Economics of One Health Presentation to the One Health Summit 2012 Davos, February 19-23, 2012 Olga Jonas, Economic Adviser, World Bank Report by Jimmy.

Economics of One Health

Presentation to the One Health Summit 2012Davos, February 19-23, 2012

Olga Jonas, Economic Adviser, World Bank Report by Jimmy Smith, Cornelis de Haan and Sarah

Stephenson

OUTLINE

• Impact on livestock, people, economies• How can One Health approaches help

reduce these costs?–Effectiveness gains–Efficiency gains (within increased

investments and recurrent expenditures, esp. in developing countries)

• Return on investment in One Health systems 2

3

Zoonotic diseases account for half of livestock losses due to diseases

Total loss:762‘212 LSUs

50%

50%

Non-zoonosesZoonoses

Source: SAFOSO

IMPACT ON HUMANS - SELECT ZOONOTIC DISEASES

Flu Pandemic of 1918/19: 50 million to 100 million died

DISEASE PERIOD Reported cases

Reported fatalities

SARS 2002-3 7,918 761

HPAI 2004-present 584 345

West Nile 1999-2008 28,975 1,124

Rift Valley Fever

2006-7 1,062 315

HIV/AIDS 2009 2.6 m/year 1.8 m/year (25m since 1981)

What is the burden (total cost) of diseases and what are its components?• Only partial information, but better data are

increasingly needed (and will become even more necessary)

• To assess total cost, useful to look at components of costs of outbreaks in animals and in humans

• Costs of selected major outbreaks in 1986-2009

5

Components of economic costs due to zoonotic disease outbreaks

6

Deaths from disease& control measures

Medical costs

Illness and absenteeism

Avoidance behaviors

Spill-over effects in other sectors (tourism, transport, retail, etc)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%D

irect

imp

act

In

dir

ect

im

pact

Control measures

Outbreak in animals Outbreak in humans

Lower Productivity

Ripple effects:-- Reduced demand-- Complementary products

Consequential on-farm losses

-

Mortality

7

1980 1985 1990 1995 2000 2005 20100

5,000,000,000

10,000,000,000

15,000,000,000

20,000,000,000

25,000,000,000

30,000,000,000

35,000,000,000

40,000,000,000

45,000,000,000

50,000,000,000

Series3; BSE (UK)

Plague (India), 1994

Nipah virus (Malaysia),

1998Series3; WNV

SARS (Asia, Canada, rest of the world), 2002

Series3; HPAI (Asia)

Series3; BSE (USA)

Series3; HPAI (Europe)Series3; RVF (Kenya, Somalia, Tanzania)

US

$ bi

llion

Costs of selected zoonotic disease outbreaks

8

Example of “indirect” economic costs: Tourist arrivals in China and Thailand

Adding it up: costs of zoonotic diseases (select outbreaks, US$ billion)

PeriodCosts (conservative

estimates)Annual

average

6 outbreaks other than SARS -Nipah virus (Malaysia), -West Nile fever (USA), -HPAI (Asia, Europe), -BSE (US), -Rift Valley Fever (Tanzania, Kenya, Somalia)- BSE (UK) costs in 1997-09 only

1998-2009 38.7

SARS 2002-2004 41.5

Total in 12 year period (1998-2009)

80.2 6.7

9

Poor households hardest hit – household income effect of backyard poultry sales ban

• Significant negative impacts …. but only partially monitored and documented

• What could One Health approaches contribute to reduce negative impacts?

11

One Health approach – an integrated response to “what needs to be done?” -- as opposed to the classical approach based on “what can I do?”

12

One Health approaches can increase:

• EFFECTIVENESS–doing the right thing, getting

the desired results: prevention, accurate and timely diagnostics, effective control measures

• EFFICIENCY–doing the thing right,

achieving results at least cost13

Delays increase costs

Adapted from IOM (2009)

Exposure in animals

Clinical signs in animals

Exposure in humans Clinical

signs in humans

Humans seek medical care

Cost of control outbreak

14

Funding requirements for “One Health” efficient prevention and control system

• Total for 139 low- and middle-income countries

–$ 1.9 b – 3.4 b per year» Note: actual losses in 1998-2008 were >US$ 6.7b/year (i.e.,

double)

– About 7x more than current effort, which is waning due to “flu fatigue”

– Equivalent to $1.90 - $3.40 per person per year in OECD countries (low price to pay for greater health security and protection of incomes)

15

16

Costs of prevention (investments in an-

imal and human health systems)

Benefits from averted mild

pandemic

Benefits from averted severe

pandemic

0

5

10

15

20

25

30

35

40

Annual costs of prevention vs Annual expected benefits of prevention of

pandemic and non-pandemic outbreaks$ b

illio

n p

er

year

6.7 b

6.7b

17

Case 1 : Mild Influenza Pandemic*Annual Expected Rate of Return on Investments in Prevention

low preventive effort

high preventive

effort

Reduction in expected disease outbreak impact

20% 31% 14%

50% 65% 44%

100% 97% 71%

* Impact $600 b (1% of GDP), probability 2.5%, expected benefit of prevention $15 b/year

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Case 2: Severe Influenza PandemicAnnual Expected Rate of Return on Investments in Prevention

low preventive

efforthigh preventive

effort

Reduction in expected disease outbreak impact

20% 49% 25%

50% 88% 57%

100% 123% 86%

* Impact $3 trillion (4.8% of GDP), probability 1%, expected benefit of prevention $30 b/year

17

9

4

8

0

4

8

12

16

20

24

28

32

36

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Beijing (Jan '06)

Bamako (Dec '06)

Delhi (Dec '07)

Sharm El -Sheikh

(Oct '08)

After SES,2009

Num

ber of donors pledging

$ m

illio

n

Financing gap Pledges Number of donors pledging

Loans

Grants

35

Avian & Pandemic Influenzas - Donor Interest Has Vanished

19

Characteristics of financing for One Health systems

• Constant over time, medium- to long-term, and reliably assured (not emergency response financing)

• Reach countries with greatest gaps in veterinary and human health systems

• Should be on grant basis (global public good) … and also include contribution from sector/livestock product consumers

• Encourage prompt and complete reporting of outbreaks at national, regional and international levels 20

Some options for mobilizing resources for One Health systems

• Official Development Assistance -- insufficient and unreliable, prevention typically not a priority.

• World Bank, AsDB, AfDB etc – time-bound loans (good in emergencies, as last resort). Could “blend” with grants for leverage.

• Dedicated funding from donors (with fair burdensharing) plus a levy on livestock products and/or contributions from consumers wishing to lower their pandemic risk. Governance of fund could include livestock producer associations, official and scientific representatives, civil society.

• Private sector – international and domestic21

Value Added of One Health Approaches

1. support poverty alleviation and economic growth in developing countries

2. reduce pandemic risk globally3. improve public health globally 4. help build effective animal and human health systems

without weak links; “effective” means early detection and rapid response; delays result in less effective disease control and higher risks at the animal-human-environment interface

5. help build efficient animal and human health systems; “efficient” because of shared capacities and information, reduction of duplication, economies of scope, economies of scale

6. net expected annual benefit between $4 billion (no pandemic threat) and $35 billion (1 severe pandemic/100 years); with higher probability of pandemics, benefits even greater.

22

Thank you.www.worldbank.org/flu

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