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COVID-19 vaccination Costing and Financing in low-income countries and lower-middle-income countries

What are the challenges?

The world has to overcome major inequities in vaccine roll-out to control the pandemic, spark robust global economic recovery, and prevent the emergence of dangerous variants. As of end of April 2021 over 1 billion doses have been administered of which 76% in 10 countries (22% in one country)[1]. Less than one-fifth of doses have been administered in low-income countries (LICs) and lower-middle-income countries (LMICs) which represent 47% of the world’s population [2]. High income countries have administered 90 times more doses per inhabitant than the lowest income countries [3], even though efforts by COVAX have resulted in the shipment of 49 million doses to 121 participants. Addressing disparities in COVID-19 vaccination is critical to prevent deaths and the emergence of dangerous variants which may undermine the efficacy of vaccines throughout the world. As the pandemic has resulted in a shutdown of much economic activity, COVID-19 vaccination has very high returns on investment as it can facilitate a reopening of the global economy. However, the debate should also focus on the importance of delivering vaccines and the key role women frontline health workers play in vaccine delivery and the continuity of essential services. Vaccines are only cost-effective when countries have the delivery systems that get them into the arms of individuals.

Current routine immunization expenditure could see a 4-fold increase in the coming years due to roll-out of COVID-19 vaccines. This is due to a much larger population needing to be covered (i.e., including most adults), the potential need for boosters, higher delivery costs (human resource surge costs, expanded cold chain costs, complex demand generation, and personal protective equipment), and greater ambitions in alignment with the Immunization Agenda 2030. Total delivery costs for COVID-19 vaccination, covering approximately 20% of the population in 2021 in the 92 Advance Market Commitment (AMC) countries, has been estimated at US$ 2 billion by the Global WHO/UNICEF global delivery/operational cost projections. This includes country, regional, and global level costs, and is equivalent to US$ 1.66 per dose delivered and US$ 3.70 per person vaccinated with two doses. This estimate does not include human resource surge costs of US$1 billion, which if included would bring the total delivery costs to US$3 billion. This estimate could further increase if costs for both formal and informal health workers, in particular women frontline health workers, would be included according to a recent study by CARE.

Increasing financial resources to finance COVID-19 vaccines will be challenging in most LMICs, given the economic downturn. Many health systems were overstressed and underfunded even before the crisis, and the pandemic’s economic fallout is further constraining national fiscal capacity. A recent report from the World Bank indicates that government per capita expenditures will fall in many LIC and LMIC groups in 2021 and again in 2022. UNICEF’s social spending tracker also shows that over half of the countries surveyed anticipate a decline in government revenues between 2020-2021 and over three quarter are planning cuts in social spending (including in the health sector). For many countries government budgetary space for health in general is expected to be far short in 2023 of what it was expected to be prior to the epidemic. This will necessitate active re-prioritization in terms of government expenditures for health just to maintain government per capita (2019) health expenditures. Many countries are already relying on financing from multilateral development banks to finance the COVID-19 vaccine roll-out and this will likely remain a source of financing for the coming years in LICs and LMICs given the uncertainty about the need for boosters, availability of vaccines and timelines of delivery. Concessional financing offers governments an opportunity to make one of the most important investments needed to get economies on track and is often on highly concessional terms, including grants and loans, as opposed to loans taken on the commercial markets, which are often a source of high debt. Debt relief will also be an important part of the ‘toolbox’ to getting economies on track.

What are the risks?

Economic recovery and the end of the pandemic will be delayed because of the slow delivery of vaccines. In short, the economy cannot open or restart safely and sustainably unless the epidemic is controlled. This requires COVID-19 vaccination in combination with public health and social measures. Relatedly, COVID vaccine rollout may be slowed because of delivery costs and infrastructure that is not able to keep up with the supply (eventually) and demand from communities, slowing down the end of the pandemic.

The resulting slow recovery from the economic crisis in many LMICs will lead to threats to livelihoods and increases in poverty. Government revenue continues to stagnate or decline because there is no economic recovery, debt still needs to be paid, government revenue for health gets smaller and a negative feedback loop ensues. In addition, to fund the vaccination campaigns, countries will be looking into increasing taxes, imposing fee for services which would increase the burden on households and contribute to increased poverty.

Many health systems lack the capacity to scale up vaccinations. If these systems considerations are inadequately addressed, there is a risk that the vaccination program will be impeded and that commodities and other scare resources may be wasted. Signs of this can already be seen in some countries. In Ghana, not enough trained staff was available to deliver the second shipment of COVID-19 vaccines and equipment (such as masks, cotton wool) were missing, slowing down delivery. In the Democratic Republic of Congo, 75% of doses received from COVAX were sent back to be used in other African nations before expiry.

Without adequate measures, COVID-19 vaccination delivery may compromise essential health services, given pre-pandemic challenges in Universal Health Coverage attainment, which has been further strained by the pandemic. A poorly deployed vaccination strategy has consequences for the entire health system. A recent survey administered by the WHO found that 90% of countries still report one or more disruptions in the provision of essential healthcare services, over a year since the start of the pandemic. If proper planning and investments for scaling up the vaccination campaign is not undertaken, there is a risk of further exacerbating those disruptions because of human and financial resources being “diverted” away from essential services. Optimizing efficient delivery scenarios, while taking into consideration human resource surge needs, are critical to protect essential health services.

How can we ensure adequate planning and budgeting for COVID-19 roll out?

The National Deployment and Vaccination Plan (NDVP) is also a tool to support step-by-step countries in the planning of their vaccination plan.

What is a National Deployment and Vaccination Plan (NDVP)?

An NDVP is a country’s “plan to deploy vaccines and deliver vaccination to identified target populations”. The plan is unique to a given country (one plan per country), although it may be used by different actors to coordinate efforts. The development process for the plan is expected to be iterative and the result of a collaboration with countries and partners. All countries supported by COVAX are required to submit an NDVP which is then used to assess preparedness and readiness prior to shipment from the COVAX facility. For more information, click here.

For costing and financing countries’ NDVP the following 5 inter-related steps are needed:

  1. Development of a comprehensive and feasible NDVP that is agreed across all partners,
  2. Credible costing for vaccine procurement and delivery, in alignment with the NDVP, and that can form the basis of a meaningful conversation with the government and financing partners,
  3. Identification of existing domestic resources, mobilization of additional resources, and, if necessary, identification of external funding based on the costing plan by engaging stakeholders within and outside health (e.g., MoF, MoP, Treasury) and across national, international, private and public sectors
  4. Process of preparing budget formulation, execution, and tracking
  5. Health systems financing mechanism and bottlenecks to health interventions

An analysis of submitted COVID-19 NDVPs revealed that the area of costing and funding is a major challenge for many countries and the most technical support would be needed.

The COVID-19 Vaccine Introduction and deployment Costing (CVIC) tool supports credible COVID-19 vaccination costing to facilitate a dialogue with stakeholders, while maintaining sensitivity to protect essential health services.

As a result, the CVIC tool will support countries on step 1 and 2 as the basis for funding, budgeting and financing of COVID-19 vaccination.

The CVIC tool provides a structured and comprehensive estimation of incremental operational and selected capital costs of introducing and deploying COVID-19 vaccines for resource mobilization, budgeting, and delivery strategy refinement and optimization. The tool has been pre-populated with data from global databases and provides a total cost estimate over a vaccination program lasting 2021-2023, after which COVID-19 vaccination is expected to be integrated into national immunization plans. Countries can customize the priority target populations based on SAGE guidance and select multiple delivery strategies and vaccines. Version 2.1 of the tool is now available in all six UN working languages and Portuguese.

Countries currently using/that have used CVIC tool
AFRO Cameroon, Eswatini, Ethiopia, Ghana, Madagascar, Malawi, Mozambique, Rwanda, South Sudan, Togo, Uganda, Zambia
EMRO Sudan, Syrian Arab Republic
PAHO Belize, Bolivia, Costa Rica, Haiti, Nicaragua
WPRO Cook Islands, Lao PDR, Papua New Guinea, Solomon Islands, Vietnam

The CVIC core group has been established under leadership of the Department of Immunization, Vaccines and Biologicals, World Health Organization (WHO/IVB) with representatives from WHO regional offices, UNICEF, World Bank, Bill & Melinda Gates Foundation, Clinton Health Access Initiative (CHAI), ThinkWell, Harvard T.H. Chan School of Public Health and VillageReach. The team is providing support to countries to cost for their plan using the tool. One-to-one country support and global trainings (available in English and French) have been provided. A CVIC introductory video has been developed to show the importance of costing of COVID-19 vaccination and the role of CVIC. A CVIC step-by-step written user guide and demonstration/training videos through OpenWHO will be available. The WHO Costing Team can be reached through CVICosting@who.int.

Countries can submit request of their resource needs to the WHO COVID-19 Partners Platform through uploading a completed CVIC version 2.1. The cost categories for technical assistance and funding resource requests through the platform are in line with the CVIC tool.

Other materials

[1] Bloomberg

[2] WHO COVID dashboard , Our World in Data

[3] WHO COVID dashboard , Our World in Data