemic like the Spanish Flu or COVID-19, estimated to be about 10 percent of a single year’s consumption (Martin and Pindyck 2021; Barro 2009). - Conclusion: Ending the acute phase of the pandemic everywhere and adopting a global strategy to manage long-term COVID-19 and future infectious disease risks are essential; collective action is required. *Source: IMF Working Paper "A Global Strategy to Manage the Long-Term Risks of COVID-19".* ### 1. Support countries to develop a comprehensive toolkit: While vaccines remain a critical tool, we need to ### 1. Support countries to develop a comprehensive toolkit: While vaccines remain a critical tool, we need to move beyond an approach that is overly dependent on vaccines to one that includes testing, genomic surveillance, and therapeutics ### Rationale and strategic priorities - Vaccines are critical but insufficient alone; comprehensive strategies must include testing, genomic surveillance, therapeutics, and strengthened health systems. - Strengthening health systems reduces the risk of mutations, prevents excess mortality when infections overwhelm health systems, and prepares for future pandemics. - Many multi-country infectious disease outbreaks have originated and had the greatest impact in countries with weak public health systems and limited capacity to detect and suppress outbreaks. ### Financing and the ACT Accelerator - The refreshed ACT Accelerator budget is $23.4 billion (with about $15 billion in grants). - The ACT Accelerator budget should be treated as a dynamic tool that can be updated depending on the evolution of the virus. - Financing the strengthening of health systems is likely to become more important over time. ### Antivirals: effectiveness, supply constraints, and access gaps - Paxlovid has been shown to be 89 percent effective in preventing hospitalization, albeit on a small sample. - Global production constraints in 2022: - Only 120 million courses are expected to be available in 2022. - Of those, 30 million are expected in the first half of the year. - Generics are not expected until 2023. - Access implications for developing countries: - It seems likely that only a limited volume would be available to developing countries. - If 10 million courses were secured for developing countries, about $2 billion would be required to procure and deploy this volume (with adequate testing), which is currently not available. ### Operational and policy actions needed - Substantial support is required to expand production of antivirals and create pathways for equitable access. - Implement comprehensive “test and treat” pathways that ensure: - Timely diagnosis, - Prioritization, - Treatment with antivirals within the time frame required to maximize benefits. - Many low-income countries will need to scale up testing significantly to enable effective test-and-treat strategies. - Global coordination is needed to ensure antivirals are not used as monotherapies to minimize the risk of drug resistance. ### Contingency relevance - These actions will be particularly helpful if Scenarios B or D materialize, i.e., if future variants cause severe disease. *Source: IMF Working Papers — A Global Strategy to Manage the Long-Term Risks of COVID-19 (International Monetary Fund).* ### 3. Invest in R&D and genomic surveillance: The COVID-19 pandemic has been one of the greatest ### 3. Invest in R&D and genomic surveillance ### R&D priorities and genomic surveillance - The global scientific response to COVID-19 developed vaccines, tests, and treatments at unprecedented speed, saving many lives (Agarwal and Gaule 2022). - Continued R&D investment is needed to handle new SARS-CoV-2 variants, novel coronaviruses, and other threats, including: - developing a universal vaccine against coronaviruses; and - improved antiviral drugs. - Enhanced genomic surveillance capabilities are especially needed in developing economies. - The rapid detection and sequencing of the Omicron variant by scientific teams in Botswana and South Africa demonstrated the value of surveillance and the critical need to expand these capabilities. - These actions are particularly valuable if Scenarios B or D materialize (i.e., if highly virulent future variants emerge). ### Barriers to meeting global COVID-19 tool targets - Lack of financing: - The global response has raised only about $18.7 billion in grant form for the ACT Accelerator. - The IMF Pandemic Proposal identified a grant need of $35 billion, leaving a gap of about $15 billion. - In-country delivery barriers: - COVAX offers free vaccines to 91 Advance Market Commitment (AMC) countries toward the 70 percent goal. - Over half of the countries have deferred or refused delivery of free vaccines despite low vaccine coverage, typically due to absorptive capacity or lack of demand. - COVAX Round 14 offered 420 million doses to AMC countries, but only 100 million doses were accepted. - Overcoming barriers requires more reliable long-term supply forecasts and flexible financing to support in-country efforts and strengthen health systems. - Unpredictable supplies and regulatory inefficiencies: - Episodic and unpredictable vaccine supply has disincentivized planning mass vaccination programs. - Regulatory authorities have struggled to provide timely and clear guidance for rapid use of tools. - Unbalanced response: - Tests, therapeutics, and supportive care (including medical oxygen) remain vastly under-resourced in many regions. - Funding for diagnostics through the ACT Accelerator has been only a fraction of what would be required. ### Policy implications and a unified global approach - If the “mild endemic scenario” (Scenario A) materializes worldwide, global targets are less likely to be a useful guide; if more severe scenarios occur, full access to countermeasures remains critical. - Vaccination focus should primarily be on fully vaccinating the most clinically vulnerable populations in accordance with WHO’s Prioritization roadmap (WHO 2022a). - Over time, shift from a supply-driven global response to a demand-driven and balanced response guided by national health priorities. - Four areas needing a refreshed approach: 1. Donor financing should be treated as addressing a systemic risk to the international economy—not only development aid—and go beyond official development assistance. 2. Acting early matters: taking resources even one week earlier can save lives; a systemic risk approach can avoid delays from perfectionism and poor coordination. 3. Emphasize complementarities between disease-specific investments and systems that address broader health threats; prioritize multi-pathogen systems, platforms, and capacities. 4. Strengthen global collaboration and systems for faster response, including: - (1) stronger multilateral institutions with high-level political support to coordinate global responses to health shocks; - (2) rapid and adequate financing windows for global public goods activated at pandemic onset; - (3) diversified regional manufacturing capacity for vaccines, tests, and drugs with arrangements to share technology and know-how; - (4) increased investment in disease surveillance at global, regional, and national levels, resilience and sustainability of national public health systems, and R&D to enable more rapid delivery of countermeasures (for example, the goal of making safe and effective vaccines against any virus in 100 days); and - (5) improved regulatory frameworks to allow speedy delivery of existing and novel tools worldwide. - Investments should also address environmental drivers of pathogens, reflecting One Health interlinkages. ### Financing: gaps, proposals, and roles - ACT Accelerator consolidated financing framework (released February 2022) identified: - an urgent grant financing need of $16.8 billion to meet global COVID-19 targets; and - $6.8 billion as part of a larger investment to support countries’ local delivery of COVID-19 tools. - As of mid-March 2022, the grant financing gap stood at about $15 billion. - Estimates for future pandemic preparedness and response (PPR): - WB-WHO report estimates total annual financing need for a future PPR system to be $31 billion. - Considering current and expected financing, the additional international financing required is estimated at about $10 billion annually. - Suggested international financing actions: - Make an additional $15 billion in grant financing available in 2022 (primarily geared toward fighting COVID-19 in line with the ACT Accelerator framework). - Make $10 billion annually going forward to support PPR activities. - These funds are argued to be best provided as grant financing to treat timely pandemic control as a global public good and to avoid burdening developing economies with large debt. - Additional domestic financing needs should be supported by concessional financing from multilateral development banks. - World Bank COVID health operations have provided about $15 billion in financing for COVID-19 tools, of which about $6.5 billion is in IDA financing, of which a third is on grant terms. - Coordination and efficiency: - Maximize synergies between investments for preparedness and investments to fight existing diseases to optimize impact. - Strengthen procurement capabilities, streamline regulatory approvals, and improve coordination at national, regional, and global levels. - IMF roles: - Support countries in opening fiscal space and potentially act as a third-resort line of finance. - A historic Special Drawing Right (SDR) allocation of $650 billion was approved by the IMF’s Executive Board in 2021. - The IMF is exploring options to channel SDRs to support global public policy goals through a Resilience and Sustainability Trust (RST) aimed at affordable long-term financing for structural challenges, including pandemic preparedness. ### Long-term impacts and closing observations - The pandemic has exacerbated within-country inequality, especially in emerging market and developing economies. - About 65–75 million additional people are estimated to be in extreme poverty in 2021 compared with pre-pandemic projections (IMF, 2021). - Employment and labor market participation remain below pre-pandemic levels, with emerging market and developing economies hit harder on average. - Education impacts: - Nearly one in four people in the world are school age, and schools were closed for millions worldwide. - School closures have been twice as long in developing economies as in advanced economies. - Emerging health crisis beyond COVID-19: - In rich countries, waiting lists for medical procedures and delayed diagnosis (for example, cancer) have increased. - In poorer countries, knock-on impacts on other infectious diseases have reversed years of progress and led to hundreds of thousands of additional deaths. - Long-term economic and welfare consequences: - Learning losses, productivity and employment impacts, and longer-lasting divergence across countries in health and well-being outcomes may persist for decades. - There are large welfare gains from avoiding a pandemic like the Spanish Flu or COVID-19, estimated to be about 10 percent of a single year’s consumption (Martin and Pindyck 2021; Barro 2009). - Conclusion: Ending the acute phase of the pandemic everywhere and adopting a global strategy to manage long-term COVID-19 and future infectious disease risks are essential; collective action is required. --- _Source: https://www.imf.org/-/media/files/topics/covid/pandemic/working-paper.pdf_