Gavi co financing evaluation report presentation

1. Evaluation of the GAVI Alliance Co-financing Policy July 2014 Dimitrios Gouglas, Klara Henderson, Jens Plahte, Christine Årdal, John-Arne Røttingen

2. Report objective and main finding • Purpose: to review the design, implementation and intermediate results of the policy as well as to generate learning which can inform the policy review and potential update • Key question: to what extent is the GAVI Alliance on track to achieve its policy objectives related to country ownership and financial sustainability of new and underused vaccine financing? Overall = on track The co-financing policy has raised awareness and the profile of vaccines in countries, and has contributed to increased country ownership of vaccine financing. Graduating countries are on track towards sustainable vaccine financing, given that they can obtain continued access to GAVI prices, secure institutional buy-in and ensure reliable domestic funding.

3. Presentation overview • Methods • Policy overview • Development process and design • Results and implementation • Monitoring • Policy implications • Lessons learnt and recommendations

4. Evaluation methods • Literature and document review • 56 expert and GAVI Alliance stakeholder in-depth consultations (policy revision task team; IF&S Task Team; GAVI Secretariat staff; GAVI Alliance partners; industry representatives; civil society representatives; bilateral donors) • Country-level surveys in 68 countries, with 149 respondents (73% response rate): 48 MoH/EPI officials; 49 UNICEF country officers; 52 WHO country representatives • 3 country visits and in-depth case studies: visited Burundi, Ghana and Moldova • Exploratory data analysis: main sources including data gathered from GAVI Secretariat, UNICEF SD, WHO/UNICEF JRF database on immunisation financing, WHO cMYP immunisation financing database, WHO National Health Accounts database

5. • Methods • Policy overview • Development process and design • Results and implementation • Monitoring • Policy implications • Lessons learnt and recommendations

6. Dec 2005: Board decision for co- financing 2006: approved 2008: implemented 2010: revised 2012: implemented 2001: definition of financial sustainability – “Although self- sufficiency is the ultimate goal, in the nearer term sustainable financing is the ability of a country to mobilise and efficiently use domestic and supplementary external resources on a reliable basis to achieve current and future target levels of immunisation performance.” History of co-financing policy

7. Key elements of revised co-financing policy (2012) • Overall objective: putting countries on a trajectory towards financial sustainability • Intermediate objective: enhance country ownership of vaccine financing Co-financing signifies that countries share a portion of the cost of their new vaccines and safe injection devices  co-procurement Groupings – Low-income countries: ≤$1,025 GNI p.c. (WB low-income country definition)* – Intermediate: $1,026 to $1,550 GNI p.c.* – Graduating: >$1,550 (eligibility threshold) GNI p.c.* *revised annually based on World Bank data published in July of each year; countries will have one year to adjust their budget. Co-financing levels • Low Income: country ownership – Low per dose amount (US$ 0.20) that is not to be a bottleneck to introduction • Intermediate: moving towards financial sustainability – Starting at US$ 0.20 and then steady increases by 15% per year • Graduating: financial sustainability – Annual 20% ramp up over five years (1+4) to reach projected full vaccine price after GAVI support ends – Not eligible for new GAVI support Default rule applies if countries do not pay, with exponentially increasing penalties depending on duration of default

9. Policy development process Original policy (2008): • informed by detailed analyses but insufficient consultations and poor communications with in-country stakeholders • not entirely grounded in evidence, but partly in normative beliefs Revised policy (2012): • informed by detailed analyses and comprehensive consultations, although limited to MoH officials • constrained to decisions already made during the development of GAVI’s eligibility and graduation policies

10. Design • Applicable vaccines: exceptions to co-financing, creating confusion with countries not always assessing the financial implications of introducing a new vaccine (e.g. HPV, MR). • Definitions: financial sustainability questionable in the long run if dependent on donor funds; no definition for country ownership. • Country groupings: GNI/capita metric simplifies country groupings according to ability-to-pay. However, GNI calculations do not consider poverty or inequity indicators, and can be crude estimates in the case of LMICs, lacking comprehensive country data analysis, and sensitive to sudden revisions due to formal reassessments of countries’ economies (e.g. Ghana in 2010 and Nigeria in 2014)

11. Design – Equity in co-financing Finding: Co-financing levels are equitably structured across country groups, with higher income countries contributing more than lower income countries as a share of vaccine prices. This progressive co-financing structure holds especially when: (1) co-financing levels for lower income country groups as a share of the price per dose of vaccines do not exceed the equivalent share of higher income groups (2) vaccine prices do not drop rapidly from year-to-year

12. Design – Affordability of co-financing Finding: Co-financing is taking up an increasingly larger share of government vaccine expenditures, however MoH/EPI officials reported that co-financing levels are still perceived affordable in relation to immunization budgets: • 65 % (17/26) of low income country official respondents • 58 % (7/12) of intermediate country respondents • 90 % (9/10) of graduating country respondents.

13. Design - Default • The default mechanism is a fair and appropriate mix of incentives and penalties that encourage countries to take greater ownership of the co-financing process. Survey responses from 14 MoH/EPI officials of defaulting countries: • 9 said they double-checked their accounts and coordinated with the UNICEF country office to make payment • 4 stated that they transferred funds immediately • 1 stated that the country reprogrammed funds from other non-GAVI-funded routine vaccines Case study - Burundi made it clear that the value of GAVI financed vaccines was perceived to be so large that the government would ensure that a default never happened. Survey responses from the remaining 34 MoH/EPI officials in the hypothetical scenario of default: • 14 stated that a solution would be negotiated so that vaccine supply would not be interrupted • 11 stated that no new GAVI-funded routine vaccines would be introduced • 7 stated that after one year their country would lose access to all GAVI-funded routine vaccines • 2 stated that a donor would cover their co- financing commitments

14. Co-procurement 244 324 208 192 184 0 50 100 150 200 250 300 350 2009 2010 2011 2012 2013 Average lead time between Decision Letter issue dates and co-payments / last fund transfers made to UNICEF SD, 2009-2013 (days)* Co-pay - DL average lead time (days) 40 70 3 -36 -64 -400 -200 0 200 400 600 800 2009 2010 2011 2012 2013 Average lead time between DL issue date and beginning of co-financing calendar year, 2009-2013 (days)* Average • Co-procurement is an innovative design element of the co-financing policy, which encourages country ownership of vaccine financing. • The average lead time between decision letters and co-payments to UNICEF SD has decreased, displaying improved efficiencies and/or greater commitment by countries to co-financing obligations • The timing of some of the co-procurement process actions are not well aligned to countries’ fiscal years and budgeting cycles. • The actual price of co-procured vaccines can differ from price estimates used to calculate co- financing requirements • Co-procurement generates additional procurement processing costs, which countries may not be fully aware of when planning and budgeting for vaccines

16. Co-financing generated to date • Total number of countries co-financing and their contributions steadily increasing • Number of countries co-financing more than the minimum requirement is increasing, partially influenced by: – the presence of political champions in governments who have been supportive of vaccines – rapidly increasing health and immunization budgets 24 47 50 58 58 548 5 7 4 9 14 $21m $31m $32m $36m $63m $72m $- $10 $20 $30 $40 $50 $60 $70 $80 0 10 20 30 40 50 60 70 80 2008 2009 2010 2011 2012 2013 Co-financing(US$m) Numberofcountriesco-financingGAVIvaccines Fulfilled requirement Defaulters - full or partial Co-finance: country fulfillments

17. Financial planning and mobilising resources Financial planning: Well-performing countries are conducting sufficient financial planning to inform vaccine introduction decisions, facilitated by GAVI reporting requirements (e.g. cMYPs). But the extent to which co-financing requirements are affecting national decision-making and/or health planning processes remains unclear. This might be due to lack of confidence in the sustainability of external financing linked to cMYPs. Action taken Grad. Interm. Low income Recurrent Defaulter Creation of a budget line for vaccines / immunisation 90% 83% 88% 100% Prioritised within national health plans 90% 42% 65% 100% Initiative has the support of senior political people (Ministerial level and above) 80% 50% 42% 43% Steadily increasing government vaccine financing as a share of health budget 70% 42% 58% 86% Existence of distinct legislation on vaccine financing or immunisation 30% 17% 8% 0% Mobilizing resources: • 52 countries with no pooled funds in place draw resources for co-financing from central and district government budgets, which may or may not be partially financed by donors • 14 countries have pooled funds in place, where co- financing may be covered partly or fully by donors • 2 countries are fully donor funded for both co-financing and for traditional vaccines Actions such as the creation of budget lines for vaccines help with more predictable budgeting but are not sufficient for good performance. Political support, legislation or/and health plan prioritization, and steady increases of internal vaccine financing are critical.

18. Defaults to co-financing requirements • The number of countries defaulting on their co- financing commitments is increasing, due to multiple and complex reasons, many of which can be classified as procedural, followed by lack of clear prioritization by central governments. There is also an emerging concern that the growing size of countries’ co-financed vaccine portfolios may also be causing budgetary stress. 2 2 5 1 3 3 2 3 4 1 7 5 6 11 2 3 1 3 0% 20% 40% 60% 80% 100% New defaulter 2013 Past defaulter Recurrent defaulter Economic Vaccine stacking Misunderstanding of payment procedures Legal bottlenecks Elections Lack of priority / lack of willingness-to-pay driven Procedural challenges in-country Procedural challenges with GAVI / UNICEF processes Conflict-driven

20. Monitoring & support • UNICEF, WHO and development partners are significant contributors in support of the co-financing policy implementation via technical, resource mobilization and advocacy assistance, but often feel resource-constrained in their duties. • Proactive engagement of UNICEF country offices in the monitoring of co-financing policy implementation contributes to countries fulfilling their co-financing obligations. – graduating country offices do not give high priority to co-financing in relation to other tasks – No records of default where UNICEF country offices have explicitly stated they have taken pro-active intervention and coordination measures • WHO country offices monitor co-financing policy implementation in reaction to notifications by partners and do not feel they have a formal role in this process • Effective monitoring through IF&S Task Team, with appropriate flexibilities extended where needed. • Additional skills, resources, and commitment levels required on two fronts: (1) operational monitoring; (2) specialized knowledge on planning, financing and procuring

22. Incentivizing ownership • Countries are prioritising vaccines on the basis of lives saved and development goals, but are lacking the evidence-based mechanisms which can ensure sustainable co-financing decisions • The GAVI-supported countries have high political commitment to immunisation, but this is not enough to tackle affordability and resource constraints as well as address procurement capacity limitations • Countries are increasingly taking up the responsibility of financing both new and traditional vaccines (BCG, OPV, measles) - self-financing of traditional vaccines as a first step to country ownership of vaccine financing? • Improved country efforts to build capacity for vaccine procurement, planning and budgeting for vaccines, exposing gaps that require attention by national authorities and international development partners.

23. Financial sustainability • Vaccine costs are driving EPI routine programme expenditures, as co-financed vaccines are increasing, especially more expensive vaccines (PCV, rota). • Countries will be able to successfully sustain GAVI vaccine financing, so long as they can still access: GAVI- negotiated prices; effective procurement services; reliable funding to support co-financing and reduce budgetary stress for routine immunization programmes.

25. Lessons learnt Success factors • affordable vaccines and vaccine introduction-associated costs accompanied by sustained trends in health and immunization expenditures • efficient co-procurement processes that minimize supply costs, align with national budgets and create incentives for improved national procurement capacities • financial analysis and planning that accounts for changing external funding and policy trends on a continuous basis • Collective ownership of vaccine financing with institutional buy-in from all central government actors Barriers to implementation • Abrupt and significant changes to a country’s co-financing amounts or processes can impact policy fulfilment • Lack of access to GAVI prices and UNICEF SD procurement services can impact the financial sustainability of graduating countries • The lack of consistency of the co-financing policy across GAVI-supported vaccines weakens country ownership

26. Recommendations Policy development process • Include Ministries of Finance and feedback from countries who have struggled with the policy to date in upcoming policy revisions; synchronize revisions with other GAVI policies (eligibility, fragility, graduation) Policy design • Test scenarios and adjust five-year ramp-up period for graduating countries, by considering: • Portfolio of current and upcoming vaccines and these vaccines’ projected pricing trends • the GNI/capita level some countries start ‘graduating’ at (particularly those on the lower end of the spectrum) • extent of access to GAVI prices and effective procurement services post-graduation • differential timeline requirements for countries facing major prioritization or willingness-to-pay constraints • Better align co-procurement procedures with budget cycles and fiscal years of beneficiary countries Monitoring and implementation • Optimize advocacy efforts with central governments; better track transformative events that lead to defaults in times of major changes in-countries • Improve support and monitoring by bringing in health financing and health system strengthening competencies (e.g. World Bank; Sabin Vaccine Institute) Achieving financial sustainability and ownership objectives • Reassess the role of Interagency Coordinating Committee as signatories on GAVI documents, given that ICCs are high level advisory and decision making bodies with heavily packed agendas, sometimes lacking immunization-specific capacity • Assist countries build national procurement capacities, and transition from UNICEF Supply Division to self-procurement • Measure vaccine introduction-associated costs; monitor budget space of routine immunization programmes and pay special attention to countries that are in the process of introducing multiple and/or additional vaccines.

27. Thank you

Gavi co financing evaluation report presentation

Gavi co financing evaluation report presentation

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