Economics of One Health

1. 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 Smith, Cornelis de Haan and Sarah Stephenson

2. 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

3. Zoonotic diseases account for half of livestock losses due to diseases Source: SAFOSO Total loss: 762‘212 LSUs

4. IMPACT ON HUMANS - SELECT ZOONOTIC DISEASES DISEASE PERIOD Reported cases Reported fatalities 7,918 761 SARS 2002-3 HPAI 2004-present 584 345 1999-2008 28,975 1,124 West Nile Rift Valley Fever 2006-7 1,062 315 HIV/AIDS 2009 2.6 m/year 1.8 m/year (25m since 1981) Flu Pandemic of 1918/19: 50 million to 100 million died

5. 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

6. Components of economic costs due to zoonotic disease outbreaks 100% 90% Spill-over effects in other sectors (tourism, transport, retail, etc) 80% Avoidance behaviors • Indirect impact 70% 60% 50% • Ripple effects: • -- Reduced demand • -- Complementary products 40% Consequential on-farm losses - • Illnessand absenteeism 30% Lower Productivity Direct impact 20% • Deaths from disease • & control measures Mortality 10% Control measures Medical costs 0% Outbreak in humans Outbreak in animals

7. Costs of selected zoonotic disease outbreaks

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

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

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

11. Significant negative impacts …. but only partially monitored and documented • What could One Health approaches contribute to reduce negative impacts?

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

13. 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 cost

14. Delays increase costs Cost of control outbreak Exposure in humans Exposure in animals Clinical signs in humans Clinical signs in animals Humans seek medical care Adapted from IOM (2009)

15. 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)

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

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

19. Avian & Pandemic Influenzas - Donor Interest Has Vanished 2,000 36 35 1,800 32 1,600 28 Loans 1,400 24 1,200 20 Number of donors pledging 1,000 17 16 $ million 800 12 600 9 8 8 400 Grants 4 4 200 0 0 Beijing Bamako Delhi Sharm El - After SES, (Jan '06) (Dec '06) (Dec '07) Sheikh 2009 (Oct '08) Financinggap Pledges Numberof donors pledging

20. 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

21. 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 domestic

22. Value Added of One Health Approaches • support poverty alleviation and economic growth in developing countries • reduce pandemic risk globally • improve public health globally • 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 • help build efficient animal and human health systems; “efficient” because of shared capacities and information, reduction of duplication, economies of scope, economies of scale • 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.

23. Thank you.www.worldbank.org/flu