1. Testing the Feasibility of Financial
Innovation to Support Every Woman Every
Child’s Mandate
- Landscape Research
Partnering For Impact

2. Utilise innovative finance models to deliver EWEC’s mandate
Funding gap
• Despite the overall increase for Reproductive Maternal, Newborn and
Child Health (RMNCH), there remains a massive funding gap
• Global Strategy estimates at USD88 bn for the 2011–15 period just for
the 49 lowest-income countries
• Recent UN strategic assessment pointed out, “the history of financing for
New approach
development has been characterized by fickleness, volatility and
uncertainty. There is little to suggest that matters will be any different in
the future.”
• Financing from investors and increased investment by companies can be
more significant
• Develop thinking and way forward on financial innovation to attract
sustainable funding to support EWEC’s objectives by creating innovative
Goal
financial structures to channel more capital, philanthropic and
investment, to meet mandate needs
2

3. Financial innovation opportunity for MNCH appears promising
Global innovative finance Opportunity for MNCH
Official sector flows • Brief assessment of the investment industry
reveals no specific MNCH-themed investment
• Innovative fundraising for development products
generated an estimated USD57.1
billion between 2000 and 2008 • To date incorporated as part of wider health
• Potential for raising significant new sector investment structures (e.g. Henderson
resources is considerable Horizons Industries, Allianz RCM Wellness)
Private sector flows • Within impact investing, a few investment
funds for the health sector (e.g. Africa Health
• Investment capital represents a large pool Fund) but it is early days
of financing with global financial stock
standing at USD212 trn and growing • Out of 2,200 impact investments worth over
• Investment managers consider USD4 bn, only 59 investments totaling just
Environmental, Social, and Governance under USD90 million have been completed in
(ESG) factors - market will reach USD25 the health sector – none focus on MNCH
trn by 2015
• Impact investments emerging as an • Nevertheless, research indicates a growing
alternative investment asset - create appetite for health sector investments - could
positive impact beyond financial return be as large as USD18bn – USD123bn
• Forecasting over the next 10 years for
invested capital of USD400 bn - USD1 • EWEC’s mandate to improve MNCH could
trn become a theme for such innovative
financial vehicles and thereby attract more
capital and close the current gap in funding
3

4. Numerous innovative finance precedents to learn from
Contributions
Added value Funds direct to 100% for HIV Further (red) Direct private
Voluntary
to purchase Global Fund programs support sector support
decision
• Product Red Initiative, Smart shopper When shopper The Global The The Result?
notes that chooses to Fund uses contribution Shopper has
GAVI Matching Fund (product)RED
items from top
purchase the
(product) RED
100% of this
money to
helps people
affected by
new
(product)RED
brands cost the items the finance HIV HIV in Ghana, items from
same as non- makers send health and Swaziland, favorite
(product)RED a contribution community Rwanda, brands at the
items. But of up to 50% support Lesotho and same time
choosing the of profits programs in other helping to
(red) items directly to the Africa, with a countries to eliminate
means that up Global Fund – focus on be granted AIDS in Africa.
to 50% of not to (red) women and (red) money in They can
profits made children the future continue to
from those help when
sales will go to they choose
help eliminate other (red)
AIDS in Africa products or
donate directly
to the Global
Fund
Source: The Global Fund press release, analysis 5
UNITAID - funding through airline ticket tax
Taxes/Levies
• UNITAID, Financial • Solidarity contribution or 'tax' on airline tickets is 70% of UNITAID's financial base
Transactions Tax • Tax is applied to all flights departing from countries imposing it and is paid by passengers
• For passengers, the cost of the air tax is very low compared to the total cost of a ticket
• Different rates can be set according to a country's level of development and there is an
extra option to vary the charge according to the distance traveled
• As of September 2011, nine of UNITAID's 29 member countries were implementing the
airline tax: Cameroon, Chile, Congo, France, Madagascar, Mali, Mauritius, Niger, and the
Republic of Korea
4

5. Financial Instrument precedents have achieved success
Structure Impact
Donors World Bank ! Front-loaded support for strategic
Generate New
Treasury immunization programs:
UK $3bn (23 yrs)
– Measles Initiative
France $1.7bn (20 yrs) Management – Yellow Fever Initiative
Services – Global Poliomyelitis Eradication
Resources
Italy $600M (20 yrs) Manages bond
proceeds as liquid Campaign
Norway $264M (15 yrs) – Maternal and Neonatal Tetanus
International Finance Facility Spain
Netherlands
$240M (20 yrs)
$114M (8 yrs)
Funding investments until
they are needed
for programs in
Elimination Campaign
– Supporting pentavalent vaccine
for Immunization (IFFIm)
introduction and other new
recipient countries
Sweden $38M (15 yrs) vaccines
South Africa $20M (20 yrs) – GAVI health systems,
Notes immunization services, and
pro- IFFIm issues AAA/ injection safety support
Notes
ceeds Aaa/ AAA-rated
issues
Disburse- bonds in the ! Raised more than $ 4.5 billion for
ments international capital the GAVI Alliance s immunization
markets programs
Noteholders
Reduce Costs
Impact
Financing
! 4 suppliers submitted the offer, and GSK
Advance Market Global partnership and Pfizer agreed to supply
pneumococcal vaccines through the AMC
in March 2010
Commitments (AMC) for
Pneumococcal vaccines ! GSK introduced its first vaccine
$1.5 Billion $1.3 Billion (Synflorix™) to Kenya in Feb 2011 at
90% discounted price
Operations
An Independent ! The long-term price of pneumo vaccine
WHO establishes for developing countries will be $3.50/
Assessment UNICEF procures
the target product dose (vs. >$70/dose in industrialized
Committee (IAC) new vaccines, and
profile (TPP) – countries currently)
will approve the countries have to
minimum product
pneumo vaccine submit request
specification ! Anticipated to help 60 countries to
once developed
introduce pneumo vaccine by 2015 and
prevent more 7 million childhood deaths
by 2030
Global Premix
Constraints
Procurement Facility
Address
(GPPF)
5

6. Initial view reveals promising innovative financial structures for MNCH
• EWEC IWG and partners know the different product/service markets and the
constraints preventing the public and private sectors from realizing their potential
to improve MNCH
Product
Design and Manufacturing
Research and Packaging Distribution Sales
Development
Supply Side:
Access to Theme-Based Funds (e.g. Maternal, Newborn and Child Health Fund)
Capital
Product Development Partnership Facility
Constraints
Lack of Advance Market Commitment
innovation,
high costs !"!##$
Innovation Fund (e.g. Scaling Grant Challenges Winners)
Advisory Services Grant Facility (e.g. Catalysing Partnerships Along Value Chain)
Risk Credit Guarantees (e.g. Working Capital Credit Facility )
Vouchers
Demand
Side Performance Based Mechanisms (e.g. Country-wide Insurance/Health Finance)
Information/
Every Woman Every Child Index
Incentives
Source: EWEC IWG Task Force on Sustainable Business Models, interviews, analysis

7. Model 1: MATERNAL, NEWBORN AND CHILD HEALTH SHARED VALUE INVESTMENT FUND
• Numerous areas exist where Potential structure for MNCH SVI
companies are well-positioned MNCH SVI Asset Management (MNCH
Investors, Banks Governments,
Foundations, other
partners
SVI AM) is composed of 3 groups:
to fill gaps in the provision of – Private Equity/Debt
– Credit MNCH SVI Asset
Management
– Foundation
health care ! The Capital Advisors Group ( CAG ),
managed by bank, makes investments
• Structure provides opportunity
in MNCH value chain opportunities
! The Credit Group ( Credit ), managed
by global banking partner, sources debt
to ‘de-risk’ investments made by financing for MNCH SVI investment
opportunities
! The Foundation, managed by
Capital Advisors
Investment Group
Credit Group
Commercial Bank
Foundation - Nonprofit
Vehicle (Foundation,
EWEC members other
both public and private sector Foundations/EWEC members/others,
provides grants, loan guarantees, and
technical assistance for MNCH SVI
partners)
• Thorough investigation needed investment opportunities
! Objective is to support private sector
Manages Private
Equity/Debt Pool of
Providers of Debt
Capital/ Market
Grants, Loan
Guarantees, Technical
companies that as a core part of their
to determine where opportunity
Capital Interface Assistance
operation is to implement strategies
involving products/services that
for a Maternal, Newborn and
improve MNCH at the BOP globally by
providing equity/debt funding and
technical assistance MNCH SVI AM investment sources of capital (Equity, Debt, Foundation/Nonprofit)
Low cost of capital = more attractive projects, better financial/social returns
Child Health Fund may best
focus

8. Model 2: MNCH INNOVATION PRODUCT DEVELOPMENT
PARTNERSHIP FACILITY
Financing facility to catalyze product innovation focused on underserved markets
Loan Provide
Guarantee guarantees
PDP Financing
loans
Bond
Donors Facility Markets
Issue
R&D bonds
Funding Repayments
Product Development
PDP
Premiums Royalties
on their
purchases
Product Production
Firm
Official
Sales
Donors revenues
Product Purchase
Developing Developed
Markets Markets

9. Model 3: HIGH LEVEL WORKING CAPITAL CREDIT FACILITY
• IWG develop a working capital
loan facility to offer loans to !C!*D *-+1'#)
EWEC/Partners Credit Facility Procurement/
Partner Certification
importers, wholesalers, health E$-#,+-)
B<?='#@)
F$-#,+-)
B<?='#@)
*/"#9:+-)
B<?='#@) Agent
shops, pharmacies, Central Process
• Provide capital • Raise lending funds • Potential to
dispensaries and community- !"#$%&'"()*+,#-$&)
./$-$,#++)0/,1)23456)
to guarantee
loans
to leverage EWEC/
Partners guarantee
add
Procurement
based distributors to maintain >1+,?8@)</"#9:+-") 5-$7)8-9:);/$-$,#++)8/,1)
• Participate in
joint fundraising
capital
• Use local contacts to
and/or
Certification
direct potential
stock of pre-specified maternal -+A/'-',;)<-+1'#) #9)<9=+-)&9$,)1+8$/&#)23456) efforts
• Market facility
customers to facility
Agent to
certify,
• Qualify and approve procure and
and child health products Country Level Process
offering to win
potential
potential customers
who ask for credit
fulfill orders
customers • Receive
• Make loans and
payment
• Determine monitor repayments
from
• Provides much needed B""+"")<-+1'#)
79-#(',+"")
!G+</#+)5+%#)
H+<9=+-@)
whether
customers want
• Manage debt
recovery in event of
customers
both prepaid
working capital to businesses credit to pay for
orders
default
• Manage FX risk
and credit
customers
— and simultaneously • Bear bulk of
default risk,
• Bear commensurate
default risk to
• Pay suppliers
commensurate incentivise recovery
ensures availability and */"#9:+-)
1+8$/&#")9,) with capital
provided
• Provide financial
capacity building as
&9$,)23456)
provision of vital public health needed to customers
(depends on partner)
products
• IWG could work with • Model could potentially be used to
institutions such as Aureos, support certain commodities as well
IFC, Standard Chartered,
African Development Bank,
etc.

10. Next steps – use task force format to drive innovative finance strategy to fruition
! Clear perspective on the feasibility and potential impact of
investment vehicle(s) for EWEC IWG and/or its partners
• Established decision making framework with related criteria
to assess investment vehicles
• Initial shortlist of potential investment vehicle offerings
together with related preliminary business case/value
proposition
• High-level view on potential facility size (based on market
appetite)
! Foundation for a clear “go” or “no-go” decision to proceed with a
follow-on phase of investment vehicle development.
10

11. Thank You
11