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ADVANCE MARKET COMMITMENTS

Monday, 9th of April 2012

ADVANCE MARKET COMMITMENTS

Advance market commitment for pneumococcal vaccines: putting theory into practice

Tania Cernuschi,a Eliane Furrer,a Nina Schwalbe,a Andrew Jones,b Ernst R Berndtc & Susan McAdamsd

a GAVI Alliance Secretariat, 2 Chemin des Mines, Geneva, 1211, Switzerland.

b Clinton Health Access Initiative, Nairobi, Kenya.

c Sloan School of Management, Massachusetts Institute of Technology, Cambridge, United States of America (USA).

d Multilateral and Innovative Financing Department, The World Bank, Washington, DC, USA.

Correspondence to Eliane Furrer (e-mail: efurrer@gavialliance.org).

(Submitted: 25 February 2011 – Revised version received: 5 August 2011 – Accepted: 8 August 2011 – Published online: 7 October 2011

Abstract below; full text is at http://www.who.int/bulletin/11-087700.pdf

Markets for life-saving vaccines do not often generate the most desired outcomes from a public health perspective in terms of product quantity, quality, affordability, programmatic suitability and/or sustainability for use in the lowest income countries. The perceived risks and uncertainties about sustainably funded demand from developing countries often leads to underinvestment in development and manufacturing of appropriate products. The pilot initiative Advance Market Commitment (AMC) for pneumococcal vaccines, launched in 2009, aims to remove some of these market risks by providing a legally binding forward commitment to purchase vaccines according to predetermined terms. To date, 14 countries have already introduced pneumococcal vaccines through the AMC with a further 39 countries expected to introduce before the end of 2013.

This paper describes early lessons learnt on the selection of a target disease and the core design choices for the pilot AMC. It highlights the challenges faced with tailoring the AMC design to the specific supply situation of pneumococcal vaccines. It points to the difficulty – and the AMC’s apparent early success – in establishing a long-term, credible commitment in a constantly changing unpredictable environment. It highlights one of the inherent challenges of the AMC: its dependence on continuous donor funding to ensure long-term purchases of products. The paper examines alternative design choices and aims to provide a starting point to inform discussions and encourage debate about the potential application of the AMC concept to other fields.